Freshworks cuts 500 jobs as AI reshapes operations
- ByStartupStory | May 6, 2026
Freshworks has laid off around 500 employees, or 11% of its global workforce, as the Nasdaq-listed SaaS company restructures operations amid rapid adoption of artificial intelligence across the software industry.
The layoffs will affect teams globally and are expected to result in one-time restructuring charges of nearly $8 million. Freshworks had around 4,500 full-time employees as of December 31, 2025.
CEO Dennis Woodside said the move was partly driven by the company’s increased use of AI across product development and internal operations. According to Woodside, more than half of Freshworks’ code is now generated through AI tools, which has shortened development cycles and reduced routine manual work.
“We recently consolidated our go-to-market strategy and rebalanced our teams more towards EX,” Woodside said during the company’s earnings call, referring to Freshworks’ employee experience business. He added that the company has invested heavily in AI and automation across the business to improve efficiency and speed.
Freshworks plans to deploy savings from the restructuring into its Employee Experience (EX) vertical, including Freshservice, its IT service management platform.
This marks the second major layoff round at Freshworks in less than two years. In November 2024, the company laid off around 660 employees, or nearly 13% of its workforce, as part of a broader restructuring exercise focused on operational efficiency and AI-led transformation.
Alongside the layoffs, Freshworks reported its latest quarterly results. Revenue for the first quarter of 2026 rose 16% year-on-year to $228.6 million, surpassing analyst estimates of $223.24 million. The company expects second-quarter revenue between $232 million and $235 million, slightly above market expectations.
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