GAAP loss from operations widened to $47.1 Mn in the first quarter of 2022 as compared to $1.7 Mn during the same period last year.
Net dollar retention rate was at 115% as compared to 114% in the fourth quarter of 2021
Number of customers contributing more than $5,000 in annual revenue run rate grew 27% YoY to 15,639
Software-as-a-Service (SaaS) giant Freshworks reported widening of its net loss to $49.1 Mn in January-March quarter of 2022 as against a net loss of $2.4 Mn in the corresponding quarter of previous year.
The company’s operational loss widened to $47.1 Mn from $1.7 Mn a year ago. However, total revenue grew 42% year-on-year (YoY) to $114.6 Mn during the quarter under review. This was also the second straight quarter of the US-listed company recording more than $100 Mn in total revenue.
The non-GAAP (Generally Accepted Accounting Principles) loss in Q1 2022 was unchanged from last year at $0.6 Mn.
Net dollar retention (NDR) rate, a measure of revenue growth and customer churn, stood at 115% during Q1 2022 as compared to 114% in the fourth quarter of 2021 and 112% in the year-ago quarter.
Freshworks said that the number of customers contributing more than $5,000 in annual revenue run rate (ARR) rose 27% YoY to 15,639 during Q1 2022. The SaaS unicorn also onboarded a slew of new customers such as Sodexo, California Credit Union, Kuka, Marymount Manhattan College, TicketNetwork and Thermo Fisher during the quarter.
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For the quarter ending March 2022, net cash provided by operating activities declined to $1.4 Mn as compared to $7.8 Mn during the same period last year. The free cash flow also fell to around the $1.4 Mn mark as compared to $4.8 Mn in the first quarter of 2021.
The company projected a revenue of $117 Mn to $119 Mn for April-June quarter and non-GAAP loss from operations of $18.5 Mn-$16.5 Mn. For the full year, it projected total revenue between $395.5 Mn-$501.5 Mn. The non-GAAP loss from operations is expected to be in the $43.5 million-$37.5 million range.
In a statement, Freshworks CEO and cofounder Girish Mathrubootham said, “We’re off to a strong start to the year with Q1 revenue growth of 42% year over year. We made progress on our 2022 product priorities with the launch of Freshworks CRM for ecommerce, while increasing net dollar retention to 115%, and continuing to run our business efficiently.”
The company’s shares were trading 3% lower at $16.34 on Wednesday (May 4) at around 03:10 PM Eastern Standard Time on the Nasdaq stock exchange.
Founded in 2010 by Girish Mathrubootham and Shan Krishnasamy, Freshworks offers a suite of softwares for customer management. This includes an AI-powered chatbot and messaging platform for customer support, as well as call centre-based solutions for customer service resolutions.
The SaaS giant was listed on the Nasdaq last year in September with an opening price of $43.5, well above the set price of $36 per share.