Q1 2024 Fiverr International Ltd Earnings Call

May 9, 2024

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Operator: Good day and thank you for standing by. Welcome to the Fiverr Q1 fiscal 2024 earnings conference call. At this time all participants are in a listen-only mode. After the speaker's presentation there will be a question and answer session. To ask a question during the session you will need to press star 1 1 on your telephone. You will then hear an automated message advising your hand is phrased. To withdraw your question please press star 1 and 1 again. Please be advised that today's conference is being recorded. I would now like to hand the conference over to our speaker today, Jinjin Qian. Please go ahead.

Operator: Good day, and thank you for standing by. Welcome to the Fiverr Q1 fiscal 2024 earnings conference call. At this time, all participants are in a listen-only mode. After the speaker's presentation, there will be a question and answer session. To ask a question during the session, you will need to press star 1 1 on your telephone. You will then hear an automated message advising your hand is phrased. To withdraw your question, please press star 1 and 1 again. Please be advised that today's conference is being recorded. I would now like to hand the conference over to our speaker today, Jinjin Qian. Please go ahead.

Speaker Change: Good day and thank you for standing by welcome to the five for Q1 fiscal 'twenty to 'twenty four earnings conference call. At this time, all participants are in a listen only mode.

Speaker Change: After the speaker's presentation, there will be a question and answer session to ask a question. During this session you will need to press star one on your telephone you will done here an automated message a paucity of Hanmi priced do we still have your question. Please press star one on one again.

Speaker Change: Please be advised that today's conference is being recorded.

Speaker Change: I'd now like to hand, the conference over to your Speaker today Jingjing Chen. Please go ahead.

Jinjin Qian: Thank you, operator, and good morning, everyone. Thank you for joining us on Fiverr's earnings conference call for the first quarter that ended March 31st, 2020. Joining me on the call today are Micha Kaufman, Founder and CEO, and Ofer Katz, President and CFO. Before we start, I'd like to remind you that during this call, we may make forward-looking statements, and these statements are based on our current expectations and assumptions as of today, and Fiverr assumes no obligation to update or revise, A discussion of some of the important risk factors that could cause actual results to differ materially from any forward-looking statements can be found under the risk factor section in Fiverr's most recent Form 20-F and other findings for the essay.

Jingjing Chen: Thank you operator, and good morning, everyone. Thank you for joining us on fibers earnings conference call for the first quarter that ended March 31 2024.

Jingjing Chen: Joining me on the call today are me, how Kaufman founder and CEO and Ofer Cox President and CFO.

Speaker Change: Before we start I'd like to remind you that during this call. We may make forward looking statements and these statements are based on our current expectations and assumptions as of today and Fiverr assumes no obligation to update or revise them.

Speaker Change: A discussion of some of the important risk factors that could cause actual results to differ materially from any forward looking statements can be found under the risk factors section in fibers. Most recent form 20-F, and other filings with the SEC.

Speaker Change: During this call we'll be referring to some key performance metrics are non-GAAP financial measures, including adjusted EBITDA and adjusted EBITDA margin.

Speaker Change: Further explanation and a reconciliation of each of the non-GAAP financial measures to the most directly comparable GAAP measure is provided in earnings release, we issued today in our shareholder letter.

Speaker Change: Each of which is available on our website at investors dark fiber dot com.

Jinjin Qian: During this call, we will be referring to some key performance metrics and non-GAAP financial measures, including Adjusted Ibra and Adjusted Ibra Mahajan. Further explanation and a reconciliation of each of the non-GAAP financial measures to the most directly comparable GAAP measures is provided in the earnings release we issued today in our shareholder letter, each of which is available on our website at investors.fiverr.com. And now I'll turn the call over to me. Thank you, Jinjin. Good morning.

Jinjin Qian: During this call, we will be referring to some key performance metrics and non-GAAP financial measures, including Adjusted Ibra and Adjusted Ibra Mahajan. Further explanation and a reconciliation of each of the non-GAAP financial measures to the most directly comparable GAAP measures is provided in the earnings release we issued today and in our shareholder letter, each of which is available on our website at investors.fiverr.com. And now, I'll turn the call over to you. Thank you, Jinjin. Good morning.

Me Huh: And now I'll turn the call over to me Huh.

Micha Kaufman: Thank you, Jinjin. Good morning, everyone, and thank you for joining us.

Me Huh: Thank you Ginger and good morning, everyone and thank you for joining us.

Micha Kaufman: We kicked off 2024 with a strong set of results. Both revenue and adjusted EBITDA for Q1 exceeded expectations, driven by strong execution across the market base and Fiverr business solution. We continue to evolve our platform to accommodate not only small businesses fulfilling small tasks, but also larger wallet customers purchasing more complex and larger ticket-sized services. The strategy is working particularly well amid the current macro environment, as we remain efficient and disciplined with our top-of-funnel investments while leaning into product and innovation to drive wallet-share, AI continue to have a net positive impact on our business as complex services continue to grow faster and represent a bigger portion of our business.

Micha Kaufman: We kicked off 2024 with a strong set of results. Both revenue and adjusted EBITDA for Q1 exceeded expectations, driven by strong execution across the market base and the Fiverr business solution. We continue to evolve our platform to accommodate not only small businesses fulfilling small tasks but also larger wallet customers purchasing more complex and larger ticket-sized services. The strategy is working particularly well amid the current macro environment, as we remain efficient and disciplined with our top-of-funnel investments while leaning into product and innovation to drive wallet share. AI continues to have a net positive impact on our business as complex services continue to grow faster and represent a bigger portion of

Me Huh: We kicked off 2024 with a strong set of results.

Me Huh: Both revenue and adjusted EBITDA for Q1 exceeded expectations, driven by strong execution across our market base and fiber business solutions.

Huh: We continue to evolve our platform to accommodate not only small businesses fulfilling small comp, but also larger wallet customers purchasing more complex and larger ticket size services.

Huh: The strategy is working particularly well amid the current macro environment.

Huh: We remain efficient and disciplined with our top of funnel investments, while leaning into product and innovation to drive wallet share expansion.

Huh: AI continue to have a net positive impact in our business is complex services continued to grow faster and represent a bigger portion of our business.

Micha Kaufman: Demand for AI-related services remains strong, as evidenced by 95% year-over-year growth in GMV from AI service categories. Chatbot development was especially popular this quarter as businesses look for ways to lean into Gen-AI technology to better engage with customers. For example, we have seen a hospitality company building a conversational tool for customers to manage booking or an online learning platform creating a personalized learning menu and tutoring sessions for children.

Micha Kaufman: Demand for AI-related services remains strong, as evidenced by 95% year-over-year growth in GMV from AI service categories. Chatbot development was especially popular this quarter as businesses look for ways to lean into Gen-AI technology to better engage with customers. For example, we have seen a hospitality company building a conversational tool for customers to manage bookings, or an online learning platform creating a personalized learning menu and tutoring sessions for children.

Huh: Demand for AI related services remained strong as evidenced by 95% year over year growth in GM V from AI service category.

Huh: Chad Pud development was especially popular this quarter its businesses look for ways to lean into Ginnie I technology to better engage with customers.

Huh: For example, we have seen a hospitality company building a conversational tool for customers to manage bookings or an online learning platform, creating a personalized learning menu and tutoring sessions for children with an over 10000 and growing AI expert pool fiber has become the destination for businesses.

Micha Kaufman: With an over 10,000 and growing AI expert pool, Fiverr has become the destination for businesses to get help implementing Gen AI and take their business to the next level. We also seen very promising signals on Fiverr Neo, the AI matching assistant that we launched last year. NEO enables our buyers to have a more natural purchasing path by creating a conversational experience that leverages the catalog data and search algorithm. Answers and steps are provided based on buyer's questions and the stage of the survey.

Micha Kaufman: With an over 10,000 and growing AI expert pool, Fiverr has become the destination for businesses to get help implementing Gen AI and take their business to the next level. We have also seen very promising signals on Fiverr Neo, the AI matching assistant that we launched last year. NEO enables our buyers to have a more natural purchasing path by creating a conversational experience that leverages the catalog data and search algorithm. Answers and steps are provided based on the buyer's questions and the stage of the survey.

Huh: Get help implementing gen AI and take their business to the next level.

Huh: We've also seen very promising signals on fiber Neal the AI marching assistant that we launched last year.

Huh: Neil enables our buyers to have a more natural purchasing path by creating a conversational experience that leverages the catalog data and search.

Huh: Answers and steps are provided based on buyers questions and the stage of the search as a result, we saw that nearly one third of the buyers will receive seller recommendations from Neal ended up sending a project brief to the seller and the overall order conversion.

Micha Kaufman: As a result, we saw that nearly one third of the buyers who received seller recommendations from NEO ended up sending a project brief to the seller. And the overall order conversion is nearly three times that of the market base average. This really gives us confidence and excitement in the potential we could unlock by investing in AI-matching technology. The strong Q1 result, together with the momentum we are seeing across going up market and AI, are giving us confidence in delivering the targets we set for this year.

Micha Kaufman: As a result, we saw that nearly one-third of the buyers who received seller recommendations from NEO ended up sending a project brief to the seller, and the overall order conversion rate is nearly three times that of the market base average. This really gives us confidence and excitement in the potential we could unlock by investing in AI-matching technology. The strong Q1 result, together with the momentum we are seeing across going up market and AI, is giving us confidence in delivering the targets we set for this year.

Huh: Is nearly three times that of the market base average.

Huh: This really gives us confidence and excitement in the potential we could unlock by investing in AI matching technology.

Huh: The strong Q1 result, together with the momentum we are seeing across going upmarket in AI are giving us confidence in delivering the targets we set for this year.

Micha Kaufman: Of course, we are not here just to deliver the year, but rather to drive the next wave of work transformation and AI innovation. So many exciting product initiatives are happening at Fiverr right now as we work tirelessly towards our summer product release. Without jumping the gun on the release, I want to give you some color on how we are thinking about the business and the opportunity more broadly. I'll expand on three areas, product leadership, data and AI matching, and brand and traffic. First, let's talk about product leaders. We have been a product-led company ever since we started in 2020.

Micha Kaufman: Of course, we are not here just to deliver the year but rather to drive the next wave of work transformation and AI innovation. So many exciting product initiatives are happening at Fiverr right now as we work tirelessly towards our summer product release. Without jumping the gun on the release, I want to give you some color on how we are thinking about the business and the opportunity more broadly. I'll expand on three areas: product leadership, data and AI matching, and brand and traffic. First, let's talk about product leaders. We have been a product-led company ever since we started in 2020.

Huh: Of course, we are not here just to deliver the year, but rather to drive the next wave of work transformation and AI innovation.

Huh: So many exciting product initiatives are happening at fiber right now as we work Paris.

Huh: Towards our summer product release.

Huh: Without jumping the gun on the release I wanted to give you some color on how we are thinking about the business and the opportunity more broadly I'll expand on three areas.

Huh: <unk> leadership data and AI matching and brand and traffic.

Huh: First let's talk about product leadership.

Huh: We have been a product led company ever since we started in 2010, we pay on near the concept of service as a product and built an extensive service catalog covering any digital service you can think of.

Micha Kaufman: We pioneered the concept of service as a product and built an extensive service catalog covering any digital service you can think of, turning a super opaque, inefficient experience of hiring a freelancer into a modern, delightful e-commerce experience. Our product innovation pace picked up even more in recent years as the scale of our market base significantly expanded. This includes monetization products such as promoted gigs and SellerPlus, AI innovation such as LogoMaker, AI auditions to the latest groundbreaking Fiverr needs.

Micha Kaufman: We pioneered the concept of service as a product and built an extensive service catalog covering any digital service you can think of, turning a super opaque, inefficient experience of hiring a freelancer into a modern, delightful e-commerce experience. Our product innovation pace picked up even more in recent years as the scale of our market base significantly expanded. This includes monetization products such as promoted gigs and SellerPlus, AI innovation such as LogoMaker, and AI auditions to the latest groundbreaking Fiverr needs.

Huh: Turning a super opaque inefficient experience of hiring a freelancer into a modern delightful e-commerce experience.

Huh: Our product innovation pace picked up even more in recent years as the scale of our market base significantly expanded.

Huh: This include monetization products, such as promoted gigs and seller plus.

Huh: AI innovation, such as logo maker AI auditions to the latest groundbreaking fiber Neal Bill.

Micha Kaufman: Business solutions offering such as Project Partner and Fiverr Certified, and numerous products and features such as Fiverr Discover, Milestone, and Subscriptions that empower our community to work better and smarter. We're always leading the curve of innovation that powers growth, not only for us, but for the industry.

Micha Kaufman: Business solutions offerings such as Project Partner and Fiverr Certified, and numerous products and features such as Fiverr Discover, Milestone, and Subscriptions that empower our community to work better and smarter. We're always leading the curve of innovation that powers growth, not only for us, but for the industry.

Huh: Business solutions offerings, such as project partner and fiber certified and numerous products and features such as fiber discover milestone and subscriptions that empower our community to work better and smarter, we're always leading the curve of innovation that powers growth not only for us.

Micha Kaufman: As our teams work towards our July product release, we are focusing on deepening trust and leveraging AI to reimagine every aspect of the customer journey. This includes improving our catalog and building new experiences to enable high stakes. High trust work to have it on Fiverr.

Huh: But for the industry as our teams work towards our July product relief, we are focusing on deepening trusts and leveraging AI to re margin every aspect of the customer journey.

Huh: This includes improving our catalog and building new experiences to enable high Stakes high trust work to happen on fiber.

Micha Kaufman: We are strengthening our muscle in knowing our customers better in order to provide them with the better matching, better recommendations, and better customer care, all of which leads to more trust for Fiverr as a partner. We're already seeing some of the benefits in unlocking WalletShare and driving a niche shift, towards complex services on Fiverr. And we are going to see more impact down the road. Second, data in AI and machine learning.

Micha Kaufman: We are strengthening our muscle in knowing our customers better in order to provide them with better matching, better recommendations, and better customer care, all of which leads to more trust for Fiverr as a partner. We're already seeing some of the benefits of unlocking WalletShare and driving a niche shift towards complex services on Fiverr. And we are going to see more impact down the road. Second, data in AI and machine learning.

Huh: We are strengthening our muscle in knowing our customers better in order to provide them with a better matching better recommendations and better customer care all of which leads to more trust for fiber as a platform.

Huh: We're already seeing some of the benefits in unlocking wallet share and driving a mix shift towards complex services on fiber and we are going to see more impact down the road.

Huh: Second data and AI matching.

Micha Kaufman: Fiverr is a unique in the sense that we are not just a platform that connects businesses with freelancers, the entire work actually happens. And that is really the secret sauce that enables us to do matching in such a simple, accurate, and seamless way.

Micha Kaufman: Fiverr is unique in the sense that we are not just a platform that connects businesses with freelancers; the entire work actually happens. And that is really the secret sauce that enables us to do matching in such a simple, accurate, and seamless way.

Huh: Fiber is a unique in the sense that we are not just a platform that connects businesses with freelancers Dean.

Huh: The entire work actually happens on fiber.

Huh: And that is really the secret sauce that enables us to do matching and such a simple accurate and seamless way.

Micha Kaufman: With generative AI, there's incredible potential to take that experience to a whole new level. Just to give you some idea of the scale we operate. In 2023, over 38 million files were exchanged on our platform. And on average, 2.5 million messages were sent between buyers and sellers on a daily basis. We are experimenting with Gen-AI technology on how to unlock the potential, that massive data on Fiverr in order to enable buyers and sellers to have more information, search and browse in new ways, ask more complex questions, and ultimately make better, more informed choices on Fiverr. Third, Brandon Proffitt.

Micha Kaufman: With generative AI, there's incredible potential to take that experience to a whole new level. Just to give you some idea of the scale we operate at. In 2023, over 38 million files were exchanged on our platform, and on average, 2.5 million messages were sent between buyers and sellers on a daily basis. We are experimenting with Gen-AI technology on how to unlock the potential of that massive data on Fiverr in order to enable buyers and sellers to have more information, search and browse in new ways, ask more complex questions, and ultimately make better, more informed choices on Fiverr. Third, Brandon Proffitt.

Huh: We generated AI there is incredible potential to take that experience to a whole new level.

Huh: Just to give you some idea of the scale that we operate.

Huh: In 2023 over 38 million files, where exchange on our platform.

Huh: And on average $2 5 million messages were sent between buyers and sellers on a daily basis.

Huh: We are experimenting with Jenny I technology on how to unlock the potential.

Huh: Kodak massive data on fiber in order to enable buyers and sellers to have more information.

Huh: Search and browse in new ways.

Huh: More complex question and ultimately make better more informed choices on fiber.

Huh: Third.

Micha Kaufman: Fiverr has built one of the most recognizable brands in our industry, leading in aided and unaided brand awareness among other freelance marketers. Fiverr.com continues to be one of the highest trafficked websites as businesses of all sizes come to fulfill digital services and freelancer talent across the world come to find opportunities. This gives us a lot of opportunity to bring helpful Gen AI features and capabilities to people everywhere and improve their business.

Micha Kaufman: Fiverr has built one of the most recognizable brands in our industry, leading in aided and unaided brand awareness among other freelance marketers. Fiverr.com continues to be one of the highest-trafficked websites as businesses of all sizes come to fulfill digital services and freelancer talent across the world come to find opportunities. This gives us a lot of opportunity to bring helpful Gen AI features and capabilities to people everywhere and improve their businesses.

Brandon: Brandon traffic.

Huh: <unk> build one of the most recognizable brands in our industry, leading in aided and unaided brand awareness among other freelance market basis.

Huh: Fiber dot com continues to be one of the highest traffic websites as businesses of all sizes come to fulfill digital services and freelancer talent across the world come to find opportunities.

Huh: This gives us a lot of opportunity to bring helpful. Jenny I features and capabilities to people everywhere and improve their businesses.

Micha Kaufman: As we continue to build our brand equity, we believe the opportunities lie not only in the US, where we have the strongest foothold, but there is also a potential to grow international awareness. We have been especially successful in our recent efforts across the UK, Germany, and France, where we partnered with local influencers, to launch various campaigns. There is also a lot to do in expanding our reach and channels with business customers. And we have barely scratched the surface. So these are the key competitive modes that we enjoy today.

Micha Kaufman: As we continue to build our brand equity, we believe the opportunities lie not only in the US, where we have the strongest foothold, but there is also the potential to grow international awareness. We have been especially successful in our recent efforts across the UK, Germany, and France, where we partnered with local influencers to launch various campaigns. There is also a lot to do in expanding our reach and channels with business customers, and we have barely scratched the surface. So these are the key competitive modes that we enjoy today.

Huh: As we continue to build our brand equity we believe the opportunities lie not only in the U S, where we have the strongest foothold.

Huh: But there is also a potential to grow international awareness, we have been especially successful in our recent efforts across the UK, Germany, and France, where we partnered with local influencers to launch various campaigns.

Huh: There is also a lot to do in expanding our reach and channels with business customers.

Huh: And we have barely scratched the surface.

Huh: So these are the key competitive moats that we enjoy today and.

Micha Kaufman: And we will continue investing in Down the Road. This time last year, I shared with you how excited I am with the Gen AI development and how I think it's going to be a multi-year tailwind for Fiverr. I'm really pleased to say that over the past year, the entire Fiverr team has turned that excitement into ideas and projects already operating across our platform. And we are going to see many more of them coming to fruition this year. I'm very excited about what's to come and can't wait to share those updates with you in the coming quarters. With that, I'll turn the call over to Ofer, who will share some financial highlights. Thank you.

Micha Kaufman: And we will continue investing in Down the Road. This time last year, I shared with you how excited I am with the Gen AI development and how I think it's going to be a multi-year tailwind for Fiverr. I'm really pleased to say that over the past year, the entire Fiverr team has turned that excitement into ideas and projects already operating across our platform, and we are going to see many more of them coming to fruition this year. I'm very excited about what's to come and can't wait to share those updates with you in the coming quarters. With that, I'll turn the call over to Ofer, who will share some financial highlights. Thank you.

Huh: And we will continue investing in down the road.

Huh: This time last year I shared with you how excited I am with the Gen AI development and how I think it's going to be a multiyear tailwind for fiber I'm really pleased to say that over the past year, the entire fiber team as churn that excitement into ideas and projects already operating.

Huh: Across our platform and we are going to see many more of them coming to fruition. This year.

Huh: I am very excited about what's to come and can't wait to share those updates with you in the coming quarters with that I will turn the call over to Ofer, who will share some financial highlights.

Ofer Katz: Thank you, Micha, and good morning, everyone. We are off to a great start in 2024. Revenue for Q1 was $93.5 million, up 6.3% year-over-year, at the top end of our guidance. An adjusted EBITDA was $16 million above our guidance range and representing an adjusted EBITDA margin. 17.1.

Ofer Katz: Thank you, Micha, and good morning, everyone. We are off to a great start in 2024. Revenue for Q1 was $93.5 million, up 6.3% year-over-year, at the top end of our guidance. Adjusted EBITDA was $16 million above our guidance range and representing an adjusted EBITDA margin of 17.1.

Ofer Katz: Thank you Michelle and good morning, everyone.

Ofer: We are off to a great start in 2024.

Ofer: Revenue for Q1 was 93 5 million up six 3% payroll variable at.

Ofer: At the top end of our guidance.

Ofer: And adjusted EBITDA was $16 million above our guidance range and representing an adjusted EBITA margin of 17, 1%.

Ofer Katz: Strong performance speaks to the strategy we laid out, at the beginning of the year and the consistency in our execution, amid a volatile macro environment. We are confident in executing the reminder of the year. Successfully while making strategic long-term investments, as Micha outlined, continue to improve the underlying fundamentals across our, GMV on the platform grew 2% year over year. And acceleration from 1% last quarter, as our efforts to grow complex services and push up market paid off.

Ofer Katz: Strong performance speaks to the strategy we laid out at the beginning of the year and the consistency in our execution, amid a volatile macro environment. We are confident in executing the remainder of the year. While making strategic long-term investments, as Micha outlined, continue to improve the underlying fundamentals across our platform, GMV on the platform grew 2% year over year and acceleration from 1% last quarter, as our efforts to grow complex services and push up the market paid off.

Ofer: The strong performance speaks to the strategy we laid out.

Ofer: At the beginning of the year and the consistency in our execution.

Ofer: Amid a volatile macro environment.

Ofer: We are confident in executing that reminder, update you.

Ofer: Successfully while making strategic long term investments.

Ofer: Outline.

Ofer: We continue to improve the underlying fundamentals across our business.

Ofer: Jim on the platform grew 2% Tivo video.

Ofer: An acceleration from 1% last quarter.

Ofer: As our efforts to grow complex services and push upmarket payroll.

Ofer Katz: Complex services continue to grow at a healthy double-digit rate, and now represent over one third of our market, continue to see AI as a net positive impact for us, driving significant growth in new categories such as chatbot development and generating more demand in complex services categories where human skills are essential to provide authentic and high quality, Active buyers for Q1 was 4 million, and Spencer Buyer was 284 as we continue to double down on our upmarket effort to attract high-value quality buyers. While overall active buyer growth was muted.

Ofer Katz: Complex services continue to grow at a healthy double-digit rate and now represent over one third of our market. We continue to see AI as a net positive impact for us, driving significant growth in new categories such as chatbot development and generating more demand in complex services categories where human skills are essential to provide authentic and high quality. Active buyers for Q1 were 4 million, and Spencer Buyer was 284, as we continue to double down on our upmarket effort to attract high-value While overall active buyer growth was muted,

Ofer: Complex services continued to grow at a healthy double digit rate.

Ofer: And now represent over one third of our marketplace.

Ofer: We continue to see AI.

Ofer: As a net positive impact for us.

Ofer: Driving significant growth in new categories, such as Chatbot development and generating more demand in complex services category as well.

Ofer: A human skills are essential to provide authentic and high quality output.

Ofer: Active buyer for Q1 was $4 million.

Ofer: And spend per buyer was 284 as we continue to double down on our upmarket effort to attract high value quality buyers.

Ofer: While overall active buyer growth muted.

Ofer Katz: High-value buyers who spend over $500 annually continue to show robust growth, up 4% year-over-year. Not only are we seeing more SMBs with digital wallets come to Fiverr, we are also increasingly becoming a destination for mid to large size companies to fulfill digital services. Overall spend per buyer, grew 8% year-over-year. The highest throat we've ever had in over a year.

Ofer Katz: High-value buyers who spend over $500 annually continue to show robust growth, up 4% year-over-year. Not only are we seeing more SMBs with digital wallets come to Fiverr, but we are also increasingly becoming a destination for mid to large-size companies to fulfill digital services. Overall spend per buyer grew 8% year-over-year. The highest spend we've ever had in over a year.

Ofer: High value bio who spend over $500 annually continued to show robust growth.

Ofer: Up 4% the overview.

Ofer: Not only are we seeing more smbs with Vitol wallets come to fever.

Ofer: We are also increasingly becoming a destination for mid to large sized companies.

Ofer: To fulfill digital services.

Ofer: Overall spend per buyer grew.

Ofer: Grew 8% <unk>.

Ofer: The highest growth ever.

Ofer: Heather head in overall yield.

Ofer Katz: We are very encouraged with our progress on extending customer wallet share, especially given its compounding impact on our cohort and their long-term revenues. Stay great on our platform, continue to be strong and extending. Take rate for Q1 was 32.3%, up 190 basis points from a year ago. Both seller monetization programs continue to show robust growth.

Ofer Katz: We are very encouraged with our progress on extending customer wallet share, especially given its compounding impact on our cohort and their long-term revenues. Stay great on our platform, continue to be strong and expanding. Take rate for Q1 was 32.3%, up 190 basis points from a year ago. Both seller monetization programs continue to show robust growth.

Ofer: We are very encouraged with our progress on expanding customer wallet share, especially.

Ofer: Especially given its compounding impact on our cohort and the long term revenue streams.

Ofer: Take rate on our platform continued to be strong and expanding.

Ofer: From Q1 was 32, 3%.

Ofer: 190 basis points from a year ago.

Ofer: Both seller monetization programs continued to show robust growth.

Ofer Katz: Promoted Giz grew over 55% year-over-year and SellerPlus grew over 75% year-over-year. We are also seeing some momentum from many services offering within Fiverr business solutions as larger businesses look for end-to-end support from Fiverr in order to deploy freelancers at scale. We believe there are a lot of opportunities to double down in this area to further penetrate certain complex service categories, especially in the programming and tech world.

Ofer Katz: Promoted Giz grew over 55% year-over-year, and SellerPlus grew over 75% year-over-year. We are also seeing some momentum from many services offerings within Fiverr business solutions as larger businesses look for end-to-end support from Fiverr in order to deploy freelancers at scale. We believe there are a lot of opportunities to double down in this area to further penetrate certain complex service categories, especially in the programming and tech world

Ofer: Promoted gig grew over 55% piece of our rib and seller plus grew over 75%.

Ofer: We are also seeing some momentum from managed services offering within fiber business solutions.

Ofer: Larger businesses look for end to end support from fiber in order to deploy is thrilled him. So at scale. We believe there are a lot of opportunities to double down in this area to further penetrate certain complex set of categories, especially in the programming and tech vertical.

Ofer Katz: A few weeks ago... We announce our first ever stock repurchase program of up to $100 million. This program demonstrates our confidence in the underlying fundamentals of our business and our commitment to creating shareholders' value. We believe our current stock price represents an attractive opportunity to do a repurchase and we expect to start executing the repurchase program immediately. Our strong balance sheet and strong straight cash flow generation provide us with a financial capability to return capital to our shareholders, while also continuing to invest in our key growth initiatives. Now, turning to guidance.

Ofer Katz: A few weeks ago... we announced our first ever stock repurchase program of up to $100 million. This program demonstrates our confidence in the underlying fundamentals of our business and our commitment to creating shareholder value. We believe our current stock price represents an attractive opportunity to do a repurchase, and we expect to start executing the repurchase program immediately. Our strong balance sheet and strong straight cash flow generation provide us with a financial capability to return capital to our shareholders while also continuing to invest in our key growth initiatives. Now, turning to guidance.

Ofer: A few weeks ago.

Ofer: We announced our first ever stock repurchase program of up to $100 million.

Ofer: This program demonstrates our confidence in the underlying fundamentals of our business and our commitment to creating shareholders value.

Ofer: We believe our current stock price represents an attractive opportunity to do a repurchase and we expect to start executing the repurchase program immediately.

Ofer: Our strong balance sheet and strong free cash flow generation provide us with a financial capability to return capital to our shareholders.

Ofer: While also continuing to invest in our key growth initiatives.

Ofer Katz: For the second quarter of 2024, Revenue is expected to be $93.5 million to $95.5 million, representing year-over-year growth at 5% to 7%. Adjusted EBITDA is expected to be $16 to $18 million. Representing an adjusted EBITDA margin of 18% at the mid- For the full year of 2024, we are raising the bottom end of our guidance and now expect revenue to be in the range of 381 to 387 million, representing year-over-year growth of 5 to 7 percent.

Ofer Katz: For the second quarter of 2024, revenue is expected to be $93.5 million to $95.5 million, representing year-over-year growth of 5% to 7%. Adjusted EBITDA is expected to be $16 to $18 million. Representing an adjusted EBITDA margin of 18% at the mid- For the full year of 2024, we are raising the bottom end of our guidance and now expect revenue to be in the range of 381 to 387 million, representing year-over-year growth of 5 to 7 percent.

Ofer: Now turning to guidance for the second quarter of 2024.

Ofer: Revenue is expected to be 93, five to $95 $5 million.

Ofer: Representing <unk> growth.

Ofer: Growth at 5% to 7%.

Ofer: Adjusted EBITDA is expected to be $16 million to $18 million.

Ofer: Representing an adjusted EBITDA margin of 18% at the midpoint.

Ofer: For the full year 2024.

Ofer: The bottom end of our guidance and now expect revenue to be in the range of 381 to 387 million representing.

Ofer: Growth of 5% to 7%.

Ofer Katz: Adjusted EBITDA is now expected to be in the range of $67 to $73 million. Representing an adjusted EBITDA margin of 18.2% at the mid-term. Our improved guidance reflects our strong performance in Q1 and is largely consistent with assumptions from the beginning of the year. With that, we'll now turn the call over to the operator for questions.

Ofer Katz: Adjusted EBITDA is now expected to be in the range of $67 to $73 million, representing an adjusted EBITDA margin of 18.2% at the mid-term. Our improved guidance reflects our strong performance in Q1 and is largely consistent with assumptions from the beginning of the year. With that, we'll now turn the call over to the operator for questions.

Ofer: Adjusted EBITDA is now expected to be in the range of 6% to seven.

Ofer: $73 million.

Ofer: Presenting an adjusted EBITA margin of 18, 2% at the midpoint.

Ofer: Our improved guidance reflect our strong performance in Q1.

Ofer: And is largely consistent with the assumption from the beginning of the year.

Speaker Change: With that we'll now turn the call over to the operator for questions.

Operator: As a reminder, to ask a question, please press star 1 1 on your telephone and wait for your name to be announced. To restore your question, please press star, 1, and 1 again. We will now take the first question. Coming from the line of Ron Joseph from Citi, please go ahead.

Speaker Change: Thank you.

Ofer: As a reminder to ask a question. Please press star one on your telephone and wait for your name to be announced to waste of your question. Please press star one on one.

Ofer: Again.

Ofer: We will now take the first question.

Ofer: Coming from the line of Joseph from Citi. Please go ahead.

Ronald Josey: All right, thanks for taking the question. Micha, I was really fascinated and interested in all the commentary around AI. And so I wanted to hear just a little bit more about the approach that Fiverr's taking now that you have 10,000, I think, expert networks on the platform, the commentary around chatbot community and things along those lines. So any insights or more details on the type of projects that you're seeing come in with AI would be really helpful here.

Ronald Josey: All right, thanks for taking the question. Micha, I was really fascinated and interested in all the commentary around AI. And so I wanted to hear just a little bit more about the approach that Fiverr's taking now that you have 10,000, I think, expert networks on the platform, the commentary around the chatbot community, and things along those lines. So any insights or more details on the type of projects that you're seeing come in with AI would be really helpful here.

Joseph: Alright, thanks for taking the question.

Joseph: I was really thoughtful and we're interested in all of the commentary around AI and so I wanted to hear just a little bit more about the approach that fiber's, taking now that you have 10000, I think expert networks on the platform the commentary around chatbot community and things along those lines, so any insights or more details on the type of projects that you're that you're seeing.

Speaker Change: Come in with that it would be really helpful. Here.

Ronald Josey: And with that, maybe as the makeshift goes upstream and as we talk about Fiverr business and more complex projects, just Ofer, remind us more about the trajectory on spend per buyer going forward. That was a very strong number here and I wanted to get your thoughts on how that might progress throughout the year. Thank you.

Ronald Josey: And with that, maybe, as the makeshift goes upstream, and as we talk about Fiverr's business and more complex projects, just Ofer, remind us more about the trajectory on spend per buyer going forward. That was a very strong number here, and I wanted to get your thoughts on how that might progress throughout the year. Thank you.

Speaker Change: And with that maybe as the mix shift goes upstream and as we talked about fiber business and more complex projects just over remind us more about the <unk>.

Speaker Change: Trajectory on spend per buyer going forward that was a very strong number here and im wanted to get your thoughts on how that might progress throughout the year. Thank you.

Micha Kaufman: Good morning, Ron. Thanks for the questions. So with regards to the AI and the development there, We're definitely seeing a tailwind in those categories, and these belong more in the complex section of categories. Those include categories that allow businesses to integrate AI into their products. I think we called out the fact that there is an increase in AI avatars in chatbots, professional chatbots for customers.

Micha Kaufman: Good morning, Ron. Thanks for the questions. So with regard to AI and the development there, we're definitely seeing a tailwind in those categories, and these belong more in the complex section of categories. Those include categories that allow businesses to integrate AI into their products. I think we called out the fact that there is an increase in AI avatars in chatbots, professional chatbots for customers.

Speaker Change: Good morning, Ron Thanks for the question.

Ron: Yes, so with regards to the AI in the developing there.

Speaker Change: We're definitely seeing a tailwind in those categories.

Speaker Change: These belong more in the <unk>.

Speaker Change: Complex section of categories those include.

Speaker Change: Those include categories that allow businesses to integrate AI into their products.

Speaker Change: I think we called out the fact that there is a an increase in AI avatars in chart two bullets professional chalkboard, we're for our customers.

Ofer Katz: And we're seeing very high demand across those areas, which is the reason why it was important for us to have sufficient talent on the supply side and very professional one. As said, since a lot of it has to do with software development, these are obviously more complex types of projects that are associated with higher prices and more complex needs. And all of that contributes not only to growth as a category itself, but also the growth in spend per buyer.

Ofer Katz: And we're seeing very high demand across those areas, which is the reason why it was important for us to have sufficient talent on the supply side, and a very professional one at that. As I said, since a lot of it has to do with software development, these are obviously more complex types of projects that are associated with higher prices and more complex needs. And all of that contributes not only to growth as a category itself but also to growth in spend per buyer.

Speaker Change: And we're seeing we're seeing.

Speaker Change: Very high demand across those areas, which.

Speaker Change: Is the reason why it was important for us to have sufficient talent on the supply side and very professional one.

Speaker Change: Said since a lot of it has to do with software development. These are obviously more complex types of projects that are associated with higher prices.

Speaker Change: And the more complex needs.

Speaker Change: And all of that contributes not only to <unk>.

Speaker Change: Growth.

Speaker Change: As the category itself, but also the growth in spend per buyer.

Ofer Katz: And we're definitely seeing this continuing, which is why, as I've said, it was important for us to have a robust supply side on the market base. And we'll continue to update as we see those services evolve. But it's not just those services on the catalog, but also the fact that we're using AI extensively in the product itself to make the experiences of the customers and the sellers much, much better.

Ofer Katz: And we're definitely seeing this continuing, which is why, as I've said, it was important for us to have a robust supply side on the market base. And we'll continue to update as we see those services evolve. But it's not just those services on the catalog but also the fact that we're using AI extensively in the product itself to make the experiences of the customers and the sellers much, much better.

Speaker Change: We're definitely seeing this continuing.

Speaker Change: Which is why as I've said it was important for us of a robust supply side.

Speaker Change: On the March base, and we'll continue to update as we see those services evolve.

Speaker Change: But it's not just it's not just there.

Speaker Change: Those services on the catalog, but also the fact that we're using AI extensively in the product itself to make the experiences.

Speaker Change: Over the customers.

Speaker Change: And the seller is much much better.

Micha Kaufman: Ron, this is Ofer on the second part of the question on the central buyer growth. So we've seen tremendous growth this quarter at 8% year-over-year. And this is a clear indication. For the efforts we are making, I'm going to mark it. Whether throughout the marketing channel, focus on IWBio, under the business solution platform. It's a clear majority of those efforts. And we think there is a room for us, to further expand.

Operator: Ron, this is Ofer on the second part of the question on central buyer growth. So we've seen tremendous growth this quarter at 8% year-over-year. And this is a clear indication of the efforts we are making. Whether throughout the marketing channel, focus on IWBio, under the business solution platform. It's a clear majority of those efforts. And we think there is room for us to further expand.

Ofer: Ron This is ofer the second part of the question on the <unk> growth.

Ofer: We have seen.

Ofer: Tremendous growth this quarter of eight.

Ofer: Percent.

Ron: This is a clear indication.

Ofer: For the efforts, we are making on going upmarket.

Ron: The weather throughout the marketing channel focus on high value buyer.

Ron: All product initiative.

Ron: Although the business solutions platform.

Ron: Those.

Ron: It's a clear mature.

Ron: Okay.

Ron: And we think there is a home for us.

Ron: To further expand.

Ron: The spend.

Ron: Over time, as we keep investing and growing up market.

Micha Kaufman: [inaudible] and Complex Services, just as Biham mentioned. A minute ago, it will not necessarily grow at the same pace. But we do think there is a room to grow and as we maintain. The focus on the strategy of going up market, believe that the bio will grow accordingly.

Operator: [inaudible] and Complex Services, just as Biham mentioned a minute ago. It will not necessarily grow at the same pace, but we do think there is room to grow, and, as we maintain the focus on the strategy of going up market, we believe that the bio will grow accordingly.

Ron: And complex.

Ron: <unk>.

Ron: And then just as we have mentioned.

Ron: A minute ago.

Ron: It will not necessarily grow at the same pace.

Ron: But we do think that there is.

Ron: As a home for both to grow.

Ron: As we maintain.

Ron: The focus on these positive going up market.

Ron: We believe.

Ron: <unk>.

Ron: <unk> will grow.

Ron: Thanks.

Ofer Katz: OK, thank you, Micha. Thank you, Ofer.

Douglas Till Anmuth: OK, thank you, Micha. Thank you, Ofer.

Speaker Change: Okay. Thank you. Thank you ofer.

Speaker Change: Thank you Ron.

Operator: We will now take the next question. From the line of Douglas Anmuth from JP Morgan, please go ahead.

Micha Kaufman: We will now take the next question. On the line from Douglas Anmuth from JP Morgan, please go ahead.

Speaker Change: Q.

Speaker Change: We will now take the next question.

Speaker Change: From the line of Douglas Anmuth from Jpmorgan. Please go ahead.

Douglas Till Anmuth: Thanks for taking the questions. Micha, I wanted to dig into two topics from the letter, trust on the platform and then also the potential with agencies. So in terms of trust, can you just talk about what high value buyers are telling you that they need to spend more and then what some of those key initiatives are? And then on agencies, if you could just talk more about the potential there, some of the progress you've seen in digital marketing and tech, and then what other verticals might be attractive to target going forward. Thanks. Thanks for all the questions, Doug, and good morning.

Operator: Thanks for taking the questions. Micha, I wanted to dig into two topics from the letter: trust on the platform and then also the potential with agencies. So in terms of trust, can you just talk about what high-value buyers are telling you that they need to spend more and then what some of those key initiatives are? And then on agencies, could you just talk more about the potential there, some of the progress you've seen in digital marketing and tech, and then what other verticals might be attractive to target going forward? Thanks. Thanks for all the questions, Doug, and good morning.

Douglas Till Anmuth: Thanks for taking the questions.

Douglas Till Anmuth: I wanted to dig into two topics from the letter trust on the platform and then also the potential with agencies. So in terms of trust can you just talk about what high value buyers are telling you that they need to spend more and then what some of those key initiatives are and then on agencies. If you could just talk more about the potential there some of them.

Douglas Till Anmuth: Progress you've seen in digital marketing and Tech and then what other verticals might be attractive to target going forward. Thanks.

Micha Kaufman: Thanks for all the questions, Doug. Good morning, as one of the main drivers when we think about the ability to fulfill more complex projects. And as you think about it, the higher the spend is, the higher the trust that needs to be between the customers and the platform and the service providers, which is also one of the reasons why we're investing in agencies. These two questions are connected from our end.

Micha Kaufman: Thanks for all the questions, Doug. Good morning. This is one of the main drivers when we think about the ability to fulfill more complex projects. And as you think about it, the higher the spend is, the higher the trust that needs to be between the customers and the platform and the service providers, which is also one of the reasons why we're investing in agencies. These two questions are connected from our end.

Speaker Change: Thanks for the questions Doug Good morning.

Speaker Change: Yes, So we've mentioned trust us.

Speaker Change: As one of the.

Speaker Change: One of the main drivers when we think about the ability to fulfill more complex projects.

Speaker Change: And as you as you think about it.

Speaker Change: The higher the spend is the.

Micha Kaufman: And this is why we've seen agencies as a proxy for creating trust and quality, which is why we started to have more exposure to agencies on the platform in specific categories. For many reasons, mostly being competitive reasons, we didn't list the categories in which we're going to continue rolling this out. But the plan is to continue rolling this out across many categories. And the signs that we're seeing so far are very promising. We're seeing great conversion.

Micha Kaufman: And this is why we've seen agencies as a proxy for creating trust and quality, which is why we started to have more exposure to agencies on the platform in specific categories. For many reasons, mostly competitive reasons, we didn't list the categories in which we're going to continue rolling this out. But the plan is to continue rolling this out across many categories, and the signs that we're seeing so far are very promising. We're seeing great conversion.

Micha Kaufman: We're seeing much more complex services. And we're seeing that the overall spend that our buyers are doing with us when they work with agencies is multiple times what they do on average. So for all of these reasons, it's important for us to continue investing in it. And again, this is all about decision making, which is also the reason why we were making the technology behind the matching algorithms much more sophisticated. So we can actually provide the matching with the types of talent that instill trust in the customers. And again, depending on on the complexity of the of the process.

Micha Kaufman: We're seeing much more complex services, and we're seeing that the overall spend that our buyers are doing with us when they work with agencies is multiple times what they do on average. So for all of these reasons, it's important for us to continue investing in it. And again, this is all about decision making, which is also the reason why we are making the technology behind the matching algorithms much more sophisticated. So we can actually provide matching with the types of talent that instill trust in the customers, and again, depending on the complexity of the process.

Speaker Change: And we're seeing that the overall spend that our buyers are.

Speaker Change: We are doing with us when they work with agencies is multiple times, what they do on average so for all of these reason.

Speaker Change: It's important for us to continue investing in it and again. This is all about decision, making which is which is also the reason why we were making.

Speaker Change: The technology behind the matching algorithm is much more sophisticated.

Speaker Change: So we can actually provide the matching.

Speaker Change: With the types of talent that instill trust in the customers.

Speaker Change: And again, depending on the complexity of the project.

Speaker Change: Thank you.

Speaker Change: We will now take the next question.

Operator: We will now take the next question. From the line of Andrew Boone from JMP Securities, please go ahead.

Operator: We will now take the next question. On the line from Andrew Boone from JMP Securities, please go ahead.

Speaker Change: From the line of Angie <unk> from JMP Securities. Please go ahead.

Andrew M. Boone: Thanks so much for taking my questions. I wanted to follow along with that last question.

Andrew M. Boone: Thanks so much for taking my questions. I wanted to go along with that last question.

Angie: Thanks, So much for taking my questions I wanted to follow on with that last question. As you do think about going after more complex gigs on fiber.

Angie: Can you talk about how the product mix to evolve in terms of moving away from just simple kind of point click gangs versus something that may be more complex. What do you guys need to do to really bring more liquidity for complicated gigs and then.

Angie: Would love to hear more about take rate on the platform again, we saw it step up this quarter, how should we think about that going forward in that in the trajectory of grants from the sustainability. There. Thanks so much.

Micha Kaufman: As we do think about going after more complex gigs on Fiverr, Mika, can you talk about how the product needs to evolve in terms of moving away from just simple kind of point and click gigs versus something that may be more complex? What do you guys need to do to really bring more liquidity for complicated gigs? And then we'd love to hear more about take rate on the platform. Again, we saw it step up this quarter. How should we think about that going forward in the trajectory of take rates and sustainability there? Thanks so much.

Micha Kaufman: As we do think about going after more complex gigs on Fiverr, Mika, can you talk about how the product needs to evolve in terms of moving away from just simple kind of point and click gigs versus something that may be more complex? What do you guys need to do to really bring more liquidity to complicated gigs? And then we'd love to hear more about take rate on the platform. Again, we saw it step up this quarter. How should we think about that going forward in the trajectory of take rates and sustainability there? Thanks so much.

Speaker Change: Good morning, Andrew Thanks for the question.

Micha Kaufman: Good morning, Andrew. Thanks for the question. So when we think about complex, more complex services, this is actually what we've been doing with the types of solutions that we were building under the umbrella of the Fiverr business solution. Meaning that in some cases, when the gig model can satisfy a need, then a prepackaged model is sufficient. In some cases, a more bespoke, type of treatment is needed in order to satisfy the needs of a customer.

Micha Kaufman: Good morning, Andrew. Thanks for the question. So when we think about complex, more complex services, this is actually what we've been doing with the types of solutions that we were building under the umbrella of the Fiverr business solution. Meaning that in some cases, when the gig model can satisfy a need, then a prepackaged model is sufficient. In some cases, a more bespoke type of treatment is needed in order to satisfy the needs of a customer.

Andrew: Yeah. So when we think about complex more complex services. This is actually what we've been doing with the types of solutions that we were building under the umbrella of the fiber business solutions.

Angie: Meaning that in some cases, when the geek modal can satisfy a need.

Angie: Then a prepackaged modal is sufficient in some cases a more bespoke.

Angie: Type of treatment is needed in order to satisfy the need of our customer and for that we have multiple models and again I'm not I don't want to jump the gun.

Micha Kaufman: And for that, we have multiple models. And again, I'm not, I don't want to jump the gun as to what we're going to start introducing in our summer release. It is coming soon. But so I'm not going to get into details, but, for example, you know, solutions like product management, where you can actually tackle more complex projects through the usage of a product manager that can orchestrate the entire project for you, is one of the solutions. Actually, in some cases, agencies are able to provide these types of project solutions.

Micha Kaufman: And for that, we have multiple models. And again, I don't want to jump the gun as to what we're going to start introducing in our summer release. It is coming soon. But, so I'm not going to get into details, but, for example, you know, solutions like product management, where you can actually tackle more complex projects through the use of a product manager that can orchestrate the entire project for you. Actually, in some cases, agencies are able to provide these types of project solutions.

Angie: As to what we're going to start introducing.

Angie: Our summer release is.

Angie: It is coming soon but so I'm not going to get into details, but for example solutions like product project management, where you can actually tackle more complex project through the usage of a product manager that can orchestrate the entire project for you.

Angie: Is one of these solutions.

Angie: So in some cases agencies are able to provide these types of product solutions.

Micha Kaufman: And there is a number of additional ways for customers, to satisfy their more complex needs, which we're going to get to in our next earnings once we have the summer release behind us. So unfortunately, with some of that information, we'll have to wait a little while, um the second one was take rate maybe in terms of uh in terms of take rate, Now, this question. I think since we're in public, about the sustainability of take rates and we always. That's pretty much the same.

Micha Kaufman: And there are a number of additional ways for customers to satisfy their more complex needs, which we're going to get to in our next earnings once we have the summer release behind us. So unfortunately, with some of that information, we'll have to wait a little while. The second one was take rate, maybe in terms of uh, in terms of take rate. Now, this question. I think since we're in public, about the sustainability of take rates, and we always. That's pretty much the same.

Angie: And there is a number of additional ways for customers.

Angie: To satisfy their more complex needs, which we're going to get to in our next earnings. Once we have once we have the summer lease behind us.

Angie: So unfortunately with some of that information, we will have to wait a little while.

Angie: The second one was take rate maybe.

Angie: In terms of take rate.

Angie:

Angie: Now this question.

Angie: Is that has been asked.

Angie: Since we went public.

Angie: About the sustainability of tax rate.

Angie: And we always.

Angie: So pretty much the same we feel very confident.

Ofer Katz: We feel very confident. With the take rate as it is now. It is based on two layers, one is transactional. And the second part is value-added services. The reason for the expansion. [inaudible] and SellerPlus Contribution.

Ofer Katz: We feel very confident with the take rate as it is now. It is based on two layers, one is transactional, and the second part is value-added services. The reason for the expansion. [inaudible] and SellerPlus Contribution.

Angie: With the take rate as it is now.

Angie: It is based on two layers one is production of boom.

Angie: And the second part is value added services.

Angie: The reason for the expansion.

Angie: As a base amount of services that we offer both on the set aside and biocide Wil.

Angie: We mentioned on the shareholders' letter of the promoted gigs.

Angie: And seller plus contribution.

Angie: 55% to 75% and we believe there is a room for both products.

Ofer Katz: Thank you very much, to grow beyond and they also think that there are other products in the pipe, that might contribute on top. So, so, so confidence is high. And we think that there is a room for us to extend. Take great modestly over the next few quotes.

Ofer Katz: Thank you very much for growing beyond, and they also think that there are other products in the pipe that might contribute on top. So, so, confidence is high. And we think that there is room for us to extend. Take great modesty over the next few quotes.

Angie: To grow beyond.

Angie: And they also think that there are other products in the pipe.

Angie: That might contribute.

Angie: Todd.

Todd: So so so confidence is high.

Angie: And we think that.

Angie: There is a home for us to extend.

Angie: Modestly over the next few quarters.

Speaker Change: Thank you.

Angie: Thank you.

Operator: We will now take the next question. From the line of Jason Helfstein from Oppenheimer, please go ahead.

Operator: We will now take the next question. On the line from Jason Helfstein from Oppenheimer, please go ahead.

Angie: Yeah.

Speaker Change: We will now take the next question.

Speaker Change: From the line of Jason <unk> from Oppenheimer. Please go ahead.

Jason Stuart Helfstein: Thanks. Two questions. One, just on the Spenver buyer. Is there a way to kind of say how much of the improvement was due to improvement in SMB spend versus kind of moving up market to mix? And then second, I mean, you talked about how you are seeing clear momentum around AI categories and demand. I mean, can you maybe give the offsetting factors, like give us a sense of where you're seeing kind of like headwinds or negative pressure from AI that may be cutting into certain categories that are just not as important? And are you able to kind of distill that from like other macro factors that could also be affecting those categories?

Jason Stuart Helfstein: Thanks. I have two questions. One, just on the Spenver buyer. Is there a way to kind of say how much of the improvement was due to improvement in SMB spend versus kind of moving up market to mix? And then second, you talked about how you are seeing clear momentum around AI categories and demand. Can you maybe give us the offsetting factors, like give us a sense of where you're seeing kind of like headwinds or negative pressure from AI that may be cutting into certain categories that are just not as important? And are you able to kind of distill that from other macro factors that could also be affecting those categories?

Jason: Thanks, two questions one just on this member buyer.

Jason: Is there a way to kind of say like how much of the improvement was due to improvement in F&B spend versus kind of moving up market.

Speaker Change: To mix.

Speaker Change: And then second.

Jason: I mean, you talked about how you are seeing clear momentum around AD categories in demand I mean can you maybe give the offsetting factors like.

Speaker Change: Give us a sense of like where you're seeing kind of like headwinds negative pressure from AI. There may be cutting into certain categories. There is not as important and are you able to kind of that is still that from like other macro factors that could also be affecting those affecting those categories. Thank you.

Micha Kaufman: Morning, Jason. So on the spend per buyer, it is more driven by the investment that we're doing in going on parks. We shouldn't be surprised when we think about customer acquisition in general, we've been focusing on high value buyers, those who are spending more with us, and that cohort continues to grow. Second thing is that we know that forward behavior continues to improve in the sense that the customers that we acquire spend, materially more in their first transaction with us and then in subsequent transactions.

Micha Kaufman: Morning, Jason. So on the spend per buyer, it is more driven by the investment that we're making in going into parks. We shouldn't be surprised when we think about customer acquisition in general; we've been focusing on high-value buyers, those who are spending more with us, and that cohort continues to grow. The second thing is that forward behavior continues to improve in the sense that the customers that we acquire spend materially more in their first transaction with us and then in subsequent transactions.

Jason: Okay.

Speaker Change: Morning, Jason.

Speaker Change: So on the spend per buyer.

Speaker Change: It is more driven by the investment that we're doing in growing our markets.

Speaker Change: We shouldnt be a surprise.

Speaker Change: When we think about customer acquisition in general we've been focusing on high value buyers those are spending more with us and in that cohort continues to grow.

Speaker Change: Second thing is that we know that GOR behavior continues to improve in the sense that the customers that we acquire spend materially more in their first transaction with US and then and then in subsequent transaction. So all of that is what what is.

Micha Kaufman: So all of that is what is mostly contributing to spend per buyer. We haven't seen any macro changes, meaning macro is not getting better. And by the way, again, I don't think it should be a surprise to anyone.

Speaker Change: Mostly contributing to spend per buyer, we haven't seen any macro changes, meaning it's macro is not getting better.

Speaker Change: And by the way had again I don't think it should be a surprise to anyone that if you think about the macro conditions.

Micha Kaufman: You think about the macro conditions, they haven't changed that far. But definitely the investment that we're doing in those better, higher quality cohorts is paying off. Spamprobier is a good reflection of it, of the second part of your question about the clear movement that we're seeing with with AI. So So, you know, we mentioned in the previous earning the fact that the, negative impact that we're seeing from AI is mostly around the very simple types of services, those are normally services that would sell for, you know, for 10 $15, which is, I mean, we are moving I mean, the majority of the majority of contribution is coming from more complex, complex services anyway. And, as I said, we continue to see AI as a net positive. So we contributing more than the offsetting factors of simple products. It happens across, several categories in several verticals.

Micha Kaufman: If you think about the macro conditions, they haven't changed that far. But definitely, the investment that we're doing in those better, higher quality cohorts is paying off. Stamp provider is a good reflection of it, on the second part of your question about the clear movement that we're seeing with AI. So So, you know, we mentioned in the previous earnings the fact that the negative impact that we're seeing from AI is mostly around the very simple types of services. Those are normally services that would sell for, you know, for 10 to $15, which is, I mean, we are moving. The majority of the majority of contribution is coming from more complex, complex services anyway. And, as I said, we continue to see AI as a net positive. So we are contributing more than the offsetting factors of simple products. It happens across several categories in several verticals.

Speaker Change: Haven't changed.

Speaker Change: Thus far.

Speaker Change: But definitely the investment we're doing in in those better.

Speaker Change: Higher quality cohorts is paying off in the central buyer is.

Speaker Change: Is a good reflection of it.

Speaker Change: The second part of your question about the clear momentum, we're seeing with <unk> AI.

Speaker Change: So.

Speaker Change: So we mentioned.

Speaker Change: In the previous earning the fact that the.

Speaker Change: Negative impact that we're seeing from AI is mostly around.

Speaker Change: The very simple types of of services.

Speaker Change: Those are normally services that would sell for.

Speaker Change: For $10 $15.

Speaker Change: Which is something we are moving the majority of the.

Speaker Change: The majority of contribution is coming from more complex.

Speaker Change: Complex services anyway.

Speaker Change: And as I said, we continue to see AI as a net positive so it's it's contributing more than.

Speaker Change: Then the.

Speaker Change: Offsetting factors of simple a product it happens across several categories and in several verticals.

Micha Kaufman: But there's nothing, you know, specific to call out even, you know, you look at areas that you might think that AI would influence significantly like translation. But what you're seeing is actually that the very simple services around translation are being affected. The more complex types of services are not I mean, if you if you would a book and then want to translate it into a different language that you don't command, I would doubt that you would let AI translate it and go publish the outcome without actually verifying it.

Micha Kaufman: But there's nothing, you know, specific to call out. Even, you know, you look at areas that you might think that AI would influence significantly, like translation. But what you're seeing is actually that the very simple services around translation are being affected. The more complex types of services are not. I mean, if you write a book and then want to translate it into a different language that you don't command, I would doubt that you would let AI translate it and publish the outcome without actually verifying it.

Speaker Change: But theres nothing specific to call out.

Speaker Change: Even in the.

Speaker Change: You look at the areas that you might.

Speaker Change: I think that AI would influence significantly like translation with what Youre seeing is actually the very simple.

Speaker Change: Services around transition are being affected the more complex types of services are not I mean, if you if you would.

Speaker Change: <unk> book, and then want to translate it into a.

Speaker Change: Different language that you don't command.

Speaker Change: I would doubt that you would let AI translated in co publish the outcome without actually verifying it so so.

Micha Kaufman: So these are... You'd get a lot more interesting book that way. I mean, yeah, I mean, the outcome might be surprising, with all the hallucinations that AI likes to create. But the point is, things like Logo, for example, which again, going back to the very early history of the company, this is like a low ARPU type thing. Even in that, it is an area that you're still actually seeing people using this. It's not like Logos have gone to zero.

Micha Kaufman: So these are... You'd get a lot more interesting book that way. I mean, yeah, the outcome might be surprising, with all the hallucinations that AI likes to create. But the point is, things like Logo, for example, which again, going back to the very early history of the company, this is like a low ARPU type thing. But even in that, it is an area that you're still actually seeing people using. It's not like Logos has gone to zero.

Speaker Change: So these are as you get a lot more interesting book that way.

Speaker Change: I mean, yes, I mean, the outcome might be.

Speaker Change: Might be surprising.

Speaker Change: With all the hallucinations.

Speaker Change: AI like.

Speaker Change: Good morning.

Speaker Change: Things like logo for example, right, which again going back to the very early history in the company right that was yes, I guess, it's like a low <unk> type thing even in that it is an area that youre still youre still actually seeing people using this and not below the current era.

Micha Kaufman: Correct. Again, I mean, if you're a serious business that takes your design, your brand seriously, you would take an expert to actually work. And I'm sure many experts actually use AI tools in their process of work, but they don't rely on blindly letting AI run the work for them. But it is more of the modern tech that they use in order to to amplify their creative process. We appreciate the call.

Micha Kaufman: Correct. Again, I mean, if you're a serious business that takes your design, your brand seriously, you would take an expert to actually work. And I'm sure many experts actually use AI tools in their process of work, but they don't rely on blindly letting AI run the work for them. But it is more of the modern tech that they use in order to amplify their creative process. We appreciate the call.

Speaker Change: Pat.

Speaker Change: Correct again I mean.

Speaker Change: If you're a serious business.

Speaker Change: That takes your design your brands seriously.

Speaker Change: You would take an expert to actually work in.

Speaker Change: I'm sure many experts actually use AI tools in their process of work, but they don't rely on blindly leading AI.

Speaker Change: Run the work for them, but it is more of a of the modern tech that they use.

Speaker Change: In order to.

Speaker Change: Sure.

Speaker Change: To amplify their creative process.

Micha Kaufman: I appreciate the call. Thank you. Thank you, Jason.

Operator: I appreciate the call. Thank you. Thank you, Jason.

Speaker Change: Okay I appreciate the color. Thank you. Thank you Jason.

Speaker Change: Thank you.

Operator: We will now take the next question. From the line of Matt Farrell from Piper Sandler, please go ahead.

Matthew F. Farrell: We will now take the next question. From the line of Matt Farrell from Piper Sandler, please go ahead.

Speaker Change: We will now take the next question.

Speaker Change: From the line of Matt Farwell from Piper Sandler. Please go ahead.

Matthew F. Farrell: Thanks for taking my question, guys. As you continue to prioritize the move up market, can you just remind us of the go-to-market strategy for the larger wallet clients? And as we progress along this move, how should we think about the need for a sales force as you move forward? Thanks.

Micha Kaufman: Thanks for taking my question, guys. As you continue to prioritize the move up market, can you just remind us of the go-to-market strategy for the larger wallet clients? And as we progress along this move, how should we think about the need for a sales force as we move forward? Thanks.

Matthew F. Farrell: Thanks for taking my question guys.

Matthew F. Farrell: We've continued to prioritize the move up market can you just remind us of the go to market strategy for the larger wallet clients and as we progress along this move how should we think about the need for a sales force.

Matthew F. Farrell: As you move forward. Thanks.

Micha Kaufman: Morning, Matt. Thanks for the question. So when, you know, we've talked about this in previous quarters as well. When when you look at the topo funnel traffic that comes to Fiverr, it contains, All the customers that we need to go up. And in most cases, it's just identifying who those customers are, and making sure that we drive them to the best experience within the product. In our case, it's the types of solutions that are offered by the Fiverr Business Solutions Suite with ProLeading.com.

Micha Kaufman: Morning, Matt. Thanks for the question. So when, you know, we've talked about this in previous quarters as well. When you look at the topo funnel traffic that comes to Fiverr, it contains all the customers that we need to grow. And in most cases, it's just identifying who those customers are and making sure that we drive them to the best experience within the product. In our case, it's the types of solutions that are offered by the Fiverr Business Solutions Suite with ProLeading.com.

Speaker Change: <unk>.

Speaker Change: Good morning, Matt Thanks for the questions.

Speaker Change: So.

Speaker Change: We've talked about this in previous.

Speaker Change: Quarters as well.

Speaker Change: When you look at the top of funnel.

Speaker Change: Profit that comes to fiber. It contains all of the customers that we need to go up market.

Speaker Change: In most cases, it's just identifying who those customers are and then making sure that we drive them to the best experience within the product.

Speaker Change: Our case, it's the types of solutions that are offered by the fiber business solutions suite with <unk>, leading that suite.

Micha Kaufman: And to increase that, we have introduced a number of additional programs, like the partnership program certified in enterprise, which allows us to really entertain all the range of different customers as we go up market. But as I've said, in most cases, I mean, the sales team here on the enterprise side is extremely small and we're able to continue adding a lot of big logos into our product. The majority is coming from the funnel that comes to Fiverr, and as we become better at identifying, Those customers and pairing them with the right solutions, the better the conversion and the engagement that we're getting.

Micha Kaufman: And to increase that, we have introduced a number of additional programs, like the partnership program certified in enterprise, which allows us to really entertain a wide range of different customers as we go up market. But as I've said, in most cases, the sales team here on the enterprise side is extremely small, and we're able to continue adding a lot of big logos to our product. The majority is coming from the funnel that comes to Fiverr, and as we become better at identifying those customers and pairing them with the right solutions, the better the conversion and the engagement that we're getting.

Speaker Change: And to increase that we have introduced a number of additional programs.

Speaker Change: Partnership program certified.

Speaker Change: In enterprise, which allows us to really entertain.

Speaker Change: Of all the range of different customers as we go up market.

Speaker Change: But as I've said in most cases I mean, the sales team here on the enterprise side is extremely small.

Speaker Change: And.

Speaker Change: We're able.

Speaker Change: To continue.

Speaker Change: Adding.

Speaker Change: A lot of a lot of big logos into our into our products.

Speaker Change: The majority the majority is coming from the funnel that comes to fiber in as we become better at identifying.

Speaker Change: Those customers and pairing them with the right solutions.

Speaker Change: The conversion.

Speaker Change: And the and the engagement that we're getting with these customers.

Micha Kaufman: Thanks, and congrats on the share repurchase authorization. Just given that it's your first program and the strength of your balance sheet, how should we be thinking about the pace of buybacks as you kind of start to implement the program? Thanks.

Speaker Change: Thanks, and congrats on the share repurchase authorization just given that it's your first program and the strength of your balance sheet, how should we be thinking about the pace of buybacks.

Speaker Change: So you kind of start to implement the program. Thanks.

Micha Kaufman: Thank you. So so in general, I think, you know, we've we've given color on this on our remarks. But again, you know, this really reflects our confidence in Fiverr's long term opportunity. And given the fact that we have a very strong balance sheet and free cash flow, we have the ability to invest into growth while also returning some shareholder value. So, you know, we've, we've.

Micha Kaufman: Thank you. So, so in general, I think we've given color on this in our remarks. But again, this really reflects our confidence in Fiverr's long-term opportunity. And given the fact that we have a very strong balance sheet and free cash flow, we have the ability to invest in growth while also returning some shareholder value. So, you know, we have, we have.

Speaker Change: Thank you so so in general I think we've given.

Speaker Change: Color on this on our remarks, but again.

Speaker Change: This really reflects our confidence in fibers long term opportunity.

Speaker Change: And given the fact that we have a very strong balance sheet.

Speaker Change: And free cash flow.

Speaker Change: We have the ability to invest into growth while also returning some shareholder value.

Speaker Change: So.

Speaker Change: We've.

Micha Kaufman: We put this plan in place so that we can execute it as fast as possible. So for as long as the stock is cheap. And the speed really will depend on strategic decisions and market conditions. And, you know, we said that this would be our strategy moving forward. So as you said, this is the first time that we're doing it. But as long as these conditions are met, we're going to do it.

Micha Kaufman: We put this plan in place so that we can execute it as fast as possible, so for as long as the stock is cheap. And the speed will really depend on strategic decisions and market conditions. And, you know, we said that this would be our strategy moving forward. So, as you said, this is the first time that we're doing it, but as long as these conditions are met, we're going to do it.

Speaker Change: We've put this plan in place so that we can execute it as fast as possible.

Speaker Change: So for as long as the stock is cheap right.

Speaker Change: And the speed really will depend on strategic decisions and market conditions.

Speaker Change: We said that this would be our strategy moving forward.

Speaker Change: So as you said this is the first time that we're doing it.

Speaker Change: But as long as these conditions are met we're going to we're going to do it as fast as possible.

Micha Kaufman: Awesome. Thanks again, guys.

Operator: Awesome. Thanks again, guys.

Speaker Change: Awesome. Thanks again guys. Thank you.

Speaker Change: Thank you.

Operator: We will now take the next question. From the line of Eric Sheridan from Goldman Sachs, please go ahead.

Eric James Sheridan: We will now take the next question. On the line from Eric Sheridan from Goldman Sachs, please go ahead.

Speaker Change: We will now take the next question.

Speaker Change: From the line of Eric Sheridan from Goldman Sachs. Please go ahead.

Eric James Sheridan: Thanks so much for taking the question. Just one if I could. When you think about the international opportunity, how should we be thinking about going deeper in the market you're already in versus continue and expand the geographic footprint in the years ahead? And how much of an element of the decision between either or both of those options are down to a better macro environment and maybe a little bit more visibility into return on investment to sort of widen out that purview?

Micha Kaufman: Thanks so much for taking the question. Just one if I could. When you think about the international opportunity, how should we be thinking about going deeper in the market you're already in versus continuing and expanding the geographic footprint in the years ahead? And how much of an element of the decision between either or both of those options is down to a better macro environment and maybe a little bit more visibility into return on investment to sort of widen out that purview?

Eric James Sheridan: Thanks, So much for taking the question just wanted if I could when you think about the international opportunity how should we be thinking about going deeper in the markets you're already in versus continuing to expand the geographic footprint in the years ahead and how much of an element of the tissues decision between either or both of those options are down.

Eric James Sheridan: To a better macro environment, and maybe a little bit more visibility into return on investment to sort of widen out that per view. Thank you.

Micha Kaufman: Thank you.

Eric James Sheridan: Okay.

Speaker Change: Good morning, Erik Thanks for the questions.

Micha Kaufman: Good morning, Eric. Yeah, so, um... So, as we noted, the focus that we have on the international is mostly around UK and Germany right now, and we're seeing that they're doing well. They're growing faster than the U.S. under these conditions. And I think that the key to that is, A, there is, more of an on-top potential outside of the U.S., U.S. as you know, a different level of maturation when you think about working with with freelancers and agencies, and Europe is picking up macro conditions are, Not materially different, but they are different, and the strategy of optimizing the different marketing channels or customer engagement channels are something that we've been perfecting over the past few quarters.

Erik: Yes so.

Speaker Change: So as we noted the focus that we have on the interaction is mostly around UK.

Speaker Change: In Germany right now.

Speaker Change: And we're seeing that they are doing well.

Speaker Change: They are growing faster than the U S. Under these conditions.

Speaker Change: And I think that.

Speaker Change: The key to two that is a there is.

Speaker Change: More of an untapped potential outside of the U S. U S is.

Speaker Change: A different level of maturation when you think about working with freelancers in agencies and Europe is picking up macro conditions are.

Speaker Change: Not.

Speaker Change: Not materially different but they are different.

Speaker Change: And the strategy of optimizing the different marketing channels or customer.

Speaker Change: Engagement channels are something that we've been perfecting over the past few quarters.

Micha Kaufman: I think that coupled with the fact that we've identified some, you know, cultural changes that require some some product tweaking in order to optimize the experience in different locales has altogether proven itself to be working out well, which is which is the reason why it's, It's it's growing faster. We'll continue doing that.

Micha Kaufman: I think that coupled with the fact that we've identified some, you know, cultural changes that require some product tweaking in order to optimize the experience in different locales has altogether proven itself to be working out well, which is why it's growing faster. We'll continue doing that.

Speaker Change: I think that coupled with the fact that we've identified some.

Speaker Change: Cultural changes that require some some product tweaking in order to optimize the experience even in different locales.

Speaker Change: As altogether proven itself.

Speaker Change: To be working out well, which is which is.

Micha Kaufman: The opportunity for growth is obviously very, very large. If you think about about just Europe combined in terms of S&B size. The SMBs in Europe combined is one and a half times larger than the, Meaning that there's plenty of potential to continue growing there. And obviously, when macro improves, growth is going to be easier.

Micha Kaufman: The opportunity for growth is obviously very, very large. If you think about just Europe combined in terms of S&B size, the SMBs in Europe combined are one and a half times larger than the, meaning that there's plenty of potential to continue growing there. And obviously, when macro improves, growth is going to be easier.

Speaker Change: The reason why.

Speaker Change: It's it's growing faster, we will continue doing that.

Speaker Change: <unk> for growth is obviously very very large if you think about just Europe combined in terms of SMB side.

Speaker Change: The Smbs and in Europe combined is one five times larger than the U S.

Speaker Change: Meaning that there is plenty of potential to continue growing there and obviously when macro improves growth is going to be easier and cheaper.

Speaker Change: Thank you.

Operator: We will now take the next question. From the line of Bernie McTernan from Needham and Company, please go ahead. Hi, this is Stephanos Christ calling in for Bernie.

Speaker Change: We will now take the next question.

Speaker Change: From the line of Bernie Mcternan from Needham <unk> Company. Please go ahead.

Speaker Change: Hi, This is stefanos crist, calling in for Bernie Thanks for taking our questions.

Stefanos Crist: I just wanted to clarify the complex services getting over to a third of the marketplace.

Speaker Change: Is that an <unk> or the number of jobs.

Stefanos Crist: And maybe one are you contemplating to that mix shift for your full year guidance. Thank you.

Bernard Jerome McTernan: The short answer is it's GMV. And our expectation is that complex. We'll continue to grow.

Stephanos Christ: The short answer is it's GMV, and our expectation is that it's that complex. We'll continue to grow.

Speaker Change: The short answer is it's GMB.

Speaker Change: And.

Speaker Change: Our expectation is that complex.

Speaker Change: We'll continue to grow.

Speaker Change: Got it thank you.

Speaker Change: Thank you.

Operator: We will now take the next question. From the line of Rohit Kulkarni from Prof MKM, please go ahead.

Operator: We will now take the next question. From the line of Rohit Kulkarni from Prof. MKM, please go ahead.

Speaker Change: We will now take the next question.

Rohit Rangnath Kulkarni: Hey, thanks for taking my questions. A couple, if I could.

Speaker Change: From the line of Rohit Kulkarni from Roth and km. Please go ahead.

Micha Kaufman: One on AI, this 95% growth in AI GMV, it might be coming off of a small base, but do you see that trend line accelerate as I'm sure there are new types of use cases getting unlocked as well as new types of buyers coming in? And any more color on this AI related GMV that, where is it coming from? Where is the strength manifesting in right now, either small versus high value buyers or repeat buyers getting more active versus net new buyers coming to the platform? So that's my first question on AI.

Micha Kaufman: One on AI, this 95% growth in AI GMV, it might be coming off of a small base, but do you see that trend line accelerate as I'm sure there are new types of use cases getting unlocked as well as new types of buyers coming in? And any more color on this AI-related GMV? Where is it coming from? Where is the strength manifesting itself right now, either small versus high-value buyers or repeat buyers getting more active versus net new buyers coming to the platform? So that's my first question about AI.

Rohit Rangnath Kulkarni: Hey, Thanks for taking my questions a couple if I could one on AI.

Rohit Rangnath Kulkarni: 95% growth in <unk>.

Rohit Rangnath Kulkarni: It might be coming off of a small base, but.

Rohit Rangnath Kulkarni: Do you see that.

Speaker Change: Main line accelerators.

Speaker Change: Sure there are new types of use cases.

Speaker Change: Getting unlocked as well as new types of buyers coming in and any more color on this later GMB.

Speaker Change: Where is it coming from better the strength manifesting.

Speaker Change: And right now either small versus high value buyers are from repeat buyers are getting more active versus.

Speaker Change: New buyers coming to the platform.

Speaker Change: So thats my first question on AI and second to be excellent.

Micha Kaufman: And second, to the extent you can comment on how you feel about the long-term profitability of the business, clearly with the share buyback, you have greater conviction and there's a high likelihood that you're closing in on high teams EBITDA margin as the year exits. So perhaps talk about how high do you think this business's profitability can go? And there are marketplaces that offer similar characteristic that have demonstrated 30, 35% margins over the future. So I would love to see how you're thinking now that last 18 months you've provided a very strong track record of kind of stabilizing, growing, and then improving profitability. So thank you.

Micha Kaufman: And second, to the extent you can comment on how you feel about the long-term profitability of the business, clearly, with the share buyback, you have greater conviction, and there's a high likelihood that you're closing in on a high team EBITDA margin as the year exits. So perhaps you could talk about how high you think this business's profitability can go? And there are marketplaces that offer similar characteristics that have demonstrated 30, 35% margins in the future. So I would love to see how you're thinking now that, for the last 18 months, you've provided a very strong track record of kind of stabilizing, growing, and then improving profitability. So, thank you.

Speaker Change: You can comment on how you feel about the long term.

Speaker Change: Profitability of the business clearly with the <unk>.

Speaker Change: Share buyback you have greater conviction.

Speaker Change: And.

Speaker Change: There's a high likelihood that.

Speaker Change: We're closing in on.

Speaker Change: High teens EBITDA margin as the year exit so so perhaps talk about how.

Speaker Change: Hi, do you think this.

Speaker Change: Businesses profitability can go under marketplaces, but.

Speaker Change: Our offer similar characteristics.

Speaker Change: Demonstrative 30, 35% margins over the future so I would love to see how youre thinking.

Speaker Change: The last 18 months.

Speaker Change: <unk> had a very strong track record of.

Speaker Change: Kind of stabilizing growing and then improving profitability. So thank you.

Micha Kaufman: Good morning, Rohit. Thanks for the question. Yeah, so so you're right, AI is still pretty new. So as a base, it is growing off. It is obviously a new category, but we continue to add a lot of new AI categories constantly, as the technology evolves. And overall, we're seeing, you know, lots of buyers coming to Fiverr as a destination for those services. So, so we are becoming. [inaudible] We're seeing that demand coming both from new customers and repeat customers. Some customers are getting to us through these categories, and we see these categories have a higher ticket size. They're by definition more complex and require bespoke development.

Micha Kaufman: Good morning, Rohit. Thanks for the question. Yeah, so you're right, AI is still pretty new. So, as a base, it is growing out of. It is obviously a new category, but we continue to add a lot of new AI categories constantly as the technology evolves. And overall, we're seeing, you know, lots of buyers coming to Fiverr as a destination for those services. So, we are becoming. [inaudible] We're seeing that demand coming both from new customers and repeat customers. Some customers are coming to us through these categories, and we see these categories have higher ticket sizes. They're, by definition, more complex and require bespoke development.

Speaker Change: Good morning, <unk>. Thanks for the question yes.

Speaker Change: Yes so.

Speaker Change: Youre right AI is still pretty new so the base is growing off.

Speaker Change: It is obviously, a new category, but we continue to add a lot of <unk>.

Speaker Change: New AI categories constantly.

Speaker Change: As the technology evolves and overall, we're seeing.

Speaker Change: Lots of buyers coming to fiber as a destination for those services.

Speaker Change: So we are becoming.

Speaker Change: Synonymous with these with these types of services and as we mentioned in the call.

Speaker Change: We're seeing we're seeing over 10.

Speaker Change: 10000.

Speaker Change: AI expert.

Speaker Change: On the supply side is continuing to growth.

Speaker Change: And.

Speaker Change: We're seeing that demand coming both from new customers and repeat customers.

Speaker Change: Some customers are getting to us.

Speaker Change: Through these categories and we see these categories have a higher ticket size.

Speaker Change: They are by definition.

Speaker Change: More complex and require a bespoke development.

Micha Kaufman: And we're seeing our existing customers using that. So this is definitely a great influence, both, on the topo funnel for acquisition, but also for retention. As to long term, so, I think you've said it, we've been doing very consistent, we've been taking very consistent steps, to improve EBITDA margins, over the past few quarters. Nothing was a huge step function, but more a very thoughtful way of improving the margin as we continue to not neglect growth, which is very important.

Operator: And we're seeing our existing customers using that. So this is definitely a great influence on the topo funnel for acquisition but also for retention. As for the long term, I think you've said it, we've been doing very consistent, we've been taking very consistent steps to improve EBITDA margins over the past few quarters. Nothing was a huge step function, but more a very thoughtful way of improving the margin as we continue to not neglect growth, which is very important.

Speaker Change: And we're seeing our existing customers.

Speaker Change: Using that so.

Speaker Change: This is definitely a great influence both on the top of funnel for acquisition, but also for.

Speaker Change: For retention.

Speaker Change:

Speaker Change: As to long term.

Speaker Change: So.

Speaker Change: I think you've said it.

Speaker Change: We've been we've been doing very consistent we've been taking very consistent steps.

Speaker Change: To improve EBITDA margin.

Speaker Change: Over the past few quarters.

Speaker Change:

Speaker Change: Nothing was there was a huge step function, but more a very.

Speaker Change: Thoughtful way of improving.

Speaker Change: The margin as we continue to not neglect growth.

Micha Kaufman: We set up the 25%. And the idea is to get there. Will there be an opportunity to increase that after we meet that number? And instead of throwing promises at this point, we want to make sure that we continue the consistent execution towards, the long-term margin goal that we've set up.

Operator: We set up 25%, and the idea is to get there. Will there be an opportunity to increase that after we meet that number? And instead of throwing promises at this point, we want to make sure that we continue the consistent execution towards the long-term margin goal that we've set up.

Speaker Change: Which is very important we set up the 25%.

Speaker Change: And the idea is to get there.

Speaker Change: Well will there be an opportunity to increase that after we meet that number.

Speaker Change: Potentially yes.

Speaker Change: And we will instead of throwing promises at this point, we want to make sure that we continue the consistent execution towards.

Speaker Change: The long term margin goal that we've set up.

Speaker Change: Great. Thank you.

Speaker Change: Thank you.

Operator: We will now take the last question. From the line of Marvin Fong from BTIG, please go ahead.

Marvin Milton Fong: We will now take the last question. On the line from Marvin Fong from BTIG, please go ahead.

Speaker Change: We will now take the last question.

Speaker Change: From the line of Marvin Fong from BTG. Please go ahead.

Marvin Milton Fong: All right, great. Good morning. Thanks for taking my question. Just one for me.

Ofer Katz: All right, great. Good morning. Thanks for taking my question. Just one for me.

Marvin Milton Fong: Great. Good morning, Thanks for taking my question.

Marvin Milton Fong: Just one for me.

Marvin Milton Fong: I didn't want to actually talk about EBITDA little closer here just specific to this year. So very strong performance in the first quarter above the top end of your guide as I think you reiterated the top end and raised the lower end of EBITDA guidance for the year, but just curious.

Micha Kaufman: I didn't want to actually talk about EBIDTA a little closer here, just specific to this year. So very strong performance in the first quarter above the top end of your guide, as you know, I think you reiterated the top end and raised the lower end of EBIDTA guide for a year. But just curious, you know, what was sort of the thought or what's your view of EBIDTA margins for the balance of the year?

Marvin Milton Fong: I didn't want to actually talk about EBIDTA a little closer here, just specific to this year. So very strong performance in the first quarter above the top end of your guide, as you know. I think you reiterated the top end and raised the lower end of your EBIDTA guide for a year. But just curious, you know, what was sort of the thought or what's your view of EBIDTA margins for the balance of the year?

Speaker Change:

Speaker Change: What was sort of the thought or.

Speaker Change: Or what's your view of EBITDA.

Micha Kaufman: Was there, you know, being conservative is understandable in this environment, but is there any moving parts we should be aware of? Do you kind of plan to increase some off X items or anything along those lines? Just an additional color on how we should think about EBIDTA for the rest of the year would be great. Thanks.

Marvin Milton Fong: Being conservative is understandable in this environment, but are there any moving parts we should be aware of? Do you kind of plan to increase some of the X items or anything along those lines? Just an additional color on how we should think about EBIDTA for the rest of the year would be great. Thanks.

Speaker Change: <unk> for the balance of the year was there.

Speaker Change: And conservative is understandable in this environment, but is there any moving parts, we should be aware of.

Speaker Change: We plan to increase some opex items.

Speaker Change: Otherwise.

Speaker Change: Color on.

Speaker Change: How we should think about EBITDA.

Speaker Change: Great. Thanks.

Ofer Katz: Hey Marvin, I think that giving the The micro. We are very prudent in our guidance. We haven't changed anything on the, baseline assumption from the beginning of the year, other than being more confident in our ability, to deliver. So during this this this kind of period. The way we manage the business. Thank you.

Ofer Katz: Hey Marvin, I think that giving the Micro. We are very prudent in our guidance. We haven't changed anything on the baseline assumption from the beginning of the year other than being more confident in our ability to deliver. So during this kind of period, the way we manage the business. Thank you.

Speaker Change: Hey, Marvin I think that.

Marvin Milton Fong: And given the.

Marvin Milton Fong: The macro.

Marvin Milton Fong: Continued to be challenged.

Marvin Milton Fong:

Speaker Change: We have a.

Speaker Change: Very prudent in our guidance.

Speaker Change: We haven't changed anything on the.

Speaker Change: Baseline.

Speaker Change: Assumption.

Speaker Change: From the beginning after you.

Speaker Change: All of them being more confident in our ability.

Speaker Change: To deliver.

Speaker Change: Cumulative.

Speaker Change: Yes.

Speaker Change: Period.

Speaker Change: The way, we manage the business.

Speaker Change: It's very carefully balancing balancing between growth and <unk>.

Ofer Katz: Keeping the healthiness of the business and I think, you know, you can see the outcome. The plan for the remainder of the year, is to continue to invest. As we expand, into more complex projects and going up market, continue to invest in marketing. As long as the market allows us to be very efficient, and you can see the TROI and how it behaves. Quota over quota. And make sure we grow, on a healthy pace and improving the EBITDA throughout the remainder of the year. But there's nothing, there's no moving part that. I think you guys are not aware of it.

Ofer Katz: Keeping the healthiness of the business and I think, you know, you can see the outcome. The plan for the remainder of the year is to continue to invest. As we expand into more complex projects and go up market, continue to invest in marketing. As long as the market allows us to be very efficient, and you can see the TROI and how it behaves. Quota over quota and make sure we grow at a healthy pace and improve EBITDA throughout the remainder of the year. But there's nothing; there's no moving part to that. I think you guys are not aware of it.

Speaker Change: Keeping the healthiness.

Speaker Change: Of the business and I think you can see the outcome.

Speaker Change: The plan for the remainder of the year.

Speaker Change: To continue to invest.

Speaker Change: And in product.

Speaker Change: As we expand.

Speaker Change: Into more complex project and going up market.

Speaker Change: You need to invest in marketing.

Speaker Change: As long as the market allows us to be very efficient and you can see that the OE.

Speaker Change: How we behave.

Speaker Change: On a quarter over quarter.

Speaker Change: And make sure we grow.

Speaker Change: On a healthy pace and improving the EBITDA throughout the.

Speaker Change: As a reminder, but theres nothing theres no moving parts.

Speaker Change: I think you guys or not.

Marvin Milton Fong: That's great. Thanks, Ofer, for that insight. Appreciate it.

Operator: That's great. Thanks, Ofer, for that insight. I appreciate it.

Speaker Change: That's great. Thanks, a lot.

Speaker Change: I appreciate it.

Operator: Thank you. There are no further questions at this time. I would like to hand back over to the speakers for closing remarks.

Micha Kaufman: Thank you. There are no further questions at this time. I would like to hand the floor back to the speakers for closing remarks.

Speaker Change: Thank you there are no further questions at this time I would like to hand back over to the speakers for closing remarks.

Micha Kaufman: Thank you Sandra for moderating this call and thank you everyone for participating. We wish all of you a great day and look forward to see you very soon.

Operator: Thank you, Sandra, for moderating this call and thank you everyone for participating. We wish all of you a great day and look forward to seeing you very soon.

Speaker Change: Okay.

Speaker Change: Thank you Sandra for moderating this call and thank you everyone for participating.

Speaker Change: Wish all of you a great day and look forward to see you very soon.

Operator: This concludes today's conference call. Thank you for participating. You may now disconnect.

Speaker Change: Okay.

Speaker Change: This concludes today's conference call. Thank you for participating you may now disconnect.

Speaker Change: [music].

Speaker Change: Yes.

Speaker Change: [music].

Speaker Change: Yes.

Speaker Change: [music].

Speaker Change: Yes.

Speaker Change: [music].

Speaker Change: So.

Q1 2024 Fiverr International Ltd Earnings Call

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