UpWork (NASDAQ: UPWK) went public on October 3, 2018, and its stock has since risen by over 60%. The company is a leading freelancer platform that connects businesses with remote workers. UpWork is a popular choice for businesses because it offers access to a global pool of talent, and freelancers can work from anywhere.
So, is UpWork a good stock to buy? Let’s take a closer look at the company’s financials to find out.
UpWork reported revenue of $168.2 million in the first quarter of 2019, an increase of 36% year-over-year. The company’s net loss was $4.9 million, or $0.08 per share. On a non-GAAP basis, UpWork’s net loss was $2.5 million, or $0.04 per share.
The company’s revenue growth is being driven by an increase in the number of paying clients and higher spending by existing clients. UpWork now has over 2 million active clients, an increase of 30% year-over-year. And the average client spends $2,700 per year on the platform, up from $2,200 in the prior year period.
UpWork’s gross margin improved to 67% in the first quarter of 2019 from 63% in the prior year period. The company’s operating expenses also increased, rising by 33% year-over-year to $61.6 million.
So far this year, UpWork has been profitable on a GAAP basis in two out of three quarters. And on a non-GAAP basis, the company has been profitable in all three quarters.
Looking ahead, UpWork expects to generate revenue of $185-$188 million in the second quarter of 2019 and Adjusted EBITDA of $5-$7 million. For the full year 2019, UpWork expects revenue to grow by 32%-34% to $745-$755 million and Adjusted EBITDA to be in the range of $31-$33 million.
Based on UpWork’s strong financial results and bullish guidance, I believe that the stock is a good buy at current levels.
