moneyheap
FRSH · Analysis updated Nov 10, 2026, 6:00 PM ET
Why is Freshworks Inc. Class A Common Stock (FRSH) stock moving?
Freshworks beat Q3 2026 estimates on both revenue ($245.4M vs $245.0M) and adjusted EPS ($0.22 vs $0.18), and raised FY2026 adjusted EPS guidance to $0.71 from $0.66-$0.68, above the $0.67 estimate. Sales guidance was narrowed to $965.0M-$966.0M, in line with consensus, and Q4 guidance (adjusted EPS $0.21, sales $253.5M-$254.5M) matched estimates, so the outlook was solid but not a surprise. Analysts followed with higher targets: Cantor Fitzgerald Overweight at $20, UBS and Canaccord Buy at $17, and Piper Sandler and Wells Fargo at Neutral/Equal-Weight at $15. Against that, the stock has fallen from $14.15 at the Nov 3 close to $11.88 on Nov 10, down about 16%, and from $15.32 on Oct 22, down about 22%. It has posted nine straight lower closes since Oct 29. Volume spiked on Nov 4 to 11.4M shares, roughly three times the late-October average, as the stock fell 6% that day despite the target raises. Alphabet's Q3 13F showed a trim of about 1.87M shares. The selling looks like distribution after the print rather than a reaction to weak numbers, and the market is not yet paying for the beat-and-raise. The gap between the current price and the $15-$20 targets is wide, but it has not closed on any of the news flow.
News behind the analysis
- Freshworks Reports Third Quarter 2026 Financial ResultsFreshworks reported Q3 2026 revenue of $245.4M and adjusted EPS of $0.22. Both beat consensus estimates.
- Freshworks Raises FY2026 Adj EPS Guidance from $0.66-$0.68 to $0.71 vs $0.67 Est; Narrows FY2026 Sales Guidance from $963.500M-$966.500M to $965.000M-$966.000M vs $965.037M EstFull-year adjusted EPS guidance was raised to $0.71, above the $0.67 estimate. Sales guidance was narrowed to $965.0M-$966.0M, in line with consensus.
- Freshworks Sees Q4 Adj EPS $0.21 vs $0.21 Est; Sees Sales $253.500M-$254.500M vs $253.963M EstQ4 2026 guidance matched consensus on both adjusted EPS of $0.21 and sales of about $254M. The guide offered no upside surprise.
- Cantor Fitzgerald Maintains Overweight on Freshworks, Raises Price Target to $20Cantor Fitzgerald kept its Overweight rating and raised its price target to $20. The target sits well above the current share price.
- UBS Adjusts Freshworks Price Target to $17, Maintains Buy RatingUBS raised its price target to $17 from $14 and kept its Buy rating after the quarter.
- Canaccord Genuity Maintains Buy on Freshworks, Raises Price Target to $17Canaccord Genuity kept its Buy rating and raised its price target to $17.
- Piper Sandler Maintains Neutral on Freshworks, Raises Price Target to $15Piper Sandler kept a Neutral rating and lifted its price target from $12 to $15.
- Alphabet Discloses Reduction in Freshworks StakeAlphabet's Q3 2026 13F filing shows it cut its Freshworks holdings by about 1.87 million shares.
- Wells Fargo Maintains Equal-Weight on Freshworks, Raises Price Target to $15Wells Fargo kept an Equal-Weight rating and raised its price target to $15 before the earnings report.
- Freshworks Q3 2026 Earnings Call TranscriptThe transcript of the Q3 2026 earnings call, held on the Tuesday of the results release, is now available.
About Freshworks Inc. Class A Common Stock
Freshworks is a cloud software company based in San Mateo, California, with roots in India. It sells easy-to-use IT service management (Freshservice) and customer service (Freshdesk) software, aimed mainly at small and mid-sized businesses but increasingly at larger companies too, and it recently passed about $1 billion in annual recurring revenue.
How it makes money
Nearly all of its revenue comes from subscriptions to its cloud software. It sells these in two groups: employee experience (EX), mainly the Freshservice IT service management tool, which brings in about 59% of recurring revenue (roughly $588M, growing about 22%), and customer experience (CX), mainly the Freshdesk support and CRM tools, which makes up the rest (roughly $404M, growing about 4%). It also charges extra for AI add-ons. Revenue for 2026 is guided at roughly $965M, about 15% growth.
What usually moves FRSH
- Growth of the EX/IT service management business
- Slowdown in the CX/customer service business
- Making money from its AI features (Freddy AI)
- Profit margins and free cash flow
- Small and mid-sized business IT spending