Fiverr’s Services Revenue Soars 102% on Subscription Demand

Fiverr’s fourth-quarter earnings results, released Wednesday (Feb. 19), showed traction in the company’s services business, which includes subscription-based revenues, cementing freelancers’ relationships with buyers over several months.

However, a muted macro environment persists, as noted during an earnings call, seemingly trumping better-than-expected guidance.

A shareholder letter detailed that revenue came in higher than had been guided for the fourth quarter, at $103.7 million, up 13.3%; guidance had looked for a 9% to 12% gain. Services revenue soared by more than 102% year over year to $30.1 million.

Revenue growth in the current quarter is expected to accelerate to a range of 11% to 16% year over year, per the letter.

Investors sent the shares lower, however, by 7% at the start of trading Wednesday, as EBITDA guidance was below estimates. And active buyers — the Fiverr clients that purchase services and contract with freelancers — were down from last year’s 4 million, now standing at 3.6 million. Spend per buyer was up 9% year on year to $302, according to the letter.

“We are also seeing more new buyers coming with more complex project needs in more complex categories,” the letter said. “For example, 11% of new buyers in 2024 came from the Programming and Tech vertical, compared to 7% five years ago, and they are spending much more than new buyers in other verticals.”

Fiverr CEO Micha Kaufman said on the earnings call that the company’s latest results were “no small feat, especially at a time when our entire industry is facing macro headwinds” and where diversification of the business within the services segment has driven growth.

“Hundreds of thousands of freelancers see Fiverr as the go-to platform to build and grow their careers,” Kaufman said during the call.

With a nod to the evolving artificial intelligence landscape, Kaufman pointed to the Tuesday (Feb. 18) launch of Fiverr Go, the company’s platform for AI tools that he said allow freelancers to become a “one-person production house.”

“The personalized AI assistant on Fiverr Go can communicate with potential clients when the freelancer is away or busy, handle routine tasks and provide actionable business insights — effectively becoming the creator’s business partner.”

Chief Financial Officer Ofer Katz said on the call: “While we have yet to see meaningful improvements on the macro front in terms of incentive sentiment of freelancer hiring demand, we are able to deliver growth catalyst through strong execution and expansion of value-added products… I believe we are kicking off 2025 with a solid financial position and strong business momentum.”

“We are also seeing larger and more complex projects show robust growth with GMV from a project of over $500 growing 8% year over year in 2024 compared to 2023,” he said during the call. “Going into 2025, given that marketplace revenue is largely tied to GMV volume, and we have yet to see signs of macro improvement, we expect that growth of this revenue segment will continue to be muted… Given that macro rebound is a matter of when, not if, when it does rebound, we expect our marketplace will be one of the first areas to experience the uplift.”

Services revenue will continue to grow at a “healthy double-digit rate” during 2025, he said.

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