Udemy shifts focus to larger businesses as quarterly losses mount

By Claudia Assis

Udemy shares drop 19% after a larger-than-expected quarterly loss

Shares of Udemy Inc. sank 19% in the after-hours session Wednesday after the online education company said it was switching gears toward large businesses as quarterly losses piled up and guidance also disappointed.

Udemy (UDMY) will shift focus and resources to large business customers, or those with more than 1,000 employees, looking for "accelerated profitability," the company said.

So far, GAAP profit has been elusive.

Udemy said Wednesday that it lost $32 million, or 21 cents a share, in the second quarter, compared with a loss of $26 million, or 17 cents a share, in the year-ago quarter.

Adjusted for one-time items, the company lost 4 cents a share. Analysts polled by FactSet expected a loss of a penny a share.

Revenue rose 9% to $194 million, from $178 million a year ago and in line with Wall Street expectations.

Udemy said that its enterprise segment, called Udemy Business, saw a revenue increase of 19% to $120.6 million. Revenue from its consumer segment, however, dropped 4% to $73.8 million.

The company guided for third-quarter revenue between $191 million and $194 million, and 2024 revenue between $776 million and $782 million. That's below Wall Street expectations of $200 million and $799 million, respectively.

-Claudia Assis

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07-31-24 2019ET

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