Hi, thanks so much. Good morning everyone and thank you for joining our 2025 investor day. I'm Erica Guessert, the CFO of Upwork. For those who don't know me, I think most of you do. We are absolutely delighted to have everyone here today. I know I speak for everyone in our company when I say we are incredibly excited about this time for Upwork. It's such a great time for our customers, our employees, and of course for our shareholders. Over the next three hours, we plan to give you an overview of the significant opportunity ahead for Upwork and our strategy to capture that opportunity to create long-term shareholder value. First, before we get started, I want to call your attention to our safe harbor statement. During today's event, we will be making statements related to our business that are forward-looking. So please read the note at your leisure. These statements are not guarantees of future performance and are subject to a variety of risks and uncertainties. Our actual results could differ materially, and we will be sharing non-GAAP financial measures today which have reconciliations in the back of the deck. All right, let's do it. We have a fantastic agenda. First, of course, our own Hayden Brown will be up here to talk about our journey and strategy. Then we'll have Dave Bottoms, our amazing GM of marketplace, to talk about the tremendous market opportunity both for AI-native marketplace and for the SMB segment on our platform. Peter Sandborn, our VP of strategy, corporate development and partnerships, will be here leading a customer panel. You'll get to meet some of our customers to really see the value that we bring on our platform to our customers every day. After that we will have Andrew Rabinovich, our formidable CTO and head of AI, and the previous CEO of Headroom, up here to talk about the emerging agentic AI opportunity on our platform. Then Ernesto, our GM of enterprise, will be up here to talk about the market that we're unlocking with Lifted. I'll wrap up by sharing our financial targets for our business, which I'm sure everyone is eager to hear about. And then we'll have time for Q&A. So we are incredibly excited. As you all know at earnings, this is an inflection point for Upwork. We've returned to GSV growth two quarters early, and it's really up and to the right from here for our business. So with that, with no further ado, I would love to invite Hayden Brown up to the stage.
We dream big, looking into the future and always staying a step ahead through every chapter of work. From the rigid 9 to 5 grind to working how and when we want; from desks to wherever this is; from business as usual to business as anything but. The story of work is still unfolding, ushering in a new era where AI helps talent make more of their talent and businesses make more of their time. Pushing past what was possible just an instant ago. Embracing AI and agents to augment human talent and deliver better work outcomes. But the story is far from over. AI can draft, build, code, and do whatever this is. But the vision, the meaning, the judgment, the taste, that comes from us. We're leading the way, boldly, creating opportunities and shaping the future of work. Because the story of work is ours.
Good morning everyone. I am so excited to be here today and to introduce all of you to the new Upwork. We have done a lot of work over the time that I've been leading this company for six years. The company today is completely different. If you thought you knew Upwork, you are in for a surprise. No changes that we've made to this business are more profound than those in the last three years. We have fundamentally transformed this business, rebuilt it for speed, for scale, and for the new era of human and AI collaboration. This is not a refresh; this is a full reinvention on every dimension. It's how we've achieved accelerated GSV growth two quarters ahead of schedule and record profitability. Today you'll see what we've done and how we've done it. Look around – no one else is making these types of moves. This work is underpinned by a new AI-native platform that has enabled accelerated GSV growth, record free cash flow, profitability, and revenue in Q3, margin expansion including being on track for six points of margin expansion this year, and absorbing the cost of high-impact M&A while still on track for our long-term adjusted EBITDA margin target of 35%. We have built a formidable growth engine. This morning we'll talk you through what this reinvention has looked like, how we've gotten here, and why we're positioned to win in this next exciting chapter. This is the most exciting chapter in Upwork's history. We have traction on three major growth opportunity areas: AI tailwinds, SMB market, and enterprise expansion. Now I want to start by talking about the elephant in the room – AI. Is it good or bad for Upwork? AI is definitively positive for us. It is one of our most exciting and growing tailwinds. Our platform operates with tremendous scale – 60,000 jobs posted a week, over 3 million per year. We see how businesses change their needs with AI. AI substitution is happening in small jobs under $300, which have gone from 5% to 3.5% of GSV, but that is a tiny fraction. There is a bigger trend: creation of new demand for expert, highly skilled talent because of AI. Our superpower is matching talent with exactly the job needed. Two trends: net new creation of demand from AI projects, and fractionalization of full-time jobs due to AI. For example, Grammarly, now Superhum, uses hundreds of Upwork writers alongside AI. As a result, our project sizes are up 12% year-over-year, spend per client increasing, and 50% growth in clients engaging in AI projects. Clients doing AI spend three times as much. Early momentum. 77% of hiring decision makers say AI will increase demand for fractional workers. So we are building a human and AI work marketplace. Our flywheel starts with our work delivery platform that de-risks hiring, attracts 800,000 clients annually. We focus on client quality, and it attracts the largest and most liquid talent pool on the planet. We are now adding AI agents to both demand and supply. On demand side, LLMs and AI agents come to Upwork to hire humans; on supply side, we rebuilt Upwork to include AI agents in work delivery. In 2026 we will broadly launch AI agents in the marketplace. We have a data asset no one else has – data on every step of work across 130 categories, which powers our AI tools like UMA. Our customers have an 'aha moment' moving from scarcity to abundance. Let's hear from a customer.
It's making it easier for us to launch. I think it's more around timing. It gives us confidence as well. If we have an idea, we don't go, 'Oh, that's expensive, that's too risky to do,' because we tend to associate innovative app development projects with high costs and high failure rates. But now Upwork is helping us experiment ideas faster and fail faster if we need to, or find success faster. It's about having the confidence to launch low-fidelity solutions quickly and innovative ones too because you're accessing all these amazing talents. There was one applicant whose role is an LLM developer. I've never heard of an LLM developer before. I wouldn't even know that that's what I was meant to hire. Just reading through his portfolio taught me this is the birth of a new breed of talent.
No one does it so well. This is the type of power that we provide every day for our customers large and small. We know we can reach more of them. Our strategy is to unlock more value with SMBs and grow more in the enterprise. At Upwork, we make things possible that aren't possible anywhere else. Duolingo has been a customer since early days, expanding languages and courses with massive workforce adaptation. Atlas, a small business customer, built a team of over 150 CX and operations specialists on our platform. We rebuilt our business to provide this value. In the last three years, we reinvented the product, customer focus, and operations. We began by reinventing our product in early 2023, executing acquisitions to accelerate AI. $100 million of incremental GSV this year from our AI-driven improvements. We also reinvented who we serve: launched Business Plus for SMBs, which grew 33% GSV quarter on quarter in Q3, and made enterprise acquisitions to relaunch as Lifted. We also reinvented operations, reducing team size by 21% and bringing AI into workflows. We did this to pursue a $1.3 trillion market by 2028: $530 billion SMB, $650 billion enterprise, and $120 billion in AI agents. Our strategy has three building blocks: AI, SMB, and enterprise. In AI, we have three opportunities: expanding AI-powered workflows (UMA moving from manual to fully autonomous), accelerating AI categories of growth (already $300 million GSV growing 50% year-over-year), and building the human and AI agent marketplace. In SMB, Business Plus is gaining traction with a 33% quarter-on-quarter increase in clients. In enterprise, we launched Lifted, a completely unique solution, and we see incredible feedback. These building blocks give us confidence in new long-term targets: GSV CAGR 7-9%, revenue CAGR 13-15%, and 20% margin expansion over the next three years. It's clear Upwork is a different company. We have rebuilt to win in the AI era. This is the most exciting chapter in Upwork's history. Thank you. I now want to invite Dave Bottoms up here.
Thank you Hayden. Good morning everyone. I'm Dave Bottoms, the GM of the world's largest human and AI-powered marketplace. I spent 25 years in Silicon Valley leading product and growth teams at Netscape, Yahoo, Dropbox, Meta. I joined Upwork in 2022 because I believe in creating economic opportunities through technology. Today I'll share highlights from our journey. First, how we transformed our platform into an AI-native experience. Then why we're uniquely positioned to grow reach among SMBs. Our marketplace already has 18 million active professionals from 180 countries, 10,000 skills across 130 categories, and over 250,000 AI experts. The diversity of work gives us a front row seat to the AI shift. We've rebuilt, not retrofitted, every critical workflow and customer touch point – from discovery to work delivery. By the end of first half 2026, virtually every step will be enhanced or orchestrated by UMA. Let me highlight some features: UMA powers 70% of job posts, guides proposals, facilitates messaging, drafts offers, AI-generated work summaries, video interviews, project milestone tracking, real-time video collaboration from Headroom acquisition, improved search, and conversational search in beta where clients express desired outcomes and UMA recommends candidates. Direct hiring through conversational search makes up nearly 40% of hiring on the platform.
The AI-native platform yields higher fill rates than traditional job posts. We expect adoption of conversational search to increase as we roll out the next-generation experience. Looking to 2026, we'll transform the post-match experience, introducing UMA project manager to orchestrate high-value work. Today our marketplace is faster and more intelligent, benefiting both clients and talent. These innovations are estimated to unlock over $100 million in incremental GSV in 2025. Let's zoom out. AI is a tailwind. First, net new categories of AI work are emerging, creating strong demand. Second, full-time work is being fractionalized as AI workflows are embraced. Demand for human expertise fuels both trends. Net new AI work is one of the fastest-growing categories on Upwork, with GSV growing over 50% year-over-year in Q3. This spans technical and traditional categories. We have a 40-quarter view showing acceleration in AI and machine learning, and net new categories like AI integration are outpacing traditional ones. We are uniquely positioned to capitalize on early trends. Now let's dive into fractionalization. As companies integrate AI, workflows are redefined. Some tasks are automated, but new ones require human oversight. 77% of companies expect demand for fractional labor to increase. Work becomes more modular and distributed, aligned with Upwork's fractional model. SMBs account for nearly half of global GDP. The market for contingent digital knowledge work is expected to reach $530 billion by 2028. SMBs already drive our platform, with average GSV per client of $12,000, hiring across five categories on average, and higher net promoter scores. We are intentional about moving up the value chain to serve larger SMBs with Business Plus. Business Plus gives access to top 1% of talent, UMA Recruiter (AI that reduces shortlisting time by 5x), team-based hiring, payment protection with net30 terms, weekly work summaries, and 24/7 support. Since launch in Q3 last year, Business Plus clients rose 36% quarter-over-quarter, hire 15% faster, spend 2.5x more, and retain at higher rates. We've launched a new acquisition campaign. Now I'm excited to share a customer, Brent Chuck from Demco.
Demco is a fourth-generation family business producing products for agriculture and construction equipment. Business Plus allows us to scale teams as needed. The curated short list was a major pain point. Net30 billing works better with our accounting software. It reduces internal overhead. We use it for 3D animation and rendering support. Over the past year, we've leaned into ongoing support. As needs arise, our first thought is Upwork.
Thank you, Brandt. 2025 has been a transformational year. Our efforts to reimagine the product experience are unlocking over $100 million in incremental GSV. Next year, we'll focus on post-match work delivery with UMA evolving into project management. We'll continue trend-spotting. Looking to 2026 and 2027, UMA will become an orchestration agent. Business Plus will solve more complex work problems. Let me summarize three main points: First, we've reimagined the marketplace as AI-native, powered by UMA. Second, we are uniquely positioned behind two AI tailwinds: net new AI work and fractionalization. Third, we are super-serving small business customers with Business Plus. I'm excited to welcome a panel moderated by Peter Sandborn.
Hi, I'm Peter Sandborn, VP of strategy, corporate development, and partnerships at Upwork. You've heard from Dave and Hayden how the new Upwork is rebuilt for the human and AI era. I'm joined by three SMB leaders using Upwork to accelerate innovation and tackle complex challenges. Let's get to know them. Gabe, tell us about OM.
I'm founder and CEO of OM, building biological superintelligence to end disease. We reimagine how we engineer therapies. We knew the traditional VC model wouldn't work. Without Upwork, OM wouldn't be possible. We have 15 contractors who are core to our RD. Upwork allowed us to attract world-class talent from genomic scientists to chemists.
Awesome. Phil, you operate in regulated financial services. Tell us about MCT.
MCT hedges interest rate risk for banks and mortgage companies. We started with Upwork in 2010. It was essential because I needed to follow the sun for software developers. Now we have 115 employees and 25-30 Upwork contractors, including a core group of 15 developers in Europe.
Cory, you're a product leader at Core Story. Tell us about it.
I'm VP of product and research at Core Story. We build large models to understand legacy code bases. Upwork lets us bring in acute talent for specific problems, which is huge for a smaller fish in a huge AI market.
Let's talk about flexible talent versus full-time hiring. Does it move the needle? Gabe?
It transformed our business. It removed the barrier to experimentation. For example, I had a crazy idea to re-engineer part of our platform. I hired a PhD-level CUDA developer on Upwork, and he solved it. That idea is now core to our platform. I keep turning to Upwork for specialized talent.
Are these short-term or long-term projects?
Almost exclusively long-term. It takes time for people to get up to speed.
Phil, you've seen the evolution. How is AI transforming flexible talent needs?
I feel strongly that this is the future. Number one, as a small business owner in California, the return policy on full-time employees isn't great. You need flexibility. Number two, we can now capitalize AI projects more easily with contract work via Upwork. We treat Upwork as a vendor, which simplifies accounting.
Dave and Hayden referenced 77% of business leaders looking to increase flexible talent with AI. Do you see that fractionalization point as true?
Yes, I think that will continue to grow. You'll likely see a reduction in full-time staff.
Flexible talent is clearly important. Why Upwork specifically? Cory?
Three things: scale, customer success, and platform. We recently ran a study with 300 people. We brought them all on in about a month, which is unheard of speed. The customer success team helped manage that. The platform is extremely easy to use, enabling adoption across the business.
Breadth and depth of talent. We need people with expertise in multiple areas—biology and AI, chemistry and physics. Upwork consistently provides that diverse expertise.
Phil, why do you keep coming back after decades?
It's all I've ever known. The large talent pool and specialized skills—we're seeing better talent on the platform.
Hayden and Dave talked about the new Upwork. Is there anything to the platform technology or is it just about the talent? Gabe?
Upwork has become a core part of our business operations. We use it to attract, hire, retain, pay, and manage time. Recently, we used UMA Recruiter and Business Plus to access a new level of talent. That reduces friction and lets us reinvest in solving diseases.
Phil, you've been hiring internationally. Tell us about that.
In 2011 we hired a guy in Croatia. He's been with us ever since. We hired his brother and their friends—about 20 contractors in total. We bring them onto the Upwork platform, which handles payment and compliance. The ease of use is a no-brainer.
So you basically have a sheet for how they start a profile on Upwork, then they send a link and we sign them up.
Cory, 300 people for the research project. How did you do that so quickly?
We were under time pressure for a paper with Microsoft and GitHub. We submitted profiles of what we needed, and the customer success team helped source, onboard, and offboard. It took about 15-20 minutes to know a good candidate. That velocity lets us be more ambitious.
Incredible. Let's talk about AI. Is there real tangible value for SMBs? Cory?
Our philosophy is that every company is moving toward being research-led. Upwork lets us quickly validate ideas and get data. The cost of code is going to zero. The differentiator will be who has good ideas and can execute fastest. Upwork helps us find ideas, double down, and move fast.
So really leveling the playing field. Gabe, you talked about AI creating a new breed of founders.
The idea that great innovation only comes from a few zip codes is evaporating. Brilliant people exist everywhere. A PhD scientist on the OM platform can accomplish what used to take entire teams. Upwork enables founders with small teams and big ideas to tackle challenging problems.
Phil, is AI unlocking new opportunities for your business?
We're in the trenches of financial software development. Upwork helps us bring on developers quickly who use new tools like Cursor, which is changing the game. It commoditizes skill sets and forces our internal developers to step up.
You mentioned a math problem you had to bring someone in for.
We had a constrained optimization problem for pooling. We brought in a PhD in mathematics via Upwork. I see the talent getting better on the platform, likely as larger firms shed full-time staff.
Let's wrap. This is the future: bold ideas, human expertise, and AI coming together. Scale, speed, flexibility, access to expert talent. These leaders are using Upwork to build the future. Thanks for the discussion. We'll take a 15-minute break and then hear from Andrew Rubenovich, our CTO.
I'm David Wrench, co-founder and CEO of Data Joy. We tell data stories using AI. For SMBs and professionals dealing with data, AI lets them tell stories instead of building entire data systems. I was burnt out from a six-figure job and wanted to build a team. I knew I needed Upwork when I was failing without help. Demetro is our CTO from Upwork—he's the ice to my fire. He helped us go from months between deliverables to weekly. Upwork has a deep, broad talent pool I can pull from instantly. I don't need people just to do work; I need people who get it and commit. Half of our team is from Upwork.
Our company does physical marketing and branding. We put logos on items and handle promotional products. I posted a job on Upwork and found Jerry in the Philippines. He's been with us ever since. That led to hiring inside sales and production support. Once you see the value, there's no stopping. Every problem I come up with, I think, 'Can we hire someone from Upwork?' Usually yes. Why hire the best local designer when I can have the best in the world? Upwork handles the messy stuff like taxes and payments. The hiring process is super easy. We get a dozen qualified candidates. I'm not looking at other options. It's a 100% no-brainer.
