Upwork (NASDAQ:UPWK) executives told investors the company finished 2025 with record revenue and adjusted EBITDA, while pointing to accelerating momentum in AI-related work, rapid adoption of its Business Plus offering for small businesses, and early progress on its revamped enterprise strategy built around the Lifted platform.
Fourth-quarter and full-year results
CEO Hayden Brown said 2025 marked the completion of a three-year transformation designed to position Upwork for what she described as the “human plus AI” era of work. For the full year, Upwork reported more than $4 billion in gross services volume (GSV), $788 million in revenue, and $226 million in adjusted EBITDA. Brown said revenue and adjusted EBITDA were record highs, with revenue growth of 2.4% and an adjusted EBITDA margin of 29%.
Gessert said marketplace GSV growth in Q4 was “relatively flat” versus the prior year due primarily to fewer “low-value, high-volume” contracts, while fundamentals for larger clients remained positive. The company ended Q4 with 785,000 active clients. Management said churn improved over 2025, with Q4 churn reaching its lowest level in more than eight quarters and more than 130 basis points better than Q4 2024.
AI: product enhancements and rising category demand
Brown said Upwork embedded more AI functionality into the marketplace in Q4 and that AI-related work on the platform generated more than 50% GSV growth. She said Upwork estimates AI-native improvements, including search and recommendations and its AI agent “Uma,” contributed $100 million in incremental GSV in 2025.
Among new Q4 features, Upwork introduced AI-generated work summaries intended to provide a richer view of freelancer experience and support better-fit hiring decisions. Brown said the feature was already “delivering an increased spend per client.” In response to analyst questions, Brown described investments such as “Uma Recruiter,” conversational search, and more AI-powered experiences spanning pre-hire matching and collaboration/project management, saying early testing showed customers could “offload more of the work to Uma and move more quickly towards their goals.”
Brown said GSV from AI-related work surpassed $300 million on an annualized basis in Q4, up more than 50% from the prior year. She added that categories such as Generative AI and creative production and AI integration and automation nearly doubled year-over-year in Q4. The number of clients engaging in AI work increased more than 50% year-over-year, and those clients’ GSV was about three times Upwork’s average spend per client, management said.
On the talent side, Brown said Upwork was not seeing strong indications of AI talent gaps, noting “250,000 AI experts” worked with Upwork clients in the last year alone. She also pointed to a partnership with OpenAI to offer training, certifications, and upskilling for independent professionals.
SMB: Business Plus scales and marketing ramps
Upwork’s second growth pillar is small and midsize businesses. Brown said Business Plus, launched at the end of 2024, has scaled quickly. In Q4, Upwork launched its first dedicated small-business marketing campaign to promote Business Plus features such as access to top talent, team-based hiring, and credit-based payment terms.
Brown said active Business Plus clients grew 49% sequentially in Q4, and 38% of those clients were new to Upwork. Management said Business Plus clients spend almost 2.5 times more than the marketplace average.
Gessert said GSV from Business Plus increased 24% quarter-over-quarter in Q4. Discussing marketing spend, she said Upwork stepped up Business Plus campaigns in Q4 and carried some efforts into Q1, calling the returns attractive given the higher spending profile of Business Plus customers. She also said the company expects capacity to invest more in sales and marketing this year, supported by longer-term cost optimization efforts including “back-end automation” and a “location strategy to hire in lower-cost locations.”
Management reiterated an Investor Day target for Business Plus to double in GSV and represent more than 5% of total annual GSV in 2026, with Brown saying the company was “pacing ahead of plan” toward that goal.
Enterprise: Lifted platform integration and early wins
On enterprise, management described 2025 as a pivotal year with the introduction of Lifted, enabled by the acquisition of two companies. Brown said Lifted is designed to support major contingent work contract types and integrate directly into large companies’ workflows. In Q4, Upwork finalized and launched the first phase of a go-to-market strategy focused on expanding with existing customers and pursuing about 3,000 prioritized enterprise accounts with more than $50 million in annual contingent spend.
Brown said Lifted had built a pipeline including “dozens of existing and new logos” and had “already won two new clients.” Management said enterprise sales cycles can take a year or more, and they characterized the early progress as encouraging.
Gessert said enterprise revenue decreased 3% year-over-year in Q4, as expected, after the company paused selling legacy enterprise plans in 2025 as it shifted strategy. She said Upwork was targeting 25% GSV growth for its enterprise business in 2026, with “significant acceleration” expected in the second half as integration completes and customers onboard to Lifted. In Q&A, executives added that enterprise revenue could decline sequentially in Q1 due to the pause in legacy plans and some churn at the low end, ahead of a ramp as Lifted becomes “transaction ready.”
Margins, cash flow, capital return, and 2026 outlook
Gessert said gross margin was 78.0% in Q4 and a record 77.8% for full-year 2025. Non-GAAP operating expense was $107 million in Q4, or 54% of revenue, roughly flat versus the prior-year quarter despite about $6 million of incremental operating expenses and integration costs from the Lifted-related acquisitions. Full-year non-GAAP operating expense was $405 million, or 51% of revenue, down from 57% of revenue in 2024.
Adjusted EBITDA was $53 million in Q4, exceeding the high end of guidance, and free cash flow was $57 million in the quarter. For 2025, Upwork generated $223 million in free cash flow. The company repurchased about 2 million shares for $34 million in Q4 and more than 9 million shares for $136 million in 2025. Cash, cash equivalents, and marketable securities totaled about $673 million at year-end.
For 2026, management guided to:
- GSV growth: 4% to 6%
- Revenue: 6% to 8%, or $835 million to $850 million
- Adjusted EBITDA margin: approximately 29%, or $240 million to $250 million
- Non-GAAP diluted EPS: $1.43 to $1.48
Gessert said Upwork expects GSV, total take rate, and revenue to increase sequentially beginning in Q2 and through the rest of the year, driven in part by Lifted ramping in the second half of 2026. She also said investments in the Lifted strategy would dilute margin by about two percentage points in 2026, but the company still expects to maintain its annual margin rate year over year and to exit 2026 with margins in the low 30s.
For Q1 2026, Upwork guided to revenue of $192 million to $197 million and adjusted EBITDA of $45 million to $47 million (23% to 24% margin). Gessert attributed the lower Q1 margin outlook to the pace of Lifted integration work, investments to support growth on the Lifted platform, and incremental marketing investments.
About Upwork (NASDAQ:UPWK)
Upwork Inc operates a leading online talent marketplace that connects businesses with independent professionals worldwide. Through its digital platform, the company enables clients across industries—including technology, marketing, creative services and customer support—to source, hire and manage freelance talent on demand. Key features of the Upwork platform include streamlined job posting, proposal evaluation, time-tracking tools, invoicing and secure payment processing, all designed to simplify collaboration between clients and remote workers.
The company traces its roots to the merger of two pioneering freelance marketplaces, Elance (founded in 1998) and oDesk (founded in 2003), which combined in 2015 to form a unified entity.
