Financial Data and Key Metrics Changes - Coursera reported revenue of $194 million for Q3 2025, reflecting a 10% year-over-year increase [4][20] - Free cash flow reached $27 million, up 59% from the previous year, contributing to a total of over $80 million year-to-date, representing 55% year-over-year growth [4][22] - The company raised its full-year revenue guidance to a range of $750 to $754 million, indicating an 8% to 9% growth from the prior year [5][18] Business Line Data and Key Metrics Changes - Consumer segment revenue was $130 million, up 13% year-over-year, driven by 7.7 million new registered learners [20][23] - The gross profit for the consumer segment was $80 million, a 16% increase from the previous year, with a gross margin of 61% [24] - Enterprise segment revenue was $64 million, up 6% year-over-year, with a net retention rate of 89% [25][26] Market Data and Key Metrics Changes - The total number of registered learners reached 191 million, with significant growth in the consumer segment [23] - The demand for generative AI courses has surged, with 14 enrollments per minute, up from eight enrollments per minute last year [9][10] Company Strategy and Development Direction - The company is focusing on product-led innovation and operational discipline to enhance customer experiences and drive long-term growth [4][5] - Coursera is expanding its catalog, which has grown by 44% to over 12,000 courses, and is enhancing its offerings with nearly 100 professional certificates [8][9] - The integration with OpenAI's ChatGPT is expected to enhance user engagement and discovery of Coursera's offerings [16][30] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the consumer business, citing strong top-of-funnel metrics and the success of Coursera Plus [37][38] - The enterprise environment remains muted, with no significant changes expected in corporate spending trends [70] - The company anticipates Q4 revenue in the range of $189 to $193 million, representing 5% to 8% year-over-year growth [17][18] Other Important Information - The appointment of Anthony Salcido as the new General Manager of the enterprise segment is expected to drive growth initiatives [5][6] - The company is investing in AI-driven innovations and personalized learning experiences to meet evolving learner needs [19] Q&A Session Summary Question: Insights on OpenAI embedded app and its impact - Management is excited about the partnership with OpenAI, noting it as a top-of-funnel opportunity without a direct economic arrangement [29][30] Question: Sales and marketing investment priorities - The company continues to see effective returns on sales and marketing investments, particularly in driving subscriptions [33][34] Question: Q4 revenue outlook and consumer growth durability - Management raised full-year revenue guidance, citing strong consumer growth and visibility from Coursera Plus [36][37] Question: Balancing free cash flow growth with content investments - The company plans to continue investing in content while leveraging AI to reduce production costs [39] Question: International pricing strategy and its impact - Management lowered prices in various international markets to enhance accessibility and drive revenue growth [43][44] Question: Trends in enterprise segment and corporate spending - Mixed trends were observed across different verticals, with Coursera for Campus performing better than Coursera for Government [45][46] Question: Future of AI certifications and partnerships - There is potential for creating AI certifications in collaboration with partners, similar to existing certifications with other companies [58][60] Question: Shifts in search from traditional SEO to AI search - The integration with OpenAI is expected to improve user engagement and traffic quality, enhancing the learner journey [63][64]

Core Insights - The UK government has partnered with major technology companies to train 7.5 million workers in essential AI skills, aiming to position the UK as a global leader in AI [3][4] - A significant skills gap exists in AI, with over three-quarters of companies reporting a shortage, and the skills requirements in AI sectors changing 66% faster than in other sectors [6][12] - Continuous learning and upskilling are essential due to the rapid evolution of AI technologies, with a focus on specific business outcomes being crucial for successful training initiatives [10][22][24] Group 1: Government Initiatives - The UK government has launched a £187 million ($253 million) program called TechFirst to provide AI skills training across various demographics [2] - Microsoft has committed to upskilling one million workers by the end of 2025 as part of this initiative [2] - The partnership includes major tech firms like Amazon, Google, and IBM, emphasizing a collaborative approach to workforce development [3] Group 2: Skills and Training - AI literacy is difficult to define, but understanding the benefits and limitations of AI tools, particularly large-language models, is a key aspect [1][5] - Different training needs exist based on roles within organizations, with C-suite executives, average workers, and AI technologists requiring tailored training [8] - The need for ongoing training is highlighted, as AI technologies are rapidly evolving, necessitating a culture of lifelong learning [9][10] Group 3: Economic Impact - A study from Stanford University indicates a 16% reduction in entry-level jobs in AI-exposed sectors since the launch of ChatGPT, affecting younger job seekers [12] - The World Economic Forum predicts that AI will create 170 million new jobs by 2030 while also eliminating 92 million jobs, resulting in a net increase of 78 million jobs globally [14] - Concerns exist regarding the potential for increased youth unemployment if entry-level jobs are automated without adequate training and new opportunities [16][20] Group 4: Successful Upskilling Strategies - Successful AI upskilling initiatives focus on specific business outcomes rather than generic training, which has shown mixed results [22][24] - Companies that purchase external AI tools and automate back-end processes tend to drive revenue more effectively than those that build internal tools [21] - The importance of defining clear objectives for upskilling programs is emphasized to avoid falling into generic adoption practices [24]

Financial Performance - Q2 2025 revenue reached $199.9 million, exceeding expectations, with a 3% year-over-year increase[9, 12, 15] - GAAP net income was $6.3 million, marking the first positive quarter since IPO, a 120% change year-over-year[9, 12] - Adjusted EBITDA stood at $28.4 million, representing a 14% margin, which is above the high end of the guidance range[9, 12] - Free cash flow for Q2 was positive $39.0 million, and year-to-date free cash flow was positive $46.1 million[10] Subscription and Customer Growth - Subscription revenue now accounts for 70% of total revenue, an increase of 200 basis points quarter-over-quarter[14, 16, 17] - The company surpassed 200,000 paid consumer subscribers, with subscription revenue increasing to 15% of the consumer segment's total mix[9, 13] - Udemy Business (UB) Annual Recurring Revenue (ARR) is $520 million, a 6% year-over-year increase[7, 11, 12] - Udemy Business has 17,107 total customers, including 5,799 large enterprise customers[19] Strategic Initiatives and AI Focus - Launched AI Readiness and AI Growth packages for enterprise customers, along with AI-powered Role Play simulations[10, 13] - AI Learning Assistant engagement increased to over 4 million unique inquiries[13] - The company offers over 4,500 AI-focused courses with over 11 million AI course enrollments[7] Future Outlook - Q3 2025 revenue is projected to be between $190 million and $195 million, with an adjusted EBITDA between $18 million and $20 million[24] - Full year 2025 revenue is projected to be between $784 million and $794 million, with an adjusted EBITDA between $84 million and $89 million[7, 24]