Fiverr International Ltd. Q4 FY2024 earnings call

• Q4 2024 saw 13% revenue growth and a 20% adjusted EBITDA margin, putting Fiverr in the elite group hitting the Rule of 30.
• Focused on quality of revenue in Marketplace and expanding offerings/diversifying revenue in Services.
• Launched Fiverr Go, an open platform for personalized AI tools including an AI personal assistant and creation model, designed to give creators control over their creative process and rights.
• Announced a Freelancer Equity Program, an industry-first initiative to give top-performing freelancers equity shares of Fiverr.
• Marketplace revenue growth muted due to macro headwinds, but buyers with annual spend over $10,000 showed resilient growth, and GMV from projects over $500 grew 8% in 2024. Services revenue growing strongly, expected to reach over 30% of total revenue in 2025.

For the full year 2024, Marketplace revenue was $303.1 million, driven by 3.6 million annual active buyers, $302 annual spend per buyer, and a 27.6% Marketplace take rate. Services revenue was $88.4 million, representing year-over-year growth of 62%, and accounted for 23% of total revenue in 2024, up from 15% in 2023. Marketplace revenue comes from transaction commissions on orders completed, while Services revenue is from subscription products (e.g., Seller Plus, AutoDS), advertising services (Fiverr Ads), and other optional value-added services.

• For full year 2025, expected revenue range $422 million to $438 million (8%-12% y-o-y growth), adjusted EBITDA range $82 million to $90 million (20% midpoint margin).
• First quarter 2025 revenue expected $103.5 million to $108.5 million (11%-16% y-o-y growth), adjusted EBITDA $18 million to $20 million (18% midpoint margin).
• Services revenue expected to continue growing at double-digit rate, reaching over 30% of total revenue in 2025. Growth in first half of 2025 higher due to lapping Fiverr Ads expansion, Kickstart Program launch, and AutoDS inclusion; adjusted EBITDA margin improvement lower in first half due to Fiverr Go investment acceleration.

• Macro headwinds impacting SMB sentiment and freelancer hiring demand.
• AI advancement threatening freelancers' creative assets and rights, though Fiverr Go is designed to address this by keeping creators at the center.
• Uncertainty around the pace of macro rebound and its impact on Marketplace revenue growth.

Q: How should we think about Fiverr Go's impact on conversion over medium to long-term?

A: Fiverr Go's AI personal assistant helps convert customers by addressing questions immediately even if freelancer is away, and the creation model gives customers confidence in freelancer style, with many assistants already converting customers.

Q: Any impact of FX on 2025 guidance?

A: No material impact on top line as prices are in US dollar; OpEx hedged to cover any material EBITDA impact.

Q: Thoughts on SMB sentiment improvement translating to Fiverr timing?

A: No identified trend yet; too early to close on SMB sentiment improvement trend.

Q: Genesis behind Freelancer Equity Program?

A: To give top-performing freelancers equity shares, as they help shape future of work and Fiverr has been wanting to do this for a while, details to be in F3 filing.