Fiverr Intl (NYSE:FVRR) reported first-quarter financial results on Wednesday. The transcript from the company's first-quarter earnings call has been provided below.

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The full earnings call is available at https://edge.media-server.com/mmc/p/bm4ojkrn/

Summary

Fiverr Intl reported Q1 revenue of $105.5 million, slightly down year-over-year, but adjusted EBITDA increased by 16.3% to $22.6 million, indicating strong financial discipline.

The company is undergoing a multi-year transformation from a transactional marketplace to a trusted platform for high-value, complex projects, focusing on quality, trust, and AI-driven collaboration.

Strong growth in projects over $1,000, with an 18% increase in clients completing such engagements, highlighting a shift towards more strategic, high-value work.

Fiverr Intl is investing in rebuilding its matching infrastructure to enhance talent quality and trust, aiming to reduce mismatch rates and improve buyer satisfaction.

The company is developing an end-to-end fulfillment layer to support complex projects and plans to expand its go-to-market strategy with talent-led, industry-led, and partner-led growth engines.

Guidance for 2026 includes revenue between $380 to $420 million and adjusted EBITDA between $64 to $80 million, reflecting ongoing transformation efforts and market uncertainties.

Management emphasized the importance of AI and human collaboration in future workflows and aims to leverage AI to improve efficiency and decision-making.

Full Transcript

OPERATOR

Good morning and welcome to the Fiverr first quarter 2026 earnings conference call. All participants will be in the listen only mode. Should you need assistance during the conference call, please signal a conference specialist by pressing the star key followed by zero. After today's presentation there will be an opportunity to ask questions. To ask a question you may press STAR and then one on your touchstone phone. To withdraw your question you may press STAR and then two. Please note that this conference has been recorded. I would now like to turn the conference over to Ms. Emily Greenstein. Thank you. And over to you.

Emily Greenstein

Thank you Operator and good morning everyone. Thank you for joining us on Fiverr's earnings conference call for the first quarter that ended March 31, 2026. Joining me on the call today are Miha Kaufman, Founder and CEO and SG Levy Dadon, CFO. Before we start, I would 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 Factors section in Fiverr's most recent Form 20-F 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 our shareholder letter, each of which is available on our [email protected]. and now I will turn the call over to Miha.

Miha Kaufman (Founder and CEO)

Thank you Emily. Good morning, everyone and thank you for joining us. Let me start with the headline Q1 was a solid quarter of execution with both revenue and adjusted EBITDA coming in at the high end of our guidance range. Esti will walk through the details shortly, but the underlying message is we are focused on executing the strategic transformation while being methodical in managing the existing business across both top and bottom lines. Maintaining financial discipline and transparency throughout this transformation is critical and we are committed to doing that consistently and credibly. Let me now turn to the transformation or as we mentioned last quarter, we are in the early stages of a multi year journey to reposition Fiverr from a transaction oriented marketplace into a trusted work platform for complex high value outcomes. This is not a cosmetic shift, it is a fundamental evolution of how work is matched, delivered and orchestrated on our platform Our North Star is clear to become the most trusted platform for completing high value high trust work. This means enabling businesses and talent and increasingly AI driven workflows to collaborate effectively on complex outcomes. Two months into the transformation, the early signals across all pillars of this transformation are consistent with our plan. First, we are strengthening the high end talent flywheel and expanding into more complex higher value projects. Projects over $1,000 continue to grow at a strong double digit rate with clients completing $1,000 plus projects up 18% year over year. We are also seeing increasing participation from talent delivering these engagements. What's important here is not just the growth, it's the nature of the work. We are seeing businesses come to Fiverr not for isolated tasks but for multi phase mission critical projects. For example 1. A global healthcare company is working with Talent on Fiverr to produce over 30 multilingual animated assets for a product launch with ongoing spend across multiple engagements. 2. A C2C sports platform in New Zealand built a full mobile application through multiple development phases on Fiverr. 3. A European entrepreneur is building an AI enabled invoicing SaaS platform to comply with regional regulatory standards. These are not one off gigs. They are sustained high value engagements that require coordination, iteration and trust. This is exactly the segment we are targeting and exactly where the market is moving towards more strategic outcome based engagements. Second, we are investing heavily in matching infrastructure and experience. This is our main differentiator and the key to driving trust and quality which are the core primitives of the market. Our research and internal data confirm this. The primary differentiator in hiring platforms is not price, it is talent, quality and trust. Historically Fiverr has won on ease of use and speed. Winning upmarket means extending that advantage into quality and trust and that is exactly what our infrastructure investments are designed to deliver. That is why we are rebuilding our matching infrastructure from the ground up. We are moving from keyword based matching to context awareness outcome driven matching powered by a knowledge graph that captures not just who the talent is but what they have delivered, in what context and with what results. At the same time we are shifting ranking from optimizing for conversion to optimizing for expected project success and buyer satisfaction. The data is already moving. Recent tests in Fiverr Pro show mismatch rates down nearly 10% and we are consistently seeing higher value engagements leading to stronger repeat behavior. These are the early proof points of a durable trust mode. Third, we are evolving Fiverr into a comprehensive work platform. Today most high value projects on FIVERR run on infrastructure built for a different era of the platform. We are addressing this by building an end to end fulfillment layer that includes visibility into project progress, early detection of risk, structured feedback loops and active orchestration by fiverr. This is a fundamental shift in responsibility and perception of responsibility. We are becoming an active partner for our clients and talent, not just a passive connector. Over time this infrastructure will also allow FIVERR to integrate seamlessly into agentic workflows where AI handles coordination and humans provide judgment and accountability. Fourth, we are expanding our go to market capabilities to scale more aggressively into high value work. We are now building three new growth engines. First, talent LED growth engine driving high quality demand directly to high performing freelancers. Second, industry LED growth engine building tailored experiences for specific industries such as E commerce and early stage startup companies and third, Partner LED distribution, embedding fiverr directly into workflows and platforms where high value demand already exists. These initiatives expand beyond traditional performance marketing and are designed to create scalable, durable growth engines aligned with our upmarket strategy. Finally, we are improving execution across the organization. We are optimizing production workflows through better telemetry, identifying bottlenecks and increasing discipline in delivery. At the same time, we are rebuilding how work is executed with AI agents at the center and human judgment where it matters most. This approach enables faster decision making, reduces handoffs, improves product quality and drives efficiency across the organization. Mastering this as a company will also allow us to generate a reusable blueprint for our customers and talent to replicate and enjoy Stepping back. The fundamental dynamics of this market are moving in our direction. AI is increasing, not reducing the complexity of matching the right talent to the right work. The demand for trusted outcome based platforms is not a future possibility. It is already showing up in our data, in our customer examples and in the infrastructure we are building. Fiverr has a differentiated model, a compounding data advantage built on real transaction outcomes in an end to end platform that no point solution can easily replicate. We are executing with urgency and discipline and we are confident in where this leads. With that, I'll turn it over to ESTI for the financial details.

Esti

Thank you Micha and good morning everyone. We delivered a strong first quarter with both top and bottom lines exceeding the midpoint of our guidance. Revenue was 105.5 million down 1.6% year over year reflecting continued growth in high value work offset by headwinds in low value transactional activity on the marketplace alongside a continued growth of service revenue. Adjusted EBITDA was 22.6 million up 16.3% year over year and representing an adjusted EBITDA margin of 21%. This is an improvement of 330 basis points from a year earlier as we continue to execute with strong financial discipline. Turning to our revenue segments, Q1 marketplace revenue was $67.1 million driven by 2.9 million active buyers, $356 in spend per buyer and a 27.7% marketplace take rate. The continued momentum in our upmarket strategy and shift towards more complex engagement is clearly showing in our cohort behavior. With spend per buyer growth of 15% year over year projects over $1,000 grew at a strong double digit rate driven by 18% growth in clients completing these engagements. This growth is coming from both new adoption and repeat behavior as buyers expand into larger use cases along with increased usage of dynamic matching and managed services. Looking ahead, macro conditions remain largely unchanged. Based on current trends, we expect marketplace growth for the remainder of the year and on a full year basis to track broadly in line with Q1 performance. Service revenue in Q1 was $38.4 million, up 30% year over year and accounted for 36% of total revenue. Services revenue came in slightly higher than expected as AutoDS ran successful campaign at the start of the year pulling certain users sign ups and revenue forward from Q2 to Q1 overall. Overall, our expectations for services revenue for this year remain largely unchanged with growth moderation in Q2 and continuing into the second half of the year. As Miha mentioned, 2026 is a transformational year for us as we make critical foundational investments to strengthen our high end talent flywheel. Our decisions are centered on improving marketplace quality and trust, prioritizing high value work and driving more focused execution. With strong financial discipline on capital allocation, we continue to take a disciplined and balanced approach. Our strong balance sheet allows us to invest in growth, returning capital to shareholders and remain opportunistic on M&A. We generated $21 million in free cash flow in Q1 and we expect to continue executing our buyback program in a thoughtful manner. As of March 31, 2026, we had $59.5 million remaining under the current authorization. Now on to guidance. For the full year 2026, we expect revenue to be in the range of 380 to $420 million representing a year over year growth of negative 12% to negative 3%. We are raising our full year adjusted EBITDA guidance and now expect it to be in the range of $64 to $80 million representing an adjusted EBITDA margin of 18% at the midpoint for the second quarter of 2026. Revenue is expected to be between 95 to $103 million, representing year over year growth of negative 13% to negative 5%. Adjusted EBITDA is expected to be between 16 to $20 million, representing an adjusted EBITDA margin Of 18% at the midpoint. Our revenue outlook reflects solid execution in Q1 and the continued uncertainty in the market conditions. Our adjusted EBITDA guidance reflects the strength of our core marketplace profitability and our continued commitment in maintaining disciplined margin profile while investing in the transformation. As we look at the rest of the year, we are staying focused on our core priorities, driving progress in higher value work, improving trust and quality, and building scalable growth engines. We believe these are the right indicators to evaluate the business as we transition to the next phase. With that, we will now turn the call over to the operator for questions.

OPERATOR

Thank you. We will now begin the question and answer session. To ask a question, we press Star and then one on your telephone keypad. If you're using a speakerphone, please pick up your handset before pressing the keys. If at any time a question has been addressed and you would like to withdraw your question, please press Star and then two. At this time you will pause momentarily to assemble a roster. We have the first question from the line of Eric Schadent from Goldman Sachs. Please go ahead.

Eric Schadent (Equity Analyst)

Thanks so much for taking the questions. Maybe two if I could. One. Just coming back to the transformation strategy, want to know a little bit more about the duration of completion of what you called the infrastructure layer and putting the pieces in place and how should we think about when you exit that phase of the transformation and some of the execution shifts more predominantly to go to market or what the mix is of building blocks relative to execution on the transformation strategy, that would be one and then the second one would just be you talked a little bit about partners and evolving the go to market strategy. Want to know if you go a little bit deeper in terms of what those types of partners might look like and what market opportunity they might open up that maybe you're under index to today.

Miha Kaufman (Founder and CEO)

Thanks so much. Good morning Eric. Essentially the transformation is an ongoing process and since we just started it mid-last quarter, we are anticipating to see results over the remainder of the year with more emphasis because it takes time between the things that we develop and release until they show up in the numbers to see this more in the second half of the year and definitely towards the end of the year. And as we said we will continue to be transparent on what we're seeing and the progress there as the transformation. My belief is that the entire market is in a transformational moment where every business needs to adopt to a new reality where AI plays a critical game, not in just making products better and more efficient, but also being able to connect with agentic realities where agents are actually using the platform. This is not limited to this year. I think that this is going to be a transformation that every business out there will have to implement in the coming years. It's very similar in my mind to the digital transformation when businesses went from the offline to the online and now are seeing a new reality. Now we are already seeing some initial signals that we called out in the opening remarks of areas where that transformation has started and we started rolling out experiments and new products and how they influence a higher quality matching and focuses on better conversion and better retention around high end talent and larger scopes. So over the next few quarters we will continue to report on what we're seeing, the progress and obviously the more history we have in doing this, the results should accumulate. And as we said, this is going to be a turnaround year where the next years are going to be years of growth. In terms of the other question regarding partners and go to market strategy, again, we very much focus on this idea of human in the loop partners where the requirement for a skilled talent network to make judgment calls on AI's work and on calibrating models and checking integrity and ensuring accuracy is paramount. I think that this is an area where fiverr can play a major role that together with agents that we're developing to automate some of this work to make sure that the experts are actually focusing only on things that humans need to focus is a very important and critical role in what we're doing. It is still early. There's a lot of AI automation use cases. We're running successful pilots with some initial customers and we see that there's a lot of demand for Fiverr to become a fulfillment partner for SMBs to adopt automation. So again, early in the process, but we will have more things to call out in future quarters. Great, thank you.

OPERATOR

Thank you. We have the next question from the line of Jason Hofstein. From Oppenheimer. Please go ahead.

Jason Hofstein (Equity Analyst)

Kind of like a two part question, but on the same theme. So obviously you've had a front row seat to this whole evolution of how agents are evolving the business. As you're seeing kind of even these more cutting edge frontier models coming out, how is that further evolving your view on kind of how both you will leverage this technology, how your companies, how your customers will leverage it. And then there's also been discussion among investors that AI agents are like, lowering the barriers to new business creation. There's like more new domains coming online, I think a record number of apps submitted to the app stores, I guess. How do you think about that? Is that a positive for Fiverr or negative for Fiverr? Can you leverage that? Just kind of broadly all bring those topics together. Thank you.

Miha Kaufman (Founder and CEO)

Thanks for the question. Jason, good morning. So essentially, the way we're thinking about how agents are becoming a part of what we're doing, essentially, agents are very much learning from human skilled people on how to run workflows much, much faster, much more efficient. 24/7. But at the same time, a lot of what agents are doing require ongoing judgment. And it's much like everything else with AI. Everybody has the access to the same AI, which means that also everybody has access to the same agents that are available out there. Just having access to this technology doesn't give you a competitive edge. It just flattens everything and maybe it elevates the floor. But on top of what agents are doing and how you create skill sets for agents, how you create workflows that integrate multiple skills, multiple agents, that is an art, and that is what a lot of companies are actually focusing in and providing their employees their expert skills onto agents. Now, in the case of businesses, not all businesses have the talent to actually train an agent and oversee what the agent is doing and providing judgment and calibration and fine tuning. We see this on Fiverr. The implementation of agents across our system internally require tremendous amount of collaboration to overcome hallucinations, inaccuracies, or just moderate execution. So definitely the role of an expert, of an employee, of a freelancer is changing, but it is highlighting the uniqueness of what they can build bring to the table to provide an advantage. Now, when we think about lowering the barriers or agents lowering the barriers for business creation, this is amazing news for us. I've seen lately staggering numbers on the launches of new products in recent months. I believe April was the highest month with over 19,000 new announcements on product and company releases. On the one hand, the signal to noise is extremely complex because it makes everybody a builder. But building something gives you nothing. It's all about the deployment, it's all about taking it to the market. It's getting noticed, it's validating, and then it's scaling. These tasks are largely unresolved yet by AI. Can AI help in this? Yes, but generically speaking, because it Provides the same help for everybody else. Again flattening everything. What gives you that competitive edge? When you create something or you almost create something and you want to improve it and then you want to deploy it and then you want to scale it. This is where experts come in. Now the reason why I believe that this is not still showing up in the numbers is that this is a transformative period. I remember the digital transformation from 2000. It took time for businesses to understand that if you don't have a website, you're going to be out of business over time. The same goes with AI. The same goes with experts that need to come with AI to make your AI or your execution better than your competitors. I think that we're in the early innings, it's going to take some time. But all in all I actually think that this is really a great upside for us. When I look at the marketplace, we see AI consulting, business formation all grow really strong double digits. This to me I think it's an early sign of what would come. Also AI related categories continue to be super strong. AI development up 118% year over year. Marketing automation also growing really strong double digits. And I can go into my answer is really long so I'll stop here but I can give more color around this.

OPERATOR

That's really helpful. I guess I haven't automated us doing this earnings process yet, but maybe someday. Thanks. Nice. Thank you. We have the next session line of Ron Jose from Citi. Please go ahead.

Ron Jose (Equity Analyst)

Great. Thanks for taking the question. Automation is the future, right? Can't wait. I wanted to ask a little bit more two questions. First is on just attracting the talent to the marketplace. As we go to more upmarket projects. Upmarket and towards these multi phase projects we're clearly seeing continued strength on spend per buyer. We're seeing that growth re accelerate. So talk to us just about the talent on the marketplace as we go more up market and these multi phase projects. And then one of the things that struck me, matching is a key part of the marketplace and and I think I heard the team talk about mismatch rates being down 10%. So during this transformation era talk to us just about the ability to continue to execute on some of the key tenets of the marketplace like dynamic matching and the results that you're seeing. Thank you very much.

Miha Kaufman (Founder and CEO)

Thank you Ron. Good morning. On the first question, talent is super important as we know from research, quality is core and the ability to match quality, drive quality, perception is super critical. This is very much in the center of this transformation for Us now, getting access or getting talent to the platform has never been an issue. Actually, we always had, I would say, an abundance of talent. What we're more adamant right now is really understanding on the meta skill level, what does it mean to be a talent and for what type of customer and what type of an outcome in creating this skill graph is super critical. In other words, what this means is a, we're more picky about talent. But two, by improving the algorithm, improving the matching we can create, we can anticipate better outcomes, better happiness, and as a result, we also anticipate better retention in our customers. Those are the key things. So when we call out the reduction in mismatch, this is key because this actually means, and you know, it's like hiring, it's like hiring for any job, right? Some people that you hire turn out to be amazing, some you later on figure out that they're is something that you missed or they missed, which makes the match not optimal. We don't want to tolerate this. And we actually think that if there's one huge advantage based on data that we've accumulated over 16 years, billions of interactions, tens of millions of transactions, is being able to take that data and actually make matching like anything that was done before by anyone. And this is the reason to win. This is the reason to exist. So we're putting a lot of pressure there and seeing numbers, seeing the amount of actual matches that were mismatched. In hindsight, getting down is a very positive signal and we're far from done. We're just starting right now. And obviously over time, as we accumulate more signals, deeper signals, we will continue sharing it with you guys. That's good. Thank you, mija.

OPERATOR

Thank you. We have the next question. Line of Bernie McKeren from Needham. Please go ahead.

Stefanos Chris

Hi, this is Stefanos Chris calling in for Bernie. Thanks for taking our questions. Wanted to follow up on Ron's question on the matching. Could you maybe give us any more details on what a baseline mismatch rate is or maybe what the revenue impact is of that 10% reduction? And then also wanted to ask on the autods pull forward, could you talk about what went right with that campaign? And is the pull forward just a dynamic of annual subscriptions or is there anything else? Thank you.

Miha Kaufman (Founder and CEO)

Hey, good morning, Stefanos. Thanks for the question. In terms of matching, we haven't publicly shared any specific numbers, but with this transformation, we're really focusing on trust and quality as core primitives. So to us, mismatch is really about making sure that we have this deep understanding of what are the things that would drive a perfect match between a customer with their specific circumstances and needs and the very specific skill and validated experience of a talent to do this task. And again, as we move forward to do this restructure and refocus, we are going to be able to provide more color, more specific color as we really focus on those KPIs. This nuanced understanding is super important. It's not just driving revenue today, but it is driving the flywheel and driving the repeat rate now on the autods. Essentially, we had a very strong influencer campaign that we found great timing to do in Q1. Essentially, we were kind of focusing this on Q2, but we were able to actually execute this slightly earlier. Not something that we plan to replicate, but which is baked into the numbers which that has drove strong signups at the beginning of the year. Okay. So we called it out because this was a great opportunity for us to move something from Q2 to Q1 and do it earlier. Great. Thank you.

OPERATOR

Thank you. We have the next question on the line of Doug Anmit from JP Morgan. Please go ahead.

Doug Anmit (Equity Analyst)

Great. Thanks so much for taking the questions. I have two miha. Can you just talk about where you

Esti

are in terms of hiring AI Native personnel within your own company and how you're thinking about that and then sd, can you just help us bridge the EBITDA margins from the 21% in 1q to the 18% or so for the full year? Thank you.

Miha Kaufman (Founder and CEO)

Morning, Doug. In terms of hiring AI Native, we're on track. We continue to do this. And it's obviously, I think the competition over talent is pretty brutal, but we've added incredible people into the team. And what's interesting is that if you really can find, identify and attract the right people, it's really different than it used to be before in terms of the amount of people that you need to do this. Because essentially those who are really AI native are very much. What I found in common and I actually wrote about this is really this idea that they have this founder mentality, this entrepreneur mentality. What's really common around them is that they're 10xers. Essentially there are people that can do 10x and a lot of what they do is really put up these systems, these agents, these workflows, and be able to connect them for the rest of the company and continue evolving this tweaking, calibrating, validating. It's incredible. And this is really, I think, also points to future corporates being leaner, smaller, but having people that can actually multiply the work,

Esti

You know, talent strategy is important not just for us, but for all companies. Top of mind, in my opinion. I'll let Esti address the EBITDA question. Yes. Hi, Doug. So as for the 18% full year margin guide, so that actually reflects that, the hiring and investment that we're doing in the transformation transformation and that picks up over time during the year. So it's consistent with our expectation at the beginning of the year. As you know, overall we're very committed to execute a transformation, but that is with a strong financial discipline. So we are planning to execute that together with high profitability and to continue to generate healthy cash flow.

OPERATOR

Great. Thank you, Bill.

Brad Erickson (Equity Analyst)

Thank you. We have the next question from the line of Brad Erickson from RBC Capital Markets. Please go ahead. Hey guys, thanks for taking the questions. I guess all this transformation Talk, larger buyers, etc. I wonder, do you think about adjusting the economics or take rates or pricing or how you merchandise your services at all to kind of serve that type of customer? And then along those same lines, what would you say you want to kind of be signaling here this morning on overall marketing intensity as you pursue again this kind of maybe different customer profile than you have historically?

Miha Kaufman (Founder and CEO)

Thanks. Good morning, Brad. As for the first question, there's nothing to call out at the moment. What we see from the dynamics is as expected. I don't want to speculate on future models. Obviously it's a very dynamic company, we look at it all the time. But I don't have anything to call out at the moment in terms of, in terms of similar to the market with the customer profile and marketing. So we gave some example of use cases in the prepared remarks and these types of examples are rising. That portion of the business is growing. It is taking a larger size of our overall of our overall activity. And as it continues to grow, it will drive the business for growth. Now as we create more efficient, higher trust, higher quality solutions with everything I've outlined, again, I'm happy to go through it, but I was pretty long in my opening remark about what we're doing with the transformation, what we're doing with acquiring customers, with creating the flywheel will become more efficient, allowing us to also invest more aggressively in marketing to feed this flywheel as it grows. That's the plan. This is why we said at the beginning of the year, and I'm reiterating this, we're building ourselves for growth in the next couple of years and this is really important and the foundational work that we're doing are not buzzwords. It is really the essence of the business.

OPERATOR

Understood. Thanks. Thank you. We have a next question from the line of Matt Condon from Citizens Bank. Please go ahead.

Matt Condon (Equity Analyst)

Great. Thank you so much. My first question is just on, as we look at the green shoots that you're seeing in success moving into more complex projects, can you just talk about what you're seeing today as far as the product launches or go to market that's really driving that success? And the transactions of $1,000 plus growing clients purchasing projects, $1,000 plus growing. And then my second question is just, you talked in the letter a lot about this comprehensive work platform. Just can you just talk about the specific products that you are really focused on today that's really enabling that end to end platform, as you called it. Thank you so much.

Miha Kaufman (Founder and CEO)

Thanks, Matt. Good morning. The truth is we're only two months into the transformation. So what we've progressed so far is not big product launch yet. What we're doing is really dealing with the fundamentals of the business, the infrastructure of the business, the data infrastructure, the matching algorithm, the quality improvements, all of these. It's not really about new product launches, but it is very much about how we enhance everything we do. In some cases, we completely rewrite those solutions. Now I called out job post as an example, dynamic matching managed services and they're driving large engagement on Fiverr and we highlighted a few examples in the prepared remarks. But more broadly, we're seeing a clear shift in how customers use the platform. These products are fundamentally changing Fiverr from a place to complete isolated tasks into a platform to execute multiphase high value projects. So again, two months into it, it's not about shiny new launches and creating promises, it's about going back to the basics and making sure that we provide a level of service, a quality of service that is unmatched. That is the focus and this is where we're starting to see the numbers provide signals.

Matt Condon (Equity Analyst)

Does that answer your question, Matt? Yes. That's great. I just had another question. Just on the comprehensive work platform, just the end to end platform that they're launching, what are the capabilities that you really need to launch to enable this end to end service?

Miha Kaufman (Founder and CEO)

Sorry for skipping this. So on the product front, we talked about invest in an end to end fulfilling layer, which we think is key to identifying and increasing the value of Fiverr as an active partner in ensuring that the customers and the talent is engaging efficiently. And if there's anything in the process that we need to identify to Course, correct, we're there. This is really important because as you go to more bespoke, more complex types of projects, being there and being a part of that transaction and making sure that you understand the scope, you understand the progress you can create, transparency, you identify early on if things are on track or are deviating from track is super important. And this is a whole new layer that we are creating. And it's important as we think about changing the perception of Fiverr as a high end solution for high end scope and talent and as we. I can talk about those core pillars, I just don't want to reiterate my opening comments, but it's all about the matching and the brain behind things. It's about the product itself, it's about the go to market and how we entertain, how we engage with customers. And it's all about this idea of operational excellence where we're creating this extremely high execution capability which we want to also provide for our customers. The learnings that we have as a team on how to be more efficient. Where do you need to have a human in the loop and where can Fiverr help with both? Providing you with the right tech, but also with the human in the loop is critical. And all of these learnings are transforming from our internal execution into the tools that we are and we will provide for our customers and for talent.

Matt Condon (Equity Analyst)

That's very helpful. Thank you so much.

OPERATOR

Thank you. We have a last question from the line of Josh Chan from ubs. Please go ahead.

Josh Chan (Equity Analyst)

Hi Miha sd I guess with your move up market, you know, what's the profile of the customer that you're ultimately targeting? You know you mentioned projects above $1,000. So is that the benchmark of what you're targeting? And then secondly on free cash flow, could you talk about whether the Q1 level of free cash flow is roughly sustainable for the rest of the year and then your willingness to more aggressively buy back the stock at these levels.

Miha Kaufman (Founder and CEO)

Thank you. Morning Josh. In terms of focus, it's still largely focused on SMBs, probably larger than the micro businesses, but still SMBs. There's a lot of untapped demand both into larger customers and larger use cases. Every business and definitely mid sized businesses and up are building their own new tech stock that includes agents, APIs, MCPs. All of these use cases require tremendous amount of validation to check accuracy, integrity, compliance, security. All these things require the mix of both technology and human in the loop to continue calibrating, validating. In some cases, building, fixing. Those are areas that fiber is a perfect fit and so we'll see more of these use cases as we continue exploring this. But largely speaking, it's SMBs and the projects of $1,000 and more is a proxy. It's a way to identify the spend, capacity and willingness on digital services. That has provided us with a good point. Now it's 1,000 and above and within our market base, we have everything in ranges of of hundreds to tens and sometimes hundreds of thousands of dollars on transactions. But that's kind of a reference point to help us identify the seriousness and willingness to invest in your business.

Esti

As for cash flow, we generated $21 million free cash flow in Q1, and we plan to continue to generate strong cash flow and to be consistent and disciplined on capital allocation. Obviously, our capital allocation priorities remain the same. First and foremost, we are investing in the business and we will continue to invest in the transformation and generating cash flow. Now, as for buyback, we have authorization of $59.5 million and we will use it and act on that thoughtfully over time.

Josh Chan (Equity Analyst)

Great. Thank you both for the color.

OPERATOR

Thank you.

Miha Kaufman (Founder and CEO)

Thank you. This concludes the question and answer session. I would like to turn the conference back to the management for any closing remarks. Thank you, Maren, for moderating the call today and for everyone joining. Wishing you a great day and looking forward to speaking soon.

OPERATOR

Thank you. The conference has now concluded. Thank you for attending today's presentation. You may now disconnect.

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