FRSH
Freshworks' new pitch: EX is the whole game
Freshworks is getting a fresh set of believers, and the bull case is pretty simple: the market may be underpricing the company’s move into employee experience, or EX for short. That segment now makes up about 60% of annual recurring revenue, and it’s growing faster, sticking better, and generally acting less like a side quest and more like the main character.
Why investors should care
The note isn’t just a “we like the vibes” kind of call. It points to a setup where growth and profitability are both improving at the same time — the rare company-goes-to-the-gym-and-stops-eating-random-snacks storyline.
A few things stand out:
- EX ARR is up 22% year over year, which is not exactly “meh” territory.
- FY26 EPS guidance was raised by 7% to 8%, flipping the script from a prior view that earnings would shrink.
- FY27 EPS growth is now expected to land around 20% to 28%, which is the kind of trajectory that gets stock-pickers leaning forward.
The market may be late to the party
Freshworks has been trying to convince investors it’s not just another software name with big promises and a messy margin story. The argument here is that the EX transition is making the business more durable and more profitable, while the stock still trades like people haven’t fully gotten the memo.
And if the technicals are also turning supportive, that’s the classic Wall Street combo meal: better fundamentals, better sentiment, and a chart that stops looking like a ski slope.
Big picture: if Freshworks can keep turning EX into a bigger slice of the pie, the company could graduate from “interesting software turnaround” to “actually compounding like one.”