Why Udemy Stock Got Hammered Today

Core Viewpoint - Udemy's stock price has significantly declined following the release of its second-quarter financial results, primarily due to lowered full-year revenue guidance despite achieving revenue targets for the quarter [1][4]. Financial Performance - For the second quarter, Udemy reported revenue exceeding $194 million, aligning with management's expectations and reflecting a 9$776 million to $782 million, down from the previous estimate of$795 million to $805 million [4]. Business Model and Revenue Streams - Udemy operates as a two-sided education marketplace, where third-party contributors create courses, and learners can purchase them without needing accreditation [3]. - In the second quarter, Udemy Business, which provides a catalog of courses for enterprises, accounted for 62$493 million [3]. Future Outlook - Management anticipates only 5% top-line growth in the upcoming third quarter and has outlined plans to restructure the business to focus on higher growth opportunities [4]. - For 2026, Udemy expects to report adjusted EBITDA between $130 million and$150 million, with an enterprise value of approximately $980 million, suggesting a potentially attractive valuation if profit goals are met [5]. Customer Metrics and Profitability - Customer metrics for Udemy continue to improve, and the company is expected to achieve profitability as it implements changes to the payout structure for instructors [6]. - Maintaining a balance of instructors and buyers is crucial for enhancing the stock's outlook in the coming years [6].