Coursera,(COUR) - 2024 Q1 - Quarterly Results

Financial & Operating Highlights Coursera reported strong Q1 2024 results with a 15% year-over-year revenue increase to $169.1 million, achieving positive Adjusted EBITDA and Free Cash Flow Q1 2024 Key Financial Metrics (YoY Comparison) | Financial Metric | Q1 2024 | Q1 2023 | Change | | :--- | :--- | :--- | :--- | | Revenue | $169.1M | $147.6M | +15% | | Gross Profit (GAAP) | $89.5M | $77.5M | +15.5% | | Net Loss (GAAP) | $(21.3)M | $(32.4)M | Improved | | Net Loss per Share | $(0.14) | $(0.22) | Improved | | Adjusted EBITDA | $8.3M | $(7.5)M | Improved | | Net Cash from Operations | $24.5M | $4.7M | +421% | | Free Cash Flow | $18.1M | $0.9M | +1911% | Q1 2024 Revenue by Segment (YoY Comparison) | Segment | Q1 2024 Revenue | YoY Growth | Key Drivers | | :--- | :--- | :--- | :--- | | Consumer | $96.7M | +18% | Demand for Professional Certificates and AI courses | | Enterprise | $57.5M | +10% | Strength in government and campus verticals | | Degrees | $14.8M | +10% | Growth in new students and scaling of new programs | - Key operational metrics showed continued growth, reaching 148 million registered learners (an increase of 7 million in the quarter), 1,480 Paid Enterprise Customers (+18% YoY), and 22,200 Degrees Students (+23% YoY)[17] - The Net Retention Rate for Paid Enterprise Customers was 94%[17] Business & Platform Developments Coursera significantly expanded its AI-related offerings and platform enhancements, launching over 75 new courses and AI-powered tools while broadening strategic partnerships globally - Content and Credentials: * Launched over 75 new courses and projects in generative AI from partners including Google, DeepLearning.AI, Duke University, IBM, and Microsoft[19][33] * Added new entry-level Professional Certificates from Unilever in supply chain analytics and digital marketing[19][33] * Announced a new master's in management pathway degree program with the University of Huddersfield[19][33] - Enterprise Customers: * Coursera for Business: Signed new and expanded deals with Aboitiz Power Corporation, Buk, Coast Capital, and The Bank of Saint Lucia Limited[20][34] * Coursera for Government: Launched a national training initiative with the President of Guyana for all citizens and public sector employees[20][34] * Coursera for Campus: Partnered with institutions like Central State University (U.S.), Heriot-Watt University (U.K.), and Yenepoya University (India)[20][34] - Learning Platform Enhancements: * Expanded AI-powered course translation from 18 to 21 languages, adding Hindi, Japanese, and Korean[21][35] * Launched 'Course Builder,' an AI-assisted tool for enterprise customers to create custom private courses[21][35] * Broadened beta access to 'Coursera Coach' for paying Consumer learners and Business/Government customers[21][35] Financial Outlook Coursera provided its financial outlook for Q2 and full year 2024, projecting revenue between $162 million and $166 million for Q2 and $695 million to $705 million for the full year Financial Outlook for 2024 | Period | Revenue | Adjusted EBITDA | | :--- | :--- | :--- | | Q2 2024 | $162M - $166M | $(2)M - $2M | | Full Year 2024 | $695M - $705M | $24M - $28M | Consolidated Financial Statements This section presents the unaudited condensed consolidated financial statements for Q1 2024, including statements of operations, balance sheets, and cash flows Condensed Consolidated Statements of Operations For Q1 2024, Coursera's revenue grew 15% year-over-year to $169.1 million, with net loss improving to $(21.3) million from $(32.4) million in the prior year Q1 2024 Statement of Operations Highlights (in thousands) | Line Item | Q1 2024 | Q1 2023 | | :--- | :--- | :--- | | Revenue | $169,068 | $147,642 | | Gross Profit | $89,497 | $77,468 | | Total Operating Expenses | $119,239 | $116,545 | | Loss from Operations | $(29,742) | $(39,077) | | Net Loss | $(21,256) | $(32,364) | | Net Loss Per Share | $(0.14) | $(0.22) | Condensed Consolidated Balance Sheets As of March 31, 2024, Coursera reported total assets of $916.3 million, maintaining a strong cash position of $725.4 million with total stockholders' equity at $609.1 million Balance Sheet Highlights (in thousands) | Account | March 31, 2024 | December 31, 2023 | | :--- | :--- | :--- | | Cash and cash equivalents | $725,363 | $656,321 | | Total current assets | $833,247 | $832,486 | | Total assets | $916,303 | $920,533 | | Total current liabilities | $302,587 | $298,260 | | Total liabilities | $307,189 | $304,339 | | Total stockholders' equity | $609,114 | $616,194 | Condensed Consolidated Statements of Cash Flows In Q1 2024, Coursera generated $24.5 million in cash from operating activities, significantly increasing cash and cash equivalents by $69.0 million during the quarter Q1 2024 Cash Flow Summary (in thousands) | Cash Flow Activity | Q1 2024 | Q1 2023 | | :--- | :--- | :--- | | Net cash provided by operating activities | $24,450 | $4,692 | | Net cash provided by (used in) investing activities | $59,643 | $(50,540) | | Net cash used in financing activities | $(15,051) | $(7,682) | | Net increase (decrease) in cash | $69,042 | $(53,530) | | Cash, cash equivalents, and restricted cash—End of period | $727,128 | $269,348 | Reconciliation of GAAP to Non-GAAP Financial Measures This section reconciles GAAP to non-GAAP measures, showing Q1 2024 non-GAAP net income of $11.9 million, Adjusted EBITDA of $8.3 million, and Free Cash Flow of $18.1 million, all significantly improved year-over-year Reconciliation of Net Loss to Adjusted EBITDA (in thousands) | Description | Q1 2024 | Q1 2023 | | :--- | :--- | :--- | | Net loss (GAAP) | $(21,256) | $(32,364) | | Stock-based compensation expense | $27,857 | $30,330 | | Depreciation and amortization | $6,356 | $5,511 | | Interest income, net | $(9,583) | $(8,037) | | Restructuring related charges | $2,101 | $(5,659) | | Other adjustments | $2,838 | $2,687 | | Adjusted EBITDA (Non-GAAP) | $8,313 | $(7,532) | Reconciliation of Net Loss to Non-GAAP Net Income (in thousands) | Description | Q1 2024 | Q1 2023 | | :--- | :--- | :--- | | Net loss (GAAP) | $(21,256) | $(32,364) | | Stock-based compensation expense | $27,857 | $30,330 | | Other adjustments | $5,319 | $(4,145) | | Non-GAAP net income (loss) | $11,920 | $(5,161) | | Non-GAAP net income (loss) per share—diluted | $0.07 | $(0.03) | Reconciliation to Free Cash Flow (in thousands) | Description | Q1 2024 | Q1 2023 | | :--- | :--- | :--- | | Net cash provided by operating activities | $24,450 | $4,692 | | Less: purchases of property, equipment, and software | $(134) | $(298) | | Less: capitalized internal-use software costs | $(4,070) | $(2,862) | | Less: purchases of content assets | $(2,153) | $(624) | | Free Cash Flow (Non-GAAP) | $18,093 | $908 | Key Business Metrics & Definitions Coursera defines key performance indicators including Registered Learners, Paid Enterprise Customers, Net Retention Rate, and Degrees Students to clarify operational scale and customer engagement - Registered Learners: Each customer account with a unique email is counted as a registered learner, adjusted for spam, test accounts, and cancellations. The count as of March 31, 2024 was 148 million[26][39] - Paid Enterprise Customers: A customer who purchases Coursera via the direct sales force. This excludes customers from Coursera for Teams or channel partners. The count as of March 31, 2024 was 1,480[40][48] - Net Retention Rate (NRR) for Paid Enterprise Customers: Calculated by dividing the Annual Recurring Revenue (ARR) from a cohort of customers at the end of the current period by the ARR from the same cohort 12 months prior. The NRR for Q1 2024 was 94%[17][28][41] - Number of Degrees Students: Includes all students matriculated in a degree program and enrolled in at least one course during the period. The count as of March 31, 2024 was 22,200[42][50]