What Happened:
Shares of online freelance marketplace Fiverr (NYSE:FVRR) jumped 17.9% in the afternoon session after the company reported a "beat and raise" quarter. Second quarter earnings results beat analysts' revenue, adjusted EBITDA, and EPS estimates. The company also slightly raised full-year revenue guidance, showing that topline trends are better than just a few months ago. Overall, this was a solid quarter for Fiverr.
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What is the market telling us:
Fiverr's shares are very volatile and over the last year have had 32 moves greater than 5%. But moves this big are very rare even for Fiverr and that is indicating to us that this news had a significant impact on the market's perception of the business.
The biggest move we wrote about over the last year was 5 months ago, when the stock dropped 14.9% on the news that the company reported fourth-quarter results that missed analysts' revenue expectations as user growth stalled. Revenue and adjusted EBITDA guidance for the next quarter and full year also fell below consensus estimates. The company cited a challenging macro environment in 2023: "US job openings down 19% and professional staffing down 6% year-over-year." On the other hand, free cash flow seemed to be heading in the right direction. Overall, this was a weaker quarter for Fiverr.
Fiverr is down 1.1% since the beginning of the year, and at $25.92 per share it is trading 22.9% below its 52-week high of $33.60 from August 2023. Investors who bought $1,000 worth of Fiverr's shares 5 years ago would now be looking at an investment worth $1,020.
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