Freshworks Inc. vs SAP SE: Strategic Comparison

This in-depth comparison examines Freshworks Inc. and SAP SE across revenue, market value, business model, competitive positioning, and long-term growth strategy. Whether you are researching Freshworks Inc. on its own, evaluating SAP SE, or weighing the two companies side by side, the breakdown below highlights where each company leads and where the gap between Freshworks Inc. and SAP SE is widest.

On the headline numbers, annual revenue is $838.8M (FY2025) for Freshworks Inc. and ~$41.6B (FY2025) for SAP SE, while their respective market capitalizations stand at $3.3B and $238.9B. Freshworks Inc. is headquartered in United States and SAP SE in Germany, and those different home markets shape how each company competes.

Freshworks Inc.: Freshworks is one of the best-known software companies founded in India. It started as a cheaper, simpler alternative to Zendesk, then expanded into IT service management with Freshservice, which is now its largest growth engine. The company is headquartered in San Mateo, California, while much of its product and engineering work happens in Chennai and Bengaluru.

SAP SE: SAP, headquartered in Walldorf, Germany, is the market leader in enterprise resource planning (ERP) software. Most consumers never see it, but its systems record orders, inventory, payroll, purchasing and financial ledgers for many of the world's largest companies. The product range spans S/4HANA Cloud ERP, SuccessFactors for HR, Ariba for procurement, Concur for travel and expenses, Signavio for process mining, and the Business Technology Platform for data, integration and AI. SAP shares trade in Frankfurt, where it is the largest DAX member by market value, and as ADRs on the NYSE.

Freshworks Inc. and SAP SE pursue distinct approaches to generating revenue, and understanding how each company operates is the foundation of any fair comparison between Freshworks Inc. and SAP SE.

Freshworks Inc. business model: Freshworks sells subscriptions, mostly priced per agent or per user, across tiered plans (Growth, Pro, Enterprise). Revenue comes from two segments: employee experience (Freshservice for IT service management, IT asset management via the 2024 Device42 acquisition, and service management for HR and facilities) and customer experience (Freshdesk ticketing, Freshchat messaging and Freshsales CRM). Freddy AI copilot and AI agent features are sold as paid add-ons. Small customers often start with free trials or self-serve plans; larger mid-market and enterprise deals go through a direct sales team and channel partners. Growth comes from adding seats, upgrading tiers and cross-selling Freshservice to Freshdesk customers.

SAP SE business model: SAP earns most of its money from recurring fees. Cloud subscriptions (SaaS, PaaS and a small IaaS business) are now the largest line, led by the Cloud ERP Suite, which produced ~$6.21 billion (EUR 5.5 billion) of Q2 2026's ~$7.12 billion (EUR 6.3 billion) cloud revenue. Software support contracts on older on-premise licenses are the second pillar, but they are shrinking as customers migrate through RISE with SAP. New software license sales and professional services make up the remainder. A large partner ecosystem of system integrators such as Accenture, Deloitte and IBM handles much of the implementation work.

The durability of a company's moat often decides long-term winners. Here is how the competitive advantages of Freshworks Inc. stack up against those of SAP SE.

Freshworks Inc. competitive advantage: Freshworks' main advantage is a lower total cost of ownership: Freshservice and Freshdesk are designed to be configured by in-house admins in weeks rather than through multi-month integrator projects common with ServiceNow or Salesforce. A large engineering base in India keeps R&D costs lower than Silicon Valley peers, and a shared platform lets one vendor cover IT, HR and customer support desks.

SAP SE competitive advantage: SAP's advantage comes from switching costs and process depth. Once a manufacturer or retailer has run finance, supply chain and procurement on SAP for years, its data models, customizations, controls and staff skills are all tied to the platform, and replacing it is a multi-year project. SAP adds industry-specific processes refined over decades, the SAP Business Network for procurement, and thousands of certified partners and consultants who know its software.

Future prospects matter as much as current results. The growth strategies below explain how Freshworks Inc. and SAP SE each plan to expand from here.

Freshworks Inc. growth strategy: Under Dennis Woodside, Freshworks narrowed its focus to service software. It pushes Freshservice upmarket into mid-sized and larger enterprises, cross-sells IT asset management, sells Freddy AI add-ons into the installed base, and relies more on partners and resellers. In 2024 it de-emphasized standalone sales and marketing CRM products to concentrate investment on IT and customer service.

SAP SE growth strategy: SAP's growth strategy has three parts. First, migrate on-premise ERP customers to cloud through RISE with SAP for large enterprises and GROW with SAP for mid-market companies. Second, sell data and AI on top of that core: SAP Business Data Cloud, the Joule assistant and agents, and the Business AI platform. Third, use targeted acquisitions to fill gaps, including WalkMe in 2024 and Dremio and Prior Labs in 2026.

A closer look at the financial trajectory of Freshworks Inc. and SAP SE rounds out the comparison.

Freshworks Inc.: Freshworks grew revenue from $172.4 million in 2019 to $838.8 million in 2025. Losses peaked at a $232 million net loss in 2022, then narrowed as the company cut costs and slowed hiring. In 2025 it posted GAAP operating income of $13.2 million (versus a $138.6 million loss in 2024), non-GAAP operating income of $178.0 million, and $242.4 million in operating cash flow; GAAP net income of about $184 million was boosted by a fourth-quarter tax benefit. Cash and marketable securities were $843.7 million at year-end 2025. In Q2 2026 revenue rose 16% to $237.4 million with a 24% non-GAAP operating margin. Freshworks Inc. is a major SaaS company providing customer and employee engagement solutions, maintaining a market valuation typically around $4 billion to $5 billion.

SAP SE: SAP has spent most of the 2020s turning license-and-maintenance revenue into cloud subscriptions. The shift hurt margins early on: in October 2020 SAP cut its outlook and pushed back its margin targets, and its shares dropped about 22% in a day. The model has since matured. Cloud revenue rose from ~$9.15 billion (EUR 8.1 billion) in 2020 to ~$23.7 billion (EUR 21.0 billion) in 2025, total revenue reached ~$41.6 billion (EUR 36.8 billion), and IFRS profit after tax attributable to owners was ~$8.14 billion (EUR 7.2 billion). For 2026 SAP guided to ~$29.2 billion (EUR 25.8 billion) to ~$29.6 billion (EUR 26.2 billion) of cloud revenue and about $11.3 billion (EUR 10 billion) of free cash flow. SAP is Europe's largest software company, sustaining a robust market valuation generally over $200 billion through its enterprise resource planning dominance.