Upwork's Q2 2025: Unraveling Contradictions on AI Impact, Macroeconomic Challenges, and Growth Strategies

Impact of AI on business growth, macroeconomic impact on business, take rate expansion and AI impact, macroeconomic environment impact, and AI and freelancer fee changes are the key contradictions discussed in Upwork's latest 2025Q2 earnings call.



Revenue and Profitability Growth:
- Upwork reported its highest ever Q2 revenue of $194.9 million, with a 16.8% profit margin and 29.3% adjusted EBITDA margin.
- The growth was driven by AI enhancement of the platform, accelerated client hiring in AI-related work, ads and monetization strategies, and the thriving Business Plus offering.

AI and Marketplace Expansion:
- GSV from AI-related work accelerated to 30% year-over-year growth from 25% in the first quarter.
- This was attributed to businesses accessing AI experts, with the number of clients posting AI jobs growing 38% year-over-year, contributing to increased GSV per active client.

Business Plus Growth:
- Active Business Plus clients increased 45% quarter-over-quarter, while GSV from those clients surged 190% quarter-over-quarter.
- The success of Business Plus is due to its appeal to both existing customers and new prospects, with 35% of clients being new to Upwork.

Enterprise Subsidiary and Acquisition Strategy:
- Upwork announced two significant acquisitions by its new wholly-owned subsidiary, Upwork Enterprise.
- The acquisitions are expected to drive meaningful GSV and revenue growth starting in late 2026, enhancing Upwork's ability to capture a greater share of the $650 billion contingent workforce market.