Freshworks, the company that built its reputation on making customer support software simple, is now openly managing its customer experience business for low growth - redirecting its investment, its hires, and its ambition toward IT service management instead.
What Do Freshworks’ Earnings Reveal About Its CX Strategy Shift?
The numbers from Freshworks' Q4 2025 earnings call quietly revealed where the CX mainstay may be heading. The company's Employee Experience (EX) business - anchored by Freshservice, its IT service management platform - ended the year at $510 million in annual recurring revenue, growing 26% year-over-year.
Its Customer Experience (CX) business, built around Freshdesk, ended 2025 with $395 million in ARR, growing just 9% on a reported basis and 5% on a constant-currency basis. That means EX has now overtaken CX as Freshworks' largest segment.
"We're running CX lean to enable us to invest in that EX opportunity" - Dennis Woodside, CEO and President.
His CFO, Tyler Sloat, was equally direct: "A lot of the confidence - or all of the confidence - is coming from EX." When asked about CX growth expectations for 2026, Woodside said the company is "managing that business to kind of grow where it is now, which is in that mid-single digit range."
This is not the language of a company fighting for space in the CX market. It’s the language of a company amid a strategic pivot.
How Is Freshworks Executing Its Transition to EX?
In the ten weeks since Freshworks reported its Q4 results, three decisions have underscored that its EX-first strategy is structural rather than temporary.
On March 5, the company promoted Ian Tickle to Chief Revenue Officer, consolidating sales, customer success, and customer experience under a single leader. This kind of unified revenue structure is typically associated with optimisation, not expansion - a signal that Freshworks is prioritising efficiency across an established portfolio rather than pursuing aggressive growth.
The market responded positively, with shares rising 10.4%, suggesting investor alignment with this direction.
A second move followed on April 10, with the appointment of Kuntal Vahalia as SVP of Global Channels and Alliances. Joining from Anaplan, Vahalia will lead partner strategy and execution. Notably, coverage from CRN Asia tied the hire directly to Freshworks’ $510 million EX business, with no comparable investment evident on the CX side - reinforcing where the company sees its primary opportunity.
The third shift is product-led. In November 2025, Freshworks launched Freshdesk Command Center, consolidating conversational and ticketing capabilities into a single Freshdesk Omni platform. Strategically, the rationale is sound: a unified codebase enables faster AI deployment and simplifies implementation.
However, on the earnings call, CEO Dennis Woodside indicated that near-term CX growth will be constrained as the company focuses on migrating its existing customer base to the new platform. While necessary, this effort reflects rationalisation - prioritising retention and operational efficiency over net-new expansion.
Does Freshworks Still Believe in CX?
In March 2026, Freshworks was named a Strong Performer in the Forrester Wave for Customer Service and Support, with top scores in key areas such as digital channels, marketplace breadth, and pricing, showing its CX product is still being actively improved.
