Freshworks Explores AI Acquisitions with Over $800 Million Cash Reserves
Written by Emily J. Thompson, Senior Investment Analyst
Updated: Dec 17 2025
0mins
Should l Buy FRSH?
Source: Newsfilter
- Acquisition Strategy Initiated: Freshworks CEO Dennis Woodside announced that the company is exploring acquisitions in AI and employee experience software, backed by over $800 million in cash reserves, aiming to drive revenue growth in the coming years, indicating a proactive stance towards M&A in the tech sector.
- Market Environment Analysis: Despite uncertainties from U.S. tariffs, global M&A volumes rose 39% to $4.3 trillion in 2025, reflecting that the adoption of artificial intelligence is fueling deal-making activity across the technology industry.
- Target Market Positioning: Freshworks has engaged in discussions with potential partners from Israel, Europe, the U.S., and India, with the CEO mentioning conversations with about 50 companies over the past six months, showcasing its intent to pursue acquisitions on a global scale.
- Ongoing Investment and Growth Outlook: Freshworks forecasts double-digit revenue growth over the next three years and, following its acquisition of FireHydrant, plans to continue hiring in India for engineering, product development, and design roles to support its expansion strategy.
Trade with 70% Backtested Accuracy
Stop guessing "Should I Buy FRSH?" and start using high-conviction signals backed by rigorous historical data.
Sign up today to access powerful investing tools and make smarter, data-driven decisions.
Analyst Views on FRSH
Wall Street analysts forecast FRSH stock price to rise over the next 12 months. According to Wall Street analysts, the average 1-year price target for FRSH is 18.88 USD with a low forecast of 13.00 USD and a high forecast of 25.00 USD. However, analyst price targets are subjective and often lag stock prices, so investors should focus on the objective reasons behind analyst rating changes, which better reflect the company's fundamentals.
9 Analyst Rating
6 Buy
3 Hold
0 Sell
Moderate Buy
Current: 8.920
Low
13.00
Averages
18.88
High
25.00
Current: 8.920
Low
13.00
Averages
18.88
High
25.00
About FRSH
Freshworks Inc. is a software company. Its software-as-a-service (SaaS) solutions fall into two product families: Customer Experience (CX) and Employee Experience (EX). CX products include Freshdesk, Freshchat, Freshsales, and Freshmarketer. EX products include Freshservice, Freshservice for Business Teams, and Device42. The Company's generative artificial intelligence (AI) solutions, Freddy AI Agent and Freddy AI Copilot, further enhance the customer and employee experience.
About the author
Emily J. Thompson
Emily J. Thompson, a Chartered Financial Analyst (CFA) with 12 years in investment research, graduated with honors from the Wharton School. Specializing in industrial and technology stocks, she provides in-depth analysis for Intellectia’s earnings and market brief reports.
Wall Street Analysts Adjust Ratings
- Analyst Rating Changes: Top Wall Street analysts have adjusted their ratings on several companies, reflecting varying market perspectives that could influence investor decisions and market trends.
- Overview of Updates: The rating changes include upgrades, downgrades, and new initiations, showcasing analysts' keen responses to market dynamics, which may lead to short-term volatility in the affected stocks.
- Investor Considerations: Investors considering purchasing VERX stock should pay attention to the latest insights from analysts to make more informed investment decisions, especially amid increasing market uncertainties.
- Market Impact Analysis: The adjustments in analysts' ratings not only affect the performance of individual stocks but may also influence overall market sentiment, prompting investors to closely monitor these changes to seize investment opportunities.
See More
Piper Sandler Downgrades Three Software Stocks Amid Sector Pessimism
- Rating Downgrade: Piper Sandler downgraded Adobe, Freshworks, and Vertex from Overweight to Neutral, cutting their price targets from $479, $20, and $32 to $330, $12, and $20 respectively, reflecting ongoing pessimism in the software sector.
- Growth Slowdown Forecast: Analysts predict that 2026 will mark the fifth consecutive year of decelerating growth rates for software, citing AI efficiencies as a pressure on headcount growth, which poses significant challenges for software companies that sell on a per-seat basis.
- Price Target Adjustments: In addition to the three companies, Piper Sandler also lowered price targets for several others including Amplitude and Asana, indicating a cautious outlook for the entire software industry amid continued investor apathy.
- Future Outlook: Despite the negative sentiment surrounding software, analysts remain bullish on Microsoft and ServiceTitan, viewing Microsoft as a top play on AI adoption and highlighting ServiceTitan's multiple growth drivers as potential revenue upside in FY27.
See More
Freshworks Explores AI Acquisitions with Over $800 Million Cash Reserves
- Acquisition Strategy Initiated: Freshworks CEO Dennis Woodside announced that the company is exploring acquisitions in AI and employee experience software, backed by over $800 million in cash reserves, aiming to drive revenue growth in the coming years, indicating a proactive stance towards M&A in the tech sector.
- Market Environment Analysis: Despite uncertainties from U.S. tariffs, global M&A volumes rose 39% to $4.3 trillion in 2025, reflecting that the adoption of artificial intelligence is fueling deal-making activity across the technology industry.
- Target Market Positioning: Freshworks has engaged in discussions with potential partners from Israel, Europe, the U.S., and India, with the CEO mentioning conversations with about 50 companies over the past six months, showcasing its intent to pursue acquisitions on a global scale.
- Ongoing Investment and Growth Outlook: Freshworks forecasts double-digit revenue growth over the next three years and, following its acquisition of FireHydrant, plans to continue hiring in India for engineering, product development, and design roles to support its expansion strategy.
See More
Freshworks Acquires FireHydrant to Enhance IT Service Management Capabilities
- Strategic Acquisition: Freshworks has signed a definitive agreement to acquire FireHydrant, which will integrate IT Service Management with IT Operations Management, expected to enhance service efficiency and customer satisfaction.
- Technology Integration: FireHydrant's AI-powered incident management software will combine with Freshservice to provide a unified ServiceOps solution aimed at reducing incident response times and improving service reliability.
- Market Expansion: This acquisition will drive Freshworks' expansion into higher-end markets, further solidifying its position in the IT Service Management sector and attracting more large clients.
- Financial Impact: The acquisition is expected to close in Freshworks' first fiscal quarter of 2026, aligning with the company's long-term growth strategy and supporting overall financial performance.
See More
Freshworks Sees Growth Despite Conference Cancellation
Freshworks Conference Cancellation: Freshworks (FRSH) canceled its appearance at the UBS Global Technology and AI conference due to a family matter and illness affecting executives.
Stock Movement: Despite the cancellation, Freshworks' stock rose by 2.8%.
See More
Analyzing Freshworks: Insights from 7 Analysts
Analyst Sentiment: Over the past three months, 7 analysts have provided mixed ratings on Freshworks, with 2 bullish, 2 somewhat bullish, and 3 indifferent ratings, reflecting a shift in sentiment compared to previous months.
Price Target Adjustments: Analysts have set an average 12-month price target of $19.43 for Freshworks, down from $22.67, with a high estimate of $27.00 and a low of $13.00.
Financial Performance: Freshworks reported a revenue growth rate of 15.3% over the last three months, with a net margin of -2.18%, indicating strong profitability management despite challenges in return on equity (ROE) at -0.51%.
Debt Management: The company's debt-to-equity ratio of 0.05 is below industry norms, suggesting a solid financial structure, while its return on assets (ROA) of -0.33% indicates effective asset utilization.
See More
Wall Street Analysts Adjust Ratings
- Analyst Rating Changes: Top Wall Street analysts have adjusted their ratings on several companies, reflecting varying market perspectives that could influence investor decisions and market trends.
- Overview of Updates: The rating changes include upgrades, downgrades, and new initiations, showcasing analysts' keen responses to market dynamics, which may lead to short-term volatility in the affected stocks.
- Investor Considerations: Investors considering purchasing VERX stock should pay attention to the latest insights from analysts to make more informed investment decisions, especially amid increasing market uncertainties.
- Market Impact Analysis: The adjustments in analysts' ratings not only affect the performance of individual stocks but may also influence overall market sentiment, prompting investors to closely monitor these changes to seize investment opportunities.
See More
Piper Sandler Downgrades Three Software Stocks Amid Sector Pessimism
- Rating Downgrade: Piper Sandler downgraded Adobe, Freshworks, and Vertex from Overweight to Neutral, cutting their price targets from $479, $20, and $32 to $330, $12, and $20 respectively, reflecting ongoing pessimism in the software sector.
- Growth Slowdown Forecast: Analysts predict that 2026 will mark the fifth consecutive year of decelerating growth rates for software, citing AI efficiencies as a pressure on headcount growth, which poses significant challenges for software companies that sell on a per-seat basis.
- Price Target Adjustments: In addition to the three companies, Piper Sandler also lowered price targets for several others including Amplitude and Asana, indicating a cautious outlook for the entire software industry amid continued investor apathy.
- Future Outlook: Despite the negative sentiment surrounding software, analysts remain bullish on Microsoft and ServiceTitan, viewing Microsoft as a top play on AI adoption and highlighting ServiceTitan's multiple growth drivers as potential revenue upside in FY27.
See More
Freshworks Explores AI Acquisitions with Over $800 Million Cash Reserves
- Acquisition Strategy Initiated: Freshworks CEO Dennis Woodside announced that the company is exploring acquisitions in AI and employee experience software, backed by over $800 million in cash reserves, aiming to drive revenue growth in the coming years, indicating a proactive stance towards M&A in the tech sector.
- Market Environment Analysis: Despite uncertainties from U.S. tariffs, global M&A volumes rose 39% to $4.3 trillion in 2025, reflecting that the adoption of artificial intelligence is fueling deal-making activity across the technology industry.
- Target Market Positioning: Freshworks has engaged in discussions with potential partners from Israel, Europe, the U.S., and India, with the CEO mentioning conversations with about 50 companies over the past six months, showcasing its intent to pursue acquisitions on a global scale.
- Ongoing Investment and Growth Outlook: Freshworks forecasts double-digit revenue growth over the next three years and, following its acquisition of FireHydrant, plans to continue hiring in India for engineering, product development, and design roles to support its expansion strategy.
See More
Freshworks Acquires FireHydrant to Enhance IT Service Management Capabilities
- Strategic Acquisition: Freshworks has signed a definitive agreement to acquire FireHydrant, which will integrate IT Service Management with IT Operations Management, expected to enhance service efficiency and customer satisfaction.
- Technology Integration: FireHydrant's AI-powered incident management software will combine with Freshservice to provide a unified ServiceOps solution aimed at reducing incident response times and improving service reliability.
- Market Expansion: This acquisition will drive Freshworks' expansion into higher-end markets, further solidifying its position in the IT Service Management sector and attracting more large clients.
- Financial Impact: The acquisition is expected to close in Freshworks' first fiscal quarter of 2026, aligning with the company's long-term growth strategy and supporting overall financial performance.
See More
Freshworks Sees Growth Despite Conference Cancellation
Freshworks Conference Cancellation: Freshworks (FRSH) canceled its appearance at the UBS Global Technology and AI conference due to a family matter and illness affecting executives.
Stock Movement: Despite the cancellation, Freshworks' stock rose by 2.8%.
See More
Analyzing Freshworks: Insights from 7 Analysts
Analyst Sentiment: Over the past three months, 7 analysts have provided mixed ratings on Freshworks, with 2 bullish, 2 somewhat bullish, and 3 indifferent ratings, reflecting a shift in sentiment compared to previous months.
Price Target Adjustments: Analysts have set an average 12-month price target of $19.43 for Freshworks, down from $22.67, with a high estimate of $27.00 and a low of $13.00.
Financial Performance: Freshworks reported a revenue growth rate of 15.3% over the last three months, with a net margin of -2.18%, indicating strong profitability management despite challenges in return on equity (ROE) at -0.51%.
Debt Management: The company's debt-to-equity ratio of 0.05 is below industry norms, suggesting a solid financial structure, while its return on assets (ROA) of -0.33% indicates effective asset utilization.
See More
