EX-99.1 2 exhibit_99-1.htm EXHIBIT 99.1
Exhibit 99.1

Fiverr Announces Fourth Quarter and Full Year 2024 Results
 

 ●
Delivered an outstanding year of growth and profitability. We finished 2024 on a strong note, with double-digit revenue growth and a 20.0% Adjusted EBITDA margin for Q4’24. Our strong execution of upmarket initiatives such as Fiverr Pro and Dynamic Matching, and our strategy to expand Services revenue as a key growth catalyst, allowed us to deliver results ahead of expectations.

●
Introduced an open platform for first-of-its-kind Generative AI solutions for creators and customers: Fiverr Go is a human-centered AI platform that unites businesses, creative talent and AI developers all in one place. It leverages Fiverr’s massive first-party transaction data and creates a revolutionary platform that gives talent full control and pricing power over their AI counterparts.

●
Announcing industry-first Freelancer Equity Program: The program is designed to reward high-performing Fiverr freelancers by granting ordinary shares of Fiverr based on their annual earnings growth on the platform. With this initiative, Fiverr is deepening its commitment to independent talent by giving top creators a real stake in our growth. Just as Fiverr Go empowers freelancers to scale like never before, this program ensures they’re not just shaping the future of work - they own a piece of it.

●
Going upmarket continues to be a key focus: With the rollout of multi-tier subscription plans of Fiverr Pro, as well as the addition of Team Accounts for freelancers and agencies, we continue to focus on driving upmarket in terms of growing buyers with larger spending capacity as well as enabling larger sellers and more complex projects to transact on the platform.

●
Strong setup for 2025: Our guidance for 2025 implied double-digit revenue growth at the midpoint and continued steady progress toward our three-year targets laid out in 2024. We believe the strong momentum in Services revenue will serve as a short-term growth catalyst, while our investments in upmarket initiatives and AI will position us for long-term growth opportunities.

NEW YORK, February 19, 2025 - Fiverr International Ltd. (NYSE: FVRR), the company that is changing how the world works together, today reported financial results for the fourth quarter and full year 2024. Additional operating results and management commentary can be found in the Company’s shareholder letter, which is posted to its investor relations website at investors.fiverr.com.
 
“We delivered strong results for 2024, finishing the year well ahead of our initial targets, with double-digit revenue growth and robust margins. We continue to focus on our upmarket initiatives while strategically expanding Services revenue to drive further growth. It has been a year of significant innovation and investment in AI. Our latest launch, the revolutionary and unique human-centered AI platform Fiverr Go, allows our talent community to build their own creation models, control their creative rights, and take their business to the next level,” said Micha Kaufman, founder and CEO of Fiverr. “We started off 2025 with significant momentum in our product pipeline, growth trajectory and investments, giving us confidence in the long-term opportunity ahead.”
 
"Throughout 2024 we successfully exceeded expectations on both top and bottom lines. Our ability to deliver growth, while showing continued discipline in driving profitability, demonstrates our steady progress towards achieving our Adjusted EBITDA and free cash flow three-year targets” said Ofer Katz, President and CFO of Fiverr. “We will continue to execute a thoughtful capital allocation strategy, balancing the need for growth as well as returning capital to shareholders. The guidance we gave for 2025 reflects our optimism as we expect to maintain momentum in Services revenue, continue upmarket investments, and lead in AI innovation.”
 
Fourth Quarter 2024 Financial Highlights
 
●
Revenue in the fourth quarter of 2024 was $103.7 million, compared to $91.5 million in the fourth quarter of 2023, an increase of 13.3% year over year.
●
Marketplace revenue in the fourth quarter of 2024 was $73.5 million, compared to $76.6 million in the fourth quarter of 2023, representing a decline of 4.0% year over year.
●
Annual active buyers1 as of December 31, 2024 was 3.6 million, compared to 4.0 million as of December 31, 2023, a decline of 10% year over year.
●
Annual spend per buyer1 as of December 31, 2024 reached $302, compared to $278 as of December 31, 2023, an increase of 9% year over year.
●
Marketplace take rate1 for the period ended December 31, 2024 was 27.6%, up from 27.4% for the period ended December 31, 2023, an increase of 20 basis points year over year.
●
Services revenue in the fourth quarter of 2024 was $30.2 million, compared to $14.9 million in the fourth quarter of 2023, representing an increase of 102.1% year over year.
●
GAAP gross margin in the fourth quarter of 2024 was 80.5%, a decrease of 260 basis points from 83.1% in the fourth quarter of 2023. Non-GAAP gross margin1 in the fourth quarter of 2024 was 84.0%, a decrease of 60 basis points from 84.6% in the fourth quarter of 2023.

●
GAAP net income in the fourth quarter of 2024 was $12.8 million, or $0.36 basic net income per share and $0.33 diluted net income per share, compared to $4.7 million net income, or $0.12 basic and diluted net income per share in the fourth quarter of 2023.
●
Non-GAAP net income1 in the fourth quarter of 2024 was $24.9 million, or $0.70 basic non-GAAP net income per share1 and $0.64 diluted non-GAAP net income per share1, compared to $23.1 million non-GAAP net income1, or $0.60 basic non-GAAP net income per share1 and $0.56 diluted non-GAAP net income per share1, in the fourth quarter of 2023.
●
Net cash provided by operating activities in the fourth quarter of 2024 was $30.0 million, compared to $27.5 million in the fourth quarter of 2023, an increase of 9.0% year over year.
●
Free cash flow1 in the fourth quarter of 2024 was $29.6 million, compared to $27.4 million in the fourth quarter of 2023, an increase of 8.1% year over year.
●
Adjusted EBITDA1 in the fourth quarter of 2024 was $20.7 million, compared to $16.1 million in the fourth quarter of 2023. Adjusted EBITDA margin1 was 20.0% in the fourth quarter of 2024, compared to 17.6% in the fourth quarter of 2023, representing a 240 basis points improvement year over year.

Full Year 2024 Financial Highlights

●
Revenue in 2024 was $391.5 million, compared to $361.4 million in 2023, an increase of 8.3% year over year.
●
Marketplace revenue in 2024 was $303.1 million, compared to $307.0 million in 2023, representing a decline of 1.3% year over year.
●
Services revenue in 2024 was $88.4 million, compared to $54.4 million in 2023, representing an increase of 62.5% year over year.
●
GAAP gross margin in 2024 was 82.0%, a decrease of 90 basis points from 82.9% in 2023. Non-GAAP gross margin1 in 2024 was 84.3%, a decrease of 20 basis points from 84.5% in 2023.
●
GAAP net income in 2024 was $18.2 million, or $0.49 basic net income per share and $0.48 diluted net income per share, compared to a net income of $3.7 million, or $0.10 basic net income per share and $0.09 diluted net income per share in 2023.
●
Non-GAAP net income1 in 2024 was $95.1 million, or $2.57 basic Non-GAAP net income per share1 and $2.38 diluted Non-GAAP net income per share1, compared to $80.4 million, or $2.11 basic Non-GAAP net income per share1 and $1.95 diluted Non-GAAP net income per share1, in 2023.


1 This is a non-GAAP financial measure or Key Performance Metric. See “Key Performance Metrics and Non-GAAP Financial Measures” and reconciliation tables at the end of this release for additional information regarding the non-GAAP metrics and Key Performance Metrics used in this release.

●
Net cash provided by operating activities in 2024 was $83.1 million. Net cash provided by operating activities, excluding one-time escrow payment for contingent consideration of $12.2 million, was $95.3 million in 2024, compared to $83.2 million in 2023.
●
Free cash flow1 in 2024 was $81.7 million. Free cash flow1, excluding one-time escrow payment for contingent consideration of $12.2 million, was $93.9 million in 2024 compared to $82.1 million in 2023, an increase of 14.3% year over year.
●
Adjusted EBITDA in 2024 was $74.2 million, compared to $59.2 million in 2023. Adjusted EBITDA margin was 19.0% in 2024, an increase of 260 basis points from 16.4% in 2023.

Financial Outlook

Our Q1’25 and full-year 2025 guidance reflect the recent trends in our marketplace.

 
Q1 2025
FY 2025
Revenue
$103.5 - $108.5 million
$422.0 - $438.0 million
y/y growth
11% - 16% y/y growth
8% - 12% y/y growth
Adjusted EBITDA(1)
$18.0 - $20.0 million
$82.0 - $90.0 million

Conference Call and Webcast Details

Fiverr’s management will host a conference call to discuss its financial results on Wednesday, February 19, 2025, at 8:00 a.m. Eastern Time. A live webcast of the call can be accessed from Fiverr’s Investor Relations website. An archived version will be available on the website after the call. To participate in the conference call, please register using the link here.

About Fiverr

Fiverr’s mission is to change how the world works together. We exist to democratize access to talent and to provide talent with access to opportunities so anyone can grow their business, brand, or dreams. From small businesses to Fortune 500, around 4 million customers worldwide worked with freelance talent on Fiverr in the past year, ensuring their workforces remain flexible, adaptive, and agile. With Fiverr Business Solutions, large companies can find the right talent and tools tailored to their needs to help them thrive and grow. On Fiverr, you can find over 700 skill categories, ranging from AI to programming and 3D design, digital marketing to content creation, and from video animation to architecture.

Don’t get left behind - come be a part of the future of work by visiting fiverr.com, reading our blog, and following us on Instagram, X, and Facebook.

Investor Relations:
Jinjin Qian
investors@fiverr.com

Press:
Jenny Chang
press@fiverr.com

Source: Fiverr International Ltd.

CONSOLIDATED BALANCE SHEETS
(In thousands)

   
December 31,
    
December 31,
  
   
2024
    
2023
  
   
(Audited)
    
(Audited)
  
Assets
            
Current assets:
            
Cash and cash equivalents
  
$
133,472
    
$
183,674
  
Marketable securities
    
288,947
      
147,806
  
User funds
    
153,309
      
151,602
  
Bank deposits
    
144,843
      
85,893
  
Restricted deposit
    
1,315
      
1,284
  
Other receivables
    
34,198
      
24,217
  
Total current assets
    
756,084
      
594,476
  
                 
Long-term assets:
                
Marketable securities
    
122,009
      
328,332
  
Property and equipment, net
    
4,271
      
4,735
  
Operating lease right of use asset
    
5,122
      
6,720
  
Intangible assets, net
    
41,882
      
10,722
  
Goodwill
    
110,218
      
77,270
  
Other non-current assets
    
30,388
      
1,349
  
Total long-term assets
    
313,890
      
429,128
  
                 
TOTAL ASSETS
  
$
1,069,974
    
$
1,023,604
  
                 
Liabilities and Shareholders' Equity
                
Current liabilities:
                
Trade payables
  
$
5,533
    
$
5,494
  
User accounts
    
141,691
      
142,203
  
Deferred revenue
    
20,090
      
11,047
  
Other account payables and accrued expenses
    
57,167
      
44,110
  
Operating lease liabilities
    
2,608
      
2,571
  
Convertible notes, net
    
457,860
      
-
  
Total current liabilities
    
684,949
      
205,425
  
                 
Long-term liabilities:
                
Convertible notes, net
    
-
      
455,305
  
Operating lease liabilities
    
2,747
      
4,482
  
Other non-current liabilities
    
19,628
      
2,618
  
Total long-term liabilities
    
22,375
      
462,405
  
                 
TOTAL LIABILITIES
  
$
707,324
    
$
667,830
  
                 
Shareholders' equity:
                
Share capital and additional paid-in capital
    
727,176
      
640,846
  
Accumulated deficit
    
(366,193
)
    
(284,358
)
Accumulated other comprehensive income (loss)
    
1,667
      
(714
)
Total shareholders' equity
    
362,650
      
355,774
  
                 
TOTAL LIABILITIES AND SHAREHOLDERS' EQUITY
  
$
1,069,974
    
$
1,023,604
  

CONSOLIDATED STATEMENTS OF OPERATIONS
(In thousands, except share and per share data)

   
Three Months Ended
    
Year Ended
  
   
December 31,
    
December 31,
  
 
  
2024
    
2023
    
2024
    
2023
  
   
(Unaudited)
    
(Audited)
  
Revenue
 
$
103,666
    
$
91,502
    
$
391,481
    
$
361,375
  
Cost of revenue
   
20,201
      
15,473
      
70,566
      
61,846
  
Gross profit
   
83,465
      
76,029
      
320,915
      
299,529
  
                                 
Operating expenses:
                                
Research and development
   
22,329
      
22,054
      
90,241
      
90,720
  
Sales and marketing
   
45,232
      
39,767
      
171,678
      
161,208
  
General and administrative
   
21,782
      
15,816
      
74,814
      
62,710
  
Total operating expenses
   
89,343
      
77,637
      
336,733
      
314,638
  
Operating loss
   
(5,878
)
    
(1,608
)
    
(15,818
)
    
(15,109
)
Financial income (expenses), net
   
5,662
      
6,914
      
27,706
      
20,163
  
Income (loss) before taxes on income
    
(216
)
    
5,306
      
11,888
      
5,054
  
Tax benefit (taxes on income)
    
13,054
      
(605
)
    
6,358
      
(1,373
)
Net income attributable to ordinary shareholders
  
$
12,838
    
$
4,701
    
$
18,246
    
$
3,681
  
Basic net income per share attributable to ordinary shareholders
 
$
0.36
    
$
0.12
    
$
0.49
    
$
0.10
  
Basic weighted average ordinary shares
   
35,658,287
      
38,501,155
      
36,984,757
      
38,066,203
  
Diluted net income per share attributable to ordinary shareholders
 
$
0.33
    
$
0.12
    
$
0.48
    
$
0.09
  
Diluted weighted average ordinary shares
   
38,947,644
      
39,286,967
      
37,840,154
      
39,151,047
  

CONSOLIDATED STATEMENTS OF CASH FLOWS
(In thousands)

   
Three Months Ended
    
Year Ended
  
   
December 31,
    
December 31,
  
   
2024
    
2023
    
2024
    
2023
  
   
(Uaudited)
    
(Audited)
  
Cash flows from operating activities:
                        
Net income
  
$
12,838
    
$
4,701
      
18,246
    
$
3,681
  
Adjustments to reconcile net income to net cash provided by operating activities:
                                
Depreciation and amortization
    
4,328
      
1,287
      
10,476
      
5,987
  
Amortization of premium and accretion of discount of marketable securities, net
    
(1,647
)
    
(1,841
)
    
(4,753
)
    
(730
)
Amortization of discount and issuance costs of convertible notes
    
640
      
637
      
2,555
      
2,541
  
Shared-based compensation
    
18,020
      
16,792
      
73,942
      
68,698
  
Exchange rate fluctuations and other items, net
    
166
      
(214
)
    
226
      
71
  
Impairment of lease ROU asset
    
-
      
211
      
-
      
211
  
Revaluation of Earn-out
    
3,059
      
(570
)
    
3,202
      
(570
)
Changes in assets and liabilities:
                                
User funds
    
6,017
      
8,880
      
(1,707
)
    
(8,582
)
Operating lease ROU assets and liabilities
    
89
      
358
      
(104
)
    
(205
)
Other receivables
    
(12,250
)
    
3,379
      
(18,316
)
    
(2,877
)
Trade payables
    
2,653
      
2,099
      
(409
)
    
(3,195
)
Deferred revenue
    
484
      
(1,989
)
    
2,275
      
(306
)
User accounts
    
(6,597
)
    
(7,140
)
    
(512
)
    
9,171
  
Payment of earn out
    
(843
)
    
-
      
(843
)
    
-
  
Escrow payment for contingent consideration
    
-
      
-
      
(12,168
)
    
-
  
Account payable, accrued expenses and other
    
1,098
      
752
      
7,967
      
8,232
  
Non-current liabilities
    
1,979
      
207
      
2,991
      
1,059
  
Net cash provided by operating activities
    
30,034
      
27,549
      
83,068
      
83,186
  
                                 
Investing Activities:
                                
Investment in marketable securities
    
(56,606
)
    
(46,394
)
    
(87,340
)
    
(309,155
)
Proceeds from maturities of marketable securities
    
25,361
      
40,780
      
159,216
      
273,186
  
Investment in short-term bank deposits
    
(20,007
)
    
-
      
(66,357
)
    
-
  
Proceeds from short-term bank deposits
    
-
      
31,245
      
8,213
      
46,858
  
Acquisition of business, net of cash acquired
    
(383
)
    
-
      
(39,738
)
    
-
  
Acquisition of intangible asset
    
(1,106
)
    
-
      
(1,106
)
    
-
  
Purchase of property and equipment
    
(326
)
    
(135
)
    
(1,303
)
    
(1,053
)
Capitalization of internal-use software
    
(83
)
    
(3
)
    
(103
)
    
(60
)
Other receivables and non-current assets
    
-
      
-
      
(300
)
    
-
  
Net cash provided by (used in) investing activities
    
(53,150
)
    
25,493
      
(28,818
)
    
9,776
  
                                 
Financing Activities
                                
Repurchases of ordinary shares
    
-
      
-
      
(100,081
)
    
-
  
Proceeds from exercise of share options
    
989
      
364
      
3,349
      
2,765
  
Payment of earn out
    
(4,357
)
    
-
      
(4,357
)
    
-
  
Proceeds from (payments of) withholding tax related to employees' exercises of share options and RSUs
     879
       163
       859
       87
  
Repayment of debt to previous shareholder of the acquired business
    
-
      
-
      
(3,992
)
    
-
  
Net cash provided by (used in) financing activities
    
(2,489
)
    
527
      
(104,222
)
    
2,852
  
                                 
Effect of exchange rate fluctuations on cash and cash equivalents
    
(168
)
    
220
      
(230
)
    
(29
)
                                 
Increase (decrease) in cash, cash equivalents
   
(25,773
)
    
53,789
      
(50,202
)
    
95,785
  
Cash, cash equivalents at the beginning of period
    
159,245
      
129,885
      
183,674
      
87,889
  
Cash and cash equivalents at the end of period
  
$
133,472
    
$
183,674
      
133,472
    
$
183,674
  

REVENUE BREAKDOWN
(In thousands1)

   
Three Months Ended
    
Year Ended
  
   
December 31,
    
December 31,
  
   
2024
    
2023
    
2024
    
2023
  
Marketplace Revenue
  
$
73,510
    
$
76,583
    
$
303,069
    
$
306,981
  
   Annual Active Buyers
    
3,630
      
4,027
      
3,630
      
4,027
  
   Annual Spend per Buyer
  
$
302
    
$
278
    
$
302
    
$
278
  
   Marketplace Take Rate
    
27.6
%
    
27.4
%
    
27.6
%
    
27.4
%
                                 
Services Revenue
  
$
30,156
    
$
14,919
    
$
88,412
    
$
54,394
  
Total Revenue
  
$
103,666
    
$
91,502
    
$
391,481
    
$
361,375
  


1.
Except for Annual Spend per Buyer and Marketplace Take Rate.

RECONCILIATION OF GAAP TO NON-GAAP GROSS PROFIT
(In thousands, except gross margin data)

 
  
Q4'23
    
Q1'24
    
Q2'24
    
Q3'24
    
Q4'24
    
FY 2023
    
FY 2024
  
   
(Uaudited)
    
(Audited)
    
(Audited)
  
GAAP gross profit
  
$
76,029
    
$
78,076
    
$
78,639
    
$
80,735
    
$
83,465
    
$
299,529
    
$
320,915
  
Add:
                                                        
Share-based compensation
    
633
      
678
      
499
      
514
      
445
      
2,497
      
2,136
  
Depreciation and amortization
    
709
      
613
      
791
      
2,415
      
3,198
      
3,253
      
7,017
  
Earn-out revaluation, acquisition related costs and other
    
-
      
-
      
-
      
11
      
17
      
-
      
28
  
Non-GAAP gross profit
  
$
77,371
    
$
79,367
    
$
79,929
    
$
83,675
    
$
87,125
    
$
305,279
    
$
330,096
  
Non-GAAP gross margin
    
84.6
%
    
84.9
%
    
84.4
%
    
84.0
%
    
84.0
%
    
84.5
%
    
84.3
%

RECONCILIATION OF GAAP NET INCOME TO NON-GAAP NET INCOME AND NET
INCOME PER SHARE
(In thousands, except share and per share data)

 
  
Q4'23
    
Q1'24
    
Q2'24
    
Q3'24
    
Q4'24
    
FY 2023
    
FY 2024
  
   
(Uaudited)
    
(Audited)
    
(Audited)
  
GAAP net income attributable to ordinary shareholders
  
$
4,701
    
$
788
    
$
3,267
    
$
1,353
    
$
12,838
    
$
3,681
    
$
18,246
  
Add:
                                                        
Depreciation and amortization
    
1,287
      
1,150
      
1,606
      
3,392
      
4,328
      
5,987
      
10,476
  
Share-based compensation
    
16,792
      
19,020
      
18,438
      
18,464
      
18,020
      
68,698
      
73,942
  
Earn-out revaluation, acquisition related costs and other
    
(359
)
    
9
      
109
      
1,273
      
4,240
      
(359
)
    
5,631
  
Convertible notes amortization of discount and issuance costs
    
637
      
637
      
638
      
640
      
640
      
2,541
      
2,555
  
Taxes on income related to non-GAAP adjustments
    
-
      
-
      
(71
)
    
(290
)
    
(16,249
)
    
-
      
(16,610
)
Exchange rate (gain)/loss, net
    
42
      
128
      
(156
)
    
(221
)
    
1,108
      
(131
)
    
859
  
Non-GAAP net income
 
$
23,100
    
$
21,732
    
$
23,831
    
$
24,611
    
$
24,925
    
$
80,417
    
$
95,099
  
Weighted average number of ordinary shares - basic
    
38,501,155
      
38,756,151
      
38,089,060
      
35,435,532
      
35,658,287
      
38,066,203
      
36,984,757
  
Non-GAAP basic net income per share attributable to ordinary shareholders
  
$
0.60
    
$
0.56
    
$
0.63
    
$
0.69
    
$
0.70
    
$
2.11
    
$
2.57
  
                                                         
Weighted average number of ordinary shares - diluted
    
41,440,827
      
41,758,840
      
40,909,724
      
38,359,853
      
38,947,644
      
41,304,907
      
39,994,015
  
Non-GAAP diluted net income per share attributable to ordinary shareholders
  
$
0.56
    
$
0.52
    
$
0.58
    
$
0.64
    
$
0.64
    
$
1.95
    
$
2.38
  

RECONCILIATION OF GAAP NET INCOME TO ADJUSTED EBITDA
(In thousands, except Adjusted EBITDA margin data)

 
  
Q4'23
    
Q1'24
    
Q2'24
    
Q3'24
    
Q4'24
    
FY 2023
    
FY 2024
  
   
(Uaudited)
    
(Audited)
    
(Audited)
  
GAAP net income
  
$
4,701
    
$
788
    
$
3,267
    
$
1,353
    
$
12,838
    
$
3,681
    
$
18,246
  
Add:
                                                        
Financial expenses (income), net
    
(6,914
)
    
(6,661
)
    
(8,502
)
    
(6,881
)
    
(5,662
)
    
(20,163
)
    
(27,706
)
Tax benefit (taxes on income)
    
605
      
1,713
      
2,931
      
2,052
      
(13,054
)
    
1,373
      
(6,358
)
Depreciation and amortization
    
1,287
      
1,150
      
1,606
      
3,392
      
4,328
      
5,987
      
10,476
  
Share-based compensation
    
16,792
      
19,020
      
18,438
      
18,464
      
18,020
      
68,698
      
73,942
  
Earn-out revaluation, acquisition related costs and other
    
(359
)
    
9
      
109
      
1,273
      
4,240
      
(359
)
    
5,631
  
Adjusted EBITDA
  
$
16,112
    
$
16,019
    
$
17,849
    
$
19,653
    
$
20,710
    
$
59,217
    
$
74,231
  
Adjusted EBITDA margin
    
17.6
%
    
17.1
%
    
18.9
%
    
19.7
%
    
20.0
%
    
16.4
%
    
19.0
%

RECONCILIATION OF GAAP TO NON-GAAP OPERATING EXPENSES
(In thousands)

 
  
Q4'23
    
Q1'24
    
Q2'24
    
Q3'24
    
Q4'24
    
FY 2023
    
FY 2024
  
   
(Uaudited)
    
(Audited)
    
(Audited)
  
GAAP research and development
  
$
22,054
    
$
23,633
    
$
21,855
    
$
22,424
    
$
22,329
    
$
90,720
    
$
90,241
  
Less:
                                                        
Share-based compensation
    
5,836
      
6,836
      
5,897
      
5,273
      
5,563
      
24,310
      
23,569
  
Depreciation and amortization
    
191
      
201
      
193
      
190
      
247
      
799
      
831
  
Earn-out revaluation, acquisition related costs and other
    
-
      
-
      
-
      
700
      
(672
)
    
-
      
28
  
   
$
16,027
    
$
16,596
    
$
15,765
    
$
16,261
    
$
17,191
    
$
65,611
    
$
65,813
  
                                                         
GAAP sales and marketing
  
$
39,767
    
$
42,152
    
$
41,324
    
$
42,970
    
$
45,232
    
$
161,208
    
$
171,678
  
Less:
                                                        
Share-based compensation
    
3,166
      
3,436
      
3,389
      
3,605
      
3,162
      
13,304
      
13,592
  
Depreciation and amortization
    
309
      
264
      
553
      
721
      
770
      
1,601
      
2,308
  
Earn-out revaluation, acquisition related costs and other
    
-
      
-
      
-
      
67
      
1,811
      
-
      
1,878
  
Non-GAAP sales and marketing
  
$
36,292
    
$
38,452
    
$
37,382
    
$
38,577
    
$
39,489
    
$
146,303
    
$
153,900
  
                                                         
GAAP general and administrative
  
$
15,816
    
$
16,451
    
$
17,764
    
$
18,817
    
$
21,782
    
$
62,710
    
$
74,814
  
Less:
                                                        
Share-based compensation
    
7,157
      
8,070
      
8,653
      
9,072
      
8,850
      
28,587
      
34,645
  
Depreciation and amortization
    
78
      
72
      
69
      
66
      
113
      
334
      
320
  
Earn-out revaluation, acquisition related costs and other
    
(359
)
    
9
      
109
      
495
      
3,084
      
(359
)
    
3,697
  
Non-GAAP general and administrative
  
$
8,940
    
$
8,300
    
$
8,933
    
$
9,184
    
$
9,735
    
$
34,148
    
$
36,152
  

RECONCILIATION OF GAAP CASH FROM OPERATING ACTIVITIES TO FREE CASH FLOW
(In thousands)

 
  
Q4'23
    
Q1'24
    
Q2'24
    
Q3'24
    
Q4'24
    
FY 2023
    
FY 2024
  
   
(Uaudited)
    
(Audited)
    
(Audited)
  
Net cash provided by operating activities
  
$
27,549
    
$
21,196
    
$
20,971
    
$
10,867
    
$
30,034
    
$
83,186
    
$
83,068
  
Purchase of property and equipment
    
(135
)
    
(378
)
    
(309
)
    
(290
)
    
(326
)
    
(1,053
)
    
(1,303
)
Capitalization of internal-use software
    
(3
)
    
(20
)
    
-
      
-
      
(83
)
    
(60
)
    
(103
)
Free cash flow
  
$
27,411
    
$
20,798
    
$
20,662
    
$
10,577
    
$
29,625
    
$
82,073
    
$
81,662
  

Key Performance Metrics and Non-GAAP Financial Measures

This release includes certain key performance metrics and financial measures not based on GAAP, including Adjusted EBITDA, Adjusted EBITDA margin, non-GAAP gross profit, non-GAAP gross margin, non-GAAP operating expenses, non-GAAP net income (loss), non-GAAP net income (loss) per share, and free cash flow, as well as operating metrics, including marketplace Gross Merchandise Value or GMV, annual active buyers, annual spend per buyer and marketplace take rate. Some amounts in this release may not total due to rounding. All percentages have been calculated using unrounded amounts. We updated the definitions of annual active buyers, GMV, annual spend per buyer and marketplace take rate to align our supplemental revenue presentation, which disaggregates revenue into two components, marketplace revenue and services revenue. These metrics will now exclusively reflect the marketplace, as amounts related to services previously included in these metrics are deemed immaterial.

We define each of our non-GAAP measures of financial performance, as the respective GAAP balances shown in the above tables, adjusted for, as applicable, depreciation and amortization, share-based compensation expenses, contingent consideration revaluation, acquisition related costs and other, income taxes, amortization of discount and issuance costs of convertible note, financial (income) expenses, net. Non-GAAP gross profit margin represents non-GAAP gross profit expressed as a percentage of revenue. We define non-GAAP net income (loss) per share as non-GAAP net income (loss) divided by GAAP weighted-average number of ordinary shares basic and diluted. We use free cash flow as a liquidity measure and define it as a net cash provided by operating activities less capital expenditures.

We define GMV or marketplace Gross Merchandise Value as the total value of transactions ordered through our marketplace, excluding value-added tax, goods and services tax, service chargebacks and refunds. Annual active buyers on any given date is defined as buyers who have ordered a Gig on our marketplace within the last 12-month period, irrespective of cancellations. Annual spend per buyer on any given date is calculated by dividing our GMV within the last 12-month period by the number of annual active buyers as of such date. Marketplace take rate for a given period means marketplace revenue for such period divided by GMV for such period. When we refer in this release to the marketplace we refer to transactions conducted between buyers and freelancers on Fiverr.com. When we refer to the platform we refer to the marketplace and our additional services.

Management and our board of directors use certain metrics as supplemental measures of our performance that is not required by, or presented in accordance with GAAP because they assist us in comparing our operating performance on a consistent basis, as they remove the impact of items not directly resulting from our core operations. We also use these metrics for planning purposes, including the preparation of our internal annual operating budget and financial projections, to evaluate the performance and effectiveness of our strategic initiatives and capital expenditures and to evaluate our capacity to expand our business. In addition, we believe that free cash flow, which we use as a liquidity measure, is useful in evaluating our business because free cash flow reflects the cash surplus available or used to fund the expansion of our business after the payment of capital expenditures relating to the necessary components of ongoing operations. Capital expenditures consist primarily of property and equipment purchases and capitalized software costs.

Free cash flow should not be used as an alternative to, or superior to, cash from operating activities.  In addition, Adjusted EBITDA, Adjusted EBITDA margin, non-GAAP gross profit, non-GAAP gross margin, non-GAAP operating expenses, non-GAAP net income (loss) and non-GAAP net income (loss) per share as well as operating metrics, including GMV, annual active buyers, annual spend per buyer and marketplace take rate should not be considered in isolation, as an alternative to, or superior to net income (loss), revenue, cash flows or other performance measure derived in accordance with GAAP. These metrics are frequently used by analysts, investors and other interested parties to evaluate companies in our industry. Management believes that the presentation of non-GAAP metrics is an appropriate measure of operating performance because they eliminate the impact of expenses that do not relate directly to the performance of our underlying business.

These non-GAAP metrics should not be construed as an inference that our future results will be unaffected by unusual or other items. Additionally, Adjusted EBITDA and other non-GAAP metrics used herein are not intended to be a measure of free cash flow for management's discretionary use, as they do not reflect our tax payments and certain other cash costs that may recur in the future, including, among other things, cash requirements for costs to replace assets being depreciated and amortized. Management compensates for these limitations by relying on our GAAP results in addition to using Adjusted EBITDA and other non-GAAP metrics as supplemental measures of our performance. Our measures of Adjusted EBITDA, free cash flow and other non-GAAP metrics used herein are not necessarily comparable to similarly titled captions of other companies due to different methods of calculation.

See the tables above regarding reconciliations of these non-GAAP financial measures to the most directly comparable GAAP measures.

We are not able to provide a reconciliation of Adjusted EBITDA to net income (loss), the nearest comparable GAAP measure, and Adjusted EBITDA margin guidance for the first quarter of 2025, the fiscal year ending December 31, 2025, or the period ending December 31, 2027, because certain items that are excluded from Adjusted EBITDA and Adjusted EBITDA margin cannot be reasonably predicted or are not in our control. We are also not able to provide a reconciliation of free cash flow guidance for the fiscal year ended December 31, 2025, or the three year period from 2024-2027 to cash from operating activities, the nearest comparable GAAP measure, because certain items that are reflected in free cash flow cannot be reasonably predicted or are not in our control. In particular, in the case of Adjusted EBITDA and Adjusted EBITDA margin, we are unable to forecast the timing or magnitude of share based compensation, amortization of intangible assets, impairment of intangible assets, income or loss on revaluation of contingent consideration, other acquisition-related costs, convertible notes amortization of discount and issuance costs and exchange rate income or loss, and in the case of free cash flow, we are unable to forecast property and equipment purchases and capitalized software costs, in each case, as applicable without unreasonable efforts, and these items could significantly impact, either individually or in the aggregate, GAAP measures in the future.

Forward Looking Statements

This release contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. All statements contained in this release that do not relate to matters of historical fact should be considered forward-looking statements, including, without limitation, statements regarding our expected financial performance and operational performance including our long term targets and expectations, our business plans and strategy, the growth of our business, AI services and developments, our product portfolio and features, our freelancer equity program, as well as statements that include the words “expect,” “intend,” “plan,” “believe,” “project,” “forecast,” “estimate,” “may,” “should,” “anticipate” and similar statements of a future or forward-looking nature. These forward-looking statements are based on management’s current expectations. These statements are neither promises nor guarantees, but involve known and unknown risks, uncertainties and other important factors that may cause actual results, performance or achievements to be materially different from any future results, performance or achievements expressed or implied by the forward-looking statements, including, but not limited to: our ability to successfully implement our business plan within adverse economic conditions that may impact consumers, business spending and the demand for our services or have a material adverse impact on our business, financial condition and results of operations; our ability to attract and retain a large community of buyers and freelancers; our ability to generate sufficient revenue to  maintain profitability or positive net cash flow generated by operating activities; our ability to maintain and enhance our brand; our dependence on the continued growth and expansion of the market for freelancers and the services they offer; our dependence on traffic to our websites; our ability to maintain user engagement on our websites and to maintain and improve the quality of our platform; our operations within a competitive market; political, economic and military instability in Israel, including related to the war in Israel; our ability and the ability of third parties to protect our users’ personal or other data from a security breach and to comply with laws and regulations relating to data privacy, data protection and cybersecurity; our ability to manage our current and potential future growth; our dependence on decisions and developments in the mobile device industry, over which we do not have control; our ability to detect errors, defects or disruptions in our platform; our ability to comply with the terms of underlying licenses of open source software components on our platform; our ability to expand into markets outside the United States and our ability to manage the business and economic risks of international expansion and operations; our ability to achieve desired operating margins; our ability to comply with a wide variety of U.S. and international laws and regulations, including with regulatory frameworks around the development and use of AI; our ability to attract, recruit, retain and develop qualified employees; our reliance on Amazon Web Services; our ability to mitigate payment and fraud risks; our dependence on relationships with payment partners, banks and disbursement partners; and the other important factors discussed under the caption “Risk Factors” in our annual report on Form 20-F filed with the U.S. Securities and Exchange Commission (“SEC”) on February 19, 2025, as such factors may be updated from time to time in our other filings with the SEC, which are accessible on the SEC’s website at www.sec.gov. In addition, we operate in a very competitive and rapidly changing environment. New risks emerge from time to time. It is not possible for our management to predict all risks, nor can we assess the impact of all factors on our business or the extent to which any factor, or combination of factors, may cause actual results to differ materially from those contained in any forward-looking statements that we may make. In light of these risks, uncertainties and assumptions, the forward-looking events and circumstances discussed in this release are inherently uncertain and may not occur, and actual results could differ materially and adversely from those anticipated or implied in the forward-looking statements. Accordingly, you should not rely upon forward-looking statements as predictions of future events. In addition, the forward-looking statements made in this release relate only to events or information as of the date on which the statements are made in this release. Except as required by law, we undertake no obligation to update or revise publicly any forward-looking statements, whether as a result of new information, future events or otherwise, after the date on which the statements are made or to reflect the occurrence of unanticipated events.