The AI ​​effect: Faber significantly reduces the annual forecast

However, Faber is significantly reducing its annual forecast. While previously it expected a 12-3% decrease in revenues compared to the previous year and was supposed to end 2026 with revenues of 380-420 million dollars – now the forecast drops to 356-372 million dollars, which means a 14-17% decrease in revenues compared to 2025. The EBITDA forecast (earnings excluding interest, tax, depreciation and amortization) also decreases, From 64-80 million dollars to 52-62 million dollars, this compared to EBITDA of 91.6 million dollars in 2025.

In a letter to investors, Faber founder and CEO Micah Kaufman defined the second quarter of this year as a transitional quarter. According to him, Faber customers are accelerating the adoption of AI, and in recent weeks the company has begun to detect “a significant slowdown in overall demand and traffic, a trend that continued in the third quarter”, which they attribute to developments in large language models (LLM). Faber is trying to deal with this challenge through “aggressive implementation of our strategy towards the upmarket”, that is, for complex projects that are more valuable to the client.

Faber has developed a trading platform to connect freelancers with employers. The company is one of the most prominent victims of the negative sentiment towards software companies, because it is seen as being harmed by AI, which is also reflected in the reports it published today (Wed). Since the beginning of the year a share Faber lost 41% of its value to a current value of 417 million dollars, and with the publication of the reports the stock is falling in early trading on Wall Street.

About a third of the workers were fired

Last September Faber announced the layoff of about a third of its employees and a return to the status of a start-up as a way of dealing with the changes in the market. This week it was revealed in Globes that Faber will not move to the Wix campus in a hurry.

Meanwhile, in the second quarter of the year, as mentioned, Faber recorded results in the range of the forecast it gave, but slightly lower than the market forecasts. Revenues amounted to 97.8 million dollars, a 10% decrease from the corresponding quarter, and in the first half, revenues decreased by 5.8% to 203 million dollars.

According to generally accepted accounting principles (GAAP), net profit attributable to shareholders increased by 40% to $4.5 million in the quarter, and amounted to $13 million from the beginning of the year. On a Non-GAAP basis, a net profit of 50 cents per share was recorded, two cents less than analysts’ forecasts. Quarterly EBITDA reached $17.5 million, down 18%.

In the first half, Faber generated $35 million from current operations, and at the end of the period it had cash and investments amounting to approximately $309 million.

“The market is changing faster than expected”

Micha Kaufman, founder and CEO of Faber, said: “The results of the second quarter reflect a market that is changing faster than expected, which is affected by the rapid adoption of artificial intelligence. Accordingly, we focus on higher-value projects that require high-quality talent: while artificial intelligence takes a significant part of the simple and low-value transactions, it also creates a demand for large, complex and long-term projects, where there is a real need for human expertise, to manage the work processes and greater responsibility for the products.

“This is a transformative process that will continue over several quarters, and we are focused on disciplined and consistent execution, while building Fiber as the most reliable platform for high-value projects.”

CFO Esti Levy-Dadoon added that the results reflect the first stages of a significant transformation. According to her, “We have updated the company’s forecast to reflect these ongoing trends and the period of time required until our transformation initiatives are reflected in the financial results.

“It is important to note that we continue to operate as an efficient and focused organization, while maintaining budgetary discipline to maintain profitability. Our balance sheet gives us the flexibility required to stabilize the core activity of the marketplace, to invest in moving towards the upmarket and to examine opportunities for capital allocation, while focusing on long-term value creation.”