Udemy, Inc. (NASDAQ:UDMY): Is Breakeven Near?

With the business potentially at an important milestone, we thought we'd take a closer look at Udemy, Inc.'s (NASDAQ:UDMY) future prospects. Udemy, Inc., a learning company, that operates a marketplace platform for learning skills in North America, Europe, the Middle East, Africa, the Asia Pacific, and Latin America. On 31 December 2024, the US$1.2b market-cap company posted a loss of US$85m for its most recent financial year. Many investors are wondering about the rate at which Udemy will turn a profit, with the big question being “when will the company breakeven?” We've put together a brief outline of industry analyst expectations for the company, its year of breakeven and its implied growth rate.

See our latest analysis for Udemy

Consensus from 13 of the American Consumer Services analysts is that Udemy is on the verge of breakeven. They anticipate the company to incur a final loss in 2025, before generating positive profits of US$24m in 2026. Therefore, the company is expected to breakeven just over a year from now. In order to meet this breakeven date, we calculated the rate at which the company must grow year-on-year. It turns out an average annual growth rate of 57% is expected, which is extremely buoyant. Should the business grow at a slower rate, it will become profitable at a later date than expected.

We're not going to go through company-specific developments for Udemy given that this is a high-level summary, but, bear in mind that by and large a high forecast growth rate is not unusual for a company that is currently undergoing an investment period.

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Before we wrap up, there’s one aspect worth mentioning. Udemy currently has no debt on its balance sheet, which is quite unusual for a cash-burning growth company, which typically has high debt relative to its equity. The company currently operates purely off its shareholder funding and has no debt obligation, reducing concerns around repayments and making it a less risky investment.

Next Steps:

There are too many aspects of Udemy to cover in one brief article, but the key fundamentals for the company can all be found in one place – Udemy's company page on Simply Wall St. We've also put together a list of pertinent factors you should look at:

1. Valuation: What is Udemy worth today? Has the future growth potential already been factored into the price? The intrinsic value infographic in our free research report helps visualize whether Udemy is currently mispriced by the market.
2. Management Team: An experienced management team on the helm increases our confidence in the business – take a look at who sits on Udemy’s board and the CEO’s background.
3. Other High-Performing Stocks: Are there other stocks that provide better prospects with proven track records? Explore our free list of these great stocks here.

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This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.