Coursera Inc ((COUR)) has held its Q3 earnings call. Read on for the main highlights of the call.
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Coursera’s Q3 Earnings Call: A Mixed Bag of Growth and Challenges
The recent earnings call for Coursera Inc. painted a picture of mixed sentiment, with significant achievements in the Consumer segment overshadowed by challenges in the Enterprise sector. The company reported robust revenue growth, largely driven by new partnerships and product innovations, yet faced hurdles with muted growth in the Enterprise segment, reflecting a cautious outlook.
Revenue Growth and Consumer Segment Success
Coursera reported a strong third quarter, achieving a revenue of $194 million, marking a 10% increase year-over-year. The Consumer segment was a standout performer, with revenue growing by 13%, fueled by the addition of 7.7 million new registered learners and the success of the Coursera Plus subscription model.
Increased Full-Year Revenue Guidance
In a show of confidence, Coursera raised its full-year revenue expectations to a range of $750 million to $754 million, indicating an 8% to 9% growth from the previous year. This upward revision from an earlier forecast of 4% growth underscores the company’s positive outlook for the remainder of the year.
Operational Discipline and Free Cash Flow
The company’s operational discipline was evident with the generation of $27 million in free cash flow, a substantial 59% increase from the prior year. This demonstrates Coursera’s effective management of resources and commitment to financial health.
Expansion of AI and Content Catalog
Coursera’s content catalog saw significant expansion, growing by 44% year-over-year to over 12,000 courses. The company also doubled its GenAI course offerings, now featuring over 1,000 courses, highlighting its commitment to staying at the forefront of educational technology.
Partnerships with OpenAI and Anthropic
In a strategic move, Coursera became the first online learning platform to be integrated directly into ChatGPT and announced a content partnership with AI research company Anthropic, enhancing its technological capabilities and market reach.
Muted Enterprise Environment
The Enterprise segment faced challenges, with revenue increasing by only 6% year-over-year. The net retention rate dropped to 89%, reflecting a challenging corporate spending environment and contributing to the overall cautious sentiment.
Challenges in Government Segment
The Coursera for Government vertical also experienced difficulties, which further contributed to the muted performance of the Enterprise segment, highlighting areas needing strategic attention.
Seasonality Impact
Looking ahead, Coursera’s Q4 revenue guidance reflects a seasonal decline, with anticipated growth of 5% to 8% year-over-year, which is lower than the growth experienced in Q3, indicating potential seasonal challenges.
Forward-Looking Guidance
In its Q3 2025 earnings call, Coursera provided an optimistic outlook with revised upward expectations for the year. The company anticipates full-year revenue between $750 million and $754 million, driven by the strength of the Consumer segment. Coursera is also targeting an adjusted EBITDA margin improvement to 8% for the year, with Q4 revenue expected to be between $189 million and $193 million.
In summary, Coursera’s earnings call highlighted a dual narrative of success and challenges. While the Consumer segment thrived with strong revenue growth and strategic partnerships, the Enterprise segment faced headwinds. The company’s forward-looking guidance remains optimistic, with raised revenue expectations and continued focus on operational discipline and innovation.