Upwork Inc. (UPWK) Tops Q4 EPS by 9c, Revenues Beat; Offers Q1 & FY20 Revenue Guidance Below Consensus

Upwork Inc. (NASDAQ: UPWK) reported Q4 EPS of $0.03, $0.09 better than the analyst estimate of ($0.06). Revenue for the quarter came in at $80.3 million versus the consensus estimate of $79.42 million.

Fourth Quarter 2019 Financial Results

• Gross services volume (GSV) increased by 16% year-over-year to $549 million
• Revenue (under ASC 606) grew 19% year-over-year to $80.3 million; Revenue (under ASC 605) grew 20% year-over-year to $80.7 million
• Marketplace revenue (under ASC 606) grew 21% year-over-year to $72.2 million; Marketplace revenue (under ASC 605) grew 22% year-over-year to $72.6 million
• Take rate (under ASC 606) was 14.6%, up from 14.3% a year ago; Take rate (under ASC 605) was 14.7%, up from 14.3% a year ago
• Gross margin (under ASC 606) expanded approximately two percentage points year-over-year to 71%; Gross margin (under ASC 605) expanded three percentage points year-over-year to 72%
• Net loss (under ASC 606) was $5.5 million, or $(0.05) per share, compared to a net loss of $5.4 million, or $(0.05) per share, in the fourth quarter of 2018; Net loss (under ASC 605) was $5.2 million, or $(0.05) per share, compared to a net loss of $5.4 million, or $(0.05) per share, in the fourth quarter of 2018
• Non-GAAP net income (under ASC 606) was $3.4 million, or $0.03 per share, compared to non-GAAP net income of $2.7 million, or $0.03 per share, in the fourth quarter of 2018; Non-GAAP net income (under ASC 605) was $3.7 million, or $0.03 per share, compared to non-GAAP net income of $2.7 million, or $0.03 per share, in the fourth quarter of 2018
• Adjusted EBITDA (under ASC 606), a non-GAAP financial measure, was $3.5 million compared to $3.6 million in the fourth quarter of 2018; Adjusted EBITDA (under ASC 605), a non-GAAP financial measure, was $3.8 million compared to $3.6 million in the fourth quarter of 2018

“We had a solid fourth quarter and exceeded our revenue and adjusted EBITDA guidance. Not only do we have a tremendous market opportunity, but we are uniquely positioned to solve the greatest challenge any company can face: how to find the skills and talent they need to thrive,” said Hayden Brown, President and CEO of Upwork. “We’ve set the right strategic priorities and are making the necessary investments to take Upwork into the next phase of growth, and I am confident that we are oriented for success.”

GUIDANCE:

Upwork Inc. sees Q1 2020 revenue of $81.5-82.5 million, versus the consensus of $83.46 million.

Upwork Inc. sees FY2020 revenue of $340-345 million, versus the consensus of $355.62 million.

For the first quarter of 2020, Upwork expects to report:

• Revenue in the range of $81.5 million to $82.5 million1
• Weighted average shares outstanding in the range of 114 million to 116 million

For the full year 2020, Upwork expects to report:

• Revenue in the range of $340 million to $345 million2
• Weighted average shares outstanding in the range of 117 million to 121 million

For earnings history and earnings-related data on Upwork Inc. (UPWK) click here.

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