Udemy (UDMY) Stock Forecast & Price Target

Udemy Inc. demonstrated a positive financial outlook, with its Udemy Business segment achieving a 5% year-over-year revenue growth to $132.8 million, now constituting 67.9% of the company’s total revenue, fueled by strong customer adoption and significant deal activity. The consumer segment also showed improvements, as gross margin increased by 300 basis points year-over-year to 57.0%, supported by an 8% growth in the consumer subscription business, which has become a more significant part of overall revenue. Adjusted EBITDA surpassed expectations, reaching $24.3 million, reflecting effective operational performance and revenue outperformance, which positions Udemy favorably for future growth.

Udemy Inc is experiencing a significant decline in its Consumer revenue segment, posting a year-over-year decrease of 9.2% to $62.9 million in the third quarter, which reflects challenges in stabilizing this segment despite slightly better-than-expected results. The company's quarterly guidance for Q4 indicates an anticipated revenue decrease of 3-5% year-over-year, primarily driven by a high decline in Consumer revenues while Enterprise revenues are projected to grow modestly. Additionally, revised forecasts for FY26 and subsequent years signal decreasing profitability due to a combination of lower expected revenues and ongoing investments for product development, leading to a more cautious outlook for investors.