Education
About Us
Working with TipRanks
Follow Us
Udemy, Inc. (UDMY)
:UDMY
Top Page
Udemy Inc
(NASDAQ:UDMY)
55Neutral
Positive Factors
Financial Performance
Udemy reported solid Q4 results, with both revenue and profitability coming in ahead of expectations.
Leadership Transition
The leadership change positions the company for the next chapter of growth.
Market Strategy
AI tools gaining traction, marketplace model remains a differentiator.
Negative Factors
Growth Concerns
The company's guidance for 2025 includes growth of roughly 1%, which is a far cry from its prior long-term targets of 25%-30%.
Sales Strategy
The reduction of SMB sales capacity will negatively impact customer growth in 1H25.
Valuation
There is a downgrade to Underweight due to Udemy's premium valuation relative to a core competitor.
Udemy Inc (UDMY) vs. S&P 500 (SPY)
Market Cap
$1.15B
Dividend YieldN/A
Average Volume (3M)1.54M
Price to Earnings (P/E)―
Beta (1Y)2.29
Revenue Growth7.91%
EPS Growth22.07%
CountryUS
Employees1,246
SectorTechnology
Sector Strength43
IndustryEducation & Training Services
Share Statistics
EPS (TTM)-0.56
Shares Outstanding147,744,480
10 Day Avg. Volume1,161,820
30 Day Avg. Volume1,540,469
Financial Highlights & Ratios
PEG RatioN/A
Price to Book (P/B)N/A
Price to Sales (P/S)1.60
Price to Cash Flow (P/CF)32.80
P/FCF Ratio32.80
Enterprise Value/Market CapN/A
Enterprise Value/RevenueN/A
Enterprise Value/Gross ProfitN/A
Enterprise Value/EbitdaN/A
Forecast
1Y Price Target
$11.33Price Target Upside43.96% Upside
Rating ConsensusModerate Buy
Number of Analyst Covering9
Udemy Inc Business Overview & Revenue Model
Company DescriptionUdemy, Inc. operates a marketplace platform for teaching and learning skills in the United States and internationally. The company offers technical and business skills, and personal development courses for individual learners and enterprise customers. Its platform provides 49 million learners with access to approximately 180,000 courses through direct-to-consumer or Udemy Business offerings in approximately 75 languages. The company's courses offer learning objectives, such as reskilling or upskilling in technology and business, and soft skills, as well as learners receive access to interactive learning tools comprising quizzes, exercises, and instructor questions-and-answers. Udemy, Inc. was incorporated in 2010 and is headquartered in San Francisco, California.
How the Company Makes MoneyUdemy makes money primarily through the sale of courses on its platform. The company's revenue model is based on a marketplace approach where instructors create and publish courses, and Udemy takes a percentage of the sales generated from these courses. Instructors can set their own prices, and Udemy offers promotional and marketing tools to help increase sales. Additionally, Udemy for Business is a significant revenue stream, offering a subscription-based service to organizations seeking to provide their employees with access to a curated selection of courses. This corporate offering helps companies upskill their workforce and is a growing part of Udemy's business. Strategic partnerships with educational institutions and corporations also contribute to Udemy's earnings by expanding its reach and enhancing its course offerings.
Udemy Inc Financial Statement Overview
Summary
Udemy Inc is experiencing consistent revenue growth with improving cash flow management and operational efficiency. Despite low leverage, the company faces challenges with persistent net losses and the need to enhance profitability.Income Statement
Udemy Inc has shown consistent revenue growth over the years, with a 7.9% increase in 2024. However, the company continues to incur losses, reflected by its negative net profit margin of -10.8% in 2024. Despite a significant improvement in EBIT margin to -11.4% and EBITDA margin remaining negative, these margins indicate challenges in achieving profitability.60
Neutral
Balance Sheet
The balance sheet shows a moderate debt-to-equity ratio of 0.05, suggesting low leverage. However, the return on equity remains negative due to persistent net losses. The equity ratio is relatively stable at 32.6%, indicating a balanced asset financing structure but also highlighting the need to improve profitability to enhance shareholder value.55
Neutral
Cash Flow
Udemy's free cash flow turned positive in 2024, a substantial improvement from prior years. The free cash flow to net income ratio is positive at -0.6, indicating better cash management. The operating cash flow to net income ratio is 0.62, suggesting that operational activities are beginning to cover losses, signaling a positive trend in cash flow management.65
Positive
| Breakdown | ||||
| Dec 2024 | Dec 2023 | Dec 2022 | Dec 2021 | Dec 2020 |
|---|---|---|---|---|
| Income Statement | Total Revenue | |||
| 786.57M | 728.94M | 629.10M | 518.16M | 429.90M |
| Gross Profit | ||||
| 491.94M | 419.34M | 353.78M | 282.13M | 220.65M |
| EBIT | ||||
| -89.33M | -121.89M | -151.19M | -75.41M | -73.38M |
| EBITDA | ||||
| -89.33M | -78.53M | -129.97M | -63.53M | -62.27M |
| Net Income Common Stockholders | ||||
| -85.29M | -107.29M | -153.88M | -77.53M | -77.62M |
| Balance Sheet | Cash, Cash Equivalents and Short-Term Investments | |||
| 354.44M | 476.94M | 465.37M | 533.87M | 175.03M |
| Total Assets | ||||
| 605.63M | 741.20M | 737.57M | 739.85M | 282.10M |
| Total Debt | ||||
| 10.82M | 6.95M | 13.55M | 0.00 | 0.00 |
| Net Debt | ||||
| -179.78M | -298.62M | -300.14M | -533.87M | -175.03M |
| Total Liabilities | ||||
| 408.23M | 384.30M | 398.26M | 347.65M | 542.78M |
| Stockholders Equity | ||||
| 197.39M | 356.89M | 339.31M | 392.20M | -260.69M |
| Cash Flow | Free Cash Flow | |||
| 50.74M | -15.07M | -76.68M | -25.31M | -4.91M |
| Operating Cash Flow | ||||
| 53.04M | -2.00M | -60.96M | -7.10M | 9.62M |
| Investing Cash Flow | ||||
| 1.08M | -24.97M | -173.23M | -52.69M | -14.54M |
| Financing Cash Flow | ||||
| -171.75M | 19.20M | 14.76M | 418.63M | 131.09M |
Udemy Inc Technical Analysis
Negative
7.87
Price Trends
8.51
Negative
8.37
Negative
8.20
Negative
Market Momentum
-0.21
Positive
37.17
Neutral
9.98
Positive
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For UDMY, the sentiment is Negative. The current price of 7.87 is below the 20-day moving average (MA) of 8.46, below the 50-day MA of 8.51, and below the 200-day MA of 8.20, indicating a bearish trend. The MACD of -0.21 indicates Positive momentum. The RSI at 37.17 is Neutral, neither overbought nor oversold. The STOCH value of 9.98 is Positive, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for UDMY.
Udemy Inc Risk Analysis
Udemy Inc disclosed 57 risk factors in its most recent earnings report. Udemy Inc 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
Udemy Inc Peers Comparison
Overall Rating
UnderperformOutperform
Sector (57)
Financial Indicators
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
77 Outperform | $22.52B | 23.11 | 11.92% | ― | 3.05% | 55.96% | |
68 Neutral | $1.07B | ― | -13.11% | ― | 9.27% | 34.66% | |
65 Neutral | $14.05B | 177.25 | 11.97% | ― | 40.84% | 437.52% | |
61 Neutral | $4.96B | 238.87 | 3.48% | ― | 31.39% | ― | |
57 Neutral | $20.89B | 10.40 | -13.99% | 2.52% | 4.47% | -23.34% | |
55 Neutral | $1.15B | ― | -30.77% | ― | 7.91% | 22.07% | |
47 Neutral | $67.19M | ― | -147.16% | ― | -13.78% | -5297.96% |
* Technology Sector Average
Performance Comparison
UDMY
Udemy Inc
7.90
-2.80
-26.17%
CHGG
Chegg
0.62
-6.57
-91.38%
LYFT
Lyft
12.23
-6.05
-33.10%
ZM
Zoom Video Communications
74.02
10.80
17.08%
COUR
Coursera
6.76
-6.79
-50.11%
DUOL
Duolingo
337.56
117.53
53.42%
Udemy Inc Earnings Call Summary
Earnings Call Date: Feb 13, 2025 | % Change Since: 0.64% | Next Earnings Date: Apr 30, 2025
Earnings Call Sentiment Positive
The earnings call conveys a positive sentiment overall, with strong financial performance, significant growth in enterprise customers, and successful cost savings initiatives. However, challenges remain with declining consumer revenue and negative impacts from foreign exchange rates, alongside cautious expectations for 2025.Highlights
Strong Full-Year Financial Performance
Udemy delivered full-year revenue growth of 8% year over year, despite a two-point headwind from FX. Adjusted EBITDA significantly exceeded the high end of guidance, highlighting operational efficiency.
Enterprise Customer Growth
ARR growth from large enterprise customers was four points higher than SMB customers. Nearly fifty deals were closed over a hundred thousand in ARR, the most for any quarter this year.
Generative AI Course Surge
Udemy experienced a nearly 10x increase in generative AI course consumption in 2024, indicating strong demand for AI-related learning.
Improved Gross Margins
Gross margin for Udemy Business segment increased by 600 basis points year-over-year due to changes in instructor revenue share, with further improvements expected in the coming years.
Successful Cost Savings Initiatives
Udemy executed a $50 million cost savings program in 2024, driving increased profitability and flexibility for targeted investments.
Lowlights
Decline in Consumer Revenue
Consumer revenue decreased by 5% for the year, with a 7% decline in Q4, primarily driven by lower individual course purchases.
Impact of FX on Revenue Growth
Revenue growth was negatively impacted by foreign exchange rates, reducing both full-year and Q4 growth by two percentage points.
Flat Revenue Growth Expected for 2025
Udemy's full-year 2025 revenue is expected to be flat to up 2%, with headwinds including a $20 million reduction in SMB sales capacity and FX impacts.
Company Guidance
In Udemy's Fourth Quarter and Full Year 2024 Conference Call, the company reported an 8% year-over-year revenue growth, reaching $787 million, despite a two-point headwind from foreign exchange (FX) effects. The adjusted EBITDA was significantly higher than expected, ending at $43 million, marking an improvement from a near $50 million loss in 2022. The company's strategy to focus on large enterprise customers resulted in annual recurring revenue (ARR) growth from large enterprises being four points higher than that from SMB customers. Over 50 deals exceeding $100,000 in ARR were closed, demonstrating strong large enterprise customer engagement and retention. Udemy Business revenue grew by 18%, while consumer revenue saw a 5% decline. The gross margin for Udemy Business improved to 75%, driven by changes in the instructor revenue share and a strategic mix shift towards more enterprise clients. The company also completed a $150 million share repurchase program. Looking forward, Udemy aims for a flat to 2% revenue growth in 2025, with plans to enhance its platform through AI innovation and strategic focus on large enterprises, while maintaining a disciplined approach to operational efficiency.Udemy Inc Corporate Events
Executive/Board ChangesBusiness Operations and Strategy
Udemy Inc Appoints Hugo Sarrazin as New CEO
Positive
Mar 12, 2025
On March 11, 2025, Udemy Inc. announced the appointment of Hugo Sarrazin as the new President and Chief Executive Officer, effective March 12, 2025, succeeding Greg Brown. Sarrazin, with extensive experience in SaaS and AI, is expected to lead Udemy through its next growth phase, leveraging his expertise in strategy and innovation. The company reaffirmed its financial outlook provided earlier in February 2025, signaling stability and confidence in its strategic direction.
Glossary
OutperformA stock rated as "Outperform" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests that the stock is likely to deliver higher returns compared to the average returns of other stocks in the same sector or market index. Investors might consider this stock a good buying opportunity.
NeutralA stock rated as "Neutral" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly attractive nor unattractive for investment. Investors may consider holding onto the stock, as it is not expected to either significantly outperform or underperform the market.
UnderperformA stock rated as "Underperform" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests that the stock may deliver lower returns compared to the average returns of other stocks in the same sector or market index. Investors might consider selling the stock or avoiding it as an investment.
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.