On October 24, 2024, Coursera Inc (COUR, Financial) released its 8-K filing detailing its financial results for the third quarter of 2024. Coursera, a leading online learning platform, reported a revenue of $176.1 million, surpassing the analyst estimate of $173.98 million. The company also reported a net cash inflow from operating activities of $27.8 million and a free cash flow of $16.7 million.
Company Overview
Coursera Inc is an online learning platform that connects learners, educators, and institutions to provide affordable, accessible, and relevant educational content. The company operates through three segments: Consumer, Enterprise, and Degrees, with the Consumer segment being the primary revenue generator. Coursera aims to equip individual learners with job skills and professional certifications to advance their careers.
Performance and Challenges
Coursera's Q3 2024 performance highlights a 6% year-over-year revenue increase from $165.5 million. The company reported a net loss of $13.7 million, a significant improvement from the $32.1 million loss in the same quarter last year. This performance underscores Coursera's ability to grow its revenue while narrowing its losses, a crucial factor for long-term sustainability in the competitive online education market.
“In the third quarter, we demonstrated strong progress across Coursera's learning ecosystem. We welcomed ten new partners and launched more than a dozen industry micro-credentials, many of which teach emerging skills in generative AI,” said Coursera CEO Jeff Maggioncalda.
Financial Achievements
Coursera's gross profit for the quarter was $96.2 million, representing 55% of revenue, up from 50% a year ago. The non-GAAP gross profit was $98.1 million or 56% of revenue. The company's adjusted EBITDA was $13.3 million, a notable improvement from a negative $5.3 million in the previous year. These achievements are significant as they reflect Coursera's focus on enhancing profitability while expanding its educational offerings.
Key Financial Metrics
Coursera's net loss per share improved to $(0.09) from $(0.21) a year ago, while the non-GAAP net income per share was $0.10, compared to a loss of $(0.01) last year. The company's net cash provided by operating activities increased to $27.8 million from $19.8 million, and free cash flow rose to $16.7 million from $13.5 million. These metrics are crucial as they indicate Coursera's operational efficiency and financial health.
Segment Performance
| Segment | Revenue | Growth | Gross Margin |
|---|---|---|---|
| Consumer | $102.3 million | 3% | 54% |
| Enterprise | $60.4 million | 10% | 70% |
| Degrees | $13.4 million | 15% | 100% |
The Consumer segment saw a 3% revenue increase, driven by Coursera Plus and new certificate launches. The Enterprise segment grew by 10%, with a 19% increase in paid enterprise customers. The Degrees segment experienced a 15% revenue growth, with a 29% increase in degree students, highlighting the scalability of Coursera's programs.
Analysis and Outlook
Coursera's Q3 results demonstrate its ability to grow revenue and improve profitability, crucial for sustaining its competitive edge in the online education sector. The company's strategic partnerships and focus on emerging skills, such as generative AI, position it well for future growth. Coursera's commitment to reducing expenses and enhancing profitability is expected to yield significant cost savings and support long-term growth initiatives.
Coursera's financial outlook for Q4 2024 projects revenue between $174 million and $178 million, with adjusted EBITDA ranging from $4.5 million to $6.5 million. For the full year 2024, the company anticipates revenue between $690 million and $694 million, with an adjusted EBITDA margin of 5.4%.
Explore the complete 8-K earnings release (here) from Coursera Inc for further details.
