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Revenue in line with expectations, but shares fall 13.5%
Udemy (NASDAQ:UDMY) Q2 Results: Revenue in Line with Expectations, Shares Down 13.5%
Online learning platform Udemy (NASDAQ:UDMY) reported Q2 CY2024 results in line with analysts’ expectations, with revenue up 9% year-over-year to $194.4 million. On the other hand, its next-quarter revenue guidance of $192.5 million was less impressive, coming in 3.8% below analysts’ estimates. It reported a non-GAAP loss of $0.04 per share, down from a loss of $0.01 per share in the same quarter last year.
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Udemy (UDMY) Q2 CY2024 Highlights:
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Revenue: US$194.4 million vs. analyst estimates of US$194.2 million (small beat)
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EPS (non-GAAP): -$0.04 vs analyst estimates of -$0.01 (-$0.03 error)
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Revenue Guidance for Third Quarter of Calendar Year 2024 is $192.5 million at the midpoint, below analysts’ estimates of $200.1 million
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The company abandoned its full-year revenue guidance from $800 million to $779 million at the midpoint, a 2.6% decline
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Gross Margin (GAAP): 62.3%, up from 57.4% in the same quarter last year
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Free cash flow of US$42.3 million, an increase of 142% over the previous quarter
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Monthly active buyers: 1.29 million, an increase of 1.28 million over the previous year
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Market capitalization: US$ 1.40 billion
“Q2 2024 revenue was at the high end of our guidance range and we exceeded our adjusted EBITDA forecast,” said Greg Brown, President and CEO of Udemy.
With courses ranging from investing to cooking to computer programming, Udemy (NASDAQ:UDMY) is an online learning platform that connects students with expert instructors on a wide range of topics.
Consumer signature
Today’s consumers expect goods and services to be hyper-personalized and on-demand. Whether it’s what music they listen to, what movie they watch, or even finding a date, online consumer businesses are expected to delight their customers with simple user interfaces that magically meet demand. Subscription models have further increased the usage and stickiness of many online consumer services.
Sales growth
Udemy’s revenue growth over the past three years has been lackluster, averaging 17.1% per year. This quarter, Udemy reported lackluster 9% year-over-year revenue growth, in line with analyst expectations.
Udemy Total Revenue
Guidance for the upcoming quarter indicates that Udemy expects revenue to grow 4.2% year over year to $192.5 million, slowing from the 16.6% year over year increase recorded in the comparable quarter last year. Before the earnings results, analysts were projecting sales to grow 10.5% over the next 12 months.
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Key Takeaways from Udemy’s Q2 Results
We struggled to find much positive in these results. Not only did Udemy lower its full-year revenue guidance, but it also missed Wall Street’s EPS estimates. Overall, this was a poor quarter for Udemy. The stock traded down 13.5% to $8 immediately following the report.
So should you invest in Udemy right now? When making this decision, it’s important to consider its valuation, business qualities, as well as what’s happened in the last quarter. We cover this in our full, actionable research report, which you can read here, it’s free.