Airtasker defies drop in tasks posted to drive revenue to new heights

Airtasker defies drop in tasks posted to drive revenue to new heights

Airtasker co-founder and CEO Tim Fung

Airtasker (ASX: ART) has defied a drop in consumer demand for help with odd jobs as the online services platform posted record revenue in FY23, putting it on track for a positive cashflow in the current year.

Despite a 6.4 per cent fall in the number of tasks posted on the platform in Australia, the company’s biggest market, Airtasker recorded a 38.8 per cent surge in marketplace supply – or the number of offers per task that was posted.

A 20 per cent increase in revenue from each task helped deliver 40 per cent growth in revenue for Airtasker, which also continues to build its business in the US and UK. Gross profit for the group’s Australian marketplaces surged 41.7 per cent to $41 million.

The improved performance helped Airtasker narrow its bottom-line loss by 36.7 per cent to $12.9 million, while the underlying loss showed a 53 per cent improvement to $8 million.

Airtasker, co-founded and led by Tim Fung, targeted cost reductions in FY23 to improve profitability, including the April announcement of axing 45 staff which cut the company’s headcount by 20 per cent. This came at a one-off cost of $1.2 million.

The Sydney-based company also plans to exit non-core businesses which were acquired as part of the Oneflare portfolio. Airtasker bought Oneflare, Australia’s third-largest local services platform at the time, for $9.8 million in May 2022.

The exit from the loss-making businesses, to be completed in the current half year, will cut FY24 revenue by about $1 million, but Airtasker says it will be positive in terms of operating expenses and cashflow.

The company’s international business, still in the early stages of growth, delivered revenue of about $900,000, which is up 83 per cent from FY22.

Airtasker has teamed up with UK television network Channel 4 in a media-for-equity deal to promote its platform to the media network’s 47 million viewers.

Channel 4 is investing £3.5 million ($6.8 million) via media advertising services in exchange for a 20 per cent stake in Airtasker’s UK subsidiary.

The company says a similar deal with Seven West Media (ASX: SWM) helped the group achieve 20-times revenue growth over five years.

Airtasker achieved a 34.6 per cent increase in gross market volume in the UK to £3.7 million ($7.2 million) in FY23, which contributed about $500,000 in revenue, almost double FY22.

The company has described its US marketplace as being in the ‘zero to one’ stage, with its immediate focus on building a steady flow of posted tasks.

Over the past year, the number of tasks posted in the US surged 158 per cent to 64,000, while offers to complete those tasks jumped at almost twice that pace by 300 per cent to 106,000.

Airtasker says consistent growth in the US follows a concerted campaign to focus on the Los Angeles marketplace in FY23.

Fung, the Airtasker CEO, says he is ‘super pleased’ with the record revenue posted by the group, along with the performance in the US and UK.

“We’re now really well positioned with more than $16.1 million in cash on balance sheet and are on track for a free cashflow positive result in FY24,” Fung says.

“At the same time, we’re super excited to turbocharge Airtasker in the UK via our $6.7 million media-for-equity partnership with Channel 4, replicating the success we achieved in Australia and readying our media partnership strategy for further global scale.”

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