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Nerdy (NRDY)
:NRDY
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Nerdy
(NYSE:NRDY)
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Select Model
Rating:48Neutral
Price Target:―
Nerdy's stock score reflects strong revenue growth and innovative product development, tempered by significant financial challenges, including negative profitability and cash flow issues. The technical analysis suggests moderate bullish momentum, but valuation concerns remain due to the negative P/E ratio. The earnings call indicates strategic initiatives for future growth, but immediate financial performance issues need resolution.
Positive Factors
AI-Driven Product Innovations
AI-driven innovations enhance learning experiences and operational efficiency, potentially increasing user engagement and retention, which supports long-term growth.
Strong Cash Position
A strong cash position with no debt provides financial stability, enabling strategic investments in AI and product development without immediate financial strain.
New COO Appointment
The new COO's expertise in operational efficiency and technology can drive strategic improvements, enhancing Nerdy's competitive position and operational effectiveness.
Negative Factors
Revenue Decline
A significant revenue decline indicates challenges in maintaining growth momentum, potentially impacting long-term financial performance and market confidence.
Negative Cash Flow
Negative cash flow from operations suggests difficulties in generating sufficient cash internally, which may hinder future investments and liquidity.
Gross Margin Reduction
A reduction in gross margin reflects increased costs or pricing pressures, which can erode profitability and affect long-term financial health.
Nerdy (NRDY) vs. SPDR S&P 500 ETF (SPY)
Market Cap
$241.54M
Dividend YieldN/A
Average Volume (3M)422.78K
Price to Earnings (P/E)―
Beta (1Y)1.59
Revenue Growth-10.85%
EPS Growth-15.09%
CountryUS
Employees600
SectorTechnology
Sector Strength88
IndustrySoftware - Application
Share Statistics
EPS (TTM)-0.04
Shares Outstanding121,403,404
10 Day Avg. Volume465,949
30 Day Avg. Volume422,779
Financial Highlights & Ratios
PEG RatioN/A
Price to Book (P/B)N/A
Price to Sales (P/S)N/A
P/FCF RatioN/A
Enterprise Value/Market Cap0.73
Enterprise Value/Revenue0.99
Enterprise Value/Gross Profit1.55
Enterprise Value/Ebitda-2.65
Forecast
1Y Price Target
$2.50Price Target Upside92.31% Upside
Rating ConsensusHold
Number of Analyst Covering4
Nerdy Business Overview & Revenue Model
Company DescriptionNerdy (NRDY) is an innovative education technology company that operates primarily in the online learning sector. The company offers a wide range of personalized learning solutions, including one-on-one tutoring, small group classes, and self-paced courses across various subjects and skill levels. Nerdy's core product, the Varsity Tutors platform, connects students with experts and educators, providing tailored instruction to enhance learning outcomes.
How the Company Makes MoneyNerdy makes money through a multi-faceted revenue model centered around its online learning platform, Varsity Tutors. The company generates revenue primarily from direct-to-consumer sales, where students or their parents pay for tutoring sessions, classes, and courses. These services are offered on a subscription basis or as one-time purchases. Additionally, Nerdy partners with educational institutions and businesses to provide tailored learning solutions and professional development programs, creating additional revenue streams. Other significant factors contributing to Nerdy's earnings include the scalability of its platform, which allows it to reach a broad audience, and strategic partnerships that expand its market presence and enhance its offerings.
Nerdy Earnings Call Summary
Earnings Call Date:Aug 07, 2025
(Q2-2025)
| % Change Since: |
Next Earnings Date:Nov 17, 2025
Earnings Call Sentiment Neutral
The earnings call highlighted strong growth in Learning Membership revenue and institutional bookings, driven by AI enhancements and operational efficiencies. Despite a decline in total revenue due to non-recurring items, the company's focus on AI-driven engagement and retention shows promise for future growth. However, seasonal revenue challenges and cautious institutional funding environments present ongoing challenges.Q2-2025 Updates
Positive Updates
Learning Membership Revenue Growth
Learning Membership revenue returned to year-over-year growth for the first time since Q2 2024, with a 4% increase, driven by AI-powered product enhancements.
Varsity Tutors for Schools Success
Varsity Tutors for Schools bookings grew by 21% year-over-year, supported by demand for high-dosage tutoring and a positive response to the Live+AI platform.
Gross Margin Expansion
Gross margin expanded by 350 basis points sequentially from the first quarter, with expectations for continued improvement throughout 2025.
Non-GAAP Adjusted EBITDA Improvement
The non-GAAP adjusted EBITDA loss of $2.7 million was better than expected, indicating progress towards profitability by Q4 2025.
AI Innovations and Customer Engagement
Introduction of AI-generated explanations and automated calendar invites led to higher engagement, better onboarding, and reduced cancellation rates.
Active Member and ARPM Growth
Active Members increased to 30,600 with ARPM reaching $348, a 24% year-over-year increase, driven by higher frequency Learning Memberships.
Institutional Business Progress
Institutional revenue was $7.3 million, with a significant increase in institutional bookings and AI tools resonating with district leaders.
Negative Updates
Total Revenue Decline
Total revenue was $45.3 million, down 11% year-over-year, due to non-recurring state-funded programs and lower institutional revenue.
Seasonal Revenue Challenges
The third quarter is anticipated to be the lowest revenue quarter due to summer breaks, impacting consolidated revenue growth.
Institutional Revenue Challenges
Institutional revenue decline in the first half of 2025 due to cautious federal and state-level funding environments, with expected growth returning in Q4 2025.
Company Guidance
During Nerdy, Inc.'s second quarter 2025 earnings call, the company highlighted several key metrics and strategic advancements aimed at driving growth and profitability. Learning Membership revenue grew by 4% year-over-year to $37.8 million, representing 84% of total revenue, with Active Members standing at 30,600 and an impressive 24% increase in average revenue per member per month (ARPM) to $348. Varsity Tutors for Schools bookings increased by 21% year-over-year, indicating strong demand for high-dosage tutoring services. Gross margin expanded sequentially by 350 basis points, contributing to a non-GAAP adjusted EBITDA loss of $2.7 million, which was better than the top end of guidance. The company's annualized run rate Learning Membership revenue reached $127.6 million, up 7% year-over-year, positioning Nerdy to achieve profitability by the fourth quarter. These results were driven by enhancements in the Live+AI platform, AI-powered product innovations, and operational efficiencies, with expectations for continued accelerated revenue growth and gross margin improvements throughout 2025.Nerdy Financial Statement Overview
Summary
Nerdy demonstrates strong revenue growth and a solid cash position, but continuous losses and negative cash flows highlight the need for improved operational efficiency and profitability. While the balance sheet shows financial stability with improved equity, the company must address its cash flow issues to sustain long-term growth.Income Statement
Nerdy's income statement shows a consistent increase in revenue over the years, indicating growth potential, with a revenue growth rate of 16.3% from 2020 to 2021 and 18.1% from 2019 to 2020. However, the company is struggling with profitability, as shown by negative EBIT and net profit margins. The gross profit margin in 2024 was approximately 67.5%, but the net profit margin remains negative due to significant losses.45
Neutral
Balance Sheet
The balance sheet indicates Nerdy has consistently maintained a strong cash position with no debt as of 2024, which is a positive sign of financial stability. Despite this, the company has faced challenges in sustaining positive equity. The debt-to-equity ratio is not applicable in 2024 due to zero debt, but the equity ratio has improved to about 42.7%, reflecting a strengthened balance sheet.50
Neutral
Cash Flow
Nerdy's cash flow statements reveal negative operating and free cash flows, indicating difficulties in generating cash from its core operations. The free cash flow to net income ratio is negative, showing reliance on external funding. This presents a challenge for future liquidity and investment capabilities.40
Negative
| Breakdown | TTM | Dec 2024 | Dec 2023 | Dec 2022 | Dec 2021 | Dec 2020 |
|---|---|---|---|---|---|---|
Income Statement | ||||||
| Total Revenue | 178.38M | 190.23M | 193.40M | 162.66M | 140.66M | 103.97M |
| Gross Profit | 113.84M | 128.39M | 136.45M | 112.93M | 93.96M | 69.13M |
| EBITDA | -66.44M | -62.54M | -50.80M | -57.37M | -87.06M | -11.89M |
| Net Income | -44.44M | -42.59M | -40.17M | -35.40M | -27.32M | -24.66M |
Balance Sheet | ||||||
| Total Assets | 73.69M | 92.51M | 124.74M | 132.69M | 177.15M | 57.27M |
| Cash, Cash Equivalents and Short-Term Investments | 36.72M | 52.54M | 74.82M | 90.72M | 143.96M | 29.27M |
| Total Debt | 0.00 | 928.00K | 4.67M | 1.53M | 841.00K | 47.58M |
| Total Liabilities | 24.95M | 31.39M | 39.14M | 51.64M | 81.34M | 455.74M |
| Stockholders Equity | 31.83M | 39.48M | 52.48M | 46.93M | 50.66M | -398.46M |
Cash Flow | ||||||
| Free Cash Flow | -33.30M | -22.47M | -14.45M | -53.32M | -44.05M | -9.53M |
| Operating Cash Flow | -27.86M | -15.60M | -7.56M | -48.00M | -38.89M | -6.65M |
| Investing Cash Flow | -5.44M | -6.86M | -6.89M | -5.32M | -5.16M | -2.87M |
| Financing Cash Flow | 0.00 | 0.00 | -1.94M | -1.00M | 159.25M | 12.29M |
Nerdy Technical Analysis
Negative
1.30
Price Trends
1.39
Negative
1.52
Negative
1.58
Negative
Market Momentum
-0.01
Negative
43.59
Neutral
43.14
Neutral
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For NRDY, the sentiment is Negative. The current price of 1.3 is below the 20-day moving average (MA) of 1.32, below the 50-day MA of 1.39, and below the 200-day MA of 1.58, indicating a bearish trend. The MACD of -0.01 indicates Negative momentum. The RSI at 43.59 is Neutral, neither overbought nor oversold. The STOCH value of 43.14 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for NRDY.
Nerdy Risk Analysis
Nerdy disclosed 57 risk factors in its most recent earnings report. Nerdy reported the most risks in the "Finance & Corporate" category.
Finance & Corporate - Financial and accounting risks. Risks related to the execution of corporate activity and strategy
Latest Risks Added 0 New Risks
Nerdy Peers Comparison
Overall Rating
UnderperformOutperform
Sector (61)
Financial Indicators
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
70 Neutral | 1.92B | 17.41 | 22.11% | ― | 6.08% | 153.79% | |
65 Neutral | 2.67B | -67.86 | -11.19% | ― | 29.63% | 29.87% | |
63 Neutral | 1.47B | -67.23 | -5.73% | ― | 5.96% | 50.29% | |
60 Neutral | 1.10B | -823.33 | -0.46% | ― | 22.16% | -107.92% | |
60 Neutral | 1.51B | -15.18 | -34.47% | ― | 9.93% | -11.15% | |
48 Neutral | $241.54M | ― | -105.81% | ― | -10.85% | -15.09% | |
61 Neutral | $37.18B | 12.37 | -10.20% | 1.83% | 8.50% | -7.62% |
* Technology Sector Average
Performance Comparison
NRDY
Nerdy
1.30
0.32
32.65%
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7.41
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Alkami Technology
25.68
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CXM
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7.86
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1.68%
MLNK
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19.92
-1.07
-5.10%
AMPL
Amplitude
11.38
2.43
27.15%
Glossary
BuyA stock rated as a "Buy" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock is likely to deliver higher returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
HoldA stock rated as a "Hold" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly compelling nor unfavorable for investment. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
SellA stock rated as a "Sell" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock may deliver lower returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
Disclaimer
This AI Analyst Stock Report is automatically generated by our AI systems using advanced algorithms and publicly available financial, technical, and market data. While the information provided aims to be accurate and insightful, it is intended for informational purposes only and should not be considered financial advice. Any content created by an AI (Artificial Intelligence) system may contain inaccuracies and/or contain errors. Investing in stocks carries inherent risks, and past performance is not indicative of future results. This report does not account for your personal financial circumstances, objectives, or risk tolerance. Always conduct your own research or consult with a qualified financial advisor before making investment decisions. The analysis and recommendations provided are based on historical and current data and may not fully reflect future market conditions or unexpected developments. Neither the creators of this report nor its affiliated entities guarantee the accuracy, completeness, or reliability of the information presented. Use this report at your own discretion and risk.