Freshworks shares fall 25% after Girish Mathrubhumi steps down as CEO

Shares of Freshworks fell nearly 25 per cent on Thursday, May 2, after founder Girish Mathrubhumi stepped down as chief executive officer (CEO) of the CRM software maker. The first India-born software-as-a-service (SaaS) firm to trade on a US stock exchange lowered its full-year annual revenue guidance to between $695 million and $705 million, compared to the previous forecast of $703.5 million to $711.5 million. Was. ,

Mathrubhumi has moved from the role of CEO to executive chairman of the company’s board. Freshworks has also named Dennis Woodside who will take over as CEO. Woodside joined Freshworks as President in 2022, with a prior professional record including President at Impossible Foods, CEO at Dropbox, and CEO at Motorola Mobility.

Freshworks offers an IT service management product called FreshServices, which assists businesses with employee onboarding and management. The company, which once targeted a valuation of about $10 billion for its initial public offering, has seen its share price decline more than 60 percent from its peak in 2021.

The stock’s current loss would shave about $1.4 billion from the company’s market value of $5.45 billion, based on Wednesday’s closing price. Brokerage Baird Equity said Thursday it likes the upmarket approach to the venture. They are moving to the sidelines and will look for better entry points on signals of stability and GenAI clarity

Piper Sandler analysts anticipate pressure on Freshworks’ small and medium-sized business (SMB) customers. According to analysts, the SMB group remained under pressure due to expansion rates, customer growth and churn during the first quarter.