Udemy (UDMY) Stock Forecast & Price Target

Udemy Inc. has demonstrated a positive financial trajectory, with Udemy Business revenue increasing 7.2% year-over-year, now accounting for 64.7% of total revenue, driven by robust customer adoption and large deal activities. The company's annual recurring revenue (ARR) rose to $520 million, reflecting a 5.6% year-over-year growth, alongside an overall revenue increase of 2.8% year-over-year, with approximately 4% growth in constant currency. Additionally, the gross margin for the Consumer segment improved significantly by 340 basis points year-over-year to 59.6%, underscoring the strength of consumer subscription growth within that segment.

Udemy Inc. has provided a disappointing financial outlook, with prior guidance indicating flat year-over-year growth and a potential decline in revenue. The company experienced a significant decrease in average monthly buyers, falling from 1,410 to 1,240, suggesting a troubling trend in individual course purchases despite some growth in personal subscriptions. Additionally, the Enterprise segment, which is critical for Udemy's revenue, showed weakness, with negative net dollar retention rate for large customers slipping to 99%, raising concerns about sustained revenue from this key demographic.