Upwork 2025 Q2 Earnings Strong Performance as Net Income Surges 47%

Upwork reported robust second-quarter 2025 financial results, exceeding expectations with a 47% year-over-year increase in net income and raising full-year guidance for revenue and adjusted EBITDA. The company's strategic focus on AI-driven solutions and enterprise expansion has positioned it for continued growth in the evolving work marketplace.

Revenue
Upwork’s total revenue for the second quarter of 2025 rose slightly by 0.9% year-over-year to $194.94 million. The Marketplace segment remained the primary growth driver, generating $170.66 million in revenue, reflecting the platform’s strong performance and increased project complexity. Meanwhile, the Enterprise segment reported revenue of $24.28 million, contributing to the overall revenue but experiencing a modest decline compared to the previous year.

Earnings/Net Income
Upwork's earnings demonstrated significant growth, with net income rising 47.3% to $32.73 million in 2025 Q2, compared to $22.22 million in 2024 Q2. Earnings per share (EPS) also increased by 47.1% to $0.25, showcasing strong profitability. The company achieved a record high in net income for fiscal Q2, marking the highest level in eight years and demonstrating its effective cost management and revenue growth. This performance highlights a strong earnings trajectory for the company.

Price Action
The stock price of Upwork (UPWK) has shown mixed performance in recent trading periods. On the latest trading day, shares edged up 0.42%, but declined 0.99% during the most recent full trading week and fell 11.15% month-to-date. This volatility reflects broader market dynamics and investor sentiment following the earnings release.

Post-Earnings Price Action Review
A strategy of buying Upwork shares 30 days after its earnings release following a quarter-over-quarter revenue increase over the past three years underperformed significantly. The approach generated a negative compound annual growth rate (CAGR) of -1.17% and total return of -3.10%, lagging behind the benchmark return of 63.80%. The strategy's poor performance was marked by minimal risk, with a maximum drawdown of 0.00% and a negative Sharpe ratio of -0.05, indicating that while it was low-risk, it also delivered subpar returns.

CEO Commentary
Hayden Brown, President and CEO of Upwork, highlighted the company’s exceptional second quarter, driven by AI features that enhanced value for small and medium businesses (SMBs), large enterprises, and talent. Brown emphasized that recent acquisitions of Bubty and Ascen expanded Upwork’s full-stack contingent workforce solutions, positioning the company to access a $650 billion Enterprise TAM opportunity. Brown expressed optimism about leveraging these strategic moves to maintain industry leadership in the human and AI-powered era of work.

Guidance
Erica Gessert, CFO, announced an increase in full-year guidance for both revenue and adjusted EBITDA, citing strong product enhancements, disciplined cost management, and outperformance in Q2. While specific numeric guidance ranges were not included in the provided text, Gessert reiterated the company’s long-term adjusted EBITDA margin target of 35%.

Additional News
In a significant move to strengthen its enterprise offerings, Upwork announced the acquisition of Bubty and agreed to acquire Ascen. These acquisitions will enhance the company’s full-stack contingent workforce solutions, enabling access to a broader range of talent and contract types for large enterprises. The acquisitions are expected to position Upwork to capitalize on the $650 billion enterprise talent market. Additionally, the company raised its full-year revenue and adjusted EBITDA guidance, citing product enhancements and cost discipline. Upwork also plans to continue investing in AI infrastructure, including the development of embedded AI copilots and autonomous agents, which have already driven a 30% year-over-year growth in AI-related work on the platform.