• Total Revenue (Q4 2024): $179 million, up 6% year-over-year.
• Gross Profit (Q4 2024): $97.5 million, with a 54% gross margin.
• Net Income (Q4 2024): $13.3 million, representing 7.4% of revenue.
• Adjusted EBITDA (Q4 2024): $9.5 million, or 5% of revenue.
• Total Revenue (Full Year 2024): $695 million, up 9% year-over-year.
• Gross Profit (Full Year 2024): $379.6 million, with a 55% gross margin.
• Net Income (Full Year 2024): $55.6 million, representing 8% of revenue.
• Adjusted EBITDA (Full Year 2024): $41.5 million, or 6% of revenue.
• Free Cash Flow (Full Year 2024): Over $59 million.
• Consumer Revenue (Q4 2024): $101.7 million, up 5% year-over-year.
• Enterprise Revenue (Q4 2024): $62.3 million, up 7% year-over-year.
• Degree Revenue (Q4 2024): $15.2 million, up 14% year-over-year.
• Number of Paid Enterprise Customers (End of 2024): 1,612, up 18% year-over-year.
• Net Retention Rate for Paid Enterprise Customers: 87%.
• Total Number of Degree Students (End of 2024): 26,700, up 22% year-over-year.
• Cash and Marketable Securities (End of 2024): Approximately $726 million.

• Warning! GuruFocus has detected 3 Warning Sign with COUR.

Release Date: January 30, 2025

For the complete transcript of the earnings call, please refer to the full earnings call transcript.

Positive Points

• Coursera Inc (NYSE:COUR) achieved significant revenue growth from less than $100 million in 2017 to nearly $700 million by the end of 2024.
• The company has expanded its platform by partnering with over 350 world-class universities and industry leaders.
• Coursera Inc (NYSE:COUR) launched nearly 40 new entry-level professional certificates in 2024, many of which have received credit recommendations.
• The company has seen a substantial increase in generative AI course enrollments, with over 450 new courses added in 2024.
• Coursera Inc (NYSE:COUR) demonstrated strong financial performance with over $59 million in free cash flow and a healthy balance sheet with $726 million in cash and no debt.

Negative Points

• Growth fell short of Coursera Inc (NYSE:COUR)'s goals for 2024, with a slower pace of revenue increase compared to previous years.
• The company is experiencing weakness in the government workforce development programs and non-credit Coursera for Campus offerings.
• Coursera Inc (NYSE:COUR) anticipates a revenue decline in its degree segment for Q1 and full year 2025.
• The company is facing challenges in the North American market, with softer growth impacting consumer segment performance.
• There is a strategic shift away from degrees as a core growth engine, with a focus on other initiatives for faster returns.

Q & A Highlights

Q: Can you discuss the trends you're seeing in the enterprise segment, specifically in campus B2B and government? A: Jeffrey Maggioncalda, CEO, noted weakness in government workforce development programs due to transitory budgets post-COVID. In the campus segment, challenges arise when Coursera is not integrated into the curriculum for credit, leading to lower student engagement. However, when used for credit, student engagement and completion rates are high. Kenneth Hahn, CFO, added that for 2025, they expect the most growth from Coursera for Campus, followed by Coursera for Business, and then Coursera for Government.

Q: At your 2023 Investor Day, you expected degrees to be a core growth engine. Why is there now a shift in strategic priorities? A: Jeffrey Maggioncalda explained that the online degree market has evolved, with a focus now on integrating open content for credit, which aligns with Coursera for Campus. The synergy between campus offerings and degree recruitment is being prioritized. Kenneth Hahn added that while degrees were expected to grow more, the focus is shifting to areas with more immediate growth potential.

Q: Reflecting on your tenure, how do you view the adoption of virtual learning and AI's impact? A: Jeffrey Maggioncalda noted that while COVID accelerated virtual learning, the adoption of AI has been slower due to regulatory uncertainties and the need for clear productivity gains. He believes that as AI models improve, the urgency for companies to upskill will increase. Andrew Ng added that while AI disruption hasn't been as immediate as hyped, valuable applications are being developed, and Coursera is well-positioned to innovate and capture these opportunities.

Q: Can you elaborate on the strategy for the degrees segment and its impact on growth and profitability? A: Kenneth Hahn stated that while degrees have been growing, the focus is shifting to enterprise and consumer segments for quicker returns. The degree segment's growth is slower than anticipated, and resources are being reallocated to areas with more immediate growth potential. Jeffrey Maggioncalda emphasized focusing on scalable models that integrate open content for credit.

Q: How do you view the impact of generative AI on consumer segment growth in 2025? A: Jeffrey Maggioncalda highlighted that a broader and more diverse content portfolio, powered by Gen AI, will drive consumer growth, especially in international markets. The focus will be on job-specific titles that teach new AI tools, aiming to position learners as AI-capable employees. Kenneth Hahn added that stability in Coursera Plus subscriptions and renewed agreements with industry partners will support growth.

For the complete transcript of the earnings call, please refer to the full earnings call transcript.