Thread by @BrianFeroldi

$FVRR got whacked yesterday

Here are my thoughts about the quarter 🔽

Headlines:

Revenue +60% to $75.3 Million
✅Guidance was $73 MM to $75 MM
✅Wall street expected $74.8 MM

Adjusted EPS +110% to $7.9 million, or $0.19
✅Wall Street expected $0.14

Other metrics:

✅Active buyers +43% to 4.0 million
✅Spend per buyer +23% to $226
✅Take rate up 80 basis points to 27.8%
✅Non-GAAP gross margin 84.4%
➡️Expenses grew ~80%, especially R&D, SGA
✅FCF $15 million
➡️Cash $312 MM / Convertible notes $361 million

Why hit the stock?

In a word: Guidance

Previous full-year guidance:
$302 MM to $308 MM (~60% growth)

Updated full-year guidance:
$280 MM to $288 MM (~50% growth)

Why?

Management's explanation:

Wall Street HATES downward guidance revisions, so I understand why the stock was punished.

However, zooming out usually puts the drop in perspective:

The stock price is all the way back to where it was in:

April

Other Items:

✅ New partnerships w/ Salesforce and Wix
✅ Fiverr business (new segment that is only 3 quarters old) already 5% of GMV
✅ High-value buyers 61% of revenue, up from 55% (moving upstream)
✅Launched Seller Plus: Subscription product for most engaged sellers

The big question I always ask:

"Is the thesis on track?"

Here's a video of why I'm bullish on Fiverr:

Let's check:

✅High Revenue Growth (just not *as high* as thought 90 days ago)
✅Recurring Revenue
✅High Gross Margin
✅FCF Positive
✅Mission Statement
✅Operating Leverage
✅Optionality (Fiverr Business!)
✅Network Effects
✅Founder/CEO
✅<$10 BB market cap

Large TAM:

This is why I stress, over and over again:

Watch the business, not the stock

Could I be wrong about $FVRR?

OF COURSE!

Good investing is all about increasing your odds of success.

I think *the odds* are favorable that I'm right about Fiverr, BUT I COULD BE WRONG

I'm not investing in Fiverr because of what the stock will do this week, this month, or this quarter...

I'm investing in Fiverr for where I think the stock could be in 2026 (and beyond)

That's what I focus on.

If you want to learn the step-by-step details of how @Brian_Stoffel_ and I break down a company's earnings report, we have a video that will be released tomorrow on my YouTube channel using $PYPL as an example:

You can subscribe to it here:
youtube.com/brianferoldiyt…

My $FVRR takeaway:

✅Thesis on track
✅ Management (likely) learned a lesson about giving guidance
✅ One quarter (rarely) breaks a thesis, but several quarters in a row is a different story.

As always, don't follow me (or anyone) blindly into stock & do your own homework!

Here's the video: