Udemy (UDMY) Stock Forecast & Price Target

Udemy Inc. demonstrates a positive financial outlook, highlighted by a 5.0% year-over-year growth in Udemy Business revenue, reaching $132.8 million, which now constitutes 67.9% of total revenue. The Consumer segment also showed resilience, with a gross margin expansion of 300 basis points year-over-year to 57.0%, driven by a burgeoning consumer subscription business that contributes 19% of segment revenues. Additionally, adjusted EBITDA surpassed expectations at $24.3 million, reflecting a $5.3 million year-over-year increase, attributed to revenue growth and operational expense management.

Udemy Inc. is experiencing a notable decline in its Consumer revenue segment, which saw a 9.2% year-over-year decrease in the third quarter, indicating ongoing challenges in this area despite some results exceeding expectations. The company's guidance for fourth-quarter revenue suggests a decline of 3-5% year-over-year, with anticipated weaknesses from the Consumer segment overshadowing marginal growth in the Enterprise segment. Furthermore, there are lowered profitability estimates for fiscal year 2026 and beyond due to the combination of lower revenue projections and necessary investments in product development, creating a mixed and less favorable outlook for Udemy's financial performance.