Business software provider Freshworks (NASDAQ: FRSH) will be reporting results tomorrow afternoon. Here’s what to expect.
Freshworks beat analysts’ revenue expectations by 2.8% last quarter, reporting revenues of $186.6 million, up 21.5% year on year. It was a strong quarter for the company, with a solid beat of analysts’ annual recurring revenue and EBITDA estimates. It added 615 enterprise customers paying more than $5,000 annually to reach a total of 22,359.
Is Freshworks a buy or sell going into earnings? Read our full analysis here, it’s free.
This quarter, analysts are expecting Freshworks’s revenue to grow 18.3% year on year to $189.5 million, slowing from the 20.2% increase it recorded in the same quarter last year. Adjusted earnings are expected to come in at $0.10 per share.
Analysts covering the company have generally reconfirmed their estimates over the last 30 days, suggesting they anticipate the business to stay the course heading into earnings. Freshworks has missed Wall Street’s revenue estimates three times over the last two years.
Looking at Freshworks’s peers in the sales and marketing software segment, some have already reported their Q4 results, giving us a hint as to what we can expect. LiveRamp delivered year-on-year revenue growth of 12.4%, beating analysts’ expectations by 1.7%, and VeriSign reported revenues up 3.9%, in line with consensus estimates. LiveRamp traded up 2.7% following the results while VeriSign’s stock price was unchanged.
Read our full analysis of LiveRamp’s results here and VeriSign’s results here.
There has been positive sentiment among investors in the sales and marketing software segment, with share prices up 10.6% on average over the last month. Freshworks is up 15.7% during the same time and is heading into earnings with an average analyst price target of $19.18 (compared to the current share price of $18.05).
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