Fiverr International Ltd.'s (NYSE:FVRR) Profit Outlook

Fiverr International Ltd. (NYSE:FVRR) is possibly approaching a major achievement in its business, so we would like to shine some light on the company. Fiverr International Ltd. operates an online marketplace worldwide. On 31 December 2022, the US$1.2b market-cap company posted a loss of US$71m for its most recent financial year. Many investors are wondering about the rate at which Fiverr International will turn a profit, with the big question being “when will the company breakeven?” In this article, we will touch on the expectations for the company's growth and when analysts expect it to become profitable.

Check out our latest analysis for Fiverr International

Fiverr International is bordering on breakeven, according to the 10 American Professional Services analysts. They expect the company to post a final loss in 2024, before turning a profit of US$34m in 2025. So, the company is predicted to breakeven approximately 2 years from today. How fast will the company have to grow each year in order to reach the breakeven point by 2025? Working backwards from analyst estimates, it turns out that they expect the company to grow 77% year-on-year, on average, which is rather optimistic! Should the business grow at a slower rate, it will become profitable at a later date than expected.

Underlying developments driving Fiverr International's growth isn’t the focus of this broad overview, however, keep in mind that generally a high growth rate is not out of the ordinary, particularly when a company is in a period of investment.

One thing we would like to bring into light with Fiverr International is its debt-to-equity ratio of 170%. Typically, debt shouldn’t exceed 40% of your equity, and the company has considerably exceeded this. Note that a higher debt obligation increases the risk around investing in the loss-making company.

Next Steps:

There are key fundamentals of Fiverr International which are not covered in this article, but we must stress again that this is merely a basic overview. For a more comprehensive look at Fiverr International, take a look at Fiverr International's company page on Simply Wall St. We've also compiled a list of relevant aspects you should further research:

1. Valuation: What is Fiverr International worth today? Has the future growth potential already been factored into the price? The intrinsic value infographic in our free research report helps visualize whether Fiverr International is currently mispriced by the market.
2. Management Team: An experienced management team on the helm increases our confidence in the business – take a look at who sits on Fiverr International’s board and the CEO’s background.
3. Other High-Performing Stocks: Are there other stocks that provide better prospects with proven track records? Explore our free list of these great stocks here.

What are the risks and opportunities for Fiverr International?

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This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.