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This Week's Exclusive Story Can Upwork Maintain Its Comeback? Reasons to Be Bullish and BearishAuthor: Dan Schmidt. Posted: 12/17/2025. 
Key Takeaways - Upwork was a popular meme stock in 2021, but the company hasn't come close to matching those highs in the 4 years since.
- Despite its negative reputation, Upwork has become a profitable enterprise that's embraced AI for more complex jobs.
- While fundamental and technical tailwinds are in place, a few factors are still weighing on the stock that investors should be aware of as they enter 2026.
Traders may fondly remember the meme-stock era of 2021, but the companies involved have had a more mixed outcome. Most (if not all) meme stocks never came close to their 2021 highs and now sit in the market's rearview mirror. One of those former high-flyers is Upwork Inc. (NASDAQ: UPWK), the online gig marketplace that went public in 2018. Upwork looked in danger of penny-stock status before COVID-19, then shares surged from about $6 to $58 over 18 months. While headlines focus on Tesla's car sales, tech analyst Jeff Brown says the real story is Tesla's role in a $25 trillion AI revolution — one that Nvidia's CEO himself has called a "multi-trillion-dollar future industry" — and he's uncovered a little-known stock 168 times smaller than Nvidia that could be positioned to ride this breakthrough. Click here now to see the full report Of course, UPWK fell below $10 a share shortly after the Fed began raising rates, and the whole run felt like a fever dream. But now Upwork is once again rising, and this time the roughly 30% gain is driven by more than just cheap money. Can the stock sustain this momentum as we enter 2026? Here are three reasons to be bullish—and two reasons for caution. 3 Reasons to be Bullish on UPWK in 2026 If Upwork continues to climb, 2025 may be remembered as the year the company matured into a true tech-sector enterprise. Revenue is growing, and the company has embraced AI, signaling long-term adaptability. There are both fundamental and technical tailwinds behind this surge, including these three factors. -
Revenue Growth Becoming Profitable Growing top-line sales is one thing, but after seven years as a public company those sales must translate into profits. Upwork has started to convert revenue into earnings and is showing expansion across several key areas. The company has been beating top- and bottom-line expectations, margins have reached record levels (29.6%), and Gross Services Volume (GSV) returned to growth in Q3 2025, up 2% year-over-year (YOY). During the Q3 conference call, Upwork raised full-year revenue and EBITDA guidance and highlighted its AI progress, which brings us to the next point. -
Successfully Mitigating AI Headwinds Many analysts expected generative AI to be a threat to freelance marketplaces like Upwork, where many tasks are one-off gigs that companies might try to replace with AI. Instead of losing clients, Upwork embraced AI for hybrid workflows. Companies can now combine human freelancers with specialized AI agents for complex projects, and AI-based GSV has grown more than 50% YOY. The company also introduced UMA, its "work companion," to help freelancers and clients find each other more efficiently. -
Technical Trends Point to More Upside Fundamental improvements can take time to show up in a stock's price unless technical tailwinds align. Upwork has a favorable mix: record sales, expanding margins, and improving technical indicators. The stock sent mixed signals when the price dipped despite a Golden Cross forming on the 50-day and 200-day simple moving averages (SMAs). 
The Golden Cross wasn't wrong—just early. The 50-day SMA wobbled but held as support, and the stock quickly reclaimed the 2025 high it reached in September. The Relative Strength Index (RSI) is elevated but still below the overbought threshold of 70, suggesting additional upside may be possible. 2 Reasons to be Bearish on UPWK in 2026 Putting 2025 performance aside, investors are primarily focused on what 2026 will bring. If you're considering a position in UPWK, watch these two potential headwinds. -
Shrinking Gig Volume Is a Red Flag AI has helped Upwork grow overall revenue, but it has also exposed vulnerabilities. GSV is up, yet smaller jobs—those paying $300 or less—are disappearing as companies turn to generative AI to avoid onboarding costs or the friction of hiring one-off freelancers. If Upwork loses these smaller gigs to AI or competitors such as Fiverr International Ltd. (NYSE: FVRR), the marketplace could shrink again in terms of GSV—even if higher-level, higher-value jobs remain available. -
Broader Labor Market Weakness At the moment, the macro backdrop for Upwork looks stable. The Federal Reserve lowered rates again this month, and lower rates often help small-cap stocks with solid cash flow and reasonable valuations. Still, the labor market is a canary in Upwork's coal mine, and the company's Enterprise segment (which serves large professional clients) has already shown signs of weakness this year. Moreover, Upwork's new Lifted platform for Enterprise clients is expected to require significant integration costs, which management says could shave roughly 2% off margins in 2026. Margin pressure combined with a slowdown in the job market—or a recession—could reverse Upwork's profit progress and weigh heavily on the stock.
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