Udemy, Inc. reported its financial results for the third quarter and the nine months ended September 30, 2024, showing notable changes in revenue, profitability, and strategic initiatives compared to the previous fiscal period.
For the three months ended September 30, 2024, Udemy generated revenue of $195.4 million, a 6% increase from $184.7 million in the same period of 2023. The nine-month revenue also rose by 9%, reaching $586.6 million compared to $539.4 million in the prior year. The Enterprise segment was a significant contributor, with revenue increasing 16% to $126.1 million for the quarter and 19% to $364.3 million for the nine months. In contrast, Consumer segment revenue decreased by 8% for the quarter and 5% for the nine months.
Gross profit for the third quarter was $123.1 million, up from $107.5 million a year earlier, reflecting a gross margin improvement to 63% from 58%. For the nine months, gross profit increased to $364.7 million, compared to $309.5 million in 2023. However, total operating expenses rose significantly, totaling $152.5 million for the quarter and $442.5 million for the nine months, leading to a loss from operations of $(29.5) million for the quarter, compared to $(21.5) million in the prior year. The net loss for the third quarter was $(25.3) million, compared to $(16.8) million in 2023, while the nine-month net loss improved to $(75.4) million from $(87.0) million.
Udemy's cash and cash equivalents decreased to $204.6 million as of September 30, 2024, down from $305.6 million at the end of 2023. The company also reported a significant restructuring plan announced in September 2024, affecting approximately 280 employees, with expected charges of $18 million, of which $11.3 million was recognized in Q3 2024.
The company’s strategic focus remains on expanding its Enterprise segment, which now accounts for 65% of total revenue, up from 59% in the same quarter last year. Udemy Business (UB) customers increased by 10% year-over-year, with Annual Recurring Revenue (ARR) growing 14% to $504.6 million. The company is also investing in technology and course offerings to enhance its platform and attract new learners.
Despite the positive revenue growth, Udemy faces challenges, including increased operating expenses and a competitive online learning market. The company continues to navigate economic uncertainties that may affect customer retention and sales cycles, particularly in its Enterprise segment.
About Udemy, Inc.
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