Nerdy (NRDY) Q4 2025 earnings summary

Executive summary

• Achieved all three 2025 goals: returned to growth, accelerated AI-native platform transformation, and reached positive non-GAAP adjusted EBITDA, with Q4 revenue of $49.1M, up 2% year-over-year and above guidance.

• Both consumer and institutional businesses grew simultaneously for the first time since Q1 2024.

• Completed rollout of new AI-native learner and expert experiences, improving product development velocity and unit economics.

• The Live + AI model enhances tutor effectiveness, automates content creation, and improves session outcomes and retention.

Financial highlights

• Q4 revenue was $49.1M, up 2% year-over-year, exceeding guidance of $45M-$47M.

• Non-GAAP adjusted EBITDA was $1.3M, beating guidance and improving by $6.8M from Q4 2024.

• Consumer learning memberships revenue grew 6% year-over-year to $41.6M, representing 85% of total revenue.

• Institutional revenue was $7.2M, up 6% year-over-year, but bookings declined 11% due to funding delays.

• ARPM reached $364, a 21% year-over-year increase; active members ended at 33.2K.

• Gross margin (excluding one-time software abandonment charge) was 66.8%, up 380 bps sequentially.

• Sales and marketing expenses decreased to $14.2M (from $18.4M), and G&A expenses to $24.7M (from $29.9M).

• Headcount declined 22% year-over-year, driving cost reductions and efficiency.

• Q4 net loss was $14.0M (GAAP); non-GAAP adjusted net loss was $0.4M, a significant improvement from $7.0M loss in Q4 2024.

• Annualized run-rate Learning Membership revenue as of December 31, 2025: $145.4M, up 7% year-over-year.

• Active Experts for Q4: 9.1K, down from 10.7K in Q4 2024.

• $7.8M charge for abandonment of capitalized internal-use software due to platform replacement.

Outlook and guidance

• Q1 2026 revenue expected at $46M-$48M; full-year 2026 revenue guidance is $180M-$190M.

• Non-GAAP adjusted EBITDA expected to be approximately breakeven for both Q1 and full year 2026, representing over 1,000 bps margin improvement year-over-year.

• Gross margin expected to expand each quarter in 2026 as higher frequency memberships and optimized tutor incentives take effect.

• Year-end 2026 cash projected at $40M-$45M, including $20M from a new term loan.