Upwork Reports Third Quarter 2025 Financial Results
Upwork (NASDAQ: UPWK) reported Q3 2025 revenue of $201.7M (up 4% YoY) and GAAP net income of $29.3M with diluted EPS $0.21. Adjusted EBITDA hit a record $59.6M (up 38% YoY) and a record 30% adjusted EBITDA margin. GSV was $1.018B, up 1.9% YoY; active clients totaled 794,000. The company announced a new $100M share repurchase authorization, launched Lifted after acquiring Bubty and Ascen, and continues expanding its Uma AI features. Upwork raised full‑year 2025 guidance to $782M–$787M revenue and $222M–$225M adjusted EBITDA, and provided Q4 2025 guidance for revenue of $193M–$198M and adjusted EBITDA of $49M–$52M.
Upwork (NASDAQ: UPWK) ha riportato entrate del terzo trimestre 2025 pari a $201,7 M (in crescita del 4% rispetto all’anno precedente) e un utile netto GAAP di $29,3 M con un ôtle diluito per azione di $0,21. L'ëBITDA rettificato ha toccato un record di $59,6 M (in crescita del 38% su base annua) e un margine EBITDA rettificato record del 30%. GSV era di $1,018 Miliardi, in aumento del 1,9% su base annua; i clienti attivi ammontavano a 794.000. L'azienda ha annunciato una nuova autorizzazione al riacquisto di azioni di $100M, ha lanciato Lifted dopo l'acquisizione di Bubty e Ascen, e continua a espandere le sue funzionalità Uma AI. Upwork ha aumentato le previsioni per l'intero 2025 a ricavi di $782M–$787M e $222M–$225M di EBITDA rettificato, e ha fornito una guidance per il Q4 2025 di ricavi tra $193M–$198M e EBITDA rettificato tra $49M–$52M.
Upwork (NASDAQ: UPWK) informó ingresos del tercer trimestre de 2025 de $201.7M (un aumento del 4% interanual) y beneficio neto GAAP de $29.3M con un EPS diluido de $0.21. El EBITDA ajustado alcanzó un récord de $59.6M (un aumento del 38% interanual) y un margen EBITDA ajustado récord del 30%. El GSV fue de $1.018B, un aumento del 1.9% interanual; los clientes activos totalizaron 794,000. La empresa anunció una nueva autorización de recompra de acciones de $100M, lanzó Lifted tras adquirir Bubty y Ascen, y continúa expandiendo sus características de Uma AI. Upwork elevó las previsiones para todo 2025 a ingresos de $782M–$787M y $222M–$225M de EBITDA ajustado, y proporcionó una guía para el Q4 2025 de ingresos de $193M–$198M y EBITDA ajustado de $49M–$52M.
Upwork(NASDAQ: UPWK)은 2025년 3분기 매출 201.7M달러를 보고했고(전년 동기 대비 4% 증가) GAAP 순이익 29.3M달러 및 희석 주당순이익 0.21달러를 기록했다. 조정 EBITDA는 사상 최고치인 59.6M달러를 기록했고(전년 동기 대비 38% 증가) 조정 EBITDA 마진 30%의 사상 최고치를 달성했다. GSV는 1.018B달러로 전년 동기 대비 1.9% 증가했고 활성 고객은 794,000명에 달했다. 회사는 $100M 자사주 매입 승인을 발표했고 Bubty와 Ascen 인수 후 Lifted를 출시했으며 Uma AI 기능 확장을 계속하고 있다. Upwork은 2025년 전체 연간 가이던스를 $782M–$787M 매출, $222M–$225M 조정 EBITDA로 상향했고, 2025년 Q4 가이던스를 $193M–$198M 매출 및 $49M–$52M의 조정 EBITDA로 제시했다.
Upwork (NASDAQ: UPWK) a annoncé un chiffre d'affaires du T3 2025 de 201,7 M$ (en hausse de 4% sur un an) et un bénéfice net GAAP de 29,3 M$ avec un bénéfice par action dilué de 0,21$. L'EBITDA ajusté a atteint un record de 59,6 M$ (en hausse de 38% sur un an) et une marge d'EBITDA ajusté record de 30%. Le GSV était de 1,018 Mrd$, en hausse de 1,9% sur un an; les clients actifs totalisaient 794 000. L'entreprise a annoncé une nouvelle autorisation de rachat d'actions de 100 M$, a lancé Lifted après l'acquisition de Bubty et Ascen, et continue d'étendre ses fonctionnalités Uma AI. Upwork a relevé ses prévisions pour l'ensemble de 2025 à des revenus de 782–787 M$ et un EBITDA ajusté de 222–225 M$, et a fourni des prévisions pour Q4 2025 pour des revenus de 193–198 M$ et un EBITDA ajusté de 49–52 M$.
Upwork (NASDAQ: UPWK) berichtete Umsatz im Q3 2025 von 201,7 Mio. USD (plus 4% YoY) und GAAP-Nettoergebnis von 29,3 Mio. USD bei verwässertem EPS von 0,21 USD. Bereinigtes EBITDA erreichte einen Rekordwert von 59,6 Mio. USD (plus 38% YoY) und eine Rekordmarge von 30% beim bereinigten EBITDA. GSV betrug 1,018 Mrd. USD, plus 1,9% YoY; aktive Kunden beliefen sich auf 794.000. Das Unternehmen kündigte eine neue Aktienrückkaufgenehmigung über 100 Mio. USD an, startete Lifted nach der Übernahme von Bubty und Ascen, und erweitert weiter seine Uma AI-Funktionen. Upwork hob den Jahresausblick 2025 auf Umsatz von 782–787 Mio. USD und bereinigtes EBITDA von 222–225 Mio. USD an, und gab eine Guidance für Q4 2025 für einen Umsatz von 193–198 Mio. USD und ein bereinigtes EBITDA von 49–52 Mio. USD bekannt.
Upwork (NASDAQ: UPWK) أبلغت عن إيرادات في الربع الثالث 2025 تبلغ 201.7 مليون دولار (بنمو 4% على أساس سنوي) وصافي دخل GAAP قدره 29.3 مليون دولار مع ربحية السهم المخفّف البالغة 0.21 دولار. بلغ EBITDA المعدل مستوى قياسيًا قدره 59.6 مليون دولار (بنمو 38% على أساس سنوي) وبمرجانیة EBITDA المعدل القياسية 30%. كانت قيمة GSV 1.018 مليار دولار، بارتفاع 1.9% على أساس سنوي؛ بلغ عدد العملاء النشطين 794,000. أعلنت الشركة عن تفويض لإعادة شراء الأسهم بقيمة 100 مليون دولار، أطلقت Lifted بعد الاستحواذ على Bubty وAscen، وتواصل توسيع ميزات Uma AI. رفعت Upwork التوجيه لعام 2025 كاملاً إلى إيرادات قدرها 782–787 مليون دولار و EBITDA معدّل من 222–225 مليون دولار، وقدمّت توجيهات للربع الرابع من 2025 لإيرادات بين 193–198 مليون دولار و EBITDA المعدل بين 49–52 مليون دولار.
- Revenue of $201.7M in Q3 2025, +4% YoY
- Adjusted EBITDA $59.6M, +38% YoY and record 30% margin
- Raised full‑year 2025 revenue guidance to $782M–$787M
- Announced $100M share repurchase authorization
- Completed acquisitions and launched Lifted for enterprise solutions
- GSV growth muted at 1.9% YoY in Q3 2025
- Active clients declined to 794,000, a 7% decrease YoY
- Q4 2025 revenue guidance of $193M–$198M implies a sequential revenue dip from Q3
Insights
Upwork delivered record revenue, stronger margins, and raised FY2025 guidance — clear positive operational and financial momentum.
Upwork reported record quarterly revenue of
Key drivers cited include growing AI-related GSV (AI-related work GSV up
Achieves record quarterly revenue of
Generates GAAP net income of
Raises FY2025 revenue and adjusted EBITDA guidance
PALO ALTO, Calif., Nov. 03, 2025 (GLOBE NEWSWIRE) -- Upwork Inc. (Nasdaq: UPWK), the world’s human and AI-powered work marketplace, today announced its financial results for the third quarter of 2025.
“The third quarter marked the start of the next chapter for Upwork. As we build the world’s human and AI-powered work marketplace, we’re driving phenomenal user productivity and engagement, resulting in a return to positive GSV growth,” said Hayden Brown, president and CEO, Upwork Inc. “We are executing with speed and precision across our growth levers of AI, SMB, and Enterprise, and are now on the path to sustained, multi-year growth.”
“Our third quarter was exceptional, with record performance. We crossed the
Third Quarter 2025 Financial Highlights
- GSV(1) grew
2% year-over-year - Revenue grew
4% year-over-year to$201.7 million - Active clients(1) of 794,000
- GSV per active client(1) of
$5,036 increased5% year-over-year - Net income was
$29.3 million , up6% year-over-year - Diluted earnings per share was
$0.21 , compared to diluted earnings per share of$0.20 in the third quarter of 2024 - Adjusted EBITDA(2) was
$59.6 million , up38% year-over-year - Cash provided by operating activities(3) was
$75.1 million , compared to cash provided by operating activities of$61.0 million in the third quarter of 2024 - Free cash flow(2)(3) was
$69.4 million , compared to free cash flow of$56.8 million in the third quarter of 2024
Third Quarter Operational Highlights
Building the World’s Human and AI-Powered Work Marketplace
- Uma™, Upwork’s Mindful AI, continued to evolve into an always-on work agent, further increasing customer engagement and productivity.
- Scaled Uma’s capabilities across the customer journey with additional premium features like AI interviews, recruiting, and collaborative hiring capabilities for teams.
- Uma Proposal Writer provided a
15% uplift in Uma-generated proposals. - Launched agentic talent sourcing solution for Business Plus clients, reducing the median time to receive a high-quality talent shortlist for their jobs by more than
75% .
Growing AI Work on the Marketplace
- GSV from AI-related work accelerated to
53% year-over-year growth in Q3 2025, compared to30% year-over-year growth in Q2 2025.- GSV from Generative AI work grew
65% year-over-year in Q3 2025. - GSV from Prompt Engineering grew
71% year-over-year and increased23% quarter-over-quarter in Q3 2025.
- GSV from Generative AI work grew
- The number of clients engaging in AI-related projects grew
45% year-over-year in Q3 2025.
Winning Bigger with SMBs
- GSV from Upwork Business Plus offering for SMBs increased
33% quarter-over-quarter. - Business Plus active clients increased
36% quarter-over-quarter, with36% of active clients on Business Plus in Q3 being net-new customers to Upwork.
Generating New Value through Ads & Monetization Strategies
- Revenue from Ads & Monetization grew
19% year-over-year in Q3 2025.- Connects revenue increased
18% year-over-year in Q3 2025. - Freelancer Plus subscription revenue grew
24% year-over-year in Q3 2025.
- Connects revenue increased
Unlocking the Enterprise Opportunity
- Launched Lifted, Upwork’s new enterprise-focused subsidiary, creating a unique offering of full-stack, end-to-end contingent work solutions for large enterprises following Lifted’s acquisitions of Bubty and Ascen.
- Rapidly integrating acquired companies and products, in anticipation of onboarding first customers onto the new Lifted platform by early 2026.
Financial Guidance & Outlook
Upwork’s guidance for revenue, adjusted EBITDA, diluted weighted-average shares outstanding, and non-GAAP diluted EPS for the fourth quarter of 2025 is:
- Revenue:
$193 million to$198 million - Adjusted EBITDA:
$49 million to$52 million - Diluted weighted-average shares outstanding: 138 million to 140 million
- Non-GAAP diluted EPS:
$0.31 t o$0.33
Upwork’s guidance for revenue, adjusted EBITDA, diluted weighted-average shares outstanding, non-GAAP diluted EPS, and stock-based compensation expense for full year 2025 is:
- Revenue:
$782 million to$787 million - Adjusted EBITDA:
$222 million to$225 million - Diluted weighted-average shares outstanding: 140 million to 142 million
- Non-GAAP diluted EPS:
$1.35 t o$1.37 - Stock-based compensation expense: Approximately
$65 million
| UPWORK INC. Key Financial and Operational Metrics (In thousands, except percentages and basis points) (Unaudited) | |||||||||||||||||||||
| Three Months Ended September 30, | Nine Months Ended September 30, | ||||||||||||||||||||
| 2025 | 2024 | Change | 2025 | 2024 | Change | ||||||||||||||||
| GSV(1) | $ | 1,017,680 | $ | 998,268 | 1.9 | % | $ | 3,008,054 | $ | 3,015,331 | (0.2)% | ||||||||||
| Marketplace revenue(1) | $ | 174,572 | $ | 167,337 | 4 | % | $ | 511,525 | $ | 498,453 | 3 | % | |||||||||
| Enterprise revenue(1) | $ | 27,158 | $ | 26,439 | 3 | % | $ | 77,850 | $ | 79,389 | (2 | )% | |||||||||
| Gross profit | $ | 155,887 | $ | 150,368 | 4 | % | $ | 458,294 | $ | 446,389 | 3 | % | |||||||||
| Gross profit margin | 77 | % | 78 | % | -32 bps | 78 | % | 77 | % | 51 bps | |||||||||||
| Operating expenses | $ | 126,129 | $ | 129,575 | (3 | )% | $ | 357,281 | $ | 394,766 | (9 | )% | |||||||||
| Net income | $ | 29,335 | $ | 27,758 | 6 | % | $ | 99,791 | $ | 68,420 | 46 | % | |||||||||
| Adjusted EBITDA(2) | $ | 59,627 | $ | 43,227 | 38 | % | $ | 172,699 | $ | 117,387 | 47 | % | |||||||||
| Profit margin | 15 | % | 14 | % | 22 bps | 17 | % | 12 | % | 509 bps | |||||||||||
| Adjusted EBITDA margin(2) | 30 | % | 22 | % | 725 bps | 29 | % | 20 | % | 899 bps | |||||||||||
| Cash provided by operating activities(3) | $ | 75,079 | $ | 60,964 | 23 | % | $ | 184,558 | $ | 114,981 | 61 | % | |||||||||
| Free cash flow(2)(3) | $ | 69,431 | $ | 56,797 | 22 | % | $ | 165,847 | $ | 104,402 | 59 | % | |||||||||
| As of September 30, | ||||||||
| (In thousands) | 2025 | 2024 | % Change | |||||
| Active clients(1) | 794 | 855 | (7 | )% | ||||
(1) See Key Definitions in our third quarter 2025 earnings presentation.
(2) An explanation of non-GAAP financial measures and reconciliations to their most directly comparable GAAP financial measures can be found in the “Non-GAAP Financial Measures" section and the subsequent tables at the end of this press release.
(3) We elected to change the presentation of certain cash flows on our Consolidated Statement of Cash Flow, reclassifying the change in Trade and client receivables, related to amounts received on behalf of talent to fund their escrow account, from operating activities to financing activities. Prior period comparative amounts have been recast to conform to the current period presentation.
Third Quarter 2025 Financial Results Conference Call and Webcast
Upwork will host a conference call today at 2:00 p.m. Pacific Time/5:00 p.m. Eastern Time to discuss the company’s third quarter 2025 financial results. An audio webcast archive will be available following the live event for approximately one year at investors.upwork.com. Please visit the Upwork Investor Relations website at investors.upwork.com/financial-information/quarterly-results to view Upwork’s third quarter 2025 earnings presentation.
Disclosure Information
We use our Investor Relations website (investors.upwork.com), our Blog (upwork.com/blog), our X handle (twitter.com/Upwork), Hayden Brown’s X handle (twitter.com/hydnbrwn) and LinkedIn profile (linkedin.com/in/haydenlbrown), and Erica Gessert’s LinkedIn profile (linkedin.com/in/erica-gessert) as means of disseminating or providing notification of, among other things, news or announcements regarding our business or financial performance, investor events, press releases, and earnings releases, and as means of disclosing material nonpublic information and for complying with our disclosure obligations under Regulation FD.
About Upwork
Upwork Inc.’s (Nasdaq: UPWK) family of companies connects businesses with global, AI-enabled talent across every contingent work type including freelance, fractional, and payrolled. This portfolio includes the Upwork Marketplace, which connects businesses with on-demand access to highly skilled talent across the globe, and Lifted, which provides a purpose-built solution for enterprise organizations to source, contract, manage, and pay talent across the full spectrum of contingent work. From Fortune 100 enterprises to entrepreneurs, businesses rely on Upwork Inc. to find and hire expert talent, leverage AI-powered work solutions, and drive business transformation. With access to professionals spanning more than 10,000 skills across AI & machine learning, software development, sales & marketing, customer support, finance & accounting, and more, the Upwork family of companies enables businesses of all sizes to scale, innovate, and transform their workforces for the age of AI and beyond.
Since its founding, Upwork Inc. has facilitated more than
Contact:
Investor Relations
investor@upwork.com
Safe Harbor:
This press release of Upwork Inc. (together with its wholly owned subsidiaries, the “Company,” “we,” “us,” or “our”) contains “forward-looking” statements within the meaning of the federal securities laws. Forward-looking statements include all statements other than statements of historical fact, including any statements regarding our future operating results and financial position, including expected financial results for the fourth quarter and full year 2025, information or predictions concerning the future of our business or strategy, anticipated events and trends, potential growth or growth prospects, competitive position, technological and market trends, industry environment, the economy, our plans with respect to share repurchases, the expected impact and timing of strategic initiatives, including the launch of Lifted, the Company’s enterprise-focused subsidiary, and its acquisitions of Bubty B.V., which we refer to as Bubty, and Ascen Inc., which we refer to as Ascen, and other future conditions.
We have based these forward-looking statements largely on our current expectations and projections as of the date hereof about future events and trends that we believe may affect our financial condition, results of operations, business strategy, short- and long-term business operations and objectives, and financial needs. As such, they are subject to inherent uncertainties, known and unknown risks, and changes in circumstances that are difficult to predict and in many cases outside our control, and you should not rely on such forward-looking statements. We make no representation that the projected results will be achieved or that future events and circumstances will occur, and actual results may differ materially and adversely from our expectations. The forward-looking statements are made as of the date hereof, and we do not undertake, and expressly disclaim, any obligation to update or revise any forward-looking statements, conform these statements to actual results, or make changes in our expectations, except as required by law. Additional information regarding the risks and uncertainties that could cause actual results to differ materially from our expectations is included under the caption "Risk Factors" in our Quarterly Report on Form 10-Q for the three months ended June 30, 2025, filed with the SEC on August 6, 2025, and in our other SEC filings, which are available on our Investor Relations website at investors.upwork.com and on the SEC’s website at www.sec.gov. Additional information will also be set forth under the caption “Risk Factors” in our Quarterly Report on Form 10-Q for the three months ended September 30, 2025, when filed.
Upwork, “Uma™, Upwork’s Mindful AI,” Lifted and other registered or common law trade names, trademarks, or service marks of Upwork appearing in this press release are the property of Upwork. This presentation may also contain additional trade names, trademarks, and service marks of other companies, including names and brands. All third-party trademarks are property of their respective owners, and any references to third-party trademarks are for identification purposes only and shall be considered nominative fair use under trademark law.
| UPWORK INC. CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS (In thousands, except for per share data) (Unaudited) | |||||||||||||||
| Three Months Ended September 30, | Nine Months Ended September 30, | ||||||||||||||
| 2025 | 2024 | 2025 | 2024 | ||||||||||||
| Revenue | |||||||||||||||
| Marketplace | $ | 174,572 | $ | 167,337 | $ | 511,525 | $ | 498,453 | |||||||
| Enterprise | 27,158 | 26,439 | 77,850 | 79,389 | |||||||||||
| Total revenue | 201,730 | 193,776 | 589,375 | 577,842 | |||||||||||
| Cost of revenue | 45,843 | 43,408 | 131,081 | 131,453 | |||||||||||
| Gross profit | 155,887 | 150,368 | 458,294 | 446,389 | |||||||||||
| Operating expenses | |||||||||||||||
| Research and development | 47,494 | 50,411 | 138,489 | 155,792 | |||||||||||
| Sales and marketing | 34,985 | 46,093 | 107,407 | 141,277 | |||||||||||
| General and administrative | 41,257 | 31,276 | 104,964 | 93,201 | |||||||||||
| Provision for transaction losses | 2,393 | 1,795 | 6,421 | 4,496 | |||||||||||
| Total operating expenses | 126,129 | 129,575 | 357,281 | 394,766 | |||||||||||
| Income from operations | 29,758 | 20,793 | 101,013 | 51,623 | |||||||||||
| Other income, net | 5,917 | 8,091 | 18,112 | 20,433 | |||||||||||
| Income before income taxes | 35,675 | 28,884 | 119,125 | 72,056 | |||||||||||
| Income tax provision | (6,340 | ) | (1,126 | ) | (19,334 | ) | (3,636 | ) | |||||||
| Net income | $ | 29,335 | $ | 27,758 | $ | 99,791 | $ | 68,420 | |||||||
| Net income per share: | |||||||||||||||
| Basic | $ | 0.22 | $ | 0.21 | $ | 0.75 | $ | 0.51 | |||||||
| Diluted | $ | 0.21 | $ | 0.20 | $ | 0.72 | $ | 0.50 | |||||||
| Weighted-average shares used to compute net income per share: | |||||||||||||||
| Basic | 131,987 | 132,603 | 133,114 | 133,404 | |||||||||||
| Diluted | 139,666 | 139,294 | 140,910 | 140,552 | |||||||||||
| UPWORK INC. CONDENSED CONSOLIDATED BALANCE SHEETS (In thousands) (Unaudited) | |||||||
| September 30, 2025 | December 31, 2024 | ||||||
| ASSETS | |||||||
| Current assets | |||||||
| Cash and cash equivalents | $ | 260,838 | $ | 305,757 | |||
| Marketable securities | 382,259 | 316,344 | |||||
| Funds held in escrow, including funds in transit | 211,373 | 195,736 | |||||
| Trade and client receivables, net | 76,433 | 75,490 | |||||
| Prepaid expenses and other current assets | 18,048 | 17,727 | |||||
| Total current assets | 948,951 | 911,054 | |||||
| Property and equipment, net | 40,373 | 30,056 | |||||
| Goodwill | 150,471 | 121,064 | |||||
| Intangible assets, net | 39,656 | 12,989 | |||||
| Operating lease asset | 5,188 | 5,752 | |||||
| Deferred tax asset | 125,065 | 128,779 | |||||
| Other assets, noncurrent | 1,505 | 1,919 | |||||
| Total assets | $ | 1,311,209 | $ | 1,211,613 | |||
| LIABILITIES AND STOCKHOLDERS’ EQUITY | |||||||
| Current liabilities | |||||||
| Accounts payable | $ | 8,514 | $ | 6,128 | |||
| Escrow funds payable | 211,373 | 195,736 | |||||
| Debt, current | 359,310 | — | |||||
| Accrued expenses and other current liabilities | 73,336 | 59,300 | |||||
| Deferred revenue | 7,943 | 7,269 | |||||
| Total current liabilities | 660,476 | 268,433 | |||||
| Debt, noncurrent | — | 357,928 | |||||
| Operating lease liability, noncurrent | 10,131 | 9,567 | |||||
| Other liabilities, noncurrent | 12,476 | 308 | |||||
| Total liabilities | 683,083 | 636,236 | |||||
| Stockholders’ equity | |||||||
| Common stock | 13 | 14 | |||||
| Additional paid-in capital | 605,931 | 653,575 | |||||
| Accumulated and other comprehensive income | 867 | 264 | |||||
| Accumulated deficit | 21,315 | (78,476 | ) | ||||
| Total stockholders’ equity | 628,126 | 575,377 | |||||
| Total liabilities and stockholders’ equity | $ | 1,311,209 | $ | 1,211,613 | |||
| UPWORK INC. CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (In thousands) (Unaudited) | |||||||||||||||
| Three Months Ended September 30, | Nine Months Ended September 30, | ||||||||||||||
| 2025 | 2024 | 2025 | 2024 | ||||||||||||
| CASH FLOWS FROM OPERATING ACTIVITIES: | |||||||||||||||
| Net income | $ | 29,335 | $ | 27,758 | $ | 99,791 | $ | 68,420 | |||||||
| Adjustments to reconcile net income to net cash provided by operating activities: | |||||||||||||||
| Provision for transaction losses | 2,113 | 1,100 | 5,707 | 3,533 | |||||||||||
| Depreciation and amortization | 7,946 | 3,668 | 18,686 | 10,443 | |||||||||||
| Amortization of debt issuance costs | 460 | 460 | 1,381 | 1,381 | |||||||||||
| Accretion of discount on purchases of marketable securities, net | (2,195 | ) | (2,272 | ) | (5,699 | ) | (10,431 | ) | |||||||
| Amortization of operating lease asset | 179 | 722 | 564 | 2,428 | |||||||||||
| Tides Foundation common stock warrant expense | 188 | 188 | 563 | 563 | |||||||||||
| Stock-based compensation expense | 19,789 | 18,578 | 48,038 | 54,758 | |||||||||||
| Deferred taxes | (2,463 | ) | — | (399 | ) | — | |||||||||
| Changes in operating assets and liabilities: | |||||||||||||||
| Trade and client receivables(1) | (2,014 | ) | 4,851 | (1,654 | ) | (236 | ) | ||||||||
| Prepaid expenses and other assets | 3,378 | 2,665 | 40 | (2,468 | ) | ||||||||||
| Operating lease liability | (208 | ) | (1,086 | ) | 600 | (4,215 | ) | ||||||||
| Accounts payable | 4,571 | (160 | ) | (504 | ) | 541 | |||||||||
| Accrued expenses and other liabilities | 13,866 | 6,480 | 16,777 | (367 | ) | ||||||||||
| Deferred revenue | 134 | (1,988 | ) | 667 | (9,369 | ) | |||||||||
| Net cash provided by operating activities | 75,079 | 60,964 | 184,558 | 114,981 | |||||||||||
| CASH FLOWS FROM INVESTING ACTIVITIES: | |||||||||||||||
| Purchases of marketable securities | (106,791 | ) | (40,205 | ) | (365,939 | ) | (234,504 | ) | |||||||
| Proceeds from maturities of marketable securities | 70,314 | 43,423 | 302,725 | 365,269 | |||||||||||
| Proceeds from sale of marketable securities | 64 | 3,027 | 3,601 | 38,421 | |||||||||||
| Acquisition of business, net of cash acquired | (39,436 | ) | — | (59,846 | ) | — | |||||||||
| Purchases of property and equipment | (482 | ) | (1,204 | ) | (5,335 | ) | (1,979 | ) | |||||||
| Internal-use software and platform development costs | (5,166 | ) | (2,963 | ) | (13,376 | ) | (8,600 | ) | |||||||
| Net cash (used in) provided by investing activities | (81,497 | ) | 2,078 | (138,170 | ) | 158,607 | |||||||||
| CASH FLOWS FROM FINANCING ACTIVITIES: | |||||||||||||||
| Change in escrow funds payable, net(1) | 6,451 | 36,810 | 23,025 | 32,008 | |||||||||||
| Proceeds from exercises of stock options and common stock warrants | 76 | 1,165 | 729 | 1,935 | |||||||||||
| Proceeds from employee stock purchase plan | — | — | 2,199 | 2,917 | |||||||||||
| Repurchase of common stock | (31,001 | ) | — | (101,923 | ) | (100,000 | ) | ||||||||
| Net cash (used in) provided by financing activities | (24,474 | ) | 37,975 | (75,970 | ) | (63,140 | ) | ||||||||
| NET CHANGE IN CASH, CASH EQUIVALENTS, AND RESTRICTED CASH | (30,892 | ) | 101,017 | (29,582 | ) | 210,448 | |||||||||
| CASH, CASH EQUIVALENTS, AND RESTRICTED CASH—beginning of period | 506,903 | 405,849 | 505,593 | 296,418 | |||||||||||
| CASH, CASH EQUIVALENTS, AND RESTRICTED CASH—end of period | $ | 476,011 | $ | 506,866 | $ | 476,011 | $ | 506,866 | |||||||
(1) We elected to change the presentation of certain cash flows on our Consolidated Statement of Cash Flow, reclassifying the change in Trade and client receivables, related to amounts received on behalf of talent to fund their escrow account, from operating activities to financing activities. Prior period comparative amounts have been recast to conform to the current period presentation.
The following table reconciles cash, cash equivalents, and restricted cash as reported in the condensed consolidated balance sheets to the total of the same amounts shown in the condensed consolidated statements of cash flows as of the following (in thousands):
| September 30, 2025 | December 31, 2024 | ||||||
| Cash and cash equivalents | $ | 260,838 | $ | 305,757 | |||
| Restricted cash | 3,800 | 4,100 | |||||
| Funds held in escrow, including funds in transit | 211,373 | 195,736 | |||||
| Total cash, cash equivalents, and restricted cash as shown in the condensed consolidated statement of cash flows | $ | 476,011 | $ | 505,593 | |||
Non-GAAP Financial Measures
To supplement our condensed consolidated financial statements, which are prepared in accordance with accounting principles generally accepted in the United States (“GAAP”), we present certain non-GAAP financial measures in this press release, including adjusted EBITDA, adjusted EBITDA margin, free cash flow, and non-GAAP diluted EPS.
We define adjusted EBITDA as net income adjusted for stock-based compensation expense; depreciation and amortization; other income (expense), net, which includes interest expense; income tax benefit (provision); and, if applicable, certain other gains, losses, benefits, or charges that are non-cash or are significant and the result of isolated events or transactions that have not occurred frequently in the past and are not expected to occur regularly in the future. Free cash flow is defined as cash provided by operations less purchases of property, plant and equipment and cash outflows from internally developed software.
We use non-GAAP financial measures in conjunction with financial measures prepared in accordance with GAAP for planning purposes, including the preparation of our annual operating budget, as a measure of our core operating results and the effectiveness of our business strategy, and in evaluating our financial performance. These non-GAAP financial measures provide consistency and comparability with past financial performance, facilitate period-to-period comparisons of our core operating results, and also facilitate comparisons with other peer companies, many of which use similar non-GAAP financial measures to supplement their GAAP results. In addition, adjusted EBITDA is widely used by investors and securities analysts to measure a company’s operating performance without regard to certain items that can vary substantially from company to company, and free cash flow allows investors to evaluate the cash generated from our underlying operations across periods.
Investors are cautioned that there are material limitations associated with the use of non-GAAP financial measures as analytical tools, and investors should not consider them in isolation or as a substitute for the most directly comparable financial measures prepared in accordance with GAAP. In particular, (1) adjusted EBITDA excludes stock-based compensation expense, which has recently been, and will continue to be for the foreseeable future, a significant recurring expense for our business and an important part of our compensation strategy, (2) although depreciation and amortization expense are non-cash charges, the assets subject to depreciation and amortization may have to be replaced in the future, and adjusted EBITDA does not reflect cash capital expenditure requirements for such replacements or for new capital expenditure requirements, and (3) adjusted EBITDA does not reflect: (a) changes in, or cash requirements for, our working capital needs; (b) interest expense, or the cash requirements necessary to service interest or principal payments on our debt, which reduces cash available to us; (c) tax payments that may represent a reduction in cash available to us; or (d) material acquisition-related deal costs. In addition, the non-GAAP financial measures we use may be different from non-GAAP financial measures used by other companies, including companies in our industry, limiting their usefulness for comparison purposes. We compensate for these limitations by providing specific information regarding the GAAP items excluded from the non-GAAP financial measures that we present. Reconciliations of the non-GAAP financial measures presented in this press release to their most directly comparable GAAP financial measures have been provided below, and investors are encouraged to review the reconciliations and not rely on any single financial measure to evaluate our business.
We have not reconciled our adjusted EBITDA guidance to GAAP net income or non-GAAP diluted EPS guidance to GAAP diluted EPS because certain items that impact GAAP net income and GAAP diluted EPS are uncertain or out of our control and cannot be reasonably predicted. In particular, stock-based compensation expense is impacted by the future fair market value of our common stock and other factors, all of which are difficult to predict, subject to frequent change, or not within our control. The actual amount of these expenses during the fourth quarter of 2025 and fiscal year 2025 will have a significant impact on our future GAAP financial results. Accordingly, a reconciliation of adjusted EBITDA guidance to GAAP net income and non-GAAP diluted EPS guidance to GAAP diluted EPS is not available without unreasonable effort.
| UPWORK INC. RECONCILIATION OF GAAP TO NON-GAAP RESULTS (In thousands, except for percentages and share data) (Unaudited) | |||||||||||||||
| Three Months Ended September 30, | Nine Months Ended September 30, | ||||||||||||||
| 2025 | 2024 | 2025 | 2024 | ||||||||||||
| Net income | $ | 29,335 | $ | 27,758 | $ | 99,791 | $ | 68,420 | |||||||
| Add back (deduct): | |||||||||||||||
| Stock-based compensation expense | 19,789 | 18,578 | 48,038 | 54,758 | |||||||||||
| Depreciation and amortization | 7,946 | 3,668 | 18,686 | 10,443 | |||||||||||
| Other income, net | (5,917 | ) | (8,091 | ) | (18,112 | ) | (20,433 | ) | |||||||
| Income tax provision | 6,340 | 1,126 | 19,334 | 3,636 | |||||||||||
| Other(1) (2) | 2,134 | 188 | 4,962 | 563 | |||||||||||
| Adjusted EBITDA | $ | 59,627 | $ | 43,227 | $ | 172,699 | $ | 117,387 | |||||||
| Profit margin | 15 | % | 14 | % | 17 | % | 12 | % | |||||||
| Adjusted EBITDA margin | 30 | % | 22 | % | 29 | % | 20 | % | |||||||
| Cost of revenue, GAAP | $ | 45,843 | $ | 43,408 | $ | 131,081 | $ | 131,453 | |||||||
| Stock-based compensation expense | (193 | ) | (361 | ) | (580 | ) | (1,324 | ) | |||||||
| Cost of revenue, Non-GAAP | 45,650 | 43,047 | 130,501 | 130,129 | |||||||||||
| As a percentage of total revenue, GAAP | 23 | % | 22 | % | 22 | % | 23 | % | |||||||
| As a percentage of total revenue, Non-GAAP | 23 | % | 22 | % | 22 | % | 23 | % | |||||||
| Gross profit, GAAP | $ | 155,887 | $ | 150,368 | $ | 458,294 | $ | 446,389 | |||||||
| Stock-based compensation expense | 193 | 361 | 580 | 1,324 | |||||||||||
| Gross profit, Non-GAAP | 156,080 | 150,729 | 458,874 | 447,713 | |||||||||||
| Gross margin, GAAP | 77 | % | 78 | % | 78 | % | 77 | % | |||||||
| Gross margin, Non-GAAP | 77 | % | 78 | % | 78 | % | 77 | % | |||||||
| Research and development, GAAP | $ | 47,494 | $ | 50,411 | $ | 138,489 | $ | 155,792 | |||||||
| Stock-based compensation expense | (6,101 | ) | (8,053 | ) | (17,528 | ) | (23,529 | ) | |||||||
| Intangible amortization | (3,067 | ) | (398 | ) | (5,697 | ) | (1,196 | ) | |||||||
| Research and development, Non-GAAP | 38,326 | 41,960 | 115,264 | 131,067 | |||||||||||
| As a percentage of total revenue, GAAP | 24 | % | 26 | % | 23 | % | 27 | % | |||||||
| As a percentage of total revenue, Non-GAAP | 19 | % | 22 | % | 20 | % | 23 | % | |||||||
| Sales and marketing, GAAP | $ | 34,985 | $ | 46,093 | $ | 107,407 | $ | 141,277 | |||||||
| Stock-based compensation expense | (1,615 | ) | (3,225 | ) | (4,790 | ) | (9,554 | ) | |||||||
| Intangible amortization | (403 | ) | — | (1,236 | ) | — | |||||||||
| Sales and marketing, Non-GAAP | 32,967 | 42,868 | 101,381 | 131,723 | |||||||||||
| As a percentage of total revenue, GAAP | 17 | % | 24 | % | 18 | % | 24 | % | |||||||
| As a percentage of total revenue, Non-GAAP | 16 | % | 22 | % | 17 | % | 23 | % | |||||||
| General and administrative, GAAP | $ | 41,257 | $ | 31,276 | $ | 104,964 | $ | 93,201 | |||||||
| Stock-based compensation expense | (11,880 | ) | (6,939 | ) | (25,140 | ) | (20,351 | ) | |||||||
| Other(1) (2) | (2,134 | ) | (188 | ) | (4,962 | ) | (563 | ) | |||||||
| General and administrative, Non-GAAP | 27,243 | 24,149 | 74,862 | 72,287 | |||||||||||
| As a percentage of total revenue, GAAP | 20 | % | 16 | % | 18 | % | 16 | % | |||||||
| As a percentage of total revenue, Non-GAAP | 14 | % | 12 | % | 13 | % | 13 | % | |||||||
| Total operating expenses, GAAP | $ | 126,129 | $ | 129,575 | $ | 357,281 | $ | 394,766 | |||||||
| Stock-based compensation expense | (19,596 | ) | (18,217 | ) | (47,458 | ) | (53,434 | ) | |||||||
| Intangible amortization | (3,470 | ) | (398 | ) | (6,933 | ) | (1,196 | ) | |||||||
| Other(1) (2) | (2,134 | ) | (188 | ) | (4,962 | ) | (563 | ) | |||||||
| Total operating expenses, Non-GAAP | 100,929 | 110,772 | 297,928 | 339,573 | |||||||||||
| As a percentage of total revenue, GAAP | 63 | % | 67 | % | 61 | % | 68 | % | |||||||
| As a percentage of total revenue, Non-GAAP | 50 | % | 57 | % | 51 | % | 59 | % | |||||||
| Income from operations, GAAP | $ | 29,758 | $ | 20,793 | $ | 101,013 | $ | 51,623 | |||||||
| Stock-based compensation expense | 19,789 | 18,578 | 48,038 | 54,758 | |||||||||||
| Intangible amortization | 3,470 | 398 | 6,933 | 1,196 | |||||||||||
| Other(1) (2) | 2,134 | 188 | 4,962 | 563 | |||||||||||
| Income from operations, Non-GAAP | 55,151 | 39,957 | 160,946 | 108,140 | |||||||||||
| Net income, GAAP | $ | 29,335 | $ | 27,758 | $ | 99,791 | $ | 68,420 | |||||||
| Stock-based compensation expense | 19,789 | 18,578 | 48,038 | 54,758 | |||||||||||
| Intangible amortization | 3,470 | 398 | 6,933 | 1,196 | |||||||||||
| Tax effect of non-GAAP adjustments | (4,897 | ) | (7,762 | ) | (13,613 | ) | (20,150 | ) | |||||||
| Other(1) (2) | 2,134 | 188 | 4,962 | 563 | |||||||||||
| Net income, Non-GAAP | 49,831 | 39,160 | 146,111 | 104,787 | |||||||||||
| Weighted-average shares outstanding used in computing earnings per share, GAAP | |||||||||||||||
| Basic (in millions) | 132.0 | 132.6 | 133.1 | 133.4 | |||||||||||
| Diluted (in millions) | 139.7 | 139.3 | 140.9 | 140.6 | |||||||||||
| Basic earnings per share, GAAP | $ | 0.22 | $ | 0.21 | $ | 0.75 | $ | 0.51 | |||||||
| Diluted earnings per share, GAAP | $ | 0.21 | $ | 0.20 | $ | 0.72 | $ | 0.50 | |||||||
| Weighted-average shares outstanding used in computing earnings per share, Non-GAAP | |||||||||||||||
| Basic (in millions) | 132.0 | 132.6 | 133.1 | 133.4 | |||||||||||
| Diluted (in millions) | 139.7 | 139.3 | 140.9 | 140.6 | |||||||||||
| Basic earnings per share, Non-GAAP | $ | 0.38 | $ | 0.30 | $ | 1.10 | $ | 0.79 | |||||||
| Diluted earnings per share, Non-GAAP | $ | 0.36 | $ | 0.29 | $ | 1.05 | $ | 0.76 | |||||||
(1) During the three and nine months ended September 30, 2025 and 2024, we incurred
(2) During the three and nine months ended September 30, 2025, we incurred acquisition-related costs of
| UPWORK INC. RECONCILIATION OF CASH PROVIDED BY OPERATING ACTIVITIES TO FREE CASH FLOW (In thousands) (Unaudited) | ||||||||||||||||
| Three Months Ended September 30, | Nine Months Ended September 30, | |||||||||||||||
| 2025 | 2024 | 2025 | 2024 | |||||||||||||
| Cash provided by operating activities | $ | 75,079 | $ | 60,964 | $ | 184,558 | $ | 114,981 | ||||||||
| Less: purchases of property, plant & equipment and cash outflows from internally developed software | (5,648 | ) | (4,167 | ) | (18,711 | ) | (10,579 | ) | ||||||||
| Free cash flow | $ | 69,431 | $ | 56,797 | $ | 165,847 | $ | 104,402 | ||||||||
FAQ
What were Upwork (UPWK) Q3 2025 results for revenue and EPS?
How large was Upwork's adjusted EBITDA and margin in Q3 2025 (UPWK)?
Did Upwork (UPWK) change full‑year 2025 guidance and to what range?
What did Upwork announce about share repurchases in 2025 (UPWK)?
What acquisitions and enterprise moves did Upwork (UPWK) disclose in Q3 2025?
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