Freshworks Undertakes Third Round Of Layoffs Within Six Months

SUMMARY

This is the third round of layoffs at Freshworks within six months after the company fired employees in March and December

A company spokesperson told Inc42 there had been no organisation-wide layoffs to report, declining to comment on workforce management

Reportedly, many senior directors, product managers and senior vice presidents across teams were let go during the process

NASDAQ-listed SaaS unicorn Freshworks has reportedly seen another round of layoffs across multiple teams in the US citing performance reviews.

The layoffs have happened within senior positions in the SaaS unicorn’s product, engineering and go-to-market (GTM) teams, sources told Moneycontrol.

Per one source cited by the publication, senior directors, product managers and senior vice presidents were let go during the process. Freshworks’ GTM team includes marketing, strategy and enablement.

Per other sources cited, there were no formal announcements and the employees got to know of the layoffs after people left WhatsApp groups. The number of employees impacted remains unknown.

When Inc42 reached out to the listed SaaS unicorn for clarification, a spokesperson said, “Freshworks does not comment on the management of the workforce in our normal course of business. There have been no organization-wide layoffs to report.”

This is the third round of layoffs at Freshworks within six months after the company fired employees in March 2023 and December 2022 as well. Freshworks had fired around 2% of its staff – around 90 employees – in December.

However, while there were no confirmations from the company on the number of impacted employees during the second layoff round in March 2023, media reports indicated around 114-125 staff being impacted.

Founded in 2010 by Girish Mathrubootham and Shanmugam Krishnasamy, Freshworks employs more than 5,000 employees, while its LinkedIn account shows a workforce of more than 7,500 employees. The company offers a suite of software for customer service and support, customer engagement and IT service management.

The layoffs come months after Freshworks reported an adjusted operating profit for the first time in the January-March quarter of 2023, posting a non-GAAP (Generally Acceptable Accounting Practices) profit of $3.88 Mn during the quarter.

The company’s overall net loss stood at $42.66 Mn in the first quarter of 2023, a decline of over 13% from $49.06 Mn in the year-ago quarter.

Freshworks’ cofounder and CTO Krishnasamy also quit late in 2022 and the SaaS unicorn has yet to appoint a replacement.

The listed SaaS unicorn’s shares closed at $15.67 apiece on Friday (June 9). While the share price is 38.18% higher than at the same time last year, it is down 66.48% compared to its listing price.

Indian startups have fired more than 27,000 employees since the start of 2022, as global macroeconomic headwinds and a funding winter continue to prevail, per Inc42’s ‘Indian Startup Layoff Tracker’.