Speaker 1: Bloomberg Audio Studios, Podcasts, radio News.
Speaker 2: You're listening to Bloomberg Business Week with Carol Masser and
Speaker 2: Tim Stenoveek on Bloomberg Radio.
Speaker 3: We're going to go back a little bit too earnings,
Speaker 3: because that's definitely been on our radar as of late.
Speaker 3: I know we talked a lot about geopolitics, and we
Speaker 3: might roll a little bit of that into our next conversation.
Speaker 3: Want to go to Upwork Shares ralling big time yesterday
Speaker 3: following their quarterly update. The online recruitment company reported second
Speaker 3: quarter results that beat expectations. They also raised their full
Speaker 3: year forecasts. The one point seven billion dollar market cap company,
Speaker 3: it connects businesses and independent professionals, so freelance, freelancers and
Speaker 3: others for remote work opportunities. The stock down more than
Speaker 3: twenty percent year to date, and about ten percent of
Speaker 3: the float is short. The company though a useful indicator
Speaker 3: of what is going on in the labor force, and
Speaker 3: so let's get to it. Today's CFO briefing with us
Speaker 3: as Erica Gesser. She is chief financial officer at Upwork.
Speaker 3: She joins US for San Francisco. She will be featured
Speaker 3: in an upcoming edition of the Bloomberg CFO Briefing newsletter,
Speaker 3: which you can find at Bloomberg dot com slash CFO
Speaker 3: Briefing and also with us as Nina Trupman. She's Bloomberg
Speaker 3: News senior editor who writes the Bloomberg CFO Briefing newsletter.
Speaker 3: She joins us here in studio. Eric, good to have
Speaker 3: you here with Nina, Jess and myself. Your stock did
Speaker 3: soar on your latest quarterly update and outlook. Talk to
Speaker 3: us about the business and what's driving growth.
Speaker 1: Yeah, thanks so much, Carol, it's great to be here.
Speaker 1: You know, we had a standout quarter in Q two
Speaker 1: in so many ways, but you know, I think really
Speaker 1: the most distinctive thing is that is the AI category
Speaker 1: of work. So many different types of work are developing
Speaker 1: in AI and on our platform. Our AI category group
Speaker 1: thirty percent year over year in the second quarter, and
Speaker 1: that was actually an acceleration from the first quarter. And
Speaker 1: one of the other drivers is actually all of the
Speaker 1: AI enablement on our platform. So if you think about
Speaker 1: the high hiring process just in general, you know that
Speaker 1: you know, posting a job freelancers, you know, bidding on
Speaker 1: a job, and then and then you know the interview
Speaker 1: process well, we have now enabled AI all across the
Speaker 1: hiring process, pulling out friction from every single part of
Speaker 1: the customer experience, and we actually attribute about eighty million
Speaker 1: dollars a volume on our platform just from those improved
Speaker 1: customer experiences.
Speaker 4: Erica, thanks for joining us. I'm just wanting to follow
Speaker 4: up on this. Of course, your platform operates all around
Speaker 4: the world. It's not just an indicator of job markets
Speaker 4: in the US, but also in other countries. Just wondering
Speaker 4: if we're looking at your US business in particular, I'm wondering,
Speaker 4: what does the growth that you've seen in the latest
Speaker 4: quarter tell you about the state of the labor market
Speaker 4: more broadly.
Speaker 1: You know, it's really interesting Nina, and and hello, good
Speaker 1: to Good to talk to you again. You know, we overall,
Speaker 1: you know, I think on the in the labor market
Speaker 1: writ large. You know, there are obviously persistent winds hitting
Speaker 1: the labor market, the BLS data coming down, and you know,
Speaker 1: public staffing, if you look at the kind of public
Speaker 1: market public staffing companies, they reported about a four percent
Speaker 1: on average down quarter in Q two and actually projecting
Speaker 1: even you know, even more kind of negative growth. We're
Speaker 1: actually really pleased in that context that you know, upper
Speaker 1: kind of growth quorder in Q two and that actually
Speaker 1: just shows the strength and the attractiveness of our digital platform.
Speaker 1: But you know, I would just say that the vagaries
Speaker 1: of the BLS data in general, you know, if that's
Speaker 1: telling us anything, it's that things are really uncertain out there,
Speaker 1: and that uncertainty is affecting our clients and people in
Speaker 1: small businesses in general that are just unsure about what's
Speaker 1: around the corner.
Speaker 2: When you're looking at particularly your share price actually being
Speaker 2: down roughly seventeen percent year to date, why is that
Speaker 2: And what do you think investors are telling you when
Speaker 2: it comes to their chief concerns right now?
Speaker 1: You know, it's a great question, and and you know,
Speaker 1: we obviously, uh, you know, disagree with what the market
Speaker 1: is saying right now. And I think I think that
Speaker 1: the reality is is some of these kind of broader
Speaker 1: labor market concerns are affecting a lot of stocks in
Speaker 1: the human capital industry, and we're kind of getting pulled
Speaker 1: down with the pack, even though our results and the
Speaker 1: progress on the platform is really standing out from the crowd.
Speaker 1: You know, I think that in general, there's been this
Speaker 1: you know concept out there that you know, as these
Speaker 1: really really exciting advances in a AI come forward, that
Speaker 1: they're going to start to substitute work. And there's actually
Speaker 1: no doubt that in certain categories at the very lowest
Speaker 1: end of you know, the types of work that are
Speaker 1: getting done and writing and translation, you do see AI substitution.
Speaker 1: But on platforms like ours, where we we we actually
Speaker 1: supply much larger, more complex work with skilled workers, we're
Speaker 1: seeing AI actually enhance work and actually start to augment
Speaker 1: and accelerate categories that that some people thought would be disrupted,
Speaker 1: things like video and animation, contract law, accounting, and bookkeeping.
Speaker 1: All of these categories are actually being accelerated and advanced
Speaker 1: by Aiay.
Speaker 4: Eric I will turn to AI in a second. I
Speaker 4: think Carol has a follow up on that. I'm just wondering.
Speaker 4: You said one thing about the BLS that I thought
Speaker 4: was interesting and actually one of the things I had
Speaker 4: wanted to to ask to you about as the CFO
Speaker 4: of a business that is, of course labor related. I'm
Speaker 4: wondering what you make of the firing of President Trump
Speaker 4: of the Commissioner of the Bureau of Labor Statistics recently.
Speaker 1: Uh, well, it's it's it's hard to comment on on
Speaker 1: sort of on those decisions. I think, you know, these
Speaker 1: types of data get you know, get get revised all
Speaker 1: the time. These were actually large revisions. But you know,
Speaker 1: it's hard to comment on that decision. It was it
Speaker 1: was certainly very surprising.
Speaker 2: Is it?
Speaker 3: But is it a data point that you respect and
Speaker 3: have looked at and compared it to know what's going
Speaker 3: on in your world?
Speaker 1: Look, I mean, we, of course as a business, you know,
Speaker 1: in a business in the human capital industry, watch the
Speaker 1: labor market very very carefully. And you know, and we
Speaker 1: have seen historically that you know, our kind of volume
Speaker 1: related trend what we call GSV in our platform have
Speaker 1: some correlation to kind of the movement of the Jolt
Speaker 1: report on a lagging on a lagging as a lagging indicator.
Speaker 1: But you know, what we're what we're seeing now is
Speaker 1: that all the improvements on our platform and again, you know,
Speaker 1: some of the strength that we're seeing in certain categories
Speaker 1: is actually helping us to kind of buck the trends
Speaker 1: of what's going on out there. And you know, we're
Speaker 1: really kind of we're relying on the strength of our
Speaker 1: platform and advancements in our own tech to offset you
Speaker 1: know what continues to be a very very uncertain operating environment.
Speaker 1: Erica Nina was right.
Speaker 3: I want to go back to AI for a moment
Speaker 3: because I'm kind of blown away that you say AI
Speaker 3: is kind of enhancing your your work and your platform
Speaker 3: in a big way, because I think there is this
Speaker 3: feeling like could even AI make what you guys do
Speaker 3: obsolete at some point? But educate because I think as
Speaker 3: we go along and we throw so much about AI
Speaker 3: into one little bucket, like, help us understand how you
Speaker 3: are using it on the platform, how it is actually
Speaker 3: driving things in your business.
Speaker 1: Yeah, so it is driving things in our business in
Speaker 1: two ways, you know. The first is you know what
Speaker 1: I refer to is that AI enhancements on our platforms,
Speaker 1: So just making it easier for our clients, which are
Speaker 1: you know, businesses of all sizes who are coming onto
Speaker 1: our platform, you know, looking for great talent to get
Speaker 1: work done. In the past, they would have to write
Speaker 1: up a job post, you know, post the job interview,
Speaker 1: interview freelancers a series of freelancers, and the freelancers themselves
Speaker 1: have to write a proposal. Now all of that is
Speaker 1: done by AI, and it's taking what used to take
Speaker 1: hours and hours, you know, down to minutes. So that's
Speaker 1: a huge advancement just in the enablement of finding a
Speaker 1: great match to get the work that you want to
Speaker 1: get done done quickly and easily. But the even more
Speaker 1: interesting trends are really around how AI is enhancing every
Speaker 1: single category of work. I mean, you know, what we're
Speaker 1: seeing on our platform is you know, freelancer, you know,
Speaker 1: job descriptions popping up saying hey, I'm an AI video animator,
Speaker 1: I'm an AI artist. You know, it's not just prompt
Speaker 1: engineering or or you know, ll and building, of which
Speaker 1: we have you know, many, many, many, nearly two hundred
Speaker 1: and fifty thousand, you know, AI skilled talent on our platform.
Speaker 1: But it's really impacting every single area of work. And
Speaker 1: what we're finding is, you know, it's enabling our freelancers
Speaker 1: to get work done faster, to get get work done better,
Speaker 1: and clients are actually looking for freelancers who are using
Speaker 1: AI to get to get work done.
Speaker 3: Hey, listen, we just have about thirty forty seconds. I
Speaker 3: know Nina has one last question that she wants to
Speaker 3: ask us quickly.
Speaker 4: Yeah, Eric, I was just wondering you completed two transactions
Speaker 4: recently and wondering did any of the macro uncertainty influence
Speaker 4: those so the deal making for those transactions.
Speaker 1: That's an interesting question. You know, I don't think the
Speaker 1: macro uncertainty, you know, really played into it at all.
Speaker 1: These two game changing transactions that we did, the names
Speaker 1: of the companies are buve Tea and Assen. These are
Speaker 1: really adding kind of digitally native capabilities to our enterprise
Speaker 1: offering to integrate you know, kind of an incredible AI
Speaker 1: kind of enhanced platform with our talent, as well as
Speaker 1: a broader contingent labor solution that will enable enterprises to
Speaker 1: again quickly and easily and kind of get through all
Speaker 1: the red tape of compliance and everything else to hire
Speaker 1: the contingent labor that they need.
Speaker 3: Thank you so much, You're so real.
Speaker 2: Love it.
Speaker 3: Erica Guessert, two financial officer at Atwork, featured in an
Speaker 3: upcoming Bloomberg CFO briefing, and of course, Anita Treatman Bloomberg
Speaker 3: new Senior Editor