What happened
Shares of Fiverr International (NYSE: FVRR) popped on Wednesday after the online freelance marketplace reported progress toward its long-term profit targets. As of 3:33 p.m. ET, Fiverr's stock price was up more than 18%.
So what
Fiverr's revenue rose 4% year over year to $83.1 million in the fourth quarter. The number of active buyers of freelance services on Fiverr's platform grew by 1% to 4.3 million. Additionally, spending per buyer increased by 8% to $262.
Fiverr now facilitates transactions in 600 service categories. New categories, such as artificial intelligence (AI), are helping to expand the company's addressable market and drive more buyers to its platform.
Fiverr is also expanding its service offerings. In turn, its take rate (revenue as a percentage of total spending) improved by 1 percentage point to 30.2%.
Moreover, cost-cutting initiatives helped Fiverr's adjusted earnings before interest, taxes, depreciation, and amortization (EBITDA) increase by 6%, to $9.4 million.
"With a shift in the macro environment and SMB [small and midsize business] sentiment, we quickly adjusted our business focus to drive efficiency," CEO Micha Kaufman said in a press release.
Now what
Looking ahead, management expects Fiverr's revenue to grow by 4% to 8% to between $350 million and $365 million in 2023. The company also forecast full-year adjusted EBITDA of $45 million to $55 million, which would be roughly twice as much as it generated in 2022.
"For 2023, we will build on the progress we made in the second half of last year and continue to make headway towards our long-term adjusted EBITDA margin target of 25%," Chief Financial Officer Ofer Katz said.
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Joe Tenebruso has no position in any of the stocks mentioned. The Motley Fool has positions in and recommends Fiverr International. The Motley Fool has a disclosure policy.
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