| --- | --- | --- | --- | |-------|-------|-------|-------| | | | | | | | | | | 1 Q3 FY21 Disclaimer Information contained in this presentation is current as of the Q3 FY21 earnings date Non-GAAP Financial Measures In addition to financial information presented in accordance with GAAP, this press release includes non-GAAP gross profit, non-GAAP net loss, adjusted EBITDA, adjusted EBITDA margin and Free Cash Flow, each of which is a non-GAAP financial measure. These are key measures used by our management to ...

Coursera, Inc. (NYSE:COUR) Q3 2021 Earnings Conference Call November 2, 2021 5:00 PM ET Company Participants Cam Carey - Head, IR Jeffrey Maggioncalda - CEO, President & Director Kenneth Hahn - SVP, CFO & Treasurer Conference Call Participants Thomas Singlehurst - Citigroup Joshua Baer - Morgan Stanley Stephen Sheldon - William Blair & Company Ryan MacDonald - Needham & Company Jason Celino - KeyBanc Capital Markets Rishi Jaluria - RBC Capital Markets Michael Ng - Goldman Sachs Group Operator Ladies and gen ...

User Growth - As of June 30, 2021, Coursera has approximately 87 million registered learners on its platform, reflecting a significant user base growth[98]. - The number of registered learners increased to 86.7 million as of June 30, 2021, up 36% year-over-year from 63.7 million[174]. - The number of Paid Enterprise Customers grew by 109% year-over-year, reaching 584 as of June 30, 2021, compared to 279 in the same period of 2020[181]. - Degrees student count increased by 81% year-over-year, reaching 14,630 as of June 30, 2021, compared to 8,079 in the same period of 2020[179]. Financial Performance - For the three months ended June 30, 2021, Coursera reported a net loss of $46.4 million, with a net loss margin of (45)%, compared to a net loss of $13.9 million and a margin of (19)% for the same period in 2020[100]. - For the six months ended June 30, 2021, the net loss increased to $65.0 million, with a net loss margin of (34)%, compared to a net loss of $28.2 million and a margin of (22)% in 2020[101]. - Revenue for the three months ended June 30, 2021, was $102.1 million, an increase of $28.4 million or 38% compared to $73.7 million for the same period in 2020[135]. - Revenue for the six months ended June 30, 2021, was $190.5 million, an increase of $62.9 million or 49% compared to $127.6 million for the same period in 2020[139]. - The net loss for the three months ended June 30, 2021, was $46.363 million, compared to a net loss of $13.916 million for the same period in 2020, representing a deterioration of about 233.5%[192]. Revenue Breakdown - Coursera's revenue is derived from three sources: Consumer, Enterprise, and Degrees, with revenue recognized ratably over the contract term[116]. - Total Consumer revenue increased by $11.7 million, or 23%, for the three months ended June 30, 2021, compared to the same period in 2020[136]. - Total Enterprise revenue increased by $11.5 million, or 69%, for the three months ended June 30, 2021, compared to the same period in 2020[137]. - Total Degrees revenue increased by $5.2 million, or 78%, for the three months ended June 30, 2021, compared to the same period in 2020[138]. - Consumer revenue for the six months ended June 30, 2021, was $113.9 million, a 38% increase from $82.6 million in the same period of 2020[185]. - Enterprise revenue for the six months ended June 30, 2021, reached $52.7 million, reflecting a 66% year-over-year growth from $31.7 million[185]. Operating Expenses - Total operating expenses for the three months ended June 30, 2021, were $106.7 million, a 104% increase from $52.4 million for the same period in 2020[147]. - Research and development expenses for the three months ended June 30, 2021, were $41.0 million, a 127% increase from $18.0 million for the same period in 2020[149]. - Sales and marketing expenses for the three months ended June 30, 2021, were $43.9 million, a 73% increase from $25.4 million for the same period in 2020[151]. - General and administrative expenses for the three months ended June 30, 2021, were $21.8 million, a 144% increase from $8.9 million for the same period in 2020[153]. Cash and Liquidity - As of June 30, 2021, the company had cash, cash equivalents, and marketable securities totaling $800.7 million[160]. - The company received cash proceeds of $525.3 million from its IPO in April 2021, net of underwriting discounts and commissions[160]. - The company expects its existing cash and cash equivalents will be sufficient to meet its cash needs for at least the next 12 months[161]. - For the six months ended June 30, 2021, net cash used in operating activities was $9.8 million, compared to net cash provided of $3.8 million for the same period in 2020, reflecting a $13.6 million increase in cash used[167][168]. Growth Strategy - The company anticipates continued investment in growth, expecting operating expenses to increase as it builds sales and marketing efforts and expands its employee base[114]. - Coursera aims to expand its international footprint, particularly in regions with large underserved adult learning populations, as part of its growth strategy[112]. - The shift in revenue mix towards Degrees and Enterprise is expected to improve overall margins, as these segments incur lower content costs compared to Consumer offerings[110]. - Coursera's ability to attract and engage new learners and Enterprise customers is critical for its growth, as these segments contribute significantly to overall revenue[107]. Market and Economic Factors - The company's revenue is primarily denominated in U.S. dollars, minimizing significant foreign currency risk[210]. - Operating expenses are subject to fluctuations due to changes in foreign currency exchange rates, particularly in the Pound Sterling, Canadian Dollar, and Indian Rupee[210]. - A 10% increase or decrease in current exchange rates would have resulted in an impact of $1.7 million on the company's quarterly unaudited condensed consolidated financial statements[210].

Financial Data and Key Metrics Changes - The company reported Q2 revenue of $102.1 million, a 38% year-over-year increase, marking the first time revenue crossed the $100 million mark [7][28] - Gross profit reached $61.8 million, up 60% from the previous year, with a gross margin of 60.6%, an increase of approximately 810 basis points year-over-year [28][30] - Net loss was $6.9 million, or 6.8% of revenue, with an adjusted EBITDA loss of $2.9 million, or 2.8% of revenue [33][34] Business Line Data and Key Metrics Changes - Consumer segment revenue was $62 million, up 23% year-over-year, driven by strong demand for Professional Certificates [36] - Enterprise segment revenue was $28.2 million, a 69% increase from the previous year, with a total of 584 paid enterprise customers, up 109% [38] - Degrees segment revenue was $11.9 million, up 78% year-over-year, with total degree students reaching 14,630, an 81% increase [39] Market Data and Key Metrics Changes - The total number of registered learners on the platform reached 87 million, with significant growth in the consumer segment [37][17] - The company is seeing strong interest in its Professional Certificates, which are designed for entry-level digital jobs [7][8] Company Strategy and Development Direction - The company aims to transform higher education and adult learning by collaborating with universities and industry partners to offer flexible and affordable education [8][16] - The focus is on expanding the enterprise sales force and investing in product improvements to capture growth opportunities [25][34] - The company is also investing in localization efforts in fast-growing economies like India to improve conversion rates [22] Management's Comments on Operating Environment and Future Outlook - Management highlighted the ongoing demand for online learning and the importance of digital skills in the post-pandemic economy [28][41] - The company expects revenue for Q3 to be in the range of $105 million to $109 million, representing a growth rate of 29% compared to the previous year [40] - For the full year 2021, revenue is anticipated to be between $402 million and $410 million, reflecting approximately 38% growth [41] Other Important Information - The company ended Q2 with over $800 million in unrestricted cash and no debt, allowing for confident investments in future growth [36] - The company is focused on building a more inclusive and scalable education system in response to the pandemic's impact on the workforce [15] Q&A Session Summary Question: What factors drove the gross margin increase in the Consumer segment? - Management noted that the increase was due to lower content costs associated with Professional Certificates, which have seen a significant uptake as individuals seek to switch careers [48][49] Question: Is the consumer growth driven by more paying users or higher spending per user? - Management indicated that the growth is a combination of both increased conversion rates and a growing portfolio of Professional Certificates, rather than a price increase [55][56] Question: What are the long-term opportunities with government partnerships? - Management highlighted that the relevance of their content has increased for government training programs, which are now more likely to be offered online, creating new opportunities for collaboration [58][59] Question: How does the competitive environment look following the acquisition of edX? - Management expressed confidence in their competitive position, noting that they have built a unique three-sided model that reinforces their market advantages [61]

| --- | --- | --- | |-------|-------|-------| | | | | | | | | 1 Q2 FY21 Disclaimer Information contained in this presentation is current as of the Q2 FY21 earnings date Non-GAAP Financial Measures In addition to financial information presented in accordance with GAAP, this presentation includes non-GAAP gross profit, non-GAAP net loss, adjusted EBITDA, adjusted EBITDA margin and Free Cash Flow, each of which is a non-GAAP financial measure. These are key measures used by our management to help us analyze ou ...

User Growth - As of March 31, 2021, Coursera has approximately 82 million registered learners on its platform, reflecting a significant user base growth[92] - Total registered learners grew from 52.4 million in Q1 2020 to 81.5 million in Q1 2021, reflecting a year-over-year growth of 56%[151] - The number of Degrees students increased from 7,184 in Q1 2020 to 13,493 in Q1 2021, showing an 88% year-over-year growth[154] - Paid Enterprise Customers rose from 260 in Q1 2020 to 479 in Q1 2021, marking an 84% increase[156] Financial Performance - For the three months ended March 31, 2021, Coursera reported a net loss of $18.7 million, with a net loss margin of (21)%, compared to a net loss of $14.3 million and a margin of (27)% for the same period in 2020[94] - Total revenue for the three months ended March 31, 2021, was $88.4 million, an increase of $34.5 million or 64% compared to $53.8 million for the same period in 2020[125] - GAAP revenue for the three months ended March 31, 2021, was $88,362,000, compared to $53,847,000 for the same period in 2020, representing a 64.2% increase[169] - Non-GAAP net loss for the three months ended March 31, 2021, was $(13,352,000), compared to $(11,300,000) for the same period in 2020, indicating a 18.2% increase in losses[171] - Adjusted EBITDA for the three months ended March 31, 2021, was $(10,126,000), with an Adjusted EBITDA Margin of (11)%[171] - Free Cash Flow for the three months ended March 31, 2021, was $(8,639,000), compared to $(9,892,000) for the same period in 2020, showing an improvement of 12.7%[174] Revenue Breakdown - Coursera's revenue is derived from three main sources: Consumer, Enterprise, and Degrees, with a focus on increasing the share of Enterprise and Degrees revenue to improve overall margins[108] - Consumer revenue increased by $19.7 million, or 61%, to $51.9 million, while Enterprise revenue rose by $9.5 million, or 63%, to $24.5 million[126][127] - Degrees revenue saw an increase of $5.4 million, or 81%, reaching $11.9 million, driven by a rise in the number of Degrees students[128] - The shift in revenue mix towards Degrees and Enterprise is expected to benefit overall margins, as Degrees offerings incur no content costs[102] Operating Expenses - Operating expenses are expected to increase as Coursera invests in sales, marketing, and technology development to support future growth[106] - Total operating expenses for the three months ended March 31, 2021, were $67.9 million, an increase of $24.3 million or 56% from $43.6 million in the same period of 2020[131] - Research and development expenses rose by $6.4 million, or 40%, to $22.1 million, primarily due to higher personnel-related costs[131] - Sales and marketing expenses increased by $11.9 million, or 58%, to $32.6 million, driven by additional headcount and increased commissions[132] - General and administrative expenses grew by $6.1 million, or 85%, to $13.1 million, mainly due to increased personnel-related costs and consulting services[133] Cash and Liquidity - As of March 31, 2021, the company had liquidity sources totaling $280.8 million, including cash, cash equivalents, and marketable securities[136] - The company reported a net cash used in operating activities of $(4,347,000) for the three months ended March 31, 2021[174] - Net cash used in operating activities decreased from $7.5 million in Q1 2020 to $4.3 million in Q1 2021, a reduction of $3.2 million[143] - The company had $280.8 million in cash, cash equivalents, and marketable securities as of March 31, 2021[182] Market Trends - The impact of COVID-19 has accelerated the demand for online learning, significantly increasing enrollments and revenue during the pandemic[107] - Coursera's strategy includes expanding its international footprint to tap into underserved adult learning populations, which is seen as a significant growth opportunity[104] Management and Controls - Management believes that disclosure controls and internal control over financial reporting are effective at a reasonable assurance level[187] - There are inherent limitations in control systems that may prevent detection of all errors and fraud[187] - Control systems are based on assumptions about future events, which may not always hold true[187] - Over time, controls may become inadequate due to changes in conditions or compliance levels[187] - Misstatements due to error or fraud may occur and not be detected due to the limitations of a cost-effective control system[187]

Coursera, Inc. (NYSE:COUR) Q1 2021 Earnings Conference Call May 4, 2021 5:00 PM ET Company Participants Cam Carey - Head of Investor Relations Jeff Maggioncalda - Chief Executive Officer Ken Hahn - Chief Financial Officer Conference Call Participants Josh Baer - Morgan Stanley Stephen Sheldon - William Blair Terry Tillman - Truist Ryan MacDonald - Needham Yun Kim - Loop Capital Markets Jason Celino - KeyBanc Brian Peterson - Raymond James Brett Knoblauch - Berenberg Capital Operator Ladies and gentlemen, th ...

| --- | --- | --- | --- | |-------|-------|-------|-------| | | | | | | | | | | 1 Q1 FY21 Disclaimer Information contained in this presentation is current as of the Q1 FY21 earnings date Non-GAAP Financial Measures In addition to financial information presented in accordance with GAAP, this presentation includes non-GAAP gross profit, non-GAAP net loss, adjusted EBITDA, adjusted EBITDA margin and Free Cash Flow, each of which is a non-GAAP financial measure. These are key measures used by our management to ...