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    COUR
    Earnings call· Jun 2026(Q2 FY26)

    Coursera Q2 FY26 earnings call COUR

    Jul 29, 2026 Source

    Executive summary

    Coursera Q2 FY26 — Strong Integration, Raised Outlook, and AI-Native Innovation

    Coursera completed its Udemy acquisition, driving significant reported revenue growth and an improved earnings profile with increased synergy targets. The company is accelerating AI-native innovation through a unified platform and a strategic $100 million investment in LearnVector, aiming to transform learning experiences. Management is focused on integration, margin expansion, and building a next-generation platform to capitalize on the evolving skills landscape.

    Highlights

    5

    • Reported revenue of $299 million, up 60% year-over-year.

    • Full-year 2026 revenue outlook raised to between $1.22 billion and $1.245 billion.

    • Full-year adjusted EBITDA margin target increased by 100 basis points to approximately 14%.

    • Paid subscribers increased 44% year-over-year to more than 1.6 million.

    • Annual run rate net synergies target increased to at least $85 million by the end of 2026.

    Concerns

    4

    • Normalized revenue declined 1% year-over-year.

    • Free cash flow was a use of $33 million, including $39 million in merger and integration-related costs.

    • Consumer transactional offerings and individual programs remain under pressure.

    • Net Revenue Retention (NRR) was 91%, indicating some churn or downsell in the Enterprise segment.

    Guidance & targets

    6
    CategoryTargetConfidence
    Full-year 2026 Reported Revenue
    $1.22B-$1.245B
    high materiality
    High
    Full-year 2026 Adjusted EBITDA Margin
    ~14%
    high materiality
    High
    Q4 2026 Adjusted EBITDA Margin
    >16%
    medium materiality
    High
    Annual Run Rate Net Synergies
    At least $85M
    high materiality
    High
    Q3 2026 Revenue
    $364M-$372M
    medium materiality
    High
    Q3 2026 Adjusted EBITDA
    $52M-$56M
    medium materiality
    High

    Segment performance

    2
    SegmentRevenueYoYQoQMargin
    Enterprise
    Performance consistent with expectations, reflecting a mixed demand environment with variability across customer segments, regions, and use cases. Gross margin benefited from Udemy's contribution and stronger content economics.
    NRR: 91%Enterprise Customers: 12,107
    		$140M118% (as reported), 3% (normalized)—79%
    Consumer
    Core subscriptions are the growth engine, while subscriptions to individual programs and transactional offerings remain under pressure. The segment is evolving towards a subscription-first model with disciplined paid marketing.
    Paid Subscribers: >1.65M (up 44% YoY)Subscription Revenue: ~$122M (>75% of segment revenue)
    		$159M29% (as reported), -5% (normalized)—65%

    Operational metrics

    17
    Total Revenue
    $299Mup 60% YoY (as reported), down 1% YoY (normalized)
    Q2 FY26

    Driven by inclusion of Udemy's results beginning May 11.

    Gross Profit
    $186Mup 77% YoY
    Q2 FY26

    Reflects overall company gross profit.

    Gross Margin
    62%expansion of 620 bps YoY (as reported), ~200 bps (normalized)
    Q2 FY26

    Benefited from pre-close structural improvements of both companies.

    Operating Expenses
    $150Mlargely in line with prior year period
    Q2 FY26

    Reflects overall company operating expenses.

    Net Income
    $40M
    Q2 FY26

    Reflects overall company net income.

    Adjusted EBITDA
    $43M
    Q2 FY26

    Provides early evidence of stronger earnings profile.

    Unrestricted Cash, Cash Equivalents and Marketable Securities
    $982M
    Q2 FY26 end

    Provides substantial flexibility for capital allocation.

    Share Repurchases (Q2)
    $90M
    Q2 FY26

    Executed through the end of June.

    Total Share Repurchases (to date)
    $140M
    To date

    Total repurchases under the $500 million authorization.

    Revenue from Recurring Subscription Streams
    >85%
    Q2 FY26

    Percentage of total revenue from Enterprise or Consumer segments.

    Paid Subscribers
    >1.6Mup 44% YoY
    Q2 FY26 end

    Driven by increasing focus on subscription business.

    GenAI Course Enrollments
    >45 enrollments per minuteup from 25 per minute last year
    2026

    Combined rate across both platforms, showing rapid adoption of generative AI content.

    Registered Learners
    >300M
    Q2 FY26 end

    Combined reach across Coursera and Udemy platforms.

    Enterprise Customers
    >12,000
    Q2 FY26 end

    Combined figure, excluding web-enabled self-service accounts.

    Instructors
    >100,000
    Q2 FY26 end

    Encompassing Udemy's expert practitioners and university/industry partners.

    University and Industry Partners
    >400
    Q2 FY26 end

    Part of the expanded ecosystem.

    GenAI Courses Offered
    ~10,000
    Q2 FY26 end

    Across the two platforms, including new offerings for Anthropic.

    Industry KPIs

    8
    MetricValueDetails
    Revenue$299MUSD
    Net income$40MUSD
    Gross margin62%%
    Sg a OPEX ratio50%% of revenue
    Operating margin14.3%%
    Adjusted EBITDA ebita$43MUSD
    Cash investments balance$982MUSD
    Share buyback capital return$90MUSD

    Product announcements

    5
    ProductTypeDetails
    AI-powered Role Playupdate
    Ollie mobile applaunch
    Model Context Protocol (MCP) Expansionupdate
    Coursera Connector for Claudelaunch
    Micro-credentialsexpansion

    Deals & partnerships

    2
    UdemyAcquisition of Udemy to build a stronger, more capable company with increased scale, data, and innovation capacity.

    Transaction completed on May 11, 2026, operating as a combined company since then.

    LearnVectorStrategic investment in an AI-native learning company founded and led by Andrew Ng.$100M

    Coursera owns approximately one-third of LearnVector. A commercial relationship is being developed to leverage LearnVector's innovations to improve Coursera's platform.

    Risks & headwinds

    4
    Pressure on Consumer transactional offerings and individual programsOngoing

    Consumer revenue down 5% on a normalized basis

    Mitigation: Evolving towards a subscription-first model across both platforms, maintaining disciplined paid marketing focused on profitable growth.

    Mixed demand environment in Enterprise segmentOngoing

    NRR was 91%

    Mitigation: Prioritizing customer continuity, integrating and aligning global account coverage, bringing capabilities of Coursera and Udemy together into a more valuable unified enterprise offering.

    Pressure on L&D budgets in the Business segmentOngoing

    NRR of 91% for Enterprise segment

    Mitigation: Focusing on execution with integrated Enterprise go-to-market teams.

    Lumpiness in Government businessOngoing

    Can have strong retention some quarters, but generally annual customers

    Mitigation: Acknowledged as a characteristic of the business, no specific new mitigation stated.

    What to watch in Q3 FY26

    4

    Annual run rate net synergies

    End of 2026, with more in 2027
    CurrentAt least $85M by end of 2026
    TargetProgress towards $150M target, further acceleration

    Why it matters

    Key to margin expansion and demonstrating successful integration, directly impacting the company's financial profile.

    We now expect to achieve at least $85 million of annual run rate net synergies by the end of 2026 and are tracking well ahead of the original 24-month time line to deliver the $115 million synergy goal.

    Q&A highlights

    7

    How is the integration of the enterprise sales teams progressing, particularly regarding retention and productivity, and are they past merger distractions?

    The enterprise sales teams were combined three weeks prior to the call. Management is confident in the leadership and the ability for reps to handle single books of business, potentially selling both platforms. They expect continued progress on execution in the combined organization.

    “for the period up to about 3 weeks ago, those teams on the Coursera and Udemy side were still operating separately. And 3 weeks ago, with the action that Mike mentioned in the scripted remarks, we took the first step to combine those teams.”

    asked by Stephen Sheldon · answered by Gregory Hart

    2 min read6 chapters

    Detailed Narrative

    01

    Udemy Integration & Synergy Realization

    Coursera completed its acquisition of Udemy on May 11, 2026, marking a significant step in its growth strategy. The integration efforts are progressing ahead of schedule, with the company now expecting to achieve at least $85 million in annual run rate net synergies by the end of 2026, an increase from the $80 million previously outlined. This accelerated synergy realization, combined with structural gross margin expansion and cost discipline, is strengthening the company's earnings profile, with a target of approximately 14% adjusted EBITDA margin for FY26.

    02

    AI Strategy & LearnVector Investment

    The company is focused on leading in the AI era by building a trusted platform for skills development, recognizing that AI is rapidly changing work and skill requirements. Coursera made a $100 million strategic investment in LearnVector, a newly formed AI-native learning company founded by Andrew Ng. This investment aims to accelerate the design and development of AI-native learning experiences, transforming learning from a traditional one-to-many model to a personalized one-to-one guide for every learner, leveraging Andrew Ng's expertise.

    03

    Unified Platform Development

    Coursera is actively building a unified platform by bringing together the data, skills intelligence, and product capabilities of both Coursera and Udemy on a modern architecture. This platform is designed to offer personalized pathways, interactive practice, and credible proof of mastery, moving beyond content consumption to demonstrated capability. An early end-to-end prototype on a new AI-native foundation was built within three weeks of forming a cross-functional team, with a full rollout expected in stages starting in the first half of next year.

    04

    Product Innovation & AI Features

    Recent product updates highlight the focus on AI-enabled learning. Both Coursera and Udemy have enhanced AI-powered role play features, including real-time voice simulations and AI avatars for more realistic practice. Coursera also launched Ollie, a stand-alone mobile app for Coursera Plus subscribers, as an AI incubation experiment. Furthermore, the company expanded its Model Context Protocol (MCP) capabilities, introducing the Coursera Connector for Claude, allowing enterprise learners to integrate AI assistants with learning experiences.

    05

    Consumer Segment Evolution

    The Consumer segment is evolving towards a subscription-first model, with paid subscribers growing 44% year-over-year to over 1.65 million. Consumer subscription revenue reached approximately $122 million, representing over 75% of the segment's revenue. While core subscriptions are a key growth driver, transactional offerings and individual programs continue to face pressure. The company is maintaining disciplined paid marketing efforts focused on profitable growth, expecting these trends to continue.

    06

    Enterprise Segment Strategy

    The Enterprise segment delivered performance consistent with expectations, reporting $140 million in revenue and serving 12,107 enterprise customers with an NRR of 91%. The demand environment remains mixed, with variability across customer segments and regions. For the second half of the year, the focus is on ensuring customer continuity, aligning global account coverage, and integrating Coursera and Udemy capabilities to offer a more valuable unified enterprise solution that addresses workforce transformation needs.

    AI-generated summary of the company’s earnings call. Not investment advice.