Q2 2024 Freshworks Inc Earnings Call Transcript
Key Points
- Freshworks Inc (FRSH) delivered Q2 revenue of $174.1 million, growing 20% year-over-year.
- Strong free cash flow of $32.8 million, resulting in a free cash flow margin of 19%.
- Successful strategic acquisition of Device42, enhancing ITAM capabilities.
- Significant customer wins including Kayak, Davidson Kempner Capital Management, and Paul Smith UK.
- Freddy AI products, particularly Freddy Copilot, showing strong adoption with over 1,200 customers and a 40% attach rate for new deals over $30,000.
- Net dollar retention rate slightly decreased to 106%, with expectations of further decline to 105% in Q3.
- Continued macroeconomic pressures affecting SMB segment, leading to slower expansion.
- Device42 integration may cause quarterly fluctuations in revenue due to its term-licensed business model.
- Challenges in the customer experience (CX) segment, primarily due to macroeconomic pressures on SMBs.
- Potential disruption in Device42's partner business involving competitors, which could impact revenue.
Good day, everyone. And thank you for standing by. Welcome to the Freshworks' second-quarter 2024 earnings conference call. (Operator Instructions) Please be advised that today's conference is being recorded. I will hand the call over to the Head of Investor Relations, Joon Huh. Please proceed. Please proceed.
Thank you. Good afternoon, and welcome to Freshworks second-quarter 2024 earnings conference call. Joining me today are Dennis Woodside, Freshworks' Chief Executive Officer and President; and Tyler Sloat, Freshworks' Chief Financial Officer.
The primary purpose of today's call is to provide you with information regarding our second-quarter 2024 performance and our financial outlook for our third quarter and full year 2024. Some of our discussion and responses to your questions may contain forward-looking statements within the meaning of the Private Securities Litigation Reform act of 1995.
These forward-looking statements are based on Freshworks' current expectations and estimates about its business and
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