Udemy (UDMY) Stock Forecast & Price Target

Udemy Inc. demonstrates a positive outlook with significant growth in its Udemy Business segment, which reported a revenue increase of 7.2% year-over-year and now accounts for 64.7% of the company's total revenue. The company's annual recurring revenue (ARR) rose by 5.6% year-over-year, reaching $520 million, indicating a solid and expanding customer base. Additionally, the consumer segment's gross margin improved to 59.6%, reflecting the successful growth of the consumer subscription model, which now constitutes 15% of segment revenues.

Udemy Inc. is experiencing a concerning decline in key financial metrics, reflected in its prior revenue guidance of $772 million to $794 million, indicating a mere 0.3% year-over-year growth along with a year-over-year decrease in revenue. Average monthly buyers fell significantly from 1,410 to 1,240, showcasing a drop in individual course purchases despite some offset from personal plan subscriptions. Additionally, the enterprise segment is showing signs of weakness, highlighted by a decline in net dollar retention rate (NDRR) for customers with over 1,000 employees, decreasing to 99% from 100% in the previous quarter.