Coursera Inc ((COUR)) has held its Q2 earnings call. Read on for the main highlights of the call.
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Coursera’s Q2 2025 Earnings Call: A Positive Outlook with Challenges Ahead
The recent earnings call for Coursera Inc. painted a generally positive picture, highlighting a strong quarter characterized by robust revenue growth, increased free cash flow, and a significant expansion in its learner base. The company also reported strong demand for its generative AI courses and improved gross margins. Despite these successes, challenges persist in the enterprise segment and with the Degrees product. Overall, the highlights significantly outweighed the lowlights, indicating a promising trajectory for Coursera.
Strong Revenue Growth
Coursera reported a revenue of $187 million for Q2 2025, marking a 10% year-over-year increase. This growth prompted the company to raise its full-year revenue guidance to between $738 million and $746 million, showcasing confidence in its financial performance.
Significant Increase in Free Cash Flow
The company achieved a free cash flow of $29 million, representing a 68% increase from the prior year. This substantial growth in cash flow indicates strong bottom-line performance and financial health.
Expansion of Learner Base
Coursera attracted 7.5 million new registered learners in Q2, marking the largest quarterly addition since 2020. This growth expanded the total learner base by 18% year-over-year to 183 million, underscoring the platform’s increasing popularity.
Generative AI Course Demand
The demand for generative AI courses surged, with the catalog tripling over the past year and surpassing 10 million enrollments. In 2025, the platform saw 12 enrollments per minute, highlighting the growing interest in AI education.
Recognition and New Partnerships
Coursera’s influence was recognized as it was named to the Time 100 Most Influential Companies list. The company also announced new courses from major partners like AWS, DeepLearning.AI, Google Cloud, IBM, Microsoft, and Snowflake, enhancing its educational offerings.
Improved Gross Margins
The company’s gross margin improved to 56%, up 180 basis points from the prior year. This improvement was driven by increased learner demand and more favorable production arrangements.
Enterprise Segment Challenges
While enterprise revenue growth was moderate at 10%, the net retention rate stood at 93%, indicating room for improvement. The macro environment continues to pose challenges, particularly in corporate spending.
Degrees Product Decline
The Degrees product, now integrated into the Consumer segment, is expected to decline, impacting overall consumer growth. This shift poses a challenge for Coursera’s consumer segment.
Forward-Looking Guidance
Coursera’s forward-looking guidance remains optimistic, with the company raising its full-year revenue guidance and adjusted EBITDA margin target. The platform’s content catalog expanded significantly, with a focus on generative AI courses. Coursera expects continued growth from its product-led initiatives and plans to invest further in content and product development.
In conclusion, Coursera’s Q2 2025 earnings call highlighted a strong performance with notable achievements in revenue growth, cash flow, and learner expansion. While challenges remain in certain segments, the company’s forward-looking guidance and strategic initiatives suggest a positive outlook for the future.