Online freelance marketplace Fiverr (NYSE: FVRR) beat Wall Street’s revenue expectations in Q2 CY2025, with sales up 14.8% year on year to $108.6 million. On the other hand, next quarter’s revenue guidance of $107.5 million was less impressive, coming in 1.4% below analysts’ estimates. Its non-GAAP profit of $0.75 per share was 16% above analysts’ consensus estimates.
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Fiverr (FVRR) Q2 CY2025 Highlights:
- Revenue: $108.6 million vs analyst estimates of $107.7 million (14.8% year-on-year growth, 0.9% beat)
- Adjusted EPS: $0.75 vs analyst estimates of $0.65 (16% beat)
- Adjusted EBITDA: $21.45 million vs analyst estimates of $21.36 million (19.7% margin, in line)
- The company reconfirmed its revenue guidance for the full year of $431.5 million at the midpoint
- EBITDA guidance for the full year is $87 million at the midpoint, below analyst estimates of $87.64 million
- Operating Margin: -1.8%, in line with the same quarter last year
- Free Cash Flow Margin: 23%, down from 25.5% in the previous quarter
- Active Buyers: 3.4 million, down 488,000 year on year
- Market Capitalization: $898.1 million
“AI continues to be a power driver for everything we do, from rapid catalog expansion around AI-related services, to enabling transformative customer experiences, or driving workflow automation within Fiverr. Together with our continuous efforts in going upmarket, we are seeing encouraging growth trends for certain key verticals and high-value transactions,” said Micha Kaufman, founder and CEO of Fiverr.
Company Overview
Based in Tel Aviv, Fiverr (NYSE: FVRR) operates a fixed price global freelance marketplace for digital services.
Revenue Growth
A company’s long-term performance is an indicator of its overall quality. Any business can have short-term success, but a top-tier one grows for years. Unfortunately, Fiverr’s 8.8% annualized revenue growth over the last three years was mediocre. This wasn’t a great result compared to the rest of the consumer internet sector, but there are still things to like about Fiverr.
This quarter, Fiverr reported year-on-year revenue growth of 14.8%, and its $108.6 million of revenue exceeded Wall Street’s estimates by 0.9%. Company management is currently guiding for a 7.9% year-on-year increase in sales next quarter.
Looking further ahead, sell-side analysts expect revenue to grow 7.7% over the next 12 months, similar to its three-year rate. This projection doesn't excite us and indicates its products and services will face some demand challenges. At least the company is tracking well in other measures of financial health.
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Active Buyers
Buyer Growth
As a gig economy marketplace, Fiverr generates revenue growth by expanding the number of services on its platform (e.g. rides, deliveries, freelance jobs) and raising the commission fee from each service provided.
Fiverr struggled with new customer acquisition over the last two years as its active buyers have declined by 8.2% annually to 3.4 million in the latest quarter. This performance isn't ideal because internet usage is secular, meaning there are typically unaddressed market opportunities. If Fiverr wants to accelerate growth, it likely needs to enhance the appeal of its current offerings or innovate with new products. 
In Q2, Fiverr’s active buyers once again decreased by 488,000, a 12.6% drop since last year. The quarterly print was lower than its two-year result, suggesting its new initiatives aren’t moving the needle for buyers yet.
Revenue Per Buyer
Average revenue per buyer (ARPB) is a critical metric to track because it measures how much the company earns in transaction fees from each buyer. This number also informs us about Fiverr’s take rate, which represents its pricing leverage over the ecosystem, or "cut" from each transaction.
Fiverr’s ARPB growth has been exceptional over the last two years, averaging 20.6%. Although its active buyers shrank during this time, the company’s ability to successfully increase monetization demonstrates its platform’s value for existing buyers. 
This quarter, Fiverr’s ARPB clocked in at $31.96. It grew by 31.2% year on year, faster than its active buyers.
Key Takeaways from Fiverr’s Q2 Results
Revenue beat slightly and previously-provided revenue guidance was reiterated. On the other hand, its number of buyers declined and its number of active buyers fell short of Wall Street’s estimates. Overall, this quarter could have been better. The stock traded up 3% to $25.74 immediately following the results.
Big picture, is Fiverr a buy here and now? What happened in the latest quarter matters, but not as much as longer-term business quality and valuation, when deciding whether to invest in this stock. We cover that in our actionable full research report which you can read here, it’s free.
