14 Best New Tech Stocks To Buy Now

7. Freshworks Inc. (NASDAQ:FRSH)

Market Capitalization as of September 13: $3.38 billion

Number of Hedge Fund Holders: 33

Freshworks Inc. (NASDAQ:FRSH) is a cloud-based SaaS company that provides tools for customer relationship management, customer support, IT service management, human resources management, and e-commerce marketing. As of October 2023, the company had over 60,000 business clients.

The company grew revenue to $174.13 million in Q2 2024, achieving a 20.02% year-over-year increase. Notable new customers in this period include Kayak and Paul Smith UK. In June, it acquired Device42, enhancing its IT asset management capabilities.

Management says that the company’s customers prioritize AI-driven automation, simplicity, rapid impact, and flexibility in solutions. The IT and employee experience solutions, boasting over $340 million in ARR and 30% year-over-year growth, remain the largest segment.

It also secured 19 new and expansion deals over $100,000 and reached a six-quarter high win rate against its largest competitor in the second quarter. Some important clients using employee experience software include Nucor Steel and Carrefour.

The company is seeing great traction in the AI category, with Freddy Copilot’s adoption growing significantly. Customers are seeing productivity improvements of 30% with Freddy Copilot. European travel company Digitrips improved response times to customer inquiries by nearly 300% using Freddy Copilot.

The company is driving strong customer adoption of its AI products, with customer experience solutions generating approximately $350 million in ARR and experiencing mid-to-high single-digit growth. By simplifying product experiences and streamlining go-to-market processes, it is well-positioned to accelerate growth.

33 hedge funds hold long positions in the company as of this quarter, with a total of 3,134,600 shares. Renaissance Technologies has the largest position with a stake that amounts to $39,778,074.

ClearBridge SMID Cap Growth Strategy stated the following regarding Freshworks Inc. (NASDAQ:FRSH) in its first quarter 2024 investor letter:

“Software development company Freshworks Inc. (NASDAQ:FRSH), whose products include customer service, operations and customer relationship management applications, also saw its share price drift lower as investors began to worry that Freshworks was no longer an AI beneficiary, though we don’t believe this to be the case.”