Afternoon Coffee: Upwork reports second-quarter growth; China imports oil from Iran despite U.S. sanctions; Huawei ban update

The publicly traded online freelancer marketplace Upwork released its second-quarter financial statement this week and reported double-digit, top-line growth. Q2 2019 gross services volume (GSV) increased 20% over Q2 2018, rising to $518.8 million (Q1 2019 GSV was $487 million). Revenue grew 18% year-over-year to $74.3 million in Q2 2019 (Q1 2019 revenue was $68.9 million).

Upwork President and CEO Stephane Kasriel was quoted as saying: “We had a solid second quarter, with notable progress made against our strategic initiatives and an increase in gross profit. Our focus on larger clients and our Enterprise customers drove 4x more Upwork Business and Enterprise sales deals in the first half of 2019 compared to a year ago.”

Its gross profit increased by 25% year-over-year to $52.7 million in Q2 2019, with the company’s gross margin percentage increasing to 71% compared to 67% in Q2 2018. However, the company’s Q2 2019 net loss was ($2 million) compared to a ($400,000) loss in Q2 2018. In addition, adjusted EBITDA was $1.6 million compared to $3.3 million in the second quarter of 2018.

Upwork’s shares were trading just above $15 a share before the Q2 announcement, and at the time of this report, shares were trading at over $17 a share.

See Spend Matters' coverage of Upwork here. Check back later for a deeper analysis of Upwork's numbers.

China-Iran oil imports

Data by three research firms shows that China imported Iranian crude oil in July ever since a U.S. sanctions waiver ended, Reuters reports. The data showed between 4.4 million and 11 million barrels of Iranian crude were discharged into China last month.

Reuters said: “China is typically Iran’s largest oil customer and contests Washington’s sanctions. But June imports of around 210,000 bpd were the lowest in nearly a decade and 60% below their year-ago level, according to customs data, as some Chinese refiners, concerned about the sanctions, refrained from dealing with Iran.”

The Chinese customs agency is expected to give details of its July imports by origin by the end of the month, Reuters said.

Interim federal rule targets Huawei, 4 other Chinese firms

The government agency responsible for federal contracting, General Services Administration (GSA), has released an interim rule for a ban on federal purchases of telecommunications equipment from five Chinese companies, including Huawei, which the U.S. government has accused of espionage and stealing intellectual property. Government contractors had been confused about the ban, and a federal process allows for waivers, Reuters reports. The interim rule is slated to take effect Tuesday, Aug. 13, Reuters reports.

Organic retailer automates supply chain

It’s interesting to see how companies respond to growth and what technology they deploy. The natural foods e-commerce company Thrive Market is automating its critical fulfillment processes to keep pace with its rapid growth, Chain Store Age reports. The market had to improve inventory planning and demand planning, as well as automate some tasks that were done with a spreadsheet or manually, CSA reports. Automation will free up its time to focus on other valuable inventory management decisions, the company said.

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