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01/11 10:00
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Access earnings results, analyst expectations, report, slides, earnings call, and transcript.
The earnings call summary highlights several positive aspects: strong financial performance, impressive product development, and strategic focus on AI and content expansion. The Q&A section reveals some uncertainties, particularly around corporate spending and NRR in the Enterprise segment, but also emphasizes growth in consumer margins and learner engagement. The guidance is slightly weak, but the company is well-positioned in AI-driven markets. Considering the company's small-cap status, these factors suggest a positive stock price movement in the short term.
Revenue $187 million, up 10% year-over-year. Growth driven by both consumer and enterprise segments.
Free Cash Flow $29 million, up 68% year-over-year. Strong bottom-line performance attributed to operational improvements.
Gross Profit $105 million, up 13% year-over-year. Gross margin at 56%, up 180 basis points from the prior year, driven by increased learner demand and favorable revenue share economics.
Net Income $19 million, representing 10.3% of revenue. Reflects strong operating discipline.
Adjusted EBITDA $18 million, representing 9.6% of revenue. Indicates strong bottom-line performance and operational discipline.
Consumer Segment Revenue $123 million, up 10% year-over-year. Growth driven by top-of-funnel activity and Coursera Plus subscription offerings.
Consumer Segment Gross Profit $75 million, up 13% year-over-year. Gross profit margin at 61%, up 160 basis points, driven by favorable revenue share economics.
Enterprise Segment Revenue $64 million, up 10% year-over-year. Growth driven by business and campus verticals.
Enterprise Segment Gross Profit $45 million, up 12% year-over-year. Gross profit margin at 70%, up 170 basis points, driven by similar content engagement trends as the consumer segment.
Paid Enterprise Customers 1,686 customers, up 12% year-over-year. Net retention rate for paid enterprise customers was 93%.
Generative AI courses: The generative AI catalog now includes over 925 courses, tripling over the past year, with 10 million enrollments in 2025. New courses and certificates focused on job-specific generative AI skills were introduced, featuring offerings from AWS, Google Cloud, IBM, Microsoft, and others.
AI-powered tutor (Coursera Coach): Coursera Coach has been used by 2.6 million learners, exchanging 36 million messages. Learners using Coach are 10% more likely to pass quizzes on the first attempt. It was recognized by the 2025 Newsweek AI Impact Awards for AI education.
AI Translations and Dubbing: AI dubbing has expanded to 300 courses in 5 languages, with 120,000 learners completing 400,000 learning hours. This feature improves focus and understanding for learners.
New partnerships and collaborations: Coursera announced collaborations with the University of Cambridge and launched professional certificates with partners like ADP, IBM, Microsoft, SAP, and Zoho. These certificates are increasingly eligible for college credit.
Global learner base: Coursera added 7.5 million new registered learners in Q2 2025, growing the total base to 183 million, an 18% year-over-year increase.
Revenue and financial performance: Revenue reached $187 million in Q2 2025, a 10% year-over-year growth. Free cash flow was $29 million, up 68% from the prior year. Full-year revenue guidance was raised to $738-$746 million.
Operational model changes: Coursera is implementing changes to its operating model to drive innovation, engagement, and agility. New leadership appointments include a Chief Product Officer and Chief Data Officer.
Focus on AI and data-driven insights: Coursera is leveraging AI and data to enhance learning experiences, including personalized recommendations and skill assessments.
Expansion of content and credentials: The catalog expanded by 36% to over 10,500 courses. Micro-credentials and professional certificates are being emphasized to meet career-aligned education demands.
Market Conditions: The company is monitoring budgetary trends amidst a dynamic macro environment, which could impact corporate spending and enterprise growth.
Competitive Pressures: The company faces competition in the rapidly transforming education and technology industry, which may challenge its ability to maintain leadership and growth.
Regulatory Hurdles: No explicit mention of regulatory hurdles was made in the transcript.
Supply Chain Disruptions: No explicit mention of supply chain disruptions was made in the transcript.
Economic Uncertainties: The company acknowledges potential challenges in the corporate spend environment due to macroeconomic uncertainties, which could affect enterprise customer budgets.
Strategic Execution Risks: The company is in the early stages of deploying investments across product, content, and marketing, which may carry risks related to execution and achieving desired outcomes. Additionally, the integration of new leadership and operational changes could pose challenges.
Full Year Revenue Expectations: Coursera has raised its full-year revenue expectations to a range of $738 million to $746 million, increasing the midpoint of the range by $17 million.
Adjusted EBITDA Margin Target: The company has increased its annual adjusted EBITDA margin target to 8%, reflecting a 200 basis points year-over-year improvement.
Q3 Revenue Guidance: Revenue for Q3 is expected to be in the range of $188 million to $192 million, representing growth of 7% to 9% year-over-year.
Q3 Adjusted EBITDA Guidance: Adjusted EBITDA for Q3 is expected to range between $10 million and $14 million.
Consumer Segment Growth: The Consumer segment is expected to drive growth, supported by strong top-of-funnel activity and Coursera Plus subscription offerings.
Enterprise Segment Outlook: The Enterprise segment's growth assumptions remain unchanged, with continued monitoring of corporate spending trends amidst macroeconomic uncertainties.
Content and Product Investments: Coursera plans to continue investing in product development, content expansion, and marketing to enhance learner experiences and drive growth.
AI and Data-Driven Enhancements: The company is leveraging AI and data-driven insights to accelerate product development cycles and improve platform capabilities.
The selected topic was not discussed during the call.
Coursera's earnings call reflects a positive sentiment with strong financial performance, increased revenue guidance, and strategic partnerships, including the OpenAI integration. While the Q&A highlighted some challenges, such as declining Enterprise NRR and muted corporate spending, the overall outlook remains optimistic due to growth in the Consumer segment, AI-driven initiatives, and international expansion. The company's strategic investments and raised guidance suggest a positive impact on the stock price, especially given the small-cap nature of the company, which typically reacts more strongly to such developments.
The earnings call reveals mixed signals: a dividend cut, which is typically negative, is offset by a share buyback announcement, a positive move. Margins are resilient at Kounrad, but Sasa faces challenges. The Q&A highlights management's cautious approach to dual listing and mine life extension, providing limited specifics. The company's market cap indicates a moderate reaction, leading to a neutral sentiment.
The earnings call summary highlights several positive aspects: strong financial performance, impressive product development, and strategic focus on AI and content expansion. The Q&A section reveals some uncertainties, particularly around corporate spending and NRR in the Enterprise segment, but also emphasizes growth in consumer margins and learner engagement. The guidance is slightly weak, but the company is well-positioned in AI-driven markets. Considering the company's small-cap status, these factors suggest a positive stock price movement in the short term.
The earnings call showed strong financial performance with revenue and EPS exceeding expectations. The focus on AI integration, content expansion, and new partnerships is promising. Despite competitive pressures and regulatory concerns, the guidance remains optimistic with single-digit growth expected. The lack of share repurchase announcement is a minor negative, but overall, the positive financial results and growth initiatives suggest a positive stock price movement, especially given the small-cap nature of the company.
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