As the craze of earnings season draws to a close, here’s a look back at some of the most exciting (and some less so) results from Q4. Today, we are looking at sales software stocks, starting with Freshworks (NASDAQ: FRSH).

Companies need to be able to interact with and sell to their customers as efficiently as possible. This reality coupled with the ongoing migration of enterprises to the cloud drives demand for cloud-based customer relationship management (CRM) software that integrates data analytics with sales and marketing functions.

The 4 sales software stocks we track reported a satisfactory Q4. As a group, revenues beat analysts’ consensus estimates by 2.6% while next quarter’s revenue guidance was in line.

Amidst this news, share prices of the companies have had a rough stretch. On average, they are down 16.8% since the latest earnings results.

Freshworks (NASDAQ: FRSH)

Founded in Chennai, India in 2010 with the idea of creating a “fresh” helpdesk product, Freshworks (NASDAQ: FRSH) offers a broad range of software targeted at small and medium-sized businesses.

Freshworks reported revenues of $194.6 million, up 21.5% year on year. This print exceeded analysts’ expectations by 2.7%. Overall, it was a strong quarter for the company with a solid beat of analysts’ billings estimates and EPS guidance for next quarter exceeding analysts’ expectations.

“Freshworks outperformed its previously provided estimates again in Q4 across all our key metrics, delivering another strong quarter with revenue growing 22% year over year to $194.6 million, operating cash flow margin of 21%, and an adjusted free cash flow margin of 21%,” said Dennis Woodside, Chief Executive Officer & President of Freshworks.

Freshworks scored the fastest revenue growth of the whole group. The company added 199 enterprise customers paying more than $5,000 annually to reach a total of 22,558. Investor expectations, however, were likely higher than Wall Street’s published projections, leaving some wishing for even better results (analysts’ consensus estimates are those published by big banks and advisory firms, not the investors who make buy and sell decisions). The stock is down 24.1% since reporting and currently trades at $13.55.

Is now the time to buy Freshworks? Access our full analysis of the earnings results here, it’s free.

Best Q4: ZoomInfo (NASDAQ: ZI)

Founded in 2007 as DiscoveryOrg and renamed after a merger in 2019, ZoomInfo (NASDAQ: ZI) is a software as a service product that provides sales departments with access to a database of prospective clients.

ZoomInfo reported revenues of $309.1 million, down 2.3% year on year, outperforming analysts’ expectations by 3.8%. The business had an exceptional quarter with an impressive beat of analysts’ billings estimates and accelerating growth in large customers.

ZoomInfo delivered the highest full-year guidance raise among its peers. The company added 58 enterprise customers paying more than $100,000 annually to reach a total of 1,867. Although it had a fine quarter compared its peers, the market seems unhappy with the results as the stock is down 6.8% since reporting. It currently trades at $8.89.

Is now the time to buy ZoomInfo? Access our full analysis of the earnings results here, it’s free.

Weakest Q4: Salesforce (NYSE: CRM)

Launched in 1999 from a rented one-bedroom apartment in San Francisco by Marc Benioff and his three co-founders, Salesforce (NYSE: CRM) is a software-as-a-service platform that helps companies access, manage, and share sales information such as leads.

Salesforce reported revenues of $9.99 billion, up 7.6% year on year, falling short of analysts’ expectations by 0.5%. It was a slower quarter as it posted EPS guidance for next quarter missing analysts’ expectations.

Salesforce delivered the weakest performance against analyst estimates and weakest full-year guidance update in the group. As expected, the stock is down 13.3% since the results and currently trades at $266.50.

Read our full analysis of Salesforce’s results here.

HubSpot (NYSE: HUBS)

Started in 2006 by two MIT grad students, HubSpot (NYSE: HUBS) is a software-as-a-service platform that helps small and medium-sized businesses market themselves, sell, and get found on the internet.

HubSpot reported revenues of $703.2 million, up 20.8% year on year. This print beat analysts’ expectations by 4.4%. Taking a step back, it was a mixed quarter as it also logged a solid beat of analysts’ EBITDA estimates but EPS guidance for next quarter missing analysts’ expectations significantly.

HubSpot scored the biggest analyst estimates beat among its peers. The company added 9,811 customers to reach a total of 247,939. The stock is down 22.9% since reporting and currently trades at $604.99.

Read our full, actionable report on HubSpot here, it’s free.

Market Update

Thanks to the Fed’s series of rate hikes in 2022 and 2023, inflation has cooled significantly from its post-pandemic highs, drawing closer to the 2% goal. This disinflation has occurred without severely impacting economic growth, suggesting the success of a soft landing. The stock market thrived in 2024, spurred by recent rate cuts (0.5% in September and 0.25% in November), and a notable surge followed Donald Trump’s presidential election win in November, propelling indices to historic highs. Nonetheless, the outlook for 2025 remains clouded by potential trade policy changes and corporate tax discussions, which could impact business confidence and growth. The path forward holds both optimism and caution as new policies take shape.

Want to invest in winners with rock-solid fundamentals? Check out our Hidden Gem Stocks and add them to your watchlist. These companies are poised for growth regardless of the political or macroeconomic climate.

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