Fiverr International Ltd. (NYSE:FVRR) reported better-than-expected fourth-quarter earnings, but weaker guidance for 2026 weighed heavily on investor sentiment, sending the stock down 17.4% in premarket trading on Wednesday.
For the fourth quarter, Fiverr posted adjusted earnings of $0.86 per share, ahead of analyst estimates of $0.74.
Revenue rose 3.4% year over year to $107.2 million, though it fell short of the $108.98 million consensus forecast. For full-year 2025, revenue increased 10.1% to $430.9 million, with adjusted EBITDA margin reaching 21.3%.
The company’s forward guidance triggered the sell-off. Fiverr projected first-quarter 2026 revenue in the range of $100 million to $108 million, significantly below analyst expectations of $112.26 million.
For the full year 2026, revenue is forecast between $380 million and $420 million, implying a potential decline of 3% to 12% and well under the consensus estimate of $456.80 million.
“As we close 2025, a year of disciplined execution for us, it is clear that we are living through a significant shift in AI adoption,” said Micha Kaufman, founder and CEO of Fiverr. “We are seeing a profound migration on our marketplace where humans are becoming more essential, not less.”
Operational metrics were mixed. Annual active buyers declined 13.6% year over year to 3.1 million, while average annual spend per buyer rose 13.3% to $342.
Marketplace revenue fell 2.7% to $71.5 million, whereas services revenue increased 18.2% to $35.6 million.
Fiverr said its broader-than-usual revenue range reflects “elevated uncertainty” as it executes a transformation strategy centered on higher-value projects while “intentionally deprioritizing incremental optimization of low-end transactions.”
The company also announced leadership changes, with Ofer Katz continuing as President and Esti Levy Dadon promoted to Chief Financial Officer.
Fourth-quarter free cash flow totaled $21.8 million, down 26.5% from a year earlier, though the company noted that the figure included a one-time escrow payment of $5.7 million.