Upwork(US:UPWK)2024-08-07 20:07Financial Performance - Second-quarter GAAP Net Income of $22.2 million, the highest ever for Upwork[1] - Revenue grew 15% year-over-year to $193.1 million in Q2 2024[3] - Adjusted EBITDA of $40.8 million in Q2 2024, compared to $14.4 million in Q2 2023[3] - Total revenue for Q2 2024 increased to $193.1 million, up 14.5% from $168.6 million in Q2 2023[15] - Net income for Q2 2024 was $22.2 million, a significant improvement from a net loss of $4.0 million in Q2 2023[15] - Net income for Q2 2024 was $22.2 million, compared to a net loss of $3.99 million in Q2 2023[23] - Adjusted EBITDA for Q2 2024 was $40.8 million, a significant increase from $14.4 million in Q2 2023[23] - Adjusted EBITDA for Q2 2024 was $40.8 million, up from $33.3 million in Q1 2024 and $14.4 million in Q2 2023[25] - Net income for Q2 2024 was $22.2 million, compared to a net loss of $4.0 million in Q2 2023[25] Revenue and Growth - Revenue from ads & monetization products grew 75% year-over-year[4] - Marketplace revenue grew to $166.8 million in Q2 2024, a 17.2% increase from $142.3 million in Q2 2023[15] - Enterprise revenue remained stable at $26.3 million in Q2 2024 compared to $26.3 million in Q2 2023[15] - Full-year 2024 revenue guidance of $735 million to $745 million[5] Client and Market Expansion - Active clients grew 6% year-over-year to over 868,000[3] - Upwork added 46 new Enterprise clients in Q2 2024, including Builders FirstSource and Guidepoint[4] Cash Flow and Financial Position - Cash and cash equivalents increased to $182.8 million as of June 30, 2024, up from $79.6 million as of December 31, 2023[16] - Marketable securities decreased to $314.9 million as of June 30, 2024, down from $470.5 million as of December 31, 2023[16] - Total current assets stood at $855.7 million as of June 30, 2024, slightly down from $883.4 million as of December 31, 2023[16] - Total liabilities decreased to $647.5 million as of June 30, 2024, from $656.5 million as of December 31, 2023[16] - Accumulated deficit improved to $253.4 million as of June 30, 2024, from $294.1 million as of December 31, 2023[16] - Net cash provided by operating activities for the six months ended June 30, 2024, was $42.9 million, compared to a net cash used in operating activities of $4.4 million for the same period in 2023[17] - Purchases of marketable securities for the six months ended June 30, 2024, were $194.3 million, a decrease from $254.1 million in the same period in 2023[17] - Proceeds from maturities of marketable securities for the six months ended June 30, 2024, were $321.8 million, compared to $307.4 million in the same period in 2023[17] - Repurchase of common stock for the six months ended June 30, 2024, amounted to $100 million, with no repurchases in the same period in 2023[17] - Cash, cash equivalents, and restricted cash at the end of June 30, 2024, were $405.8 million, up from $336.2 million at the end of June 30, 2023[17] - Free cash flow for Q2 2024 was $33.5 million, compared to $0.96 million in Q2 2023[26] - Cash provided by operating activities for Q2 2024 was $37.3 million, a significant increase from $4.3 million in Q2 2023[26] - Free cash flow for the first six months of 2024 was $36.5 million, a substantial improvement from a negative $10.6 million in the same period of 2023[26] Expenses and Margins - Research and development expenses increased to $52.5 million in Q2 2024 from $43.2 million in Q2 2023[23] - Sales and marketing expenses decreased to $47.3 million in Q2 2024 from $59.1 million in Q2 2023[23] - Gross margin for Q2 2024 was 77% on a GAAP basis and 78% on a non-GAAP basis, up from 76% in Q2 2023[23] - Stock-based compensation expense was $19.2 million in Q2 2024, slightly up from $18.4 million in Q2 2023[23] - Stock-based compensation expense for Q2 2024 was $19.2 million, slightly higher than $18.4 million in Q2 2023[25] - Depreciation and amortization for Q2 2024 was $3.6 million, up from $1.9 million in Q2 2023[25] - Purchases of property, plant & equipment and cash outflows from internally developed software for Q2 2024 were $3.7 million, slightly higher than $3.3 million in Q2 2023[26] Earnings Per Share - Basic earnings per share for Q2 2024 was $0.17 on a GAAP basis and $0.27 on a non-GAAP basis[24] - Diluted earnings per share for Q2 2024 was $0.17 on a GAAP basis and $0.26 on a non-GAAP basis[24] - Weighted-average shares outstanding for Q2 2024 were 131.4 million (basic) and 138.3 million (diluted)[24] Other Financial Metrics - GSV from AI-related work grew 67% year-over-year in Q2[4] - Upwork repurchased 2.9 million shares of stock in Q2 2024[3] - Full-year 2024 adjusted EBITDA guidance of $140 million to $150 million[5] - Adjusted EBITDA is used as a measure of core operating results and excludes stock-based compensation, depreciation, and amortization, among other items[19] - Free cash flow is defined as cash from operations less capital expenditures and internally developed software costs[19] - The company has not reconciled adjusted EBITDA guidance to GAAP net income due to uncertainties in stock-based compensation and other factors[22] - The company recognized a $38.9 million gain in Q2 2023 from early extinguishment of convertible senior notes[24] - Other income, net for Q2 2024 was a loss of $5.6 million, compared to a loss of $4.0 million in Q2 2023[25] - Income tax provision for Q2 2024 was $1.2 million, down from $1.9 million in Q2 2023[25]