Fiverr handily beats analysts on Q2 loss

Fiverr IPO

In its first quarterly financials as a public company, freelancer platform Fiverr reported a loss per share of $0.19; the consensus estimate was $0.42.

Fiverr (NYSE: FVRR) today published its first results as a public company, after completing its IPO on the New York Stock Exchange two months ago. Fiverr's results were better than the analysts' estimates, especially in the bottom line. The company posted a net loss far smaller than expected. Fiverr's share price is currently up by nearly 4% on Wall Street. Fiverr has developed a trading platform that enables freelancers in diverse categories to offer their services to potential customers.

Fiverr posted $25.9 million revenue in the second quarter of 2019, higher than the analysts' estimates and 40.8% more than in the second quarter of 2018. The company's gross profit margin under GAAP accounting rules rose from 78.4% to 79.5%, but an rise in operating expenses led to a 41.4% increase in its operating loss to $9.3 million. Fiverr's net loss totaled $9.4 million.

On  a non-GAAP basis, Fiverr's net loss was $4.9 million, 12.8% less than in the corresponding quarter last year. Loss per share was $0.19, while the analysts expected $0.42 per share.

Fiverr's revenue in the first half of 2019 shot up 41.3% to $49.7 million, its GAAP net loss dropped 23% to $17.7 million, and its non-GAAP loss fell 21.5% to $10.1 million.

Like its revenue, Fiverr's adjusted EBITDA is improving, totaling minus $4.9 million in the second quarter, compared with minus $5.6 million in the second quarter of last year. Adjusted EBITDA in the first half of 2019 was down 20.8% to minus $10.3 million.

Fiverr reported a 14% rise to 2.2 million in the number of its active customers. Each buyer paid an average of $157, 16% more than the average paid by buyers in the corresponding quarter last year. In the 12 months to the end of June, Fiverr's take rate, the commission received by the company from each deal between a freelancer and a buyer (its net revenue from total collection) was 26.4%, compared with 24.7% in the preceding year.

“We are pleased to report strong results in our first quarter as a public company, highlighted by 41% year over year revenue growth along with solid growth in active buyers and spend per buyer,” said Fiverr CEO Micha Kaufman. “Over the coming quarters and years, we plan to execute on our strategy to drive sustainable growth, while making steady progress on our path to profitability. Our results demonstrate the power of our business model and we are heading into the second half of the year with strong momentum, backed by positive market trends for freelancers globally. We believe that Fiverr’s technology and value to buyers and sellers allow us to address a significant market opportunity and we have only begun to scratch the surface of what we can accomplish.”

"I’m very happy with our results this quarter and even more excited for the expected growth ahead in the second half of 2019 and for the coming years," Fiverr CFO Ofer Katz added.

Fiverr foresees $25.5-26.5 million revenue in the third quarter and $101.5-103.5 million for 2019 as a whole, 30-35% more than in the third quarter of 2018 and 34-37% more than in 2018 as a whole, respectively. The company projects minus $5-6 million in adjusted EBITDA in the third quarter and minus $20.5-21.5 million for 2019 as a whole.

Fiverr held its IPO in June this year at $21 per share, and its share price zoomed to $39.90 on its first day of trading. The share price later receded from this level, but at $26.85 (yesterday's closing price) is still 27.9% higher than the IPO price, giving the Tel Aviv-based company a $907 million market cap.

Published by Globes, Israel business news - - on August 8, 2019

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