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Coursera, Inc. (COUR)·Q4 2024 Earnings Summary

Executive Summary

  • Q4 2024 revenue was $179.2M (+6% YoY) with GAAP gross margin 53% and adjusted EBITDA $9.5M (5.3% margin); non-GAAP net income was $13.3M (7.4% of revenue) while GAAP net loss was $(21.6)M .
  • Segment performance: Consumer $101.7M (+5% YoY), Enterprise $62.3M (+7% YoY), Degrees $15.2M (+14% YoY); Paid Enterprise Customers rose 18% to 1,612 and NRR softened to 87% .
  • Management guided Q1 2025 revenue to $173–$177M and adjusted EBITDA to $8–$12M; full-year 2025 outlook calls for positive top-line growth and further adjusted EBITDA margin improvement, with Degrees expected to decline and Consumer/Enterprise to grow .
  • Leadership transition: Greg Hart appointed CEO effective Feb 3, 2025—seen as a catalyst to accelerate product innovation and growth in AI-enabled learning; Coursera highlighted substantial margin expansion in 2024 (+750 bps YoY) and $59M free cash flow for the year .
  • Consensus estimates from S&P Global were not available due to data limits; comparisons vs Street cannot be provided for EPS/revenue (S&P Global data unavailable).

What Went Well and What Went Wrong

What Went Well

  • Adjusted EBITDA and non-GAAP profitability improved: Q4 adjusted EBITDA rose to $9.5M (5.3% margin) from $5.7M (3.4%) YoY; non-GAAP net income grew to $13.3M from $9.5M YoY .
  • Consumer stabilization and AI content expansion: “We made some progress stabilizing the month-to-month softness with our Coursera Plus subscriptions... as we seek a return to more significant growth,” with 1.7M learners exchanging 21M messages with AI Coach and 450+ GenAI courses launched in 2024 .
  • Enterprise momentum and international reach: “Coursera for Business in North America is looking pretty strong, driven mostly by AI upskilling efforts,” highlighting differentiation of Coursera’s GenAI teaching and platform experiences .

What Went Wrong

  • Enterprise NRR pressure and government weakness: Net retention rate fell to 87% due to “transitory budget dynamics” in government workforce programs; management cited weaker expansion and new bookings in Coursera for Government .
  • Degrees strategy pivot and anticipated revenue decline in 2025: Despite recent growth, management will pull back near-term investments and focus on scalable for-credit pathways via Coursera for Campus; degrees revenue expected to decline in FY25 .
  • North America consumer headwinds and lower LTV internationally: “Softer growth in North America translates into a higher proportion of learner traffic coming from international regions, which... have lower lifetime values given the price point” .

Financial Results

Income Statement and Profitability (quarterly)

MetricQ2 2024Q3 2024Q4 2024
Revenue ($USD Millions)$170.3 $176.1 $179.2
GAAP Gross Margin %53% 55% 53%
Adjusted EBITDA ($USD Millions)$10.4 $13.3 $9.5
Adjusted EBITDA Margin %6.1% 7.6% 5.3%
GAAP Net Loss ($USD Millions)$(23.0) $(13.7) $(21.6)
GAAP EPS (basic & diluted)$(0.15) $(0.09) $(0.14)
Non-GAAP Net Income ($USD Millions)$13.8 $16.6 $13.3
Non-GAAP EPS (diluted)$0.09 $0.10 $0.08

Q4 YoY Comparison

MetricQ4 2023Q4 2024
Revenue ($USD Millions)$168.9 $179.2
GAAP Gross Profit ($USD Millions)$89.3 $95.5
Adjusted EBITDA ($USD Millions)$5.7 $9.5
GAAP Net Loss ($USD Millions)$(20.4) $(21.6)
GAAP EPS$(0.13) $(0.14)
Non-GAAP Net Income ($USD Millions)$9.5 $13.3
Non-GAAP EPS (diluted)$0.06 $0.08

Segment Breakdown

SegmentQ2 2024 Revenue ($M)Q3 2024 Revenue ($M)Q4 2024 Revenue ($M)
Consumer$97.3 $102.3 $101.7
Enterprise$58.7 $60.4 $62.3
Degrees$14.3 $13.4 $15.2
Segment KPIQ2 2024Q3 2024Q4 2024
Consumer Segment Gross Margin ($M / %)$52.4 / 54% $55.3 / 54% $54.9 / 54%
Enterprise Segment Gross Margin ($M / %)$39.9 / 68% $42.3 / 70% $42.6 / 68%
Degrees Segment Margin (% of Revenue)100% 100% 100%

Platform and Customer KPIs

KPIQ2 2024Q3 2024Q4 2024
Registered Learners (cumulative)155M 162M 168M
Paid Enterprise Customers1,511 1,564 1,612
Enterprise NRR93% 89% 87%
Degree Students22,600 26,400 26,700

Balance Sheet and Cash Flow (Selected)

  • Year-end unrestricted cash, cash equivalents and marketable securities: ~$726M; no debt .
  • Q4 operating cash flow $19.2M; free cash flow $7.4M; FY24 operating cash flow $95.4M; FY24 free cash flow $59.3M .

Guidance Changes

MetricPeriodPrevious GuidanceCurrent Guidance / ActualChange
Revenue ($M)Q4 2024$174–$178 $179.2 (actual) Raised/Beat
Adjusted EBITDA ($M)Q4 2024$4.5–$6.5 $9.5 (actual) Raised/Beat
Revenue ($M)Q1 2025N/A$173–$177 New
Adjusted EBITDA ($M)Q1 2025N/A$8–$12 New
FY Top-lineFY 2025N/APositive overall growth New (qualitative)
Adjusted EBITDA MarginFY 2025N/AFurther improvement New (qualitative)
Degrees RevenueFY 2025N/AExpected decline New (segment outlook)

Management also reiterated intent to provide more detailed FY25 guidance in coming months, noting leadership transition and reassessment of growth areas .

Earnings Call Themes & Trends

TopicPrevious Mentions (Q2 2024)Previous Mentions (Q3 2024)Current Period (Q4 2024)Trend
Generative AI initiatives2M+ enrollments; GA of AI Coach; GenAI for Teams launched Coach for interactive instruction; credit recognition progress; raising FY24 EBITDA margin outlook 450+ GenAI courses; Coach dialogues; 21M messages; AI translations to 24 languages; job-specific AI titles planned Accelerating content breadth and product embedding
Enterprise demand & NRRPaid customers +17% YoY; NRR 93% Paid customers +19% YoY; NRR 89% Paid customers +18% YoY; NRR 87% (government weakness, campus non-credit use) Growth with retention pressure, mix shifting
Consumer segmentCoursera Plus growth; 7M new learners 7M new learners; consumer +3% Consumer +5%; stabilization in month-to-month softness; 6M new learners in Q4 Stabilizing, broader content base, international skew
Degrees strategyNew programs; 14% revenue growth 15% revenue growth; 26.4k students 14% revenue growth; pivot to for-credit pathways; FY25 degrees revenue decline expected Strategic refocus; near-term revenue decline
Cost disciplineReaffirm ~4% FY margin; share repurchase completed Expense reduction initiative; ~10% workforce cut; raise FY24 EBITDA margin midpoint +750 bps EBITDA margin expansion FY24; moderation to invest in growth in FY25 Significant margin gains, now reinvesting
Regional trendsAPAC campus credit expansion International learner growth; platform innovations North America consumer headwinds; stronger C4B in NA tied to AI upskilling NA enterprise AI demand offsetting consumer softness

Management Commentary

  • “We delivered more than 750 basis points of annual adjusted EBITDA margin expansion and generated over $59 million of free cash flow” — CFO Ken Hahn .
  • “Coursera Coach... has grown to become a core presence... This year, more than 1.7 million learners exchanged over 21 million messages with Coach. In Q4, we launched Coach dialogues” — CEO Jeff Maggioncalda .
  • “Enterprise... North America is looking pretty strong, driven mostly by AI upskilling efforts... Coursera content and platform are pretty well differentiated” — CEO Jeff Maggioncalda .
  • “We anticipate top-line growth in both our Consumer and Enterprise segments... we expect our Degree segment revenue to decline in the year” — CFO Ken Hahn .
  • Leadership transition: “Greg Hart... led the development and launch of Alexa... scaled Prime Video globally... the Board is confident that Greg is the right leader to deliver Coursera’s next chapter of growth” — Chairman Andrew Ng .

Q&A Highlights

  • Enterprise mix and weakness: Government programs face transitory budget reductions, weighing on NRR; C4B in North America is a bright spot, driven by AI upskilling demand and differentiated platform experiences .
  • Degrees strategy clarification: Shift resources from degrees to nearer-term growth in Consumer and Enterprise; focus on scalable models integrating open content for for-credit pathways via Coursera for Campus; degrees revenue expected to decline in FY25 .
  • Consumer content cadence: Broader and more diversified AI-powered content engine expected to support more predictable growth; geography-specific pricing/payment and translations (including audio/video dubbing) to drive international adoption .
  • GenAI model advances (e.g., DeepSeek): Better/cheaper models expected to increase productivity and training urgency; Coursera leverages multiple fit-for-purpose models across Coach/Tutor/Builder to improve cost and effectiveness .

Estimates Context

  • S&P Global consensus EPS and revenue estimates for Q4 2024 and prior quarters were unavailable due to data limits at the time of retrieval; therefore, comparisons versus Wall Street consensus cannot be provided (S&P Global data unavailable).
  • Investors should note the company exceeded its own Q4 revenue and adjusted EBITDA guidance ranges, implying operational outperformance versus internal expectations .

Key Takeaways for Investors

  • Coursera beat its Q4 revenue and adjusted EBITDA guidance, demonstrating operating leverage and cost discipline while continuing to invest in AI-driven product innovation; FY24 free cash flow of $59.3M provides balance sheet optionality .
  • Near-term growth to be driven by Consumer stabilization and Enterprise demand (especially C4B in North America tied to AI upskilling), while Degrees is expected to decline in FY25 as strategy pivots to scalable for-credit pathways .
  • Enterprise NRR softness stems from government budget normalization; monitor mix shift toward business and campus and potential recovery in government programs .
  • Leadership transition to Greg Hart is a potential catalyst for accelerating product velocity and commercial execution, given deep experience scaling AI-enabled consumer platforms (Alexa) and global media (Prime Video) .
  • AI content and platform enhancements (Coach dialogues, translations, job-specific AI credentials) support international expansion but bring lower LTV; expect pricing/localization to be critical in unlocking durable consumer growth .
  • FY25 outlook is intentionally qualitative pending new CEO assessment; watch for more detailed guidance in coming months and resource allocation toward higher-return opportunities .
  • With substantial cash and no debt, Coursera retains strategic flexibility to invest in content, platform, and potential adjacencies, while aiming for continued adjusted EBITDA margin improvement .