Udemy (UDMY) Stock Forecast & Price Target

Udemy Inc. demonstrated a robust financial performance with total revenues increasing by 5.5% year-over-year, fueled primarily by a 13.4% growth in the Enterprise segment, which now constitutes 65% of total revenue. The company also reported a notable expansion in the Consumer segment's gross margin, which increased by 187 basis points year-over-year to 53%, highlighting the successful growth of its consumer subscription offerings. Additionally, adjusted EBITDA reached $19.5 million, significantly outpacing estimates, indicating effective revenue generation and operational performance amidst a growing user base.

Udemy Inc. has reported a year-over-year decline in Consumer revenues, specifically a 6.8% decrease in 4Q, signifying challenges in stabilizing this segment despite posting results above expectations. Additionally, the company experienced a drop in Net Dollar Retention Rate (NDRR) for both its Enterprise and larger customer segments, indicating prolonged upsell processes and a lack of momentum in enterprise growth, compounded by headwinds in the EMEA region. Further complicating its outlook, management's revenue guidance for 1Q25 forecasts only slight growth below market expectations, alongside operational challenges that may hinder overall business performance.