Udemy (UDMY) Stock Forecast & Price Target

Udemy Inc. has demonstrated robust revenue growth, particularly within its Enterprise segment, which now constitutes 65% of total revenue, driven by a 13.4% year-over-year increase due to strong large deal activity. The Consumer segment also showed positive trends with a gross margin expansion of 187 basis points year-over-year, supported by growth in consumer subscriptions that now account for over 10% of its revenues. Additionally, the company reported an adjusted EBITDA of $19.5 million, significantly beating estimates and indicating strong financial performance that positions Udemy favorably for sustained growth beyond 2025.

Udemy Inc experienced a year-over-year decline in consumer revenues, reporting a 6.8% drop in the fourth quarter to $69.8 million, despite exceeding internal estimates. The company's Net Dollar Retention Rate (NDRR) declined to 98% from 99%, indicating challenges in upselling and continued weakness, particularly within the enterprise segment for larger customers. Additionally, guidance for first-quarter 2025 revenue of $195 million to $199 million reflects minimal growth expectations of just 0.1%, falling short of market consensus, highlighting potential difficulties in sustaining revenue momentum.