Udemy Reports First Profitable Year, Advances Coursera Merger, and Completes Share Buyback
Summary
Udemy reported its first profitable year in 2025, with strong growth in Adjusted EBITDA and free cash flow, alongside significant progress on its all-stock merger with Coursera and the completion of a $50.2 million share repurchase program.
Key Events
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Achieves First Profitable Year
Udemy reported a net income of $3.8 million for fiscal year 2025, a significant turnaround from a net loss of $(85.3) million in 2024. Adjusted EBITDA increased to $95.3 million (12% margin) from $43.0 million (5% margin) in the prior year, and free cash flow rose to $70.0 million from $38.3 million.
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Coursera Merger Progresses
The proposed all-stock merger with Coursera, announced on December 17, 2025, is advancing, with the U.S. Federal Trade Commission granting early termination of the Hart-Scott-Rodino waiting period on February 9, 2026. Udemy stockholders are expected to own approximately 41% of the combined company, with the merger anticipated to close by the second half of 2026.
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Completes Share Repurchase Program
The company completed a $50.2 million share repurchase program in December 2025, buying back 7,971,500 shares, demonstrating capital allocation towards shareholder value.
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Strategic Shift to Subscription Model
Subscription offerings accounted for 72% of total revenue in 2025, up from 66% in 2024, reflecting a successful transformation towards a more predictable, high-value business model. Enterprise segment revenue grew by 6% to $524.1 million.
Analysis
Udemy's annual report highlights a significant financial turnaround, achieving its first full year of positive net income in 2025, a substantial improvement from prior losses. This positive financial performance coincides with key progress on its proposed all-stock merger with Coursera, including the early termination of the HSR waiting period. The company also completed a notable share repurchase program, demonstrating a commitment to shareholder returns. While some operational metrics like Net Dollar Retention Rate saw a slight decline, the overall strategic direction towards a subscription-first model and AI-powered platform, coupled with improved profitability and merger advancement, presents a strong positive outlook.
At the time of this filing, UDMY was trading at $4.83 on NASDAQ in the Trade & Services sector, with a market capitalization of approximately $700.6M. The 52-week trading range was $4.35 to $10.26. This filing was assessed with positive market sentiment and an importance score of 9 out of 10.