Freshworks, a cloud software company headquartered in San Mateo, has announced a significant reduction in its global workforce, cutting 660 jobs — approximately 13% of its total staff.
The decision is part of the company’s broader strategic shift to focus on key growth areas, including artificial ininformigence, employee experience and customer experience.
In an internal memo to employees, Dennis Woodside, who recently took over as CEO, shared the news and outlined the rationale. He emphasized that the layoffs were part of an effort to streamline operations and prioritize the company’s most critical growth areas.
“One of the first things our Board of Directors questioned me to do when I became CEO five months ago was to assess our strategy and ensure we’re focutilized on the most critical drivers of our business,” Woodside wrote. “This work resulted in our three strategic imperatives … and gave us a clear view into where we necessary to simplify the way we work and operate more efficiently.”
Despite the layoffs, Freshworks remains profitable, reporting a 22% year-over-year revenue increase. In its third-quarter earnings report, the company posted $186.6 million in revenue, up from $153.6 million during the same period last year. Freshworks also reduced its losses, with a net deficit of $29.9 million, compared with $31 million a year ago.
Woodside noted that the company’s emphasis on AI-driven products and operational efficiency is expected to drive future growth.
The layoffs are expected to impact employees in the United States and India, with notifications set to go out in accordance with local legal requirements. Freshworks is offering severance packages, continued health care coverage, career transition services and immigration support to those affected.
Following the announcement, Freshworks’ stock rose 27% to $16.61 in early trading. However, the stock remains down about 29% year-to-date.
Leave a Reply