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This Week's Exclusive Story Can Upwork Maintain Its Comeback? Reasons to Be Bullish and BearishAuthored by Dan Schmidt. First Published: 12/17/2025. 
Article Highlights - 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 might fondly remember the meme-stock era of 2021, but the companies involved have a more mixed legacy. Most (if not all) meme stocks never returned to their 2021 highs and currently sit in the market's dustbin. One of those former high-flyers is Upwork Inc. (NASDAQ: UPWK), the online gig marketplace that went public in 2018. Upwork looked headed for penny-stock status before the COVID-19 surge, when shares climbed from roughly $6 to $58 over 18 months. While President Trump's official salary is $400,000 per year... his tax returns reveal he's been collecting up to $250,000 PER MONTH from one hidden source. Until recently, most Americans couldn't touch the type of investment that makes up this investment. But thanks to Executive Order 14330, that just changed. If you love investing in disruptive new companies... Discover how to invest in the fund Trump uses to collect this income >> But UPWK fell back under $10 a share shortly after the Fed began raising rates, and that entire run came to feel like a fever dream. Now Upwork is once again rallying, and this recent roughly 30% gain looks to be supported by more than just easy liquidity. 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 transitioned into a more mature tech-sector business. Revenue has expanded, and the company has embraced AI, signaling adaptability. The rally is backed by both fundamental and technical tailwinds, including these three factors. -
Revenue Growth Turning Profitable Growing top-line revenue is one thing; eventually that revenue needs to translate into sustainable profit, especially after seven years as a public company. Upwork has started to do exactly that and is showing growth across several key areas. The company has beaten 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 leads into the next point. -
Embracing AI Rather Than Fighting It Many analysts expected generative AI to be a death knell for freelance marketplaces like Upwork, since some one-off tasks can theoretically be handled by ChatGPT or Gemini. Instead of losing clients, Upwork embraced AI and enabled 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 launched UMA, a "work companion" designed to help freelancers and clients find each other more efficiently. -
Technical Setup Suggests More Upside Fundamentals often take time to show up in a stock's price unless technical conditions are favorable. Upwork appears to have both: record sales, expanding margins, and constructive technical signals. The stock briefly fell even after a Golden Cross formed between the 50-day and 200-day simple moving averages (SMAs).  The Golden Cross wasn't wrong — it was early. The 50-day SMA held as support after a wobble, and the stock retook the 2025 high set in September. The Relative Strength Index (RSI) is elevated but still below the overbought threshold of 70, suggesting room for further gains. 2 Reasons to be Bearish on UPWK in 2026 2025's performance is encouraging, but investors are focused on what can go wrong next year. If you're considering a position in UPWK, monitor these two risks closely. -
Shrinking Volume in Small Gigs AI has helped Upwork's overall revenue, but it has also introduced vulnerabilities. While GSV is growing, smaller jobs paying $300 or less are evaporating as companies opt for generative AI to avoid onboarding one-off freelancers. If Upwork loses these smaller gigs to AI solutions or competitors like Fiverr International Ltd. (NYSE: FVRR), the marketplace could see GSV contraction even if higher-value projects remain robust. -
Broader Labor Market Weakness The macro picture is currently stable: the Federal Reserve lowered rates again this month, and lower rates often help small-cap stocks with positive cash flow and reasonable valuations. Still, the labor market is the canary in Upwork's coal mine, and the company's Enterprise segment (which serves large corporate clients) has shown signs of weakness this year. Moreover, Upwork's new Lifted platform for Enterprise clients is expected to require substantial integration costs, which could compress margins by roughly 2% in 2026. Margin stagnation combined with a slowing job market — or a recession — could reverse Upwork's profit momentum and weigh on the stock.
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