Udemy, the San Francisco-based education technology company, experienced a surge in its stock price after reporting better-than-expected revenue for the third quarter. The company’s shares rose 8.2% to $9.76 in after-hours trading, following a 1.9% increase at Thursday’s close. Despite a 15% decline for the year, this recent uptick bodes well for the company’s future prospects.
Impressive Revenue Growth Exceeds Analysts’ Forecasts
Udemy’s revenue saw a notable increase of 17%, reaching $184.7 million in Q3. This figure surpassed analysts’ estimates of $178.2 million, as polled by FactSet. As a result of this robust performance, the company has raised its full-year revenue outlook from $702 million to a range of $723 million to $726 million.
Improved Financials and Cost-Cutting Measures
In addition to its revenue growth, Udemy also reported a significant improvement in its financials. The company posted a third-quarter loss of $16.8 million, or 11 cents per share, compared to a loss of $46.7 million, or 33 cents per share, in the same period last year. This beats analysts’ expectations of an 18 cents per share loss.
To further enhance profitability, Udemy has announced plans to reduce the share of revenue paid to its instructor partners from the current 25% to just 15% by 2026. The company believes that this strategic shift will contribute to improved gross margins moving forward.
Udemy’s strong performance in the third quarter has investors excited about its future growth potential. With a substantial increase in revenue, improved financials, and plans for cost-cutting measures, the company is well-positioned to further establish itself as a leading player in the education technology industry.