Nasdaq:UDMY
Udemy, Inc.
A leading global marketplace connecting millions of instructors with students seeking affordable online education in over 190 countries.
Key Metrics
Investment Thesis
Bull Case
Investors may buy Udemy stock anticipating sustained growth as it transitions to consistent profitability, supported by strong cash flows and an expanding global user base. The company's low capital expenditure requirements and diverse course offerings position it well to capitalize on the growing demand for upskilling in a digital economy.
Bear Case
Despite recent profitability, the massive retained earnings deficit of -$801.2M and high marketing spend relative to revenue suggest ongoing challenges in achieving scalable margins. Investors should be cautious about potential saturation in the online education market and the risk that increasing competition from AI-generated content could disrupt their core value proposition.
About Udemy, Inc.
Udemy Inc. is a global online learning platform that provides on-demand video courses across diverse subjects like technology, business, and arts to learners worldwide. The company generates revenue primarily through course sales, subscription plans for organizations and universities, and instructor commissions within its massive marketplace ecosystem.
Analysis
Management Discussion
The company achieved a significant turnaround in 2025, posting a net profit of $3.8M after years of losses, supported by revenue growth to $789.8M and improved cash flow from operations of $87.7M. This profitability milestone coincides with substantial share repurchases of $51.0M, indicating management confidence in the business's long-term value creation despite a retained earnings deficit.
Industry Overview
The global e-learning market is experiencing rapid expansion driven by remote work trends and a shift toward continuous professional development. Udemy operates in this high-growth sector but faces pressure from both traditional educational institutions digitizing offerings and new tech entrants leveraging artificial intelligence for personalized learning paths.
Financial Statements
Income Statement
Balance Sheet
Cash Flow
| Metric | 2022 | 2023 | 2024 | 2025 |
|---|---|---|---|---|
| Revenue | $629.1M | $728.9M | $786.6M | $789.8M |
| Cost of Revenue | $275.3M | $309.6M | $294.6M | $271.4M |
| Gross Profit | $353.8M | $419.3M | $491.9M | $518.4M |
| Operating Expenses | $505.0M | $541.2M | $581.3M | $522.6M |
| Operating Income | $-151.2M | $-121.9M | $-89.3M | $-4.2M |
| R&D | $104.6M | $120.3M | $125.4M | $101.5M |
| G&A | $99.1M | $93.9M | $96.2M | $93.0M |
| Marketing | $301.3M | $316.7M | $342.9M | $326.5M |
| Stock-Based Comp | $81.3M | $96.0M | $90.0M | $68.8M |
| D&A | $21.2M | $24.6M | $25.4M | $25.4M |
| Depreciation | $4.3M | $3.0M | $2.7M | $3.1M |
| Amortization | $4.3M | $4.1M | $2.8M | $1.5M |
| Other OpEx | $0 | $10.3M | $16.7M | $1.6M |
| Non-Operating Income | $-399.0K | $18.3M | $8.4M | $12.5M |
| Interest Expense | — | $518.0K | — | — |
| Pre-Tax Income | $-151.6M | $-103.6M | $-80.9M | $8.3M |
| Income Tax | $2.3M | $3.7M | $4.3M | $4.5M |
| Continuing Ops | $-153.9M | $-107.3M | $-85.3M | $3.8M |
| Discontinued Ops | $0 | $0 | $0 | $0 |
| Net Income | $-153.9M | $-107.3M | $-85.3M | $3.8M |
| Minority Interest | $0 | $0 | $0 | $0 |
| Net to Common | $-153.9M | $-107.3M | $-85.3M | $3.8M |
| Metric | 2022 | 2023 | 2024 | 2025 |
|---|---|---|---|---|
| Current Assets | $615.0M | $632.3M | $506.3M | $524.2M |
| Cash & Equivalents | $313.7M | $305.6M | $190.6M | $231.5M |
| Marketable Securities | $151.7M | $171.4M | $163.8M | $127.3M |
| Accounts Receivable | $104.5M | $92.6M | $88.2M | $95.9M |
| Prepaid Expenses | $14.9M | $20.9M | $22.7M | $25.5M |
| Other Current Assets | $30.2M | $41.9M | $40.9M | $44.1M |
| Long-Term Assets | $122.6M | $108.9M | $99.3M | $93.5M |
| PP&E (Net) | $7.0M | $4.4M | $4.5M | $6.7M |
| Intangibles | $9.3M | $5.2M | $2.4M | $2.4M |
| Goodwill | $12.6M | $12.6M | $12.6M | $12.6M |
| Operating Leases | $11.4M | $5.7M | $10.9M | $9.0M |
| LT Securities | — | — | — | $8.2M |
| Other LT Assets | $82.2M | $80.9M | $68.7M | $54.5M |
| Total Assets | $737.6M | $741.2M | $605.6M | $617.7M |
| Current Liabilities | $386.9M | $380.1M | $397.5M | $400.1M |
| Accounts Payable | $14.5M | $2.5M | $6.3M | $8.2M |
| Current Leases | $7.0M | $5.8M | $2.5M | $4.5M |
| Deferred Revenue | $273.9M | $279.4M | $291.1M | $294.1M |
| Other Current Liab | $82.9M | $78.6M | $83.0M | $75.9M |
| Long-Term Liabilities | $11.4M | $4.2M | $10.8M | $7.2M |
| LT Operating Leases | $6.5M | $1.1M | $8.3M | $5.7M |
| Other LT Liab | $464.0K | $48.0K | $6.0K | $234.0K |
| Total Liabilities | $398.3M | $384.3M | $408.2M | $407.2M |
| Shareholders' Equity | $339.3M | $356.9M | $197.4M | $210.5M |
| Paid-In Capital | $951.9M | $1.08B | $1.00B | $1.01B |
| Retained Earnings | $-612.4M | $-719.7M | $-805.0M | $-801.2M |
| Total L&E | $737.6M | $741.2M | $605.6M | $617.7M |
| Metric | 2022 | 2023 | 2024 | 2025 |
|---|---|---|---|---|
| Net Income (CFO) | $-153.9M | $-107.3M | $-85.3M | $3.8M |
| Non-Cash Adjustments | $28.0M | $126.8M | $121.1M | $66.2M |
| Working Capital Changes | $64.9M | $-21.5M | $17.2M | $17.7M |
| Cash from Operations | $-61.0M | $-2.0M | $53.0M | $87.7M |
| Capital Expenditures | $1.6M | $632.0K | $2.3M | $5.8M |
| Cash from Investing | $-173.2M | $-25.0M | $1.1M | $20.6M |
| Share Buybacks | — | — | $150.3M | $51.0M |
| Cash from Financing | $14.8M | $19.2M | $-171.7M | $-68.5M |
| FX Effect | $-25.0K | $20.0K | $-116.0K | $238.0K |
| Net Change in Cash | $-219.5M | $-7.8M | $-117.7M | $40.1M |
| Beginning Cash | $536.8M | $317.3M | $309.6M | $191.8M |
| Ending Cash | $317.3M | $309.6M | $191.8M | $231.9M |
Frequently Asked Questions
How does Udemy, Inc. make money?
The company's revenue is driven by direct-to-consumer course purchases via a freemium model, B2B enterprise learning solutions for corporations, and institutional partnerships with universities and educational institutions. Financials show heavy investment in marketing ($326.5M) and R&D ($101.5M) to sustain user acquisition and platform innovation.
What are the main risks for UDMY?
Intense competition from established LMS providers and emerging AI-driven learning tools could erode market share. High operating expenses relative to net income suggest vulnerability if marketing efficiency declines or customer acquisition costs rise. Regulatory changes in data privacy across different countries could impact its global user base operations.
What is UDMY's competitive advantage?
Udemy benefits from a vast network effect where millions of instructors continuously expand its course catalog, creating high switching costs for learners. Its asset-light operational model with significant cash reserves ($231.9M) provides flexibility compared to heavy-asset competitors, while global reach mitigates regional economic downturns.
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Not financial advice. All content is for informational purposes only. Data may contain errors. Consult a qualified financial advisor before making investment decisions.