Needham has reiterated its Buy recommendation on Upwork Inc. (NASDAQ: UPWK) and held a $25.00 price target after the company published fourth-quarter 2025 results. The price target corresponds to approximately 32% upside from a reference share price of $18.89.
The research firm said its 2026 estimates changed only slightly, but that the updated projections now call for a steeper growth ramp in the second half of 2026 for both Marketplace Gross Services Value (GSV) growth and adjusted EBITDA compared with its prior view. Needham highlighted several specific drivers that it expects to support the acceleration.
Those drivers include further scaling of Upwork's Business Plus tier, increased marketplace spending from higher-value clients, the planned launch of a new enterprise platform, and expansion within AI-related categories. Needham noted that AI-related categories represented $300 million in annualized spend during the fourth quarter and grew 50% year-over-year.
In addition to growth commentary, InvestingPro data referenced by the firm show that Upwork retains a strong gross profit margin of 77.8%, a level Needham says provides financial flexibility to invest in the initiatives it identifies as drivers of future growth.
The $25 price target is based on roughly 10 times Needham's projected 2027 EBITDA, a multiple the firm describes as implying material upside from the company's post-earnings trading level.
Upwork's reported fourth-quarter 2025 results exceeded consensus on multiple metrics. The company posted earnings per share of $0.36, versus the expected $0.31. Revenue for the quarter came in at $198.4 million, narrowly topping the forecasted $197.25 million.
In the wake of those results, other sell-side firms adjusted their views. Canaccord Genuity lowered its price target for Upwork to $22.00 from $24.00 while maintaining a Buy rating. Canaccord described the overall outlook as mixed, noting that Upwork surpassed expectations on gross service value, revenue, and adjusted EBITDA even as active client counts were softer.
Citizens also trimmed its target to $22.00 from $27.00, retaining a Market Perform rating. That firm cited limited visibility on the timing of enterprise revenue contributions as Upwork executes a transition in its enterprise strategy. These moves illustrate analysts continuing to reprice and reassess Upwork as management pursues strategic changes.
Needham's view rests on a combination of durable margins and discrete commercial initiatives. The firm points to the combination of a high gross margin and targeted product rollouts as a pathway to materially higher adjusted EBITDA by 2027 under its model. At the same time, other analysts remain attentive to execution risks tied to enterprise adoption and active-client trends.
Investors watching the stock have a range of analyst signals to weigh: a reiterated Buy with a $25 target from Needham, two peers lowering targets to $22 with differing stance on conviction, and company results that beat near-term expectations but showed mixed underlying trends.