Freshworks forecasts third-quarter revenue above estimates as AI drives strong demand
Adds stock movement in paragraph 1
By Jaspreet Singh
July 30 (Reuters) -Software firm Freshworks FRSH.O forecast third-quarter revenue above Wall Street estimates on Tuesday, expecting a surge in demand for its AI-powered services, sending its shares up 12.6% in extended trading.
Enterprise clients turn to Freshworks for its integrated platform that helps them manage customer interactions, sales and support, thereby reducing dependency on multiple products.
The San Mateo, California-based company also offers an IT service management product called Freshservice, which assists businesses with employee onboarding and management.
"We have doubled our number of paying customers for Freddy Copilot to 1,200 and those customers are seeing 30% productivity improvement," CEO Dennis Woodside told Reuters.
Freddy Copilot, an AI agent of Freshworks, helps employees improve their performance by summarizing issues and handling repetitive tasks.
Freshworks, which counts Oracle ORCL.N, Salesforce CRM.N and ServiceNow NOW.N among its competitors, completed the acquisition of Device42 in June to drive its IT asset management capabilities.
The company, founded in India's Southern city of Chennai in 2010, has more than 67,000 customers, including Databricks, American Express AXP.N, Nucor NUE.N and Sony 6758.T.
Freshworks forecast third-quarter revenue to be between $180 million and $183 million, the mid-point of which is above analysts' average estimate of $178.7 million, according to LSEG data.
It expects adjusted profit per share to be between 7 cents and 8 cents for the third quarter, compared with estimates of 8 cents.
It also raised its annual revenue forecast to between $707 million and $713 million, compared with its prior expectations of between $695 million and $705 million.
However, Freshworks trimmed the upper end of its annual adjusted profit per share forecast range.
In the second quarter ended June 30, revenue came in at $174.1 million, beating estimates of about $169 million. On an adjusted basis, quarterly profit per share stood at 8 cents, which also beat estimates of 6 cents per share.
Freshworks appointed insider Dennis Woodside as the CEO in May, taking the reins from founder Girish Mathrubootham who assumed the role of firm's executive chairman.
Freshworks Freshworks https://reut.rs/4df1EHi
Reporting by Jaspreet Singh in Bengaluru; editing by Alan Barona
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