Udemy (UDMY) Q2 2024 earnings summary

Executive summary

• Q2 2024 revenue reached $194.4 million, up 9% year-over-year, at the high end of guidance, driven by 19% growth in Udemy Business and a strategic shift toward large enterprise customers; Consumer revenue declined 4% as anticipated.

• Adjusted EBITDA was $5.5 million (3% margin), exceeding expectations due to operational efficiencies and cost initiatives.

• Net loss widened to $31.8 million, impacted by a $10.3 million impairment charge on strategic investments; non-GAAP net loss was $6.5 million.

• Surpassed 1 billion course enrollments since inception, highlighting global impact.

• $35 million was used to repurchase 3.8 million shares in Q2; $60 million remains authorized under the $150 million program.

Financial highlights

• Q2 2024 revenue: $194.4 million (+9% YoY); Udemy Business: $120.6 million (+19% YoY), Consumer: $73.8 million (–4% YoY); ARR: $492.6 million (+17% YoY).

• Gross margin improved to 62% (up from 57% YoY); non-GAAP gross margin was 64%; Udemy Business gross margin reached 72%.

• Net loss: $31.8 million (–$0.21 per share); Adjusted EBITDA: $5.5 million (3% margin), up from $1.9 million (1% margin) in Q2 2023.

• Free cash flow: $25 million; cash, equivalents, and marketable securities totaled $422 million at quarter end.

• Share repurchases: $35 million in Q2; $60 million remains authorized.

Outlook and guidance

• FY 2024 revenue guidance: $776–$782 million (~7% growth at midpoint); Q3 2024: $191–$194 million (~4% YoY growth at midpoint), both with 2% negative FX impact.

• Udemy Business revenue expected to grow 16–18% YoY in 2024; Consumer revenue to decline 6–8%.

• Full-year Adjusted EBITDA margin expected at 250–350 bps; Q3 targeted at 200–300 bps.

• Targeting $130–$150 million Adjusted EBITDA for 2026 and 15–20% long-term margin.

• $25 million in annualized structural cost savings expected from operational initiatives, with impact visible in 2025.