Nerdy (NRDY) Q1 2026 earnings summary

Executive summary

• Q1 2026 revenue reached $48.7 million, up 2% year-over-year and exceeding guidance, driven by higher Consumer revenue and price increases, partially offset by lower Institutional revenue.

• Achieved positive non-GAAP adjusted EBITDA of $1 million, a $7.3 million improvement from Q1 2025, and net loss narrowed to $6.1 million from $16.2 million year-over-year.

• Gross margin expanded to 66.2%, up over 800 basis points year-over-year, reflecting price increases and operational efficiencies.

• Active members ended at 36.9k, down 9% year-over-year, but the rate of decline narrowed for the third straight quarter; ARPM rose 12% to $374.

• Product velocity increased due to the AI-native platform, with major learner-facing releases and new features such as Maya AI concierge.

Financial highlights

• Revenue: $48.7 million, above guidance and up 2% year-over-year; Consumer revenue $39.3 million (80%), Institutional $9.3 million (19%).

• Gross profit increased 17% year-over-year to $32.3 million; gross margin: 66.2%, up from 58% in Q1 2025.

• Non-GAAP adjusted EBITDA: $1 million, up from a loss of $6.4 million in Q1 2025; net loss narrowed to $6.1 million.

• Free cash flow: -$3 million, improved from -$7.6 million a year ago; cash and cash equivalents totaled $44.7 million as of March 31, 2026.

• Sales and marketing expenses: $14.2 million, down 10% year-over-year; general and administrative expenses: $23.9 million, down 16% year-over-year.

Outlook and guidance

• Q2 2026 revenue guidance: $42 million–$44 million; full-year 2026 revenue guidance: $180 million–$190 million.

• Q2 2026 non-GAAP adjusted EBITDA guidance: -$2 million to break even; full-year 2026 non-GAAP adjusted EBITDA guidance: approximately break-even.

• Expect to end 2026 with $40 million–$45 million in cash, including $20 million funded under a new term loan.

• Anticipate return to positive active member growth by end of 2026, supported by new platform features.

• Cash on hand is expected to be sufficient for working capital, sales and marketing, and capital expenditures over the next twelve months.