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In November 2024, Freshworks committed to a restructuring plan (the plan) to better align the company’s talent with its strategic priorities and to improve operating efficiency.
Freshworks has over 5,000 employees globally.
Freshworks, a Nasdaq-listed software-as-a-service (SaaS) company, has decided to lay off 660 employees globally or 13 per cent of its workforce, according to a letter written by CEO Dennis Woodside to employees. The layoffs will also affect Indian employees of the company.
Currently, Freshworks has over 5,000 employees globally. The company has announced several round of layoffs since last year.
The company has also informed its board of directors has approved a $400-million share buyback programme. However, Freshworks did not delve into much details.
“In November 2024, the company committed to a restructuring plan (the plan) to better align the company’s talent with its strategic priorities and to improve operating efficiency. The company estimates that this will result in approximately 13% reduction in headcount and approximately $11 million to $13 million in charges in the fourth quarter of 2024, consisting primarily of cash expenditures for separation-related payments, employee benefits and related costs,” Woodside wrote in the letter.
The company has also shared the letter with the US Securities and Exchange Commission in a regulatory filing.
Freshworks expects the restructuring to be completed by the end of the fiscal year ending December 31, 2024.
“One of the first things our board of directors asked me to do when I became CEO five months ago was to assess our strategy and ensure we’re focused on the most critical drivers of our business. This work resulted in our three strategic imperatives (our employee experience business, AI and our customer experience business) and gave us a clear view into where we need to simplify the way we work and operate more efficiently,” Woodside stated.
In the letter, he also said the company began by combining teams focused on customer experience (CX) products, including support, sales and marketing, and reallocating people and investments to prioritise our fastest growing employee experience (EX) business.
“These decisions were made thoughtfully and carefully to set a strong foundation for our future. To add more focus on our EX, AI and CX priorities, we are realigning our global workforce, putting us on a path to have a bigger impact for our customers,” he added.
In the third quarter of 2024 ended September 2024, Freshworks’ revenue rose 22 per cent to $186.6 million, compared with $153.6 million in the third quarter of 2023.
