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Jun 30, 2023
Upwork Q2 2023 Earnings Report
Upwork's Q2 2023 performance showed better-than-expected financial results, driven by cost savings and progress in generative AI and Enterprise growth.
Key Takeaways
Upwork's Q2 2023 saw revenue of $168.6 million, a 7% increase year-over-year, with GSV exceeding $1 billion. The company reported a GAAP net loss of $(4.0) million and adjusted EBITDA of $14.4 million. Upwork is raising its adjusted EBITDA guidance for 2023 to $50 million to $55 million.
Upwork achieved better-than-expected results across financial goals, with revenue up 7% year-over-year.
The company made significant strides in generative AI, with AI being the fastest-growing category on Upwork.
Upwork grew its Enterprise customer base, with Enterprise Revenue increasing 16% year-over-year.
Cost savings actions taken earlier in the second quarter, along with additional measures, are expected to yield incremental benefits.
Revenue by Segment
Forward Guidance
Upwork is guiding for third-quarter 2023 revenue to be between $165 million and $170 million, and raising full-year 2023 revenue guidance to between $665 million and $675 million. Third-quarter adjusted EBITDA is expected to be between $14 million and $17 million, and full-year 2023 adjusted EBITDA guidance is increased to between $50 million and $55 million.
Positive Outlook
- Revenue guidance for Q3 2023 is set between $165 million and $170 million, indicating a 6% year-over-year increase at the midpoint.
- Full-year 2023 revenue guidance has been raised to between $665 million and $675 million, reflecting an 8% year-over-year growth at the midpoint.
- Adjusted EBITDA for Q3 2023 is projected to be between $14 million and $17 million, with an adjusted EBITDA margin of 8.5% to 10.0%.
- Full-year 2023 adjusted EBITDA guidance has been increased to between $50 million and $55 million, representing an adjusted EBITDA margin of 7.5% to 8.1%.
- The company expects to generate positive free cash flow going forward.
Challenges Ahead
- The guidance does not reconcile adjusted EBITDA to GAAP net income (loss).
Revenue & Expenses
Visualization of income flow from segment revenue to net income
Historical Earnings Impact
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Avg. Return Before/After Earnings
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