We use cookies to understand how you use our site and to improve your experience. This includes personalizing content and advertising. To learn more, click here. By continuing to use our site, you accept our use of cookies, revised Privacy Policy and Terms of Service.
You are being directed to ZacksTrade, a division of LBMZ Securities and licensed broker-dealer. ZacksTrade and Zacks.com are separate companies. The web link between the two companies is not a solicitation or offer to invest in a particular security or type of security. ZacksTrade does not endorse or adopt any particular investment strategy, any analyst opinion/rating/report or any approach to evaluating individual securities.
If you wish to go to ZacksTrade, click OK. If you do not, click Cancel.
For the fourth quarter of 2023, Upwork anticipates revenues between $175 million and $180 million. The Zacks Consensus Estimate for the same is currently pegged at $178.43 million, suggesting 10.52% growth from the year-ago period.
Non-GAAP diluted earnings are expected in the range of 16-18 cents per share. The Zacks Consensus Estimate for earnings has remained unchanged at 17 cents per share over the past 30 days, indicating growth of 325% from the year-ago period.
Markedly, Upwork’s earnings beat the Zacks Consensus Estimate in each of the trailing four quarters, the average being 326.89%.
Let’s see how things have shaped up prior to this announcement.
Upwork’s fourth-quarter performance is expected to have benefited from take rate expansion due to strength in the company’s ads products, its shift to a simplified, flat-fee pricing structure for freelancers and other monetization strategies implemented in 2023 to drive enhanced value and efficiency in the Marketplace business.
The total take rate in the third quarter was 17.1%, up from 16.3% in the previous quarter and 15.4% in the third quarter of 2022. The momentum is expected to have continued in the to-be-reported quarter.
Upwork is a standout in the world of freelance work, connecting businesses of all shapes and sizes with people around the globe.
The company’s top line is expected to have been aided by strong active client growth, driven by improved client retention and client acquisition in the to-be-reported quarter.
In the third quarter, active clients increased 2% year over year and quarter over quarter to approximately 836,000.
Managed Services is expected to have been positively impacted by clients moving from an Enterprise plan to a Managed Services plan.
This online talent marketplace provider has been striving hard to attract large business organizations to hire freelance talent through its Work Together Talent Grants program. A surge in hiring of freelance talent as businesses resort to stringent cost-saving practices is expected to have resulted in healthy adoption of UPWK’s services in the to-be-reported quarter.
Upwork signed 23 new Enterprise clients in the third quarter of 2023, representing a 21% sequential increase over new Enterprise client additions in the second quarter of 2023.
However, management remains cautious about some of the existing clients as they might curb spending on talent acquisition. Moreover, increased spending on product innovation is likely to have been a drag on profitability in the fourth quarter.
What Our Model Indicates
According to the Zacks model, the combination of a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) increases the odds of an earnings beat. But that’s not the case here.
Datadog has an Earnings ESP of 0.00% and sports a Zacks Rank #1 at present. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.
Stocks to Consider
Here are a few companies you may want to consider, as our model shows that these have the right combination of elements to post earnings beat in their upcoming releases.
Image: Bigstock
Factors Setting the Tone for Upwork's (UPWK) Q4 Earnings
Upwork (UPWK - Free Report) is set to release fourth-quarter 2023 results on Feb 14.
For the fourth quarter of 2023, Upwork anticipates revenues between $175 million and $180 million. The Zacks Consensus Estimate for the same is currently pegged at $178.43 million, suggesting 10.52% growth from the year-ago period.
Non-GAAP diluted earnings are expected in the range of 16-18 cents per share. The Zacks Consensus Estimate for earnings has remained unchanged at 17 cents per share over the past 30 days, indicating growth of 325% from the year-ago period.
Markedly, Upwork’s earnings beat the Zacks Consensus Estimate in each of the trailing four quarters, the average being 326.89%.
Let’s see how things have shaped up prior to this announcement.
Upwork Inc. Price and EPS Surprise
Upwork Inc. price-eps-surprise | Upwork Inc. Quote
Factors to Note
Upwork’s fourth-quarter performance is expected to have benefited from take rate expansion due to strength in the company’s ads products, its shift to a simplified, flat-fee pricing structure for freelancers and other monetization strategies implemented in 2023 to drive enhanced value and efficiency in the Marketplace business.
The total take rate in the third quarter was 17.1%, up from 16.3% in the previous quarter and 15.4% in the third quarter of 2022. The momentum is expected to have continued in the to-be-reported quarter.
Upwork is a standout in the world of freelance work, connecting businesses of all shapes and sizes with people around the globe.
The company’s top line is expected to have been aided by strong active client growth, driven by improved client retention and client acquisition in the to-be-reported quarter.
In the third quarter, active clients increased 2% year over year and quarter over quarter to approximately 836,000.
Managed Services is expected to have been positively impacted by clients moving from an Enterprise plan to a Managed Services plan.
This online talent marketplace provider has been striving hard to attract large business organizations to hire freelance talent through its Work Together Talent Grants program. A surge in hiring of freelance talent as businesses resort to stringent cost-saving practices is expected to have resulted in healthy adoption of UPWK’s services in the to-be-reported quarter.
Upwork signed 23 new Enterprise clients in the third quarter of 2023, representing a 21% sequential increase over new Enterprise client additions in the second quarter of 2023.
However, management remains cautious about some of the existing clients as they might curb spending on talent acquisition. Moreover, increased spending on product innovation is likely to have been a drag on profitability in the fourth quarter.
What Our Model Indicates
According to the Zacks model, the combination of a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) increases the odds of an earnings beat. But that’s not the case here.
Datadog has an Earnings ESP of 0.00% and sports a Zacks Rank #1 at present. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.
Stocks to Consider
Here are a few companies you may want to consider, as our model shows that these have the right combination of elements to post earnings beat in their upcoming releases.
Shopify (SHOP - Free Report) has an Earnings ESP of +1.02% and flaunts a Zacks Rank #1 at present. You can see the complete list of today’s Zacks #1 Rank stocks here.
Shopify is scheduled to release fourth-quarter 2023 results on Feb 13. Shares of SHOP have gained 12.8% in the year-to-date period.
Twilio (TWLO - Free Report) has an Earnings ESP of +31.37% and a Zacks Rank #2 at present.
Twilio is set to announce fourth-quarter 2023 results on Feb 14. Shares of TWLO have lost 7.3% in the year-to-date period.
Airbnb (ABNB - Free Report) has an Earnings ESP of +4.73% and a Zacks Rank #2 at present.
Airbnb is set to announce fourth-quarter 2023 results on Feb 13. Shares of ABNB have gained 10.6% in the year-to-date period.
Stay on top of upcoming earnings announcements with the Zacks Earnings Calendar.