Fiverr International Ltd.

Thank you for standing by and welcome to Fiverr's second quarter 2025 earnings conference call. At this time, all participants are in a listen-only mode. After the speaking presentation, there will be a question and answer session. To ask a question during the session, you will need to press star 1-1 on your telephone. To remove yourself from the queue, you may press star 1-1 again. I would now like to hand the call over to Jinjin Qian, EVP Strategic Finance. Please go ahead.

Thank you, operator, and good morning, everyone. Thank you for joining us on Fiverr's earnings conference call for the second quarter that ended June 30th, 2025. Joining me on the call today are Michael Kaufman, founder and CEO, and Ofer Katz, president and CFO. Before we start, I'd like to remind you that during this call, we may make forward-looking statements and that these statements are based on our current expectations and assumptions as of today, and Fiverr assumes no obligation to update or revise them. A discussion of some of the important risk factors that could cause actual results to differ materially from any forward-looking statements can be found under the risk factor section for most recent Form 20S and other filings with the SEC. During this call, we'll be referring to some key performance metrics and non-GAAP financial measures, including adjusted EBITDA, adjusted EBITDA margin, and free cash flow. Further explanation and a reconciliation of each of the non-GAAP financial measures to the most directly comparable GAAP measures is provided in the earnings release we issued today, and I'll share the letter, each of which is available on our website at .fiverr.com. And now I'll turn the call over to Mihal.

Thank you, Jinjin. Good morning, everyone, and thank you for joining us. We delivered another strong quarter, building on a solid start to the year with continued momentum across our business. In Q2 2025, we achieved 15% -over-year revenue growth and a 20% adjusted EBITDA margin as we continue to drive profitable growth with disciplined execution. Within our platform, we are seeing strong signs of durability and growth, including surging demand for AI-related services and the continued momentum of managed services and dynamic matching products. While SMBs continue to take a cautious stance on spending and hiring amidst a volatile economic environment, our success in these efforts contributed to the acceleration in spend per buyer, which grew 10% -over-year alongside robust growth across key verticals such as programming and tech, digital marketing, and video animation. Additionally, we continue to expand our value-added services across our ecosystem. AutoDS continues to maintain strong growth momentum, and we've made meaningful progress in integrating our platform to drive adoption and scale. Notable highlights include the launch of an AI-powered Shopify store builder, as well as the development of a deeper integration to enable seamless upselling and cross-selling between AutoDS and Fiverr's marketplace. The strong performance of the services segment contributed to the revenue upsides this quarter. We are also incredibly excited about how AI is positively impacting every dimension of our services, improving discovery and conversion for buyers and sellers on the market base, and unlocking operational efficiencies through AI agents across functions. Today, I want to delve deeper into each of these areas and demonstrate how we are at the forefront of AI adoption with the speed, conviction, and clarity that sets us apart. First, the rapid development of AI technology is giving rise to numerous new skills, and Fiverr's marketplace is becoming the go-to destination for accessing and engaging with AI experts. Categories such as AI agents, workflow automation, and vibe coding have experienced five- to tenfold growth on our market base over the past six months. With AI fundamentally changing how humans and machines interact, it allows many non-technical entrepreneurs and professionals to build and leverage the technology. At the same time, we are increasingly seeing the gaps between -the-shelf AI tools and the real world problems our customers are trying to solve. This is where Fiverr comes in. Freelancers on our could involve setting up AI systems, selecting the most efficient AI models, integrating the backend with existing systems, adding functionality, creating custom workflows, or simply debugging when the customer encounters issues. Fiverr's free answers help our customers turn concepts and prototypes into high-impact solutions and tangible business results. These exciting trends underscore our conviction that human expertise is crucial in unlocking the full potential of AI. With the proliferation of AI tools in the market and the increasingly ubiquitous access to these tools, we believe this represents a long-term tailwind for our business driven by an increasing number of buyers who are deploying AI and their growing need and budget for tackling AI-related problems. That's why we are not only expanding our catalog to meet this demand, but also exploring ways to embed Fiverr's talent network and transaction infrastructure directly into AI-driven workflows. These efforts include several ongoing strategic partnership discussions, the development of a targeted fulfillment capabilities, and laying the technical foundations to build scalable AI powered by experts. Our goal is simple. Fiverr's free answers are addressing critical challenges for businesses adopting AI, and we must strive to meet customers where they are and build an integrated experience that makes it seamless for them to leverage our platform. Second, we are shipping at an incredible pace so that we can leverage AI to strengthen our marketplace flywheel. Every transaction in our marketplace involves three core participants, the buyer, the seller, and the platform. Our vision is to create an intelligent, agentic experience for each. Two years ago, Fiverr launched NEO, the first of its kind AI matching agent for buyers in a marketplace environment. Since then, NEO has evolved into a powerful AI engine that drives underlying KYC and matching across all of our front end products. As we continue to build out the agentic experience on the buyer side, we envision a future where each buyer will be accompanied by a recruiting agent who can assist with drafting job briefs, communicating with freelancers, curating candidate lists, and even managing project execution end to end. This is the beginning of a search list vision for the future, at least in the traditional keyword-based sense of search that makes room for more expressive and nuanced way to address customer needs. One that unleashes the power of the multiple solutions Fiverr has built on the platform to tackle any project from simple tasks to the most complex ones imagined that requires multitask and multi-talent orchestration and assembly. On the seller side, we introduced Fiverr Go earlier this year, an AI assistant designed to help freelancers with project discovery, client engagement, and creative ideation. Following the successful launch in February, Fiverr Go continues to drive strong seller engagement and meaningful conversion uplifts across the funnel it touches. Similar to the agentic AI experience on the buyer side, we have an extensive roadmap for Fiverr Go that will enable seller agents to provide more sophisticated support and guidance for our sellers including service listing, optimization, lead generation, and qualification, and other marketing, analytics, operations, and production capabilities. Last but not least, we are deploying agentic AI across the internal function to boost platform level efficiency from automating customer support workflows to enhancing market-based integrity operations, from improving job post-matching algorithms to empowering customer success managers. These systems are designed to enable faster, more seamless orchestration between buyers and sellers while scaling operational productivity behind the scenes. As these agents become more capable over time, we believe they'll increasingly act autonomously, not only to improve individual workflows but ultimately to enable -to-agent transactions that reduce friction and eliminate the need for their human counterparts to manually navigate the platform. While this is an ambitious long-term vision, the path is clear. Having this roadmap enabled us to make informed architectural and product investments today, and these early bets will position Fiverr at the forefront of market-based innovation, further reinforcing our leadership through AI-powered differentiation. As we wrap up the first half of 2025, I'm incredibly proud of how our team has delivered and even more excited about our strategy and roadmap for the second half of this year. I look forward to updating you on our continued progress in the months to come, and with that, I will turn the call to offer.