Udemy (UDMY) Stock Forecast & Price Target

Udemy Inc. demonstrates a strong financial outlook, with the Enterprise segment (Udemy Business) experiencing a 13.4% year-over-year revenue growth, now accounting for 65% of total revenue. Additionally, the Consumer segment has shown improved gross margins, expanding by 187 basis points year-over-year to reach 53%, fueled by a growing subscription base contributing over 10% of segment revenues. Overall, Udemy reported total revenue growth of 5.5% year-over-year, complemented by a significant increase in adjusted EBITDA to $19.5 million, indicating positive operational efficiency and robust demand for both enterprise and consumer offerings.

Udemy Inc has experienced notable challenges, with consumer revenues declining by 6.8% year-over-year in 4Q to reach $69.8 million, indicating difficulties in stabilizing this segment despite surpassing some expectations. Additionally, net dollar retention rates (NDRR) have decreased to 98%, reflecting longer upsell timelines, while the enterprise segment has shown continued weakness, with NDRR for large customers falling from 104% to 103%. Lastly, although the company’s guidance for adjusted EBITDA margins in 1Q25 appears favorable, projected revenue growth of only 0.1% to a range of $195 million - $199 million falls short of consensus expectations of $201.4 million, emphasizing ongoing operational challenges.