NEW YORK, July 8, 2026, 18:02 (EDT)
Freshworks Inc. dropped 2% on Wednesday, as the company scheduled its Q2 results for Aug. 4, updating investors on its AI push and cost cutting moves. Shares ended at $10.17, down from $10.38 Tuesday. The stock moved between $10.01 and $10.34 during the session.
Timing is key here. Freshworks plans to release its quarterly results after the market closes on Tuesday, Aug. 4. The company is set to hold a webcast at 5 p.m. ET the same day.
Investors are weighing if Freshworks can convert interest in service software and AI into more stable growth. Basically, the market is looking to see if the company can boost software sales to current customers and bring down its costs at the same time.
Small software stocks struggled again. The iShares Expanded Tech-Software Sector ETF dropped 1.6%. The Nasdaq Composite edged up 0.2%. Software lagged as big tech showed some strength.
Freshworks goes up against Salesforce, ServiceNow and HubSpot in some markets, and those stocks slid Wednesday. Salesforce ended down 1.8%, ServiceNow slipped 2.7% and HubSpot was off 3.6%, market data showed.
Freshworks’ next results will be stacked up against its own Q2 outlook from May, when the company projected revenue of $232 million to $235 million. Freshworks also put non-GAAP operating income in a $41 million to $43 million range and saw non-GAAP EPS coming in at 13 cents. These non-GAAP totals leave out some standard costs.
Freshworks’ Q1 numbers gave bulls a lift but left the main argument unresolved. Revenue was up 16% to $228.6 million. The company said it signed its two biggest deals ever, including its first contract topping $1 million in annual recurring revenue, or ARR, which is a yearly subscription metric.
CEO Dennis Woodside said at that time Freshworks had “strong momentum,” mentioning demand for its Employee Experience platform for handling internal service tasks like IT. He also noted AI Copilot sales and pointed to net dollar retention, which tracks how much more or less existing customers spend year over year. GlobeNewswire
The story has taken a tougher turn. Freshworks announced in May it would lay off 11% of staff, or about 500 employees, pointing to AI shifting software industry work. Woodside told Reuters, “Over half of our code is written by AI,” adding that cost cuts from automation and a simpler sales setup would go back into Employee Experience. Reuters
Analyst views on Freshworks are split. WSJ data tracked seven buys and eight holds, with targets ranging from $8 to $16. The median target was $11.
The risk is clear. If AI drives software prices down quicker than Freshworks can trim expenses or land bigger customers, the Aug. 4 report could revive growth worries. Analyst targets on the low side suggest shares could slump again if revenue, margins, or spending trends come up short.
