Afternoon Coffee: Upwork Updates Its Post-IPO Financials; Proactis, Basware Stocks Fall

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Upwork, the global online freelance marketplace enterprise solution company, reported its first fiscal year financial results as a publicly traded company. On the positive side, the company is continuing to grow. Revenue for FY 2018 rose 25.1% year over year to $253.4 million. Marketplace (including Upwork Enterprise) revenue rose 25.7% to $223.8 million.

Investing significantly in its own growth, Upwork’s FY 2018 operating expenses were $183.6 million, up 30.9% year over year (growing faster than revenue). The sales and marketing expense (which accounts for 40% of total operating expense) increased 37.6% year over year from $53 million to $73 million. R&D expenses rose 21.7% year over year to $55.5 million in FY 2018.

The rules of arithmetic remain in force, and the company’s operating loss increased from ($3.1 million) in FY 2017 to ($11.7 million) in FY 2018. Upwork’s bottom-line net loss also increased several-fold from ($4.1 million) in FY 2017 to ($19.9 million) in FY 2018, owing to the ($11.7 million) in operating loss, interest expense of $2 million and other net income/loss of ($6.1 million).

In spite of these numbers, the market has not fallen out of love with Upwork. The company’s share price yesterday opened at $24.10 and closed at $23.70 per share (equating to a market cap of $2.5 billion).

In October, the opening IPO share price back on Oct. 12, 2018, was $15. It peaked the next day at $21.8 and then started its descent into December. Two weeks ago, we reported that Upwork’s share price — that had been hovering at the $18-19 price from the start of 2019 — rose by 20% from $18.58 on Feb. 1 to the closing price of $23.18 on Feb. 14.

At 12:45 p.m. Central today, Upwork shares were priced at $22.62.

Proactis, Basware Stocks Fall

Proactis’ shares had fallen by as much as half on news this week that it didn’t expect any “significant” annual growth for the fiscal year ending in July due to “deterioration” in its pipeline in the U.S. and Europe, Alliance News reports about the firm’s financial disclosure letter Thursday.

On the same day, Proactis announced that it had received $26.5 million in a deal with HSBC UK to fund its rollout of a new business payments solution.

In Basware’s case, its stocks fell as much as 20% after it reported Thursday that Tradeshift’s bid to buy Basware fell through.

Lyft’s IPO Shows It Lost Almost $1 Billion Last Year

In Lyft’s IPO filing, the ride-hailing company disclosed for investors that it had a net loss of $911 million on revenue of $2.2 billion last year, Bloomberg News reports about the disclosure to the SEC.

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