Shares of Upwork (NASDAQ:UPWK) rose 49.3% during the month of May, according to data from S&P Global Market Intelligence. The online talent marketplace, where employers and freelancers meet and interact, rose in response to the company's first-quarter earnings report, released on May 6.
Upwork's stock had actually been on a downward slide ever since last summer, and it was further beaten-down in March as the COVID-19 pandemic led to big recession fears and a slowdown in overall hiring. However, Upwork's technology allows for people to find remote jobs from home, and apparently, activity has been picking up recently.
During the first quarter, Upwork's revenue grew 21.5% to $83.19, which exceeded expectations. Gross services volume rose 15%, while Upwork's take rate also increased 8% from 12.6% to 13.6%. Upwork's core marketplace revenue increased by an even greater 24%, leading to gross margin expansion of three percentage points.
Of course, COVID-19 hit during the last two weeks of March, and Upwork did forecast a slight sequential decrease in revenue for the current quarter. However, that may have been better than many feared, and CEO Hayden Brown said in a subsequent CNBC interview that Upwork's activity had bounced back to record levels by late April.
Upwork is not only a passive marketplace but an active partner with its employer clients, which range from single-person businesses to large multinational corporations. As more and more companies potentially look to outsource key job roles to remote workers away from high-cost city centers, Upwork could stand to further benefit in the future. Brown called the COVID-19 situation potentially a "once-in-a-generation change" in the way companies source their workforces. If that trend holds up, this tech stock could continue its strong run.