Upwork Inc. presented the results of its third quarter of 2025 and outlined a long‑term growth strategy at its Investor Day on November 18 2025. The company reported revenue of $201.7 million, up 4 % year‑over‑year, and adjusted EBITDA of $59.6 million, a 30 % margin that represents a 7.7‑percentage‑point increase over the 22.3 % margin reported in Q3 2024.
Revenue growth was driven by a mix of higher‑margin enterprise contracts and a steady expansion of the SMB segment. Enterprise revenue, which accounts for roughly 45 % of total revenue, grew 7 % to $90.1 million, while the SMB Business Plus offering, representing about 35 % of revenue, increased 5 % to $70.5 million. The core marketplace, which makes up the remaining 20 %, grew 3 % to $41.1 million. The stronger enterprise mix and the continued uptake of the SMB platform together offset modest headwinds in the core marketplace.
The jump in adjusted EBITDA margin to 30 % from 22.3 % in the same quarter last year reflects both a higher mix of high‑margin enterprise work and operational efficiencies from the company’s AI‑native platform. Cost controls in support services and a lower proportion of lower‑margin marketplace transactions contributed to the margin expansion, while the company’s investment in AI tooling has begun to pay off in terms of higher pricing power and reduced manual labor costs.
Management raised its full‑year 2025 revenue guidance to $4.396 billion–$4.400 billion from the previous $4.14 billion–$4.15 billion range, and adjusted EBITDA guidance to $2.151 billion–$2.155 billion, signaling confidence in the company’s ability to scale the AI platform and capture additional market share. The company also projected a 7‑9 % compound annual growth rate for gross service value (GSV) and a 13‑15 % CAGR for revenue through 2028, with an expected adjusted EBITDA margin of about 29 % in 2026.
The Investor Day highlighted three strategic pillars: an AI‑native platform that integrates the Uma AI agent, expansion of the Lifted enterprise solution targeting a $650 billion contingent‑labor market, and a focus on SMBs through the Business Plus offering aimed at a $530 billion market. These initiatives are designed to capture a larger share of the $1.3 trillion digital knowledge‑work market and to drive both top‑line growth and margin expansion.
CEO Hayden Brown emphasized the company’s transformation, stating, “We are entering Upwork’s most exciting chapter yet, with a new AI‑native platform built to serve businesses of all sizes.” CFO Erica Gessert highlighted the record margin, noting, “Our accelerated long‑term targets paired with our commitment to margin growth reflect the results of this transformation and the structural advantage of our business model in the AI era.”
Analysts noted the strong margin expansion and the company’s clear focus on AI as key drivers of the positive reaction to the guidance. The updated outlook and the emphasis on high‑margin enterprise and SMB growth were seen as evidence of Upwork’s confidence in sustaining accelerated growth.
Management acknowledged macro uncertainty as a headwind but expressed confidence in pricing power and cost discipline. The company’s continued investment in AI and its focus on high‑return verticals were highlighted as mitigating factors that support the long‑term growth trajectory.
The content on BeyondSPX is for informational purposes only and should not be construed as financial or investment advice. We are not financial advisors. Consult with a qualified professional before making any investment decisions. Any actions you take based on information from this site are solely at your own risk.