Udemy’s Strategic Shift to Subscription Model: A Long-Term Growth Opportunity Despite Short-Term Challenges

Analyst Ryan MacDonald of Needham reiterated a Buy rating on Udemy Inc, retaining the price target of $11.00.

Ryan MacDonald has given his Buy rating due to a combination of factors including Udemy Inc’s strong third-quarter revenue and adjusted EBITDA performance. This success is largely attributed to the company’s focus on enhancing its consumer subscription business, which has shown promising results.
MacDonald notes that Udemy is strategically shifting its business model towards subscription-based revenue, which is expected to initially slow consumer segment growth in the first half of 2026. However, the anticipated growth in subscription revenues is projected to surpass the decline in transaction revenues in the latter half of 2026. Although this transition may pose short-term challenges, MacDonald believes it is a sound strategic move for Udemy’s long-term success.