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What changed in Coursera, Inc.'s 10-K — 2024 vs 2025

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Paragraph-level year-over-year comparison of Coursera, Inc.'s 2024 and 2025 10-K annual filings, covering the Business, Risk Factors, Legal Proceedings, Cybersecurity, MD&A and Market Risk sections. Every new, removed and edited paragraph is highlighted side-by-side so you can see exactly what management changed in the 2025 report.

+650 added−662 removedSource: 10-K (2026-02-23) vs 10-K (2025-02-24)

Top changes in Coursera, Inc.'s 2025 10-K

650 paragraphs added · 662 removed · 507 edited across 6 sections

Item 1. Business

Business — how the company describes what it does

127 edited+38 added−36 removed63 unchanged
Biggest changeINCOME TAXES The components of loss before income tax were as follows: Year Ended December 31, 2024 2023 2022 Domestic $ (84,004) $ (118,481) $ (177,649) Foreign 5,503 7,298 7,012 Total $ (78,501) $ (111,183) $ (170,637) 101 Table of Contents Income tax expense consisted of the following: Year Ended December 31, 2024 2023 2022 Current taxes: State $ 708 $ 3 $ 189 Foreign 42 4,977 4,872 Total current $ 750 $ 4,980 $ 5,061 Deferred taxes: Foreign $ 279 $ 391 $ (341) Total deferred $ 279 $ 391 $ (341) Total income tax expense $ 1,029 $ 5,371 $ 4,720 The reconciliation between the statutory U.S. federal income tax rate and our effective tax rate as a percentage of loss before income taxes was as follows: Year Ended December 31, 2024 2023 2022 U.S federal income taxes at statutory rate 21.0 % 21.0 % 21.0 % State income taxes, net of federal benefit (2.4) % 2.7 % 2.1 % Foreign income taxes at rates other than the U.S. rate 1.1 % (3.5) % (1.8) % Change in valuation allowance 1.3 % (28.7) % (19.8) % Research and development credits 5.8 % 8.2 % 3.5 % Stock-based compensation (17.4) % (5.4) % (4.4) % Foreign inclusions (10.7) % — % (3.7) % Other — % 0.9 % 0.3 % Effective income tax rate (1.3) % (4.8) % (2.8) % 102 Table of Contents Significant components of our deferred tax assets and liabilities consisted of the following: December 31, 2024 December 31, 2023 Deferred tax assets: Net operating loss carryforwards $ 112,197 $ 130,849 Capitalized research and development costs 69,957 51,940 Research and development credits 47,508 42,764 Stock-based compensation 6,769 11,160 Lease liabilities 715 1,512 Deferred revenue 783 937 Accruals and reserves 1,290 813 Gross deferred tax assets 239,219 239,975 Valuation allowance (224,375) (225,513) Total deferred tax assets $ 14,844 $ 14,462 Deferred tax liabilities: Deferred commissions (6,614) (6,768) Depreciation and amortization (6,779) (5,810) Operating lease ROU assets (689) (1,070) Partnership income (233) — Total deferred tax liabilities $ (14,315) $ (13,648) Net deferred tax assets $ 529 $ 814 Based on the weight of the available evidence, which includes our historical operating losses, lack of taxable income, and the accumulated deficit, we have a full valuation allowance against our U.S. federal and state deferred tax assets as of December 31, 2024 and 2023.
Biggest changeINCOME TAXES The components of loss before income tax were as follows: Year Ended December 31, 2025 2024 2023 Domestic $ (55.4) $ (84.0) $ (118.5) Foreign 9.5 5.5 7.3 Total $ (45.9) $ (78.5) $ (111.2) 101 Table of Contents Income tax expense consisted of the following: Year Ended December 31, 2025 2024 2023 Current taxes: State $ (0.1) $ 0.7 $ — Foreign 5.3 — 5.0 Total current $ 5.2 $ 0.7 $ 5.0 Deferred taxes: Foreign $ (0.1) $ 0.3 $ 0.4 Total deferred $ (0.1) $ 0.3 $ 0.4 Total income tax expense $ 5.1 $ 1.0 $ 5.4 The reconciliation between the U.S. federal statutory income tax rate and our effective tax rate as a percentage of loss before income taxes was as follows: Year Ended December 31, 2025 2024 2023 U.S. federal statutory tax rate $ (9.8) 21.0 % $ (16.0) 21.0 % $ (23.4) 21.0 % State and local income taxes* (0.5) 1.2 % (0.5) 0.7 % (1.2) 1.1 % Effect of cross-border tax laws GILTI — — % — — % (5.9) 5.3 % Withholding tax (0.6) 1.4 % 0.4 (0.5) % (0.8) 0.7 % Partnership income 1.1 (2.4) % — — % — — % Other (0.1) 0.1 % — — % — — % Tax credits Research and development credits (2.5) 5.4 % (4.3) 5.7 % (12.2) 10.9 % Changes in valuation allowances 9.0 (19.4) % (1.8) 2.3 % 34.1 (30.6) % Nontaxable or nondeductible items Base erosion payment waived (5.1) 11.1 % 8.4 (11.0) % — — % Stock-based compensation 9.4 (20.2) % 13.7 (18.0) % 5.8 (5.2) % Other (0.2) 0.5 % 0.2 (0.3) % 0.2 (0.2) % Other adjustments 0.1 (0.1) % (0.4) 0.5 % (0.1) 0.1 % India Withholding tax 0.3 (0.6) % (2.4) 3.2 % 1.8 (1.6) % Other 0.3 (0.8) % 0.1 (0.2) % 0.1 (0.1) % Peru Withholding tax 0.5 (1.1) % 0.5 (0.6) % 0.5 (0.5) % Other foreign jurisdictions 2.0 (4.5) % 3.1 (4.1) % 1.6 (1.4) % Changes in unrecognized tax benefits 1.2 (2.6) % — — % 4.9 (4.3) % Total income tax expense $ 5.1 (11.0) % $ 1.0 (1.3) % $ 5.4 (4.8) % *Income taxes in California for 2023, 2024, and 2025 made up the majority (greater than 50%) of the state tax effect. 102 Table of Contents Significant components of our deferred tax assets and liabilities consisted of the following: December 31, 2025 December 31, 2024 Deferred tax assets: Net operating loss carryforwards $ 126.1 $ 112.2 Capitalized research and development costs 62.0 70.0 Research and development credits 51.1 47.5 Stock-based compensation 5.1 6.8 Transaction costs 2.7 — Lease liabilities 1.1 0.7 Deferred revenue 1.0 0.8 Accruals and reserves 1.2 1.3 Partnership income 1.0 — Gross deferred tax assets 251.3 239.3 Valuation allowance (236.4) (224.4) Total deferred tax assets $ 14.9 $ 14.9 Deferred tax liabilities: Deferred commissions (5.7) (6.6) Depreciation and amortization (7.9) (6.8) Operating lease ROU assets (0.8) (0.7) Partnership income — (0.2) Total deferred tax liabilities $ (14.4) $ (14.3) Net deferred tax assets $ 0.5 $ 0.6 Based on the weight of the available evidence, which includes our historical operating losses, lack of taxable income, and the accumulated deficit, we have a full valuation allowance against our U.S. federal and state deferred tax assets as of December 31, 2025 and 2024.
RSUs and PSUs RSUs grants have a service-based vesting condition, which is satisfied generally either (i) over four years with a 25% cliff vesting period after one year and 6.25% vesting each quarter thereafter for new hires, or (ii) over four years with 6.25% vesting each quarter for new grants to existing employees.
RSUs and PSUs RSUs have a service-based vesting condition, which is satisfied generally either (i) over four years with a 25% cliff vesting period after one year and 6.25% vesting each quarter thereafter for new hires, or (ii) over four years with 6.25% vesting each quarter for new grants to existing employees.
In October 2024, we announced a commitment to further reducing overall expenses, focus efforts, and prioritize future investments in key initiatives that we expect will drive long-term, sustainable growth. This initiative resulted in a reduction of our global workforce by approximately 9% creating capacity for targeted investments, as well as incremental profitability.
In October 2024, we announced a commitment to further reducing overall expenses, focus our efforts, and prioritize future investments in key initiatives that we expect will drive long-term, sustainable growth. This initiative resulted in a reduction of our global workforce by approximately 9% creating capacity for targeted investments, as well as incremental profitability.
Stock-based awards include restricted stock units (“RSUs”), stock options, performance stock units (“PSUs”) and restricted stock awards as well as stock purchase rights granted to employees under our employee stock purchase plan (“ESPP Rights”). 95 Table of Contents The fair value of RSUs, PSUs, and restricted stock awards is based on the fair value of our common stock on the grant date.
Stock-based awards include restricted stock units (“RSUs”), stock options, performance stock units (“PSUs”), performance-based stock options (“PSOs”), and restricted stock awards as well as stock purchase rights granted to employees under our employee stock purchase plan (“ESPP Rights”). 95 Table of Contents The fair value of RSUs, PSUs, and restricted stock awards is based on the fair value of our common stock on the grant date.
The expected volatility for ESPP Rights is based on the historical volatility of our common stock over the estimated expected term. Dividend Yield —The expected dividend was assumed to be zero as we have never paid dividends and have no current plans to do so.
The expected volatility for ESPP Rights is based on the historical volatility of our common stock over the estimated expected term. Dividend Yield —The expected dividend is assumed to be zero as we have never paid dividends and have no current plans to do so.
Significant items subject to such estimates, judgements, and assumptions include, but are not limited to, those related to the determination of principal versus agent and variable consideration in our revenue contracts; stock-based compensation expense; period of benefit for capitalized commissions; internal-use software costs; useful lives of long-lived assets; the carrying value of operating lease right-of-use assets; the valuation of intangible assets; loss contingencies and potential recoveries; and income tax expense, including the valuation of deferred tax assets and liabilities, among others.
Significant items subject to such estimates, judgments, and assumptions include, but are not limited to, those related to the determination of principal versus agent and variable consideration in our revenue contracts; stock-based compensation expense; period of benefit for capitalized commissions; internal-use software costs; useful lives of long-lived assets; the carrying value of operating lease right-of-use assets; the valuation of intangible assets; loss contingencies and potential recoveries; and income tax expense, including the valuation of deferred tax assets and liabilities, among others.
We only invest in high-credit-quality instruments and maintain our cash equivalents and marketable securities in fixed-income securities. We place our cash primarily with domestic financial institutions that are federally insured within statutory limits.
We only invest in high-credit-quality instruments and maintain our cash equivalents in fixed-income securities. We place our cash primarily with domestic financial institutions that are federally insured within statutory limits.
The Consumer segment targets individual learners seeking to obtain hands-on learning, gain valuable job skills, receive professional-level certifications, and otherwise increase their knowledge to start or advance their careers.
The Consumer segment targets individual learners seeking to obtain hands-on learning, gain valuable job skills, receive professional-level certifications or degrees, and otherwise increase their knowledge to start or advance their careers.
Consumer Revenue We generate revenue from consumers by selling access to learning content hosted on our platform. Consumer products include single course certifications, professional certificates, and catalog-wide subscriptions. Access to single courses is generally purchased at a fixed price for a set period of time, typically six months.
Consumer Revenue We generate revenue from consumers by selling access to learning content hosted on our platform. Consumer products include single course certifications, professional certificates, catalog-wide subscriptions and degree programs. Access to single courses is generally purchased at a fixed price for a set period of time, typically six months.
Accounts receivable deemed uncollectible are charged against the allowance for credit losses when identified. The allowance for credit losses and related activities were not material for the years ended December 31, 2024, 2023, and 2022. Property, Equipment, and Software, Net Property, equipment, and software, net is stated at cost, less accumulated depreciation and amortization.
Accounts receivable deemed uncollectible are charged against the allowance for credit losses when identified. The allowance for credit losses and related activities were not material for the years ended December 31, 2025, 2024, and 2023. Property, Equipment, and Software, Net Property, equipment, and software, net is stated at cost, less accumulated depreciation and amortization.
The classification of a financial asset or liability within the hierarchy is determined based on the lowest-level input that is significant to the fair value measurement. 94 Table of Contents Concentrations of Risk Financial instruments that potentially subject us to concentration of credit risk consist of cash, cash equivalents, and marketable securities.
The classification of a financial asset or liability within the hierarchy is determined based on the lowest-level input that is significant to the fair value measurement. 94 Table of Contents Concentrations of Risk Financial instruments that potentially subject us to concentration of credit risk consist of cash and cash equivalents.
The related stock-based compensation expense is recognized on a straight-line basis over the requisite service period. In March 2024, we granted PSUs to certain executives under the 2021 Plan. PSU grants have both performance and service-based vesting conditions.
The related stock-based compensation expense is recognized on a straight-line basis over the requisite service period. In 2024 and 2025, we granted PSUs to certain executives under the 2021 Plan. PSU grants have both performance and service-based vesting conditions.
If not utilized, certain federal and state NOLs will begin to expire at various dates beginning in 2036 and 2031, respectively, while the federal research and development tax credit carryforwards will start to expire in various amounts beginning in 2033. State research and development tax credit carryforwards can be carried forward indefinitely.
If not utilized, certain federal and state NOLs will begin to expire at various dates beginning in 2035 and 2031, respectively, while the federal research and development tax credit carryforwards will start to expire in various amounts beginning in 2033. State research and development tax credit carryforwards can be carried forward indefinitely.
Actual results could differ from those estimates, and any such differences could be material to our Consolidated Financial Statements. 89 Table of Contents Cash, Cash Equivalents, and Restricted Cash We consider all highly liquid investments with an original maturity of three months or less at the date of purchase to be cash equivalents.
Actual results could differ from those estimates, and any such differences could be material to our Consolidated Financial Statements. Cash, Cash Equivalents, and Restricted Cash We consider all highly liquid investments with an original maturity of three months or less at the date of purchase to be cash equivalents.
The time-based stock options have an exercise price of $7.81 per share of common stock and are scheduled to vest over four years, with 25% vesting on the first anniversary of the Start Date, and the remainder vesting in equal quarterly installments thereafter, subject to continued employment.
The service-based stock options have an exercise price of $7.81 per share and are scheduled to vest over four years, with 25% vesting on the first anniversary of the Start Date and the remainder vesting in equal quarterly installments thereafter, subject to continued employment.
Under the ESPP, if the closing market price of our common stock on the offering date of a new offering falls below the closing market price of our common stock on the offering date of an ongoing offering, the ongoing offering terminates immediately following the settlement of ESPP Rights shares on the purchase date.
Under the ESPP, if the closing market price of our common stock on the purchase date of an ongoing offering falls below the closing market price of our common stock on the offering date of an ongoing offering, the ongoing offering terminates immediately following the settlement of ESPP Rights shares on the purchase date.
Share Repurchase Program On April 26, 2023, our Board approved a share repurchase program with authorization to purchase up to $95,000 of our common stock, excluding commissions and fees. We funded these share repurchases with our existing cash and cash equivalents and completed the purchase authorization on May 7, 2024.
Share Repurchase Program On April 26, 2023, the Board approved a share repurchase program with authorization to purchase up to $95.0 million of our common stock, excluding commissions and fees. We funded these share repurchases with our existing cash and cash equivalents and completed the purchase authorization on May 7, 2024.
Fair Value Measurements Fair value is defined as the price that would be received for an asset or the ‘ exit price’ that would be paid to transfer a liability in the principal or most advantageous market in an orderly transaction between independent market participants on the measurement date.
Fair Value Measurements Fair value is defined as the price that would be received for an asset or the ‘exit price’ that would be paid to transfer a liability in the principal or most advantageous market in an orderly transaction between independent market participants on the measurement date.
Fixed fees for these services are generally recognized ratably over the contract term. We include any fixed consideration within our contracts as part of the total transaction price. Generally, we include an estimate of the variable amount within the total transaction price and update our assumptions over the duration of the contract.
Fixed fees for these services are generally recognized ratably over the contract term. 92 Table of Contents We include any fixed consideration within our contracts as part of the total transaction price. Generally, we include an estimate of the variable amount within the total transaction price and update our assumptions over the duration of the contract.
Research and Development Expenditures for the research and development of our technology and non-refundable contributions to develop educator partner content are expensed when incurred, unless they qualify as internal-use software development costs. Research and development costs primarily consist of personnel costs, consulting services, content development contributions, and attributed facilities costs.
Research and Development Expenditures for the research and development of our technology and non-refundable contributions to develop content creator content are expensed when incurred, unless they qualify as internal-use software development costs. Research and development costs primarily consist of personnel costs, consulting services, content development contributions, and attributed facilities costs.
Deferred Partner Fees These fulfillment costs, which are paid to educator partners in advance of completing our performance obligations, are recorded within prepaid expenses and other current assets or other assets in the Consolidated Balance Sheets, depending on the timing of the related revenue recognition. They are then amortized into cost of revenue ratably over the subscription term.
Deferred Partner Fees These fulfillment costs, which are paid to content creators in advance of completing our performance obligations, are recorded within prepaid expenses and other current assets or other assets in the Consolidated Balance Sheets, depending on the timing of the related revenue recognition. They are then amortized into cost of revenue ratably over the subscription term.
We are generally the principal with respect to our Consumer and Enterprise revenue arrangements as we control the performance obligation and are the primary obligor with respect to delivering access to course content. Additionally, we have inventory risk through recoupable advances sometimes paid to educator partners.
We are generally the principal with respect to our Consumer and Enterprise revenue arrangements as we control the performance obligation and are the primary obligor with respect to delivering access to course content. Additionally, we have inventory risk through recoupable advances sometimes paid to content creators.
In January 2024, we implemented a plan to restructure our Enterprise segment sales force and recognized restructuring related charges of $2,145 during the year ended December 31, 2024, all of which were paid within the same year.
In January 2024, we implemented a plan to restructure our Enterprise segment sales force and recognized restructuring related charges of $2.1 million during the year ended December 31, 2024, all of which were paid within the same year.
STOCKHOLDERS’ EQUITY Preferred Stock We have authorized the issuance of 10,000,000 shares of undesignated preferred stock with a par value of $0.00001 per share, with rights and preferences, including voting rights, to be designated from time to time by the Board. As of December 31, 2024, there were no shares of preferred stock issued or outstanding.
STOCKHOLDERS’ EQUITY Preferred Stock We have authorized the issuance of 10.0 million shares of undesignated preferred stock with a par value of $0.00001 per share, with rights and preferences, including voting rights, to be designated from time to time by the Board. As of December 31, 2025, there were no shares of preferred stock issued or outstanding.
These expenses include the cost of servicing support requests from paid learners and educator partners, hosting and bandwidth costs, amortization of acquired technology, internal-use software, and content assets, customer payment processing fees, and attributed facilities costs.
These expenses include the cost of servicing support requests from paid learners and content creators, hosting and bandwidth costs, amortization of acquired technology, internal-use software, and content assets, customer payment processing fees, and attributed facilities costs.
For the years ended December 31, 2024, 2023, and 2022, we did not have any customers that accounted for more than 10% of our revenue. As of December 31, 2024 and 2023, we had one customer that accounted for 12% and 10% of our net accounts receivable balance, both of which were collected within typical business terms.
For the years ended December 31, 2025, 2024, and 2023, we did not have any customers that accounted for more than 10% of our revenue. As of December 31, 2025 and 2024, we had one customer that accounted for 12% of our net accounts receivable balance for both years, which was collected within typical business terms.
All Consumer learners pay in advance, and revenue is recognized ratably over the contract term once access has been granted to the learner, as learners have unlimited access to the course content during the contract term. Consumer learners are entitled to a full refund up to two weeks after payment is received.
For the aforementioned Consumer products, learners pay in advance, and revenue is recognized ratably over the contract term once access has been granted to the learner, as learners have unlimited access to the course content during the contract term. Consumer learners are entitled to a full refund up to two weeks after payment is received.
The performance-based stock options also have an exercise price of $7.81 per share of common stock and are scheduled to vest upon satisfaction of both time- and market-based vesting conditions.
The performance-based stock options also have an exercise price of $7.81 per share and are scheduled to vest upon satisfaction of both service- and market-based vesting conditions.
Professional certificates are a series of courses offered by the same educator partner, with learners provided access on a month-to-month subscription basis. Coursera Plus is our catalog-wide consumer subscription product, sold in monthly or annual subscriptions.
Professional certificates are a series of courses offered by the same content creator, with learners provided access on a month-to-month subscription basis. Coursera Plus is our catalog-wide consumer subscription product, sold in monthly or annual subscriptions.
We also recognized a reversal of stock-based compensation expense of approximately $5,605 during the year ended December 31, 2023, resulting from the forfeiture of RSUs and stock options.
We also recognized a reversal of stock-based compensation expense of approximately $5.6 million during the year ended December 31, 2023, resulting from the forfeiture of RSUs and stock options.
Right-of-use (“ROU”) assets represent our right to use an underlying asset for the lease term and are included in operating lease ROU assets on our Consolidated Balance Sheets. Lease liabilities represent our obligation to make lease payments according to the arrangement and are included in operating lease liabilities, current and non-current, on our Consolidated Balance Sheets.
Right-of-use (“ROU”) assets represent our right to use an underlying asset for the lease term and are included in other assets on our Consolidated Balance Sheets. Lease liabilities represent our obligation to make lease payments according to the arrangement and are included in other current liabilities and other liabilities on our Consolidated Balance Sheets.
Educator Partner Costs We have various agreements with educator partners that grant us the right to host their intellectual property on our platform. In return, educator partners earn a fee that we recognize as a content cost in the same period in which the related revenue is recognized.
Content Creator Costs We have various agreements with content creators that grant us the right to host their intellectual property on our platform. In return, content creators earn a fee that we recognize as a content cost in the same period in which the related revenue is recognized.
Cost of Revenue Cost of revenue consists of content costs, which are typically fees paid to educator partners, and expenses associated with the operation and maintenance of our platform.
Cost of Revenue Cost of revenue consists of content costs, which are typically fees paid to content creators, and expenses associated with the operation and maintenance of our platform.
We estimate the fair value of stock options and ESPP Rights using the Black-Scholes option-pricing model, which requires the use of the following assumptions: Expected Term —The expected term represents the period that our stock-based awards are expected to be outstanding.
We estimate the fair value of stock options and ESPP Rights using the Black-Scholes option-pricing model and PSOs using a Monte Carlo simulation model, which requires the use of the following assumptions: Expected Term —The expected term represents the period that our stock-based awards are expected to be outstanding.
AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (In thousands, except share and per share amounts) 1.
AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (In millions, except per share amounts) 1.
When evaluating contract modifications, we must identify the performance obligations of the modified contract and determine both the allocation of revenues to the remaining performance obligations and the period of recognition for each identified performance obligation. We generate revenue from our three reportable segments: Consumer, Enterprise, and Degrees. Refer to Note 13 for our disaggregation of revenue.
When evaluating contract modifications, we must identify the performance obligations of the modified contract and determine both the allocation of revenues to the remaining performance obligations and the period of recognition for each identified performance obligation. We generate revenue from our two reportable segments: Consumer and Enterprise. Refer to Note 13, Segment and Geographic Information, for our disaggregation of revenue.
In November 2024, the FASB issued ASU 2024-03, Income Statement—Reporting Comprehensive Income—Expense Disaggregation Disclosures (Subtopic 220-40) , which requires disclosure, on an annual and interim basis, of specified disaggregated information about certain costs and expenses.
Recently Issued Accounting Pronouncements Not Yet Adopted In November 2024, the FASB issued ASU 2024-03, Income Statement—Reporting Comprehensive Income—Expense Disaggregation Disclosures (Subtopic 220-40), which requires disclosure, on an annual and interim basis, of specified disaggregated information about certain costs and expenses.
We amortize these costs over four years, as the commissions paid upon a contract renewal are not commensurate with the commissions paid on the initial contract, and as such, the sales contract term is not commensurate with the expected period of benefit.
These costs are deferred and then amortized on a straight-line basis over the expected period of benefit. We amortize these costs over four years, as the commissions paid upon a contract renewal are not commensurate with the commissions paid on the initial contract, and as such, the sales contract term is not commensurate with the expected period of benefit.
Our business model relies on educational content and credentialing programs from educator partners. Our largest educator partner has global brand recognition and supplies a variety of in-demand content across multiple domains.
Our business model relies on educational content and credentialing programs from content creators. Our largest content creator has global brand recognition and supplies a variety of in-demand content across multiple domains.
During the year ended December 31, 2024, we recognized an impairment loss of $1,000, within other expense, net in the Consolidated Statement of Operations, on a minority interest equity investment following a recapitalization event. No such events or changes occurred during the years ended December 31, 2023 or 2022. 5.
During the year ended December 31, 2024, we recognized an impairment loss of $1.0 million, within other expense, net in the Consolidated Statement of Operations, on a minority interest equity investment following a recapitalization event. No such events or changes occurred during the years ended December 31, 2025 or 2023. 98 Table of Contents 5.
If the future undiscounted cash flows are less than the carrying amount of these assets, we recognize an impairment loss based on the excess of the carrying amount over the fair value of the assets. Impairment losses related to long-lived assets were immaterial during the year ended December 31, 2024.
If the future undiscounted cash flows are less than the carrying amount of these assets, we recognize an impairment loss based on the excess of the carrying amount over the fair value of the assets. Impairment losses during the years ended December 31, 2024 and 2023 were immaterial.
The loss of or significant reduction in this partnership or one of our other largest educator partners could have a material adverse effect on our financial position, results of operations, and cash flows.
The loss of, or significant reduction in, this partnership or one of our other large content creator relationships could have a material adverse effect on our financial position, results of operations, and cash flows.
INVESTMENTS Investments Measured at Fair Value on a Recurring Basis The following table summarizes our investments measured at fair value on a recurring basis by balance sheet classification and investment type: December 31, 2024 December 31, 2023 Amortized Cost Fair Value - Level 1 Amortized Cost Fair Value - Level 1 Cash equivalents—money market funds $ 174,227 $ 174,227 $ 186,396 $ 186,396 Cash equivalents—U.S.
INVESTMENTS Investments Measured at Fair Value on a Recurring Basis The following table summarizes our investments measured at fair value on a recurring basis by balance sheet classification and investment type: December 31, 2025 December 31, 2024 Amortized Cost Fair Value - Level 1 Amortized Cost Fair Value - Level 1 Cash equivalents—U.S.
Enterprise contracts are typically between one and three years in length and consist of selling a fixed quantity of catalog licenses that grant each learner access to our learning platform and unlimited course enrollments over the license term. We recognize revenue ratably over the contract term once access has been granted to the Enterprise customer.
Enterprise contracts are typically between one and three years in length and consist of selling a fixed quantity of catalog licenses that grant each learner access to our learning platform and unlimited course enrollments over the license term.
We dispute the claims and intend to vigorously defend against them. Legal fees related to these matters were $1,466 during the year ended December 31, 2024. 105 Table of Contents Indemnifications In the normal course of business, we enter into contracts and agreements that contain a variety of representations and warranties and provide for the potential of general indemnification obligations.
Legal fees related to these matters were insignificant during the year ended December 31, 2025 and $1.5 million during the year ended December 31, 2024. 105 Table of Contents Indemnifications In the normal course of business, we enter into contracts and agreements that contain a variety of representations and warranties and provide for the potential of general indemnification obligations.
For the years ended December 31, 2024, 2023, and 2022, these costs were $62,390, $44,818, and $39,940. 96 Table of Contents Foreign Currency The majority of our sales contracts are denominated in U.S. dollars, and the functional currency of our international subsidiaries is also the U.S. dollar.
For the years ended December 31, 2025, 2024, and 2023, these costs were $106.5 million, $62.4 million, and $44.8 million. 96 Table of Contents Foreign Currency The majority of our sales contracts are denominated in U.S. dollars, and the functional currency of our international subsidiaries is also the U.S. dollar.
Under the 401(k) Plan, participating employees may elect to contribute up to 100% of their eligible compensation, subject to certain limitations. The 401(k) Plan provides for a discretionary employer-matching contribution. We made matching contributions of $1,611, $1,710, and $1,791 to the 401(k) Plan for the years ended December 31, 2024, 2023, and 2022. 109 Table of Contents 12.
Under the 401(k) Plan, participating employees may elect to contribute up to 100% of their eligible compensation, subject to certain limitations. The 401(k) Plan provides for a discretionary employer-matching contribution. We made matching contributions of $1.5 million, $1.6 million, and $1.7 million to the 401(k) Plan for the years ended December 31, 2025, 2024, and 2023. 12.
Use of Estimates The preparation of Consolidated Financial Statements in conformity with GAAP requires management to make estimates, judgments, and assumptions that affect the reported amounts of assets and liabilities and related disclosures as of the date of the Consolidated Financial Statements, as well as the reported amounts of revenue and expenses during the reporting period.
All intercompany balances and transactions have been eliminated in consolidation. 89 Table of Contents Use of Estimates The preparation of Consolidated Financial Statements in conformity with GAAP requires management to make estimates, judgments, and assumptions that affect the reported amounts of assets and liabilities and related disclosures as of the date of the Consolidated Financial Statements, as well as the reported amounts of revenue and expenses during the reporting period.
Based on vetting procedures, we believe that the remaining arbitration claims are not material. While we maintain insurance policies intended to provide coverage for the aforementioned claims and have notified our insurance carriers about these claims, there can be no assurance regarding if or to what extent our insurance may cover such claims or any future claims.
While we maintain insurance policies intended to provide coverage for the aforementioned claims and have notified our insurance carriers about these claims, there can be no assurance regarding if or to what extent our insurance may cover such claims or any future claims.
Recently Issued Accounting Pronouncements Not Yet Adopted In December 2023, the FASB issued ASU 2023-09, Income Taxes (Topic 740): Improvements to Income Tax Disclosures , which requires public entities on an annual basis to disclose (1) specific categories in the tax rate reconciliation and (2) income taxes paid disaggregated by jurisdiction.
Recent Accounting Pronouncements New Accounting Pronouncements Recently Adopted In December 2023, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) 2023-09, Income Taxes (Topic 740): Improvements to Income Tax Disclosures , which requires public entities on an annual basis to disclose (1) specific categories in the tax rate reconciliation and (2) income taxes paid disaggregated by jurisdiction.
In August 2024, we entered into a new operating lease agreement for office space in Mountain View, California to replace our existing headquarters lease. This resulted in the recognition of an operating lease ROU asset and operating lease liability of $3,038. The lease term commenced in September 2024 and terminates in June 2030.
In August 2024, we entered into an operating lease agreement for office space in Mountain View, California to replace our existing headquarters lease, resulting in the recognition of an operating lease right-of-use asset and operating lease liability of $3.0 million. The lease term commenced in September 2024 and terminates in June 2030.
If shares of treasury stock issued at a price lower than its cost, the loss is recorded to additional paid-in capital to the extent there are previous net gains included in the account. Losses in excess of previous net gains are recorded to accumulated deficit only once there is no additional paid-in capital.
If shares of treasury stock are reissued at a price higher than its cost, the gain is recorded to additional paid-in capital. If shares of treasury stock issued at a price lower than its cost, the loss is recorded to additional paid-in capital to the extent there are previous net gains included in the account.
Loss Contingencies We regularly review the status of each significant matter and assess its potential likelihood of loss or exposure. We record an accrual for loss contingencies for legal proceedings when we believe that an unfavorable outcome is both (i) probable and (ii) the amount or range of any possible loss can be reasonably estimated.
We record an accrual for loss contingencies for legal proceedings when we believe that an unfavorable outcome is both (i) probable and (ii) the amount or range of any possible loss can be reasonably estimated.
For the years ended December 31, 2024, 2023, and 2022, income tax benefits realized related to stock-based awards vested and exercised were $551, $1,326, and $387 due to cumulative losses and valuation allowances.
For the years ended December 31, 2025, 2024, and 2023, income tax benefits realized related to stock-based awards vested and exercised were $0.4 million, $0.6 million, and $1.3 million due to cumulative losses and valuation allowances.
In this calculation, common stock options, RSUs, PSUs, and ESPP Rights are considered to be common stock equivalents. However, they have been excluded from the calculation of diluted net loss per share attributable to common stockholders due to their anti-dilutive effect for the periods presented. Comprehensive Loss Comprehensive loss includes net loss and other comprehensive income (loss), net of tax.
However, they have been excluded from the calculation of diluted net loss per share attributable to common stockholders due to their anti-dilutive effect for the periods presented. Comprehensive Loss Comprehensive loss includes net loss and other comprehensive income (loss), net of tax.
As of December 31, 2024, based on attainment against the pre-established annual revenue target, 196,604, or 83.85%, of the PSUs are expected to vest in February 2025, subject to the performance attainment being certified following the filing of this Annual Report on Form 10-K.
As of December 31, 2025, based on attainment against the pre-established annual revenue target, 0.6 million units, or 110.66%. of the PSUs granted in 2025 are expected to vest in February 2026, subject to the performance attainment being certified following the filing of this Annual Report on Form 10-K.
The offering periods start on the first trading day on or after May 11 and November 11 of each year. As of December 31, 2024, 17,408,129 shares and 5,063,535 shares of our common stock were reserved for future issuance under the 2021 Plan and ESPP.
The offering periods start on the first trading day on or after May 11 and November 11 of each year. As of December 31, 2025, 14.8 million shares and 6.0 million shares of our common stock were reserved for future issuance under the 2021 Plan and ESPP.
This investment is classified within other assets in the Consolidated Balance Sheets. The carrying value of the investment was $1,701 as of December 31, 2024. Our existing equity investments are remeasured at fair value on a nonrecurring basis when an identifiable event or change in circumstance may have a significant adverse impact on its fair value.
The carrying value of the investment was $1.7 million as of both December 31, 2025 and 2024. Our existing equity investments are remeasured at fair value on a nonrecurring basis when an identifiable event or change in circumstance may have a significant adverse impact on its fair value.
As of December 31, 2024, we had remaining performance obligations of $333,214 and expect to recognize approximately 70% as revenue over the next 12 months and the remainder thereafter.
As of December 31, 2025, we had remaining performance obligations of $342.6 million and expect to recognize approximately 72% as revenue over the next 12 months and the remainder thereafter.
The aggregate intrinsic value of stock options exercised was $21,386, $72,649, and $57,311 for the years ended December 31, 2024, 2023, and 2022. The weighted-average grant date fair value of options granted for the years ended December 31, 2024, 2023, and 2022 was $4.39, $8.41, and $7.26.
The aggregate intrinsic value of stock options exercised was $19.9 million, $21.4 million, and $72.6 million for the years ended December 31, 2025, 2024, and 2023. The weighted-average grant date fair value of options granted for the years ended December 31, 2025, 2024, and 2023 was $4.59, $4.39, and $8.41.
During the first quarter of 2023, we entered into an amendment with this educator partner, who started earning typical content fees, which are recorded within cost of revenue in the Consolidated Statements of Operations. 90 Table of Contents Leases We determine if an arrangement is a lease and its classification at inception by evaluating various factors, including if the contract conveys the right to control the use of an identified asset for a period of time in exchange for consideration, among other facts and circumstances.
This cost is classified as a cost of revenue in the Consolidated Statements of Operations. 90 Table of Contents Leases We determine if an arrangement is a lease and its classification at inception by evaluating various factors, including if the contract conveys the right to control the use of an identified asset for a period of time in exchange for consideration, among other facts and circumstances.
The federal NOL carryforwards generated after December 31, 2017 have an indefinite carryforward period and are subject to an 80% deduction limitation based upon taxable income prior to NOL deduction.
The federal NOL carryforwards generated after December 31, 2017 have an indefinite carryforward period and are subject to an 80% deduction limitation based upon taxable income prior to NOL deduction. Of the total federal NOL carryforwards as of December 31, 2025, $439.7 million are carried forward indefinitely but are limited to 80% of taxable income.
The activity related to the unrecognized tax benefits was as follows: Year Ended December 31, 2024 2023 2022 Gross unrecognized tax benefits—beginning of period $ 22,535 $ 16,371 $ 12,539 Increases related to tax positions taken during current year 2,264 5,052 3,641 Increases related to tax positions taken during prior years 405 1,163 248 Decreases related to tax positions taken during prior years (2,484) (51) (57) Gross unrecognized tax benefits—end of period $ 22,720 $ 22,535 $ 16,371 We recognize interest and penalties related to unrecognized tax benefits in income tax expense.
The activity related to the unrecognized tax benefits was as follows: Year Ended December 31, 2025 2024 2023 Gross unrecognized tax benefits—beginning of period $ 22.7 $ 22.5 $ 16.4 Increases related to tax positions taken during current year 1.4 2.3 5.0 Increases related to tax positions taken during prior years 0.1 0.4 1.2 Decreases related to tax positions taken during prior years (0.2) (2.5) (0.1) Gross unrecognized tax benefits—end of period $ 24.0 $ 22.7 $ 22.5 We recognize interest and penalties related to unrecognized tax benefits in income tax expense.
We believe that we have provided adequate reserves for income tax uncertainties in all open tax years. We are not currently aware of uncertain tax positions that could result in significant additional payments, accruals, or other material deviations in the next 12 months. 8.
We are not currently aware of uncertain tax positions that could result in significant additional payments, accruals, or other material deviations in the next 12 months.
As a result, we recognize only the service fee we receive from the universities as our Degrees revenue. 93 Table of Contents Deferred Revenue Deferred revenue, or contract liabilities, consists of consideration recorded in advance of performance obligations being delivered and is classified as current or non-current based on the related period in which services are expected to be provided.
We recognize revenue ratably over the contract term once access has been granted to the Enterprise customer. 93 Table of Contents Deferred Revenue Deferred revenue, or contract liabilities, consists of consideration recorded in advance of performance obligations being delivered and is classified as current or non-current based on the related period in which services are expected to be provided.
Incremental direct costs associated with the repurchase of our common stock, including excise tax, are included in the cost of the shares acquired. We use the average cost method to account for reissuances of our treasury stock. If shares of treasury stock are reissued at a price higher than its cost, the gain is recorded to additional paid-in capital.
Treasury Stock We record repurchases of our common stock as treasury stock, at cost. Incremental direct costs associated with the repurchase of our common stock, including excise tax, are included in the cost of the shares acquired. We use the average cost method to account for reissuances of our treasury stock.
The Enterprise segment is focused on serving businesses, government organizations, and academic institutions by providing an online platform with access to job-relevant educational content enabling them to train, upskill, and reskill their employees, citizens, and students. The Degrees segment is primarily engaged in partnering with universities to deliver fully online bachelor’s and master’s degrees.
The Enterprise segment is focused on serving businesses, government organizations, and academic institutions by providing an online platform with access to job-relevant educational content enabling them to train, upskill, and reskill their employees, citizens, and students. The CODM measures the performance of each segment primarily based on its revenue and gross profit.
AND SUBSIDIARIES Consolidated Statements of Comprehensive Loss (In thousands) Year Ended December 31, 2024 2023 2022 Net loss $ (79,530) $ (116,554) $ (175,357) Change in unrealized (loss) gain on marketable securities, net of tax (59) 777 (466) Comprehensive loss $ (79,589) $ (115,777) $ (175,823) See notes to Consolidated Financial Statements. 86 Table of Contents COURSERA, INC.
AND SUBSIDIARIES Consolidated Statements of Comprehensive Loss (In millions) Year Ended December 31, 2025 2024 2023 Net loss $ (51.0) $ (79.5) $ (116.6) Change in unrealized (loss) gain on marketable securities, net of tax — (0.1) 0.8 Comprehensive loss $ (51.0) $ (79.6) $ (115.8) See Notes to Consolidated Financial Statements. 86 Table of Contents COURSERA, INC.
COMMITMENTS AND CONTINGENCIES Purchase Obligations Our purchase obligations primarily relate to a third-party cloud infrastructure agreement, subscription arrangements, and service agreements used to facilitate our operations. As of December 31, 2024, we had approximately $13,308 in future minimum payments due under our non-cancelable purchase obligations with a remaining term in excess of one year.
COMMITMENTS AND CONTINGENCIES Purchase Obligations Our purchase obligations primarily relate to a third-party cloud infrastructure agreement, subscription arrangements, and service agreements used to facilitate our operations. As of December 31, 2025, we had no material firm purchase commitments in excess of one year.
Stock option activity for the year ended December 31, 2024 was as follows: Number of Shares Weighted- Average Exercise Price Weighted- Average Remaining Contractual Term (in Years) Aggregate Intrinsic Value Balance—December 31, 2023 11,165,138 $ 7.03 5.22 $ 142,444 Granted 612,746 7.81 Exercised (2,462,129) 3.81 Canceled (215,494) 20.41 Balance—December 31, 2024 9,100,261 $ 7.64 4.97 $ 25,314 Options vested 7,828,120 $ 6.93 4.37 $ 24,891 Aggregate intrinsic value represents the difference between the exercise price of the stock options and the fair value of our common stock.
Stock option activity for the year ended December 31, 2025 was as follows: Number of Shares Weighted- Average Exercise Price Weighted- Average Remaining Contractual Term (in Years) Aggregate Intrinsic Value Balance—December 31, 2024 9.1 $ 7.64 4.97 $ 25.3 Granted 5.2 7.81 Exercised (3.0) 3.41 Canceled (0.2) 18.07 Balance—December 31, 2025 11.1 $ 8.63 6.54 $ 6.1 Options vested 5.3 $ 9.24 3.86 $ 6.1 Aggregate intrinsic value represents the difference between the exercise price of the stock options and the fair value of our common stock.
In November 2022, we enacted a plan to reduce our global workforce to better align our cost structure and personnel needs with our planned business objectives, growth opportunities, and operational priorities at the time.
RESTRUCTURING RELATED CHARGES In November 2022, we enacted a plan to reduce our global workforce to better align our cost structure and personnel needs with our planned business objectives, growth opportunities, and operational priorities at the time. During the year ended December 31, 2023, we made cash payments of $5.1 million related to this restructuring.
The complaint asserted claims for alleged violations of the Video Privacy Protection Act (“VPPA”), and alleged, among other things, that without consent or knowledge of the plaintiff, Coursera disclosed the video viewing history and certain other information of the plaintiff to a third-party company and made similar disclosures without the knowledge or consent of other unidentified users.
Privacy Arbitration Matters Law firms representing a significant number of purported claimants have threatened to file or filed arbitration demands for alleged violations of the Video Privacy Protection Act (“VPPA”) and allege, among other things, that without consent or knowledge of the plaintiffs, Coursera disclosed the video viewing history and certain other information of the plaintiffs to a third-party company and made similar disclosures without the knowledge or consent of other unidentified users.
The aggregate fair value of RSUs that vested was $80,106, $130,891, and $29,966 for the years ended December 31, 2024, 2023, and 2022.
The aggregate fair value of RSUs that vested was $67.4 million, $80.1 million, and $130.9 million for the years ended December 31, 2025, 2024, and 2023.
During the year ended December 31, 2024, we recognized restructuring related charges of $6,797, mainly consisting of personnel expenses, such as severance and benefits. Related cash payments of $2,722 were made in the year ended December 31, 2024. As of December 31, 2024, $4,522 remained unpaid and was recorded primarily in accrued compensation and benefits in the Consolidated Balance Sheets.
During the year ended December 31, 2024, we recognized restructuring related charges of $6.8 million, mainly consisting of personnel expenses, such as severance and benefits. Related cash payments of $2.7 million were made in the year ended December 31, 2024.
We recognize sublease income as a reduction to our operating lease expense on a straight-line basis over the sublease term. Refer to Note 6 for additional information. Internal-Use Software and Website Development Costs We capitalize certain costs associated with our internal-use software and website development during the application development stage.
We recognize sublease income as a reduction to our operating lease expense on a straight-line basis over the sublease term. Refer to Note 6, Leases , for additional information.
Additionally, in January 2025, the FASB issued ASU 2025-01, Income Statement-Reporting Comprehensive Income-Expense Disaggregation Disclosures (Subtopic 220-40) , to clarify the effective date of ASU 2024-03. ASU 2024-03 is effective for annual reporting periods beginning after December 15, 2026, and interim periods within annual reporting periods beginning after December 15, 2027. Early adoption is permitted.
Additionally, in January 2025, the FASB issued ASU 2025-01, Income Statement—Reporting Comprehensive Income—Expense Disaggregation Disclosures (Subtopic 220-40) , to clarify the effective date of ASU 2024-03.
If annual revenue is equal to or exceeds the threshold amount, 25% of the PSUs ultimately granted will vest after one year, and the remaining PSUs will vest quarterly 6.25% over the subsequent three years. The fair value of each unit is determined on the grant date, and the related stock-based compensation expense is recognized using the accelerated attribution method.
If annual revenue is equal to or exceeds the threshold amount, 25% of the PSUs ultimately granted will vest after one year, and 6.25% of the remaining PSUs will vest quarterly over the subsequent three years.
Stock-Based Compensation Expense A summary of the weighted-average assumptions we utilized to record stock-based compensation expense for stock options granted is as follows: Year Ended December 31, 2024 2023 2022 Fair value of common stock $ 7.81 $ 14.72 $ 12.80 Risk-free interest rate 3.5 % 3.7 % 3.1 % Expected term (in years) 6.1 6.1 6.1 Expected volatility 56.2 % 57.3 % 57.7 % Dividend yield — % — % — % The following table summarizes the assumptions used in estimating the fair value of ESPP Rights: Year Ended December 31, 2024 2023 2022 Risk-free interest rate 4.2% - 5.4% 3.9% - 5.5% 1.4% - 4.6% Expected term (in years) 0.5 - 2.0 0.5 - 2.0 0.5 - 2.0 Expected volatility 40.2% - 72.3% 39.2% - 61.0% 59.4% - 76.5% Dividend yield —% —% —% 108 Table of Contents Stock-based compensation expense is classified in the Consolidated Statements of Operations as follows: Year Ended December 31, 2024 2023 2022 Cost of revenue $ 2,657 $ 2,593 $ 3,089 Research and development 41,846 49,931 48,779 Sales and marketing 28,104 31,299 30,092 General and administrative 35,477 31,352 28,703 Restructuring related charges — (5,605) 122 Total $ 108,084 $ 109,570 $ 110,785 We capitalized $7,675, $7,055, and $5,407 of stock-based compensation related to our internal-use software during the years ended December 31, 2024, 2023, and 2022.
Stock-Based Compensation Expense A summary of the weighted-average assumptions we utilized to record stock-based compensation expense for stock options granted is as follows: Year Ended December 31, 2025 2024 2023 Fair value of common stock $ 7.81 $ 7.81 $ 14.72 Risk-free interest rate 4.4 % 3.5 % 3.7 % Expected term (in years) 7.1 6.1 6.1 Expected volatility 55.4 % 56.2 % 57.3 % Dividend yield — % — % — % The following table summarizes the assumptions used in estimating the fair value of ESPP Rights: Year Ended December 31, 2025 2024 2023 Risk-free interest rate 3.6% - 4.2% 4.2% - 5.4% 3.9% - 5.5% Expected term (in years) 0.5 - 2.0 0.5 - 2.0 0.5 - 2.0 Expected volatility 53.6% - 64.2% 40.2% - 72.3% 39.2% - 61.0% Dividend yield —% —% —% Stock-based compensation expense is classified in the Consolidated Statements of Operations as follows: Year Ended December 31, 2025 2024 2023 Cost of revenue $ 2.5 $ 2.7 $ 2.6 Research and development 34.8 41.8 49.9 Sales and marketing 20.8 28.1 31.3 General and administrative 38.6 35.5 31.4 Restructuring related charges (1.6) — (5.6) Total $ 95.1 $ 108.1 $ 109.6 We capitalized $7.7 million, $7.7 million, and $7.1 million of stock-based compensation related to our internal-use software during the years ended December 31, 2025, 2024, and 2023. 109 Table of Contents The table below presents unrecognized employee compensation cost related to unvested shares and the weighted-average period over which it is expected to be recognized as of December 31, 2025: December 31, 2025 Unrecognized employee compensation cost related to unvested shares Weighted-average period over which the compensation is expected to be recognized (in years) RSUs $ 140.4 2.6 Common stock options 20.6 2.9 ESPP Rights 3.2 0.8 PSUs 2.5 3.2 Income tax benefits recognized from stock-based compensation expense for the years ended December 31, 2025, 2024, and 2023 were $0.5 million, $0.7 million, and $0.8 million due to cumulative losses and valuation allowances.
RSU and PSU activity for the year ended December 31, 2024 was as follows: RSUs PSUs Number of Units Weighted-Average Grant Date Fair Value Aggregate Intrinsic Value Number of Units Weighted-Average Grant Date Fair Value Aggregate Intrinsic Value Unvested balance—December 31, 2023 18,361,046 $ 15.24 $ 355,653 — $ — $ — Granted (1) 9,691,336 11.45 300,416 14.36 Vested (7,803,108) 16.19 — — Forfeited (4,167,941) 13.96 (43,964) 14.36 Unvested balance—December 31, 2024 16,081,333 $ 12.82 $ 136,691 256,452 $ 14.36 $ 2,180 (1) For PSUs, the amount presented as the number of units granted is based on the performance condition being achieved at the target level.
RSU and PSU activity for the year ended December 31, 2025 was as follows: RSUs PSUs Number of Units Weighted-Average Grant Date Fair Value Aggregate Intrinsic Value Number of Units Weighted-Average Grant Date Fair Value Aggregate Intrinsic Value Unvested balance—December 31, 2024 16.1 $ 12.82 $ 136.7 0.3 $ 14.36 $ 2.2 Granted (1) 12.2 8.10 0.5 7.94 Vested (2) (7.0) 13.21 (0.1) 14.36 Forfeited (3) (4.1) 11.75 (0.1) 9.70 Unvested balance—December 31, 2025 17.2 $ 9.56 $ 126.3 0.6 $ 9.17 $ 4.4 108 Table of Contents (1) For PSUs, the amount presented as the number of units granted is based on the performance condition being achieved at the target level.
As of December 31, 2024, future expected amortization expense for intangible assets was as follows: 2025 $ 8,059 2026 5,498 2027 4,294 2028 4,004 2029 2,558 Thereafter 108 Total $ 24,521 6. LEASES We have entered into various non-cancelable office space operating leases, with lease periods expiring through June 2030.
As of December 31, 2025, future expected amortization expense for intangible assets was as follows: 2026 $ 9.0 2027 7.6 2028 5.8 2029 3.9 2030 0.8 Total $ 27.1 6. LEASES We have entered into various non-cancelable office space operating leases, with lease periods expiring through June 2030. These leases do not contain residual value guarantees, covenants, or other restrictions.

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Item 1A. Risk Factors

Risk Factors — what could go wrong, per management

279 edited+72 added−70 removed244 unchanged
Biggest changeIn particular, risks associated with our business include, among others, the following, any of which could have an adverse effect on our business, financial condition, results of operations, or prospects: • our historical growth may not be indicative of our future growth; • fluctuations in our quarterly and annual revenue and operating results could cause our stock price to fluctuate and the value of your investment to decline; • the evolution of our offerings coupled with our limited operating history makes it difficult to predict our future financial and operating results; • the nascency and market adoption of online learning solutions and generative AI, which may not grow or evolve as we expect, or lead to increased demand for our offerings; • changes in contractual terms with our educator partners, including with respect to pricing or contract length; • our ability to maintain and expand our partnerships with our educator partners; • our ability to attract and retain learners, including converting freemium learners to paid learners; • our ability to manage the growth of our business both in terms of scale and complexity; • changes in our contract terms, including our pricing models, for our offerings; • our ability to successfully expand our international operations, including growing our worldwide educator partner and learner base, and to manage the risks presented by such operations; • our ability to launch new offerings and services to learners to grow our business; • our ability to achieve or maintain profitability in the future; • our ability to improve operational efficiencies and operating costs, including through restructuring and expense reduction initiatives; • our ability to attract and retain key personnel and manage leadership transitions; • our ability to generate sufficient revenue from new offerings to offset our costs of the offerings; • our ability to compete effectively; • the impact of potential changes in laws and regulations applicable to us, our educator partners, learners, and customers, including changes to government spending policies or budget priorities that impact our business; • our, and our educator partners’, ability to comply with international, federal, and state education laws and regulations, including applicable state authorizations for their programs; • our educator partners’ ability to obtain timely approval from applicable regulatory agencies to offer new programs, make substantive changes to existing programs, or expand programs into or within certain jurisdictions; • any changes to the validation or applicability of the United States (“U.S.”) Department of Education “Dear Colleague” Letter (“DCL”), on which our Degrees business model relies; • our educator partners’ ability to maintain institutional or programmatic accreditation for their programs; • any disclosure of sensitive information about our learners, customers, educator partners, or their employees, whether due to cyberattack or otherwise; • any failure to obtain, maintain, protect, and enforce our intellectual property (“IP”) and proprietary rights and successfully defend against claims of infringement, misappropriation, or other violations of third-party IP; • any disruption or failure of our platform or operations, including as a result of geopolitical crises, natural disasters, public health crises, or other catastrophic events; • litigation or regulatory proceedings could adversely impact our business and financial condition, including exposing us to significant monetary damages or limiting our ability to operate our business; and 17 Table of Contents • risks related to our status as a Delaware public benefit corporation (“PBC”) or Certified B Corporation that may negatively impact our financial performance or reputation.
Biggest changeIn particular, risks associated with our business include, among others, the following, any of which could have an adverse effect on our business, financial condition, results of operations, or prospects: • our historical growth may not be indicative of our future growth and our growth may be adversely impacted by macroeconomic conditions; • fluctuations in our quarterly and annual revenue and operating results could cause our stock price to fluctuate and the value of your investment to decline; • the evolution of our offerings coupled with our limited operating history makes it difficult to predict our future financial and operating results; • the nascency and market adoption of online learning solutions and generative AI, which may not grow or evolve as we expect, or lead to increased demand for our offerings; • the expected timing and realization of the expected benefits of our Merger with Udemy; • our ability to complete the Merger and the impact of such failure on our business and financial results and the price of our common stock; • the Merger Agreement contains contractual restrictions to pursue alternatives to the Merger and provisions that could require us to pay a termination fee or other amounts to Udemy; • business uncertainties and contractual restrictions while the Merger is pending; • the impact of lawsuits filed in connection with the Merger, if any, resulting in substantial costs and/or delaying or preventing the completion of the Merger; • changes in contractual terms with our content creators, including with respect to pricing or contract length; • our ability to maintain and expand our partnerships with our content creators; • our ability to attract and retain learners, including converting freemium learners to paid learners; • our ability to adapt and respond effectively to rapidly changing technology, evolving industry standards, and changing customer needs or requirements; • our ability to manage the growth of our business both in terms of scale and complexity; • changes in our subscription or contract terms, including our pricing models, for our offerings; • our ability to successfully expand our international operations, including growing our worldwide content creator and learner base, and to manage the risks presented by such operations; • our ability to launch new offerings and services to learners to grow our business; • our ability to achieve or maintain profitability in the future; • our ability to improve operational efficiencies and operating costs, including through restructuring and expense reduction initiatives; • our ability to generate sufficient revenue from new offerings to offset our costs of the offerings; • our ability to compete effectively; • our ability to successfully execute acquisitions or other strategic transactions; • our ability to attract and retain key personnel and manage leadership transitions; • the impact of potential changes in laws and regulations applicable to us, our content creators, learners, and customers, including changes to government spending policies or budget priorities that impact our business, directly or indirectly, including through our content creators; • our, and our content creators’, ability to comply with international, federal, and state education laws and regulations, including applicable state authorizations; 18 Table of Contents • our, and our content creators’ ability to obtain timely approval from applicable regulatory agencies to offer new programs, make substantive changes to existing programs, or expand programs into or within certain jurisdictions; • our university partners’ ability to maintain institutional or programmatic accreditation for their programs; • any changes to the validation or applicability of the United States (“U.S.”) Department of Education “Dear Colleague” Letter (“DCL”), on which our degree programs rely; • any disclosure of personal, confidential, or otherwise sensitive information about our learners, customers, content creators, or their employees, whether due to cyberattack or otherwise; • any failure to obtain, maintain, protect, and enforce our intellectual property (“IP”) and proprietary rights and successfully defend against claims of infringement, misappropriation, or other violations of third-party IP; • any disruption or failure of our platform or operations, including as a result of geopolitical crises, natural disasters, public health crises, or other catastrophic events; • litigation or regulatory proceedings could adversely impact our business and financial condition, including exposing us to significant monetary damages or limiting our ability to operate our business; and • risks related to our status as a Delaware public benefit corporation (“PBC”) or Certified B Corporation that may negatively impact our financial performance or reputation.
For example, there is a risk that AI-generated information may be inaccurate or misleading, or not appropriately attribute authors or creators for their work (including if used in the context of content creation), or that students may use generative AI to draft written assignments or for other projects, any of which, absent sufficient and cost-effective methods to detect and prevent such risks, may devalue or undervalue the certificates and other credentials offered through our platform due to the actual or perceived threat of increased plagiarism or cheating, concerns of academic integrity, or appropriate and permissible use of AI.
For example, there is a risk that AI-generated content or information may be inaccurate or misleading, or not appropriately attribute authors or creators for their work (including if used in the context of content creation), or that students may use generative AI to draft written assignments or for other projects, any of which, absent sufficient and cost-effective methods to detect and prevent such risks, may devalue or undervalue the certificates and other credentials offered through our platform due to the actual or perceived threat of increased plagiarism or cheating, concerns of academic integrity, or appropriate and permissible use of AI.
Our growth strategy is dependent upon increasing sales of our Enterprise offerings to these entities, which we offer on a subscription basis. Changes to our subscription and pricing models could adversely affect our ability to attract and retain Enterprise customers, resulting in adverse impact to our revenue and financial condition.
Our growth strategy is dependent upon increasing sales of our Enterprise offerings to these entities, which we offer on a subscription basis. Changes to our pricing models could adversely affect our ability to attract and retain Enterprise customers, resulting in adverse impact to our revenue and financial condition.
There have been, and from time to time, there may continue to be, changes in our senior management team and key employees, which could disrupt our business. Some of senior management members have been with us for a short period of time, and we continue to develop key functions within various aspects of our business.
There have been, and from time to time, there may continue to be, changes in our senior management team and key employees, which could disrupt our business. Some senior management members have been with us for a short period of time, and we continue to develop key functions within various aspects of our business.
We are subject to complex and evolving laws and regulations worldwide that differ among jurisdictions and affect our operations in areas including, but not limited to: higher education; IP ownership and infringement; tax; import and export requirements; anti-corruption; data privacy requirements; consumer protection; employment and labor laws; and accounting and financial reporting.
We are subject to complex and evolving laws and regulations worldwide that differ among jurisdictions and affect our operations in areas including, but not limited to: higher education, IP ownership and infringement, tax, import and export requirements, anti-corruption, data privacy, consumer protection, employment and labor, and accounting and financial reporting.
Bribery Act, as well as other similar anti-bribery, anti-kickback laws, and anti-money laundering regulations. These laws and regulations generally prohibit companies, their employees, and their intermediaries from authorizing, offering, providing, and accepting improper payments or benefits for improper purposes. These laws also require that we keep accurate books and records and maintain compliance procedures designed to prevent any such actions.
Bribery Act, as well as other similar anti-bribery, anti-kickback, and anti-money laundering regulations. These laws and regulations generally prohibit companies, their employees, and their intermediaries from authorizing, offering, providing, and accepting improper payments or benefits for improper purposes. These laws also require that we keep accurate books and records and maintain compliance procedures designed to prevent any such actions.
Acquisitions involve many risks, including the following: • an acquisition may negatively affect our results of operations and financial condition because it may require us to incur charges or assume substantial debt or other liabilities, may cause adverse tax consequences or unfavorable accounting treatment, may expose us to claims and disputes by third parties, including IP claims and disputes, or may not generate sufficient financial return to offset additional costs and expenses related to the acquisition; • we may encounter difficulties or unforeseen expenditures in integrating the business, technologies, products, personnel, or operations of any entity or business that we acquire, particularly if key personnel of the acquired entity or business decide not to work for us; • an acquisition may disrupt our ongoing business and distract our management; • an acquisition may result in a delay or reduction of customer purchases for both us and the entity or business we acquired due to customer uncertainty about continuity and effectiveness of service; • an acquisition may involve entry into geographic or business markets in which we have little or no prior experience or where competitors have stronger market positions; • we may face challenges inherent in effectively managing an increased number of employees in diverse locations; • we may experience strain on our financial and managerial controls and reporting systems and procedures; • our use of cash to pay for acquisitions would limit other potential uses for our cash; • if we incur debt to fund such acquisitions, such debt may subject us to material restrictions on our ability to conduct our business; • we may incur impairment charges related to potential write-downs of acquired assets or goodwill; and • to the extent that we issue a significant amount of equity or equity-based securities in connection with an acquisition, existing stockholders may be diluted.
Acquisitions involve many risks, including the following: • an acquisition may negatively affect our results of operations and financial condition because it may require us to incur charges or assume substantial debt or other liabilities, may cause adverse tax consequences or unfavorable accounting treatment, may expose us to claims and disputes by third parties, including IP claims and disputes, or may not generate sufficient financial return to offset additional costs and expenses related to the acquisition; • we may encounter difficulties or unforeseen expenditures in integrating the business, technologies, products, personnel, or operations of any entity or business that we acquire, particularly if key personnel of the acquired entity or business decide not to work for us; • an acquisition may disrupt our ongoing business and distract our management; • an acquisition may result in a delay or reduction of customer purchases for both us and the entity or business we acquired due to customer uncertainty about continuity and effectiveness of service; • an acquisition may involve entry into geographic or business markets in which we have little or no prior experience or where competitors have stronger market positions; • we may face challenges inherent in effectively managing an increased number of employees in diverse locations; • we may experience strain on our financial and managerial controls and reporting systems and procedures; • our use of cash to pay for acquisitions would limit other potential uses for our cash; • if we incur debt to fund such acquisitions, such debt may subject us to material restrictions on our ability to conduct our business; 33 Table of Contents • we may incur impairment charges related to potential write-downs of acquired assets or goodwill; and • to the extent that we issue a significant amount of equity or equity-based securities in connection with an acquisition, existing stockholders may be diluted.
In the EU, data protection authorities may impose large penalties for violations of the data protection laws, including potential fines of up to €20 million or 4% of annual global revenue, whichever is greater. The authorities have shown a willingness to impose significant fines on businesses and issue orders preventing them from processing personal data.
In the EU, data protection authorities may impose large penalties for violations of the data protection laws, including potential fines of up to €20 million or 4% of annual global revenue, whichever is greater. Data protection authorities have shown a willingness to impose significant fines on businesses and issue orders preventing them from processing personal information.
Any decreased use of our platform or limitation on our ability to export or sell our platform would adversely affect our business, results of operations, and financial results. We are also subject to various domestic and international anti-corruption laws, such as the U.S. Foreign Corrupt Practices Act and the U.K.
Any decreased use of our platform or limitation on our ability to export or sell our platform would adversely affect our business, results of operations, and financial results. We are also subject to domestic and international anti-corruption laws, such as the U.S. Foreign Corrupt Practices Act and the U.K.
The European Commission issued an adequacy decision in respect of the EU-U.S. Data Privacy Framework (the “Framework”) on July 10, 2023, permitting transfers of personal data from the EU to U.S. organizations certified under the Framework, without additional transfer mechanisms. The Framework also applies to transfers from the UK to the U.S. as of October 12, 2023.
The European Commission issued an adequacy decision in respect of the EU-U.S. Data Privacy Framework (the “Framework”) on July 10, 2023, permitting organizations certified under the Framework to transfer personal information from the EU to U.S. without additional transfer mechanisms. The Framework also applies to transfers from the UK to the U.S. as of October 12, 2023.
Bribery Act; • creation and distribution of content that may be misaligned with U.S. or foreign country interests, cultural norms, or regulations; • increased financial accounting and reporting burdens and complexities; • risks associated with foreign tax regimes, trade tariffs, foreign investment restrictions or requirements, or similar issues, which could negatively impact international adoption of our offerings; • adverse tax consequences, including corporate tax consequences, such as double taxation, transfer pricing burdens, taxation of dividends, value added taxes, digital services taxes, and withholding taxes; • difficulties in managing foreign business operations, including the potential need to localize our business infrastructure, translating our policies and information technology systems into the local language, and local challenges related to technology as well as internet speed and availability, among other challenges; and • regional, global, economic, and political conditions, including geopolitical tensions or hostilities within or beyond areas where we currently have, or may in the future have, international operations, such as the ongoing conflicts and unrest in Ukraine and the Middle East.
Bribery Act; • creation and distribution of content that may be misaligned with U.S. or foreign country interests, cultural norms, or regulations; • increased financial accounting and reporting burdens and complexities; • risks associated with foreign tax regimes, trade tariffs, foreign investment restrictions or requirements, or similar issues, which could negatively impact international adoption of our offerings; • adverse tax consequences, including corporate tax consequences, such as double taxation, transfer pricing burdens, taxation of dividends, value added taxes, digital services taxes, and withholding taxes; • difficulties in managing foreign business operations, including the potential need to localize our business infrastructure, translating our policies and information technology systems into the local language, and local challenges related to technology as well as internet speed and availability, among other challenges; and • regional, global, economic, and political conditions, including increases in anti-U.S. sentiment and geopolitical tensions or hostilities within or beyond areas where we currently have, or may in the future have, international operations, such as the ongoing conflicts and unrest in Ukraine and the Middle East.
As a result, our culture, information technology requirements, cybersecurity risk, and business operations could be adversely affected. Risks Related to Regulatory Matters and Litigation Laws and regulations can have a negative impact on our business.
As a result, our culture, information technology requirements, cybersecurity risk, and business operations could be adversely affected. Risks Related to Regulatory Matters and Litigation Laws and regulations could have a negative impact on our business.
In addition, we face risks in doing business internationally, including risks associated with sales to international governments and entities that could constrain our operations, increase our cost structure, compromise our growth prospects, lead to escalating enforcement actions, and damage our reputation, including: • the need to localize and adapt online credentialing programs for specific countries, including language translations and ensuring that these programs enable our educator partners to comply with local education laws and regulations; • local laws restricting learners from pursuing certifications, degrees, or other credentials through online education platforms such as ours or limiting the availability of financial aid to finance online education; • different data privacy and protection laws, see “Risk Factors—Risks Related to Privacy, Cybersecurity, and Infrastructure”; • difficulties in staffing and managing employees and contractors in foreign countries, including in countries in which workers based outside of the U.S. may become part of labor unions, employee representative bodies, workers’ councils, or collective bargaining agreements, and challenges relating to labor shortages, government shutdowns, work stoppages, such as labor strikes or lockouts, or slowdowns; • risks related to employee travel, including illness or accident, detention by foreign authorities, poor transportation infrastructure or services, kidnapping, natural or manmade disasters, or the outbreak of hostilities or war; • different pricing environments, longer sales cycles, longer accounts receivable payment cycles, restrictions on remitting payments to the U.S. or converting local currency into U.S. dollars, difficulties in adopting and supporting new and different payment preferences, increased credit risk, levels of payment fraud, and non-payment from customers; • new and different sources of competition and practices, which may favor local competitors; 23 Table of Contents • weaker protection for IP and other legal and contractual rights than in the U.S., and practical difficulties in enforcing IP and other rights outside of the U.S., including legal and contractual rights, and differing expectations regarding ongoing contractual obligations in the face of changed circumstances; • compliance and operational challenges related to the complexity of multiple, conflicting, and changing laws and regulations addressing, but not limited to, employment, tax, privacy, data protection, consumer protection, foreign investment restrictions or requirements, economic sanctions, export controls, advertising, boycotting, money laundering, supply chain transparency, modern slavery, bribery, and corruption, such as the U.S.
In addition, we face risks in doing business internationally, including risks associated with sales to international governments and entities that could constrain our operations, increase our cost structure, compromise our growth prospects, lead to escalating enforcement actions, and damage our reputation, including: • the need to localize and adapt online credentialing programs for specific countries, including language translations and ensuring that these programs enable our content creators to comply with local education laws and regulations; • local laws restricting learners from pursuing certifications, degrees, or other credentials through online education platforms such as ours or limiting the availability of financial aid to finance online education; • different data privacy and protection laws, see “Risk Factors—Risks Related to Privacy, Cybersecurity, and Infrastructure;” 25 Table of Contents • difficulties in staffing and managing employees and contractors in foreign countries, including in countries in which workers based outside of the U.S. may become part of labor unions, employee representative bodies, workers’ councils, or collective bargaining agreements, and challenges relating to labor shortages, government shutdowns, work stoppages, such as labor strikes or lockouts, or slowdowns; • risks related to employee travel, including illness or accident, detention by foreign authorities, poor transportation infrastructure or services, kidnapping, natural or manmade disasters, or the outbreak of hostilities or war; • different pricing environments, longer sales cycles, longer accounts receivable payment cycles, restrictions on remitting payments to the U.S. or converting local currency into U.S. dollars, difficulties in adopting and supporting new and different payment preferences, increased credit risk, levels of payment fraud, and non-payment from customers; • new and different sources of competition and practices, which may favor local competitors; • weaker protection for IP and other legal and contractual rights than in the U.S., and practical difficulties in enforcing IP and other rights outside of the U.S., including legal and contractual rights, and differing expectations regarding ongoing contractual obligations in the face of changed circumstances; • compliance and operational challenges related to the complexity of multiple, conflicting, and changing laws and regulations addressing, but not limited to, employment, tax, privacy, data protection, consumer protection, foreign investment restrictions or requirements, economic sanctions, export controls, advertising, boycotting, money laundering, supply chain transparency, modern slavery, bribery, and corruption, such as the U.S.
The harm may be immediate without affording us an opportunity for redress or correction and could have a material adverse effect on our reputation, business, operating results, financial condition, and prospects. 49 Table of Contents Risks Related to Intellectual Property Any failure to obtain, maintain, protect, or enforce our IP and proprietary rights could impair our ability to protect our proprietary technology and our brand and could materially harm our business.
The harm may be immediate without affording us an opportunity for redress or correction and could have a material adverse effect on our reputation, business, operating results, financial condition, and prospects. 47 Table of Contents Risks Related to Intellectual Property Any failure to obtain, maintain, protect, or enforce our IP and proprietary rights could impair our ability to protect our proprietary technology and our brand and could materially harm our business.
These laws, rules, and regulations may be inconsistent from one jurisdiction to another, subject to differing interpretations, and may be interpreted to conflict with our practices. 48 Table of Contents Additionally, we may be bound by contractual requirements applicable to our collection, use, processing, and disclosure of various types of data, including personal information, and may be bound by, or voluntarily comply with, self-regulatory or other industry standards relating to these matters.
These laws, rules, and regulations may be inconsistent from one jurisdiction to another, subject to differing interpretations, and may be interpreted to conflict with our practices. 46 Table of Contents Additionally, we may be bound by contractual requirements applicable to our collection, use, processing, and disclosure of various types of data, including personal information, and may be bound by, or voluntarily comply with, self-regulatory or other industry standards relating to these matters.
In addition, litigation expense and the timing of these expenses from period to period are difficult to estimate, subject to change, and could adversely affect our financial condition and results of operations.
In addition, litigation expenses and the timing of these expenses from period to period are difficult to estimate, subject to change, and could adversely affect our financial condition and results of operations.
If we fail to comply with these rules or requirements, we may be subject to additional fines and higher transaction fees and lose our ability to accept online payments, and our business and operating results could be adversely affected. 46 Table of Contents Our business depends to a significant degree on continued access to the internet and mobile networks.
If we fail to comply with these rules or requirements, we may be subject to additional fines and higher transaction fees and lose our ability to accept online payments, and our business and operating results could be adversely affected. 44 Table of Contents Our business depends to a significant degree on continued access to the internet and mobile networks.
We must undergo a reassessment every three years to maintain our B Corp certification, and we last completed such assessment in 2022. B Lab’s certification requirements are subject to periodic changes and updates, including a recently-released proposed new framework, which if adopted in its present form, could make it more difficult to achieve certification.
We must undergo a reassessment every three years to maintain our B Corp certification, and we last completed such assessment in 2025. B Lab’s certification requirements are subject to periodic changes and updates, including a recently-released proposed new framework, which if adopted in its present form, could make it more difficult to achieve certification.
Our ability to effectively manage any significant increase in the rate or volume of learner enrollments and retention or in the volume of new content or programs will depend on a number of factors, including our ability to: • assist our educator partners in developing, launching, and maintaining an increased volume of engaging educational content that is accessible to a wide variety of learners; • successfully introduce new features and enhancements on our platform; • maintain a high level of functionality, cross-functionality, and technological robustness of our platform; and • deliver high-quality professional services and support (including training, implementation, and consulting services) to our educator partners, their employees, and learners on our platform.
Our ability to effectively manage any significant increase in the rate or volume of learner enrollments and retention or in the volume of new content or programs will depend on a number of factors, including our ability to: • assist our content creators in developing, launching, and maintaining an increased volume of engaging educational content that is accessible to a wide variety of learners; • successfully introduce new features and enhancements on our platform; • maintain a high level of functionality, cross-functionality, and technological robustness of our platform; and • deliver high-quality professional services and support (including training, implementation, and consulting services) to our content creators, their employees, and learners on our platform.
For example, in February 2025, Mr. Hart joined us as our President, Chief Executive Officer, and Board member. The loss of one or more of our senior management members or other key employees, or the failure of our senior management team to work together effectively, develop strategies, and execute our plans, could harm our business.
For example, in February 2025, Gregory Hart joined us as our President, Chief Executive Officer, and Board member. The loss of one or more of our senior management members or other key employees, or the failure of our senior management team to work together effectively, develop strategies, and execute our plans, could harm our business.
Any failure or claim of our failure to comply, or any failure by our third-party service providers to comply, could cost us substantial resources, result in liabilities, or force us to stop offering certain third-party payment services. In addition, as we grow our international leaner and customer base, we believe we will need to accommodate more local payment methods.
Any failure or claim of our failure to comply, or any failure by our third-party service providers to comply, could cost us substantial resources, result in liabilities, or force us to stop offering certain third-party payment services. In addition, as we grow our international learner and customer base, we believe we will need to accommodate more local payment methods.
If these service providers do not perform adequately, terminate their relationships with us, refuse to renew their agreements on commercially reasonable terms, or impose additional requirements, we may need to find alternate payment processors. We may not be able to secure similar terms or replace such payment processors in an acceptable timeframe.
If these service providers do not perform adequately, terminate their relationships with us, refuse to renew their agreements on commercially reasonable terms, or impose additional requirements, we may need to find alternative payment processors. We may not be able to secure similar terms or replace such payment processors in an acceptable timeframe.
The GDPR also provides individuals with various rights in respect of their personal data, including rights of access, erasure, portability, rectification, restriction, and objection. Complying with the GDPR remains an onerous and potentially costly obligation as interpretations of the specific requirements emerge through the courts, enforcement decisions, and regulatory guidance.
The GDPR also provides individuals with various rights in respect of their personal information, including rights of access, erasure, portability, rectification, restriction, and objection. Complying with the GDPR remains an onerous and potentially costly obligation as interpretations of the specific requirements emerge through the courts, enforcement decisions, and regulatory guidance.
Our ability to effectively manage the growth of our business will depend on a number of factors, including our ability to: • effectively recruit, integrate, train, and motivate new employees while retaining high-performing employees that help us effectively execute our business plan; • continue to improve our operational, financial, and management controls; • protect and further develop our strategic assets, including our IP rights; and • make sound business decisions in light of the scrutiny associated with operating as a public company.
Our ability to effectively manage the growth of our business will depend on a number of factors, including our ability to: • effectively recruit, integrate, train, and motivate new employees while retaining high-performing employees that help us effectively execute our business plan; • continue to improve our operational, financial, and management controls; 24 Table of Contents • protect and further develop our strategic assets, including our IP rights; and • make sound business decisions in light of the scrutiny associated with operating as a public company.
If we are unable to scale our platform, maintain and increase its interoperability, develop an increasingly robust mix of engaging content, or otherwise manage new offerings effectively, our ability to grow our business and achieve profitability would be impaired, and the quality of our solutions, access to learner information and progress, and the satisfaction of our educator partners, learners, and customers could suffer, or our educator partners could transition content hosted on our platform to other providers, while we continue to provide certain services.
If we are unable to scale our platform, maintain and increase its interoperability, develop an increasingly robust mix of engaging content, or otherwise manage new offerings effectively, our ability to grow our business and achieve profitability would be impaired, and the quality of our solutions, access to learner information and progress, and the satisfaction of our content creators, learners, and customers could suffer, or our content creators could transition content hosted on our platform to other providers, while we continue to provide certain services.
Although we do not directly collect, transmit, and store financial information, such as credit cards and other payment information, except in very limited circumstances related to Enterprise customers, we utilize third-party payment processors who provide these services on our behalf.
Although we do not directly collect, transmit, and store financial information, such as credit cards and other payment information, except in very limited circumstances related to Enterprise customers, we utilize third-party payment processors who provide payment processing services on our behalf.
A number of factors could impact our ability to compete, including: • the availability or development of alternative online education services that are, or are perceived to be, more compelling than ours; • changes in pricing policies and terms offered by our competitors or by us; • our ability to adapt to new technologies and changing requirements of our learners, customers, and educator partners; • learner and customer acquisition and retention costs; • the ability of our current and future competitors to establish relationships with businesses, government organizations, academic institutions, and other organizations to enhance their services and expand their customer base; and • industry consolidation and the number and rate of new entrants.
A number of factors could impact our ability to compete, including: • the availability or development of alternative online education services that are, or are perceived to be, more compelling than ours; • changes in pricing policies and terms offered by our competitors or by us; • our ability to adapt to new technologies and changing requirements of our learners, customers, and content creators; • learner and customer acquisition and retention costs; • the ability of our current and future competitors to establish relationships with businesses, government organizations, academic institutions, and other organizations to enhance their services and expand their customer base; and • industry consolidation and the number and rate of new entrants.
For example, if a natural disaster, power outage, connectivity issue, or other event occurred that impacted our employees’ ability to work remotely, it may be difficult for us to continue components of our business for a period of time.
For example, if a natural disaster, widespread fire, power outage, connectivity issue, or other event occurred that impacted our employees’ ability to work remotely, it may be difficult for us to continue components of our business for a period of time.
We do not have control over their operations or their facilities, and these facilities may be vulnerable to damage or interruption from natural disasters, cybersecurity attacks, terrorist attacks, power outages, and similar events or acts of misconduct. 45 Table of Contents If we do not maintain the compatibility of our learning management platform with third-party applications that our customers use, our revenue will decline.
We do not have control over their operations or their facilities, and these facilities may be vulnerable to damage or interruption from natural disasters, cybersecurity attacks, terrorist attacks, power outages, and similar events or acts of misconduct. If we do not maintain the compatibility of our learning management platform with third-party applications that our customers use, our revenue will decline.
Data subjects and consumer associations also have a right of action to lodge complaints with supervisory authorities, seek judicial remedies, and obtain compensation for damages resulting from violations of applicable data protection laws. In addition, privacy advocates and industry groups have regularly proposed, and may propose in the future, self-regulatory standards that may legally or contractually apply to us.
Individuals and consumer associations also have a right of action to lodge complaints with data protection authorities, seek judicial remedies, and obtain compensation for damages resulting from violations of applicable data protection laws. In addition, privacy advocates and industry groups have regularly proposed, and may propose in the future, self-regulatory standards that may legally or contractually apply to us.
Instructors and learners featured in video segments hosted on our platform may claim that we did not obtain proper assignments, licenses, consents, and releases for using their likenesses, images, or other contributed content. Although our educator partners are contractually required to secure these rights for their course material, we cannot be certain that they have done so.
Instructors and learners featured in video segments hosted on our platform may claim that we did not obtain proper assignments, licenses, consents, and releases for using their likenesses, images, or other contributed content. Although our content creators are contractually required to secure these rights for their course material, we cannot be certain that they have done so.
Conversely, a decline in employment opportunities or economic conditions may reduce employers’ willingness to sponsor adult learning opportunities for employees given a lack of employer need for enhanced skill sets or an inability to fund such programs.
Conversely, a decline in employment opportunities or economic conditions may reduce employers’ willingness to sponsor adult learning or workforce skilling opportunities for employees given a lack of employer need for enhanced skill sets or an inability to fund such programs.
In addition, as we develop and roll out new offerings, or expand existing offerings, we will need to develop pricing and contract models for these offerings that appeal to learners and customers over time, and we may not be successful in doing so.
In addition, as we develop and roll out new offerings, or expand existing offerings, we will need to develop pricing and access models for these offerings that appeal to learners and customers over time, and we may not be successful in doing so.
However, advances in computer capabilities, increasingly sophisticated tools and methods used by hackers and cyberterrorists, new discoveries in the field of cryptography, or other developments may result in our failure or inability to adequately protect sensitive information.
However, advances in computer capabilities, increasingly sophisticated tools and methods used by hackers and cyberterrorists, new discoveries in the field of cryptography, or other developments may result in our failure or inability to adequately protect this information.
The loss of or reduction in content and programs from these and other educator partners could negatively affect our ability to sustain or generate revenue or reach future profitability, and would materially and adversely affect our business, financial condition, or results of operation if we are unable to timely secure comparable educational content and credentialing programs at a favorable cost from other educator partners.
The loss of or reduction in content and programs from these and other content creators could negatively affect our ability to sustain or generate revenue or reach future profitability, and would materially and adversely affect our business, financial condition, or results of operation if we are unable to timely secure comparable educational content and credentialing programs at a favorable cost from other content creators.
Negative changes in the estimated fair value of private companies in which we invest could have a material adverse effect on our results of operations and financial condition. 32 Table of Contents Our directors may encounter conflicts of interest involving us and other organizations with which they may be affiliated, including matters that involve corporate opportunities.
Negative changes in the estimated fair value of private companies in which we invest could have a material adverse effect on our results of operations and financial condition. Our directors may encounter conflicts of interest involving us and other organizations with which they may be affiliated, including matters that involve corporate opportunities.
If our strategy does not lead to expected growth or if we are ultimately unable to achieve results of operations at the levels expected by securities analysts and investors, our stock price would likely decline. Our results of operations could be adversely affected by natural disasters, public health crises, political crises, geopolitical crises, or other catastrophic events.
If our strategy does not lead to expected growth or if we are ultimately unable to achieve results of operations at the levels expected by securities analysts and investors, our stock price would likely decline. 35 Table of Contents Our results of operations could be adversely affected by natural disasters, public health crises, political crises, geopolitical crises, or other catastrophic events.
Additionally, the vast majority of our U.S.-based university partners participate in the federal student financial assistance programs under Title IV of the Higher Education Act of 1965, as amended (respectively, “Title IV” and “HEA”), and are subject to extensive regulation by the U.S. Department of Education (“DOE”), as well as various state agencies, licensing boards, and accrediting agencies.
Additionally, the vast majority of our U.S.-based university partners participate in the federal student financial assistance programs under Title IV of the Higher Education Act of 1965, as amended (respectively, “Title IV” and “HEA”), and are subject to extensive regulation by the DOE, as well as various state agencies, licensing boards, and accrediting agencies.
We must provide our learners with the ability to access our platform on a frequent and reliable basis, and our educator partners rely on the availability of our platform to offer their content online. Our platform is complex and relies on cloud infrastructure provided by third parties, and may contain defects, errors, or vulnerabilities, or may not perform as contemplated.
We must provide our learners with the ability to access our platform on a frequent and reliable basis, and our content creators rely on the availability of our platform to offer their content online. Our platform is complex and relies on cloud infrastructure provided by third parties, and may contain defects, errors, or vulnerabilities, or may not perform as contemplated.
If we cannot license or develop technology for any allegedly infringing aspect of our business, we would be forced to limit our service and may be unable to compete effectively. Any of these results could harm our business. 50 Table of Contents Confidentiality agreements with employees and others may not adequately prevent disclosure of trade secrets and proprietary information.
If we cannot license or develop technology for any allegedly infringing aspect of our business, we would be forced to limit our service and may be unable to compete effectively. Any of these results could harm our business. Confidentiality agreements with employees and others may not adequately prevent disclosure of trade secrets and proprietary information.
Companies are facing increasing scrutiny from customers, partners, regulators, investors, and other stakeholders related to their ESG practices and disclosures. Investor advocacy groups, investment funds, and influential investors are also increasingly focused on these practices, especially as they relate to the environment, health and safety, diversity, labor conditions, and human rights.
Companies are facing increasing scrutiny from customers, regulators, governments, investors, employees, and other stakeholders related to their ESG practices and disclosures. Investor advocacy groups, investment funds, and influential investors are also increasingly focused on these practices, especially as they relate to the environment, health and safety, diversity, labor conditions, and human rights.
Although we take precautions to prevent violations of these laws and regulations, our exposure to violations increases as our international presence expands and as we increase sales and operations in foreign jurisdictions. We may become involved in claims, lawsuits, government investigations, and other proceedings that could adversely affect our business, financial condition, and results of operations.
Although we take precautions to prevent violations of these laws and regulations, our exposure to violations increases as our international presence expands and as we increase sales and operations in foreign jurisdictions. 41 Table of Contents We may become involved in claims, lawsuits, government investigations, and other proceedings that could adversely affect our business, financial condition, and results of operations.
These laws, rules, and regulations are constantly evolving, and we expect that there will continue to be new proposed laws, regulations, and industry standards concerning privacy, data protection, and information security in the U.S., the EU, and globally. 47 Table of Contents In the U.S., the California Consumer Privacy Act ( “ CCPA ” ) grants California consumers rights to access, delete, and opt out of the sale of their personal information, while imposing operational requirements on businesses.
These laws, rules, and regulations are constantly evolving, and we expect that there will continue to be new proposed laws, regulations, and industry standards concerning privacy, data protection, and information security in the U.S., the EU, and globally. 45 Table of Contents In the U.S., where applicable, the California Consumer Privacy Act ( “ CCPA ” ) grants California consumers rights to access, delete, and opt out of the sale of their personal information, while imposing operational requirements on businesses.
If such tax or other laws, rules, or regulations are amended, or if new laws, rules, or regulations are enacted, the results could increase our tax payments or other obligations, prospectively or retrospectively, subject us to interest and penalties, decrease the demand for our services if we pass on such costs to our learners, customers, or educator partners, result in increased costs to update or expand our technological or administrative infrastructure, or effectively limit the scope of our business activities if we decided not to conduct business in particular jurisdictions.
If such tax or other laws, rules, or regulations are amended, or if new laws, rules, or regulations are enacted, the results could increase our tax payments or other obligations, prospectively or retrospectively, subject us to interest and penalties, decrease the demand for our services if we pass on such costs to our learners, customers, or content creators, result in increased costs to update or expand our technological or administrative infrastructure, or effectively limit the scope of our business activities if we decided not to conduct business in particular jurisdictions.
Any such outcomes could have a material adverse effect on our business, financial condition, and results of operations. 41 Table of Contents We are required to comply with the Family Educational Rights and Privacy Act (“FERPA”) for certain of our offerings, and failure to do so could harm our reputation and negatively affect our business.
Any such outcomes could have a material adverse effect on our business, financial condition, and results of operations. We are required to comply with the Family Educational Rights and Privacy Act (“FERPA”) for certain of our offerings, and failure to do so could harm our reputation and negatively affect our business.
The continued turmoil in Ukraine and the Middle East could have a depressing effect on the global economy, which could dampen our business activity and reduce the demand for our online learning solutions. 34 Table of Contents In addition, pandemics or other public health crises could impact our business, key metrics, and results of operations.
The continued turmoil in Ukraine and the Middle East could have a depressing effect on the global economy, which could dampen our business activity and reduce the demand for our online learning solutions. In addition, pandemics or other public health crises could impact our business, key metrics, and results of operations.
We have spent, and may continue to spend, substantial effort and management resources to secure new educator partners and to work with our existing educator partners to develop, launch, and maintain content and credentialing programs without any assurance that our efforts will result in a successful launch or revenue generation that will exceed our costs.
We have spent, and may continue to spend, substantial effort and management resources to secure new content creators and to work with our existing content creators to develop, launch, and maintain content and credentialing programs without any assurance that our efforts will result in a successful launch or revenue generation that will exceed our costs.
Further, if we were to lose a significant number of educator partners, especially those who provide a significant portion of the content and programs on our platform, or if we can no longer offer certain high-demand content or programs, our reputation, growth, and revenue would be materially and adversely impacted.
Further, if we were to lose a significant number of content creators, especially those who provide a significant portion of the content and programs on our platform, or if we can no longer offer certain high-demand content or programs, our reputation, growth, and revenue would be materially and adversely impacted.
These developments could also harm our reputation and make it more difficult for us to maintain our current content and credentialing programs and engage our educator partners for new course content or other offerings, which in turn may negatively impact our ability to expand our business and improve our financial performance.
These developments could also harm our reputation and make it more difficult for us to maintain our current content and credentialing programs and engage our content creators for new course content or other offerings, which in turn may negatively impact our ability to expand our business and improve our financial performance.
Our marketing efforts include the use of search engine optimization, paid search, and custom website development and deployment. We plan to continue investing in and expanding our Enterprise sales and marketing organization, both domestically and internationally. Identifying, recruiting, and training sales personnel requires significant time, expense, and attention.
Our marketing efforts include the use of search engine optimization, paid search, and custom website development and deployment. 28 Table of Contents We plan to continue investing in and expanding our Enterprise sales and marketing organization, both domestically and internationally. Identifying, recruiting, and training sales personnel requires significant time, expense, and attention.
Disruptions to the operations of one or more of our third-party service providers may adversely affect our business operations and financial condition. We, and our educator partners, rely on a variety of third-party service providers to support our operations by providing customer support, mobile network, internet, content production, platform integration, and other services.
Disruptions to the operations of one or more of our third-party service providers may adversely affect our business operations and financial condition. We, and our content creators, rely on a variety of third-party service providers to support our operations by providing customer support, mobile network, internet, content production, platform integration, and other services.
Litigation regarding IP rights is inherently uncertain due to the complex issues involved, and we may not be successful in defending ourselves in such matters. In addition, some of our competitors have extensive portfolios of issued patents and significant resources to enforce their IP rights.
Litigation regarding IP rights is inherently uncertain due to the complex issues involved, and we may not be successful in defending ourselves in such matters. 48 Table of Contents In addition, some of our competitors have extensive portfolios of issued patents and significant resources to enforce their IP rights.
If we cannot quickly and efficiently scale our technology and operations to handle increases in the volume and rate of learner enrollments and of new content or credentialing programs, our educator partners’, learners’, and customers’ experiences with our platform may suffer, which in turn could damage our reputation.
If we cannot quickly and efficiently scale our technology and operations to handle increases in the volume and rate of learner enrollments and of new content or credentialing programs, our content creators’, learners’, and customers’ experiences with our platform may suffer, which in turn could damage our reputation.
We believe that many of our new learners find us by word of mouth and other non-paid referrals from existing learners. If existing learners, customers. and educator partners are dissatisfied with their experience on our platform, they may stop accessing our content and may stop referring others to us.
We believe that many of our new learners find us by word of mouth and other non-paid referrals from existing learners. If existing learners, customers, and content creators are dissatisfied with their experience on our platform, they may stop accessing our content and may stop referring others to us.
Any claims successfully brought against us could subject us to significant liability for damages, and we may be required to stop using technology or other IP alleged to be in violation of a third party’s rights. We also might be required to seek a license for third-party IP.
Any claims successfully brought against us could subject us to significant liability for damages, and we may be required to stop using technology or other IP alleged to be in violation of a third party’s rights. We also might be required to license, or we may decide to forgo litigation and seek a license to, third-party IP.
Therefore, we may be subject to the possibility of increased derivative litigation, which would require management ’ s attention, and, as a result, may adversely impact our management’s ability to effectively execute our strategy. Additionally, any such derivative litigation may be costly, which may harm our financial condition and results of operations.
Therefore, we may be subject to the possibility of increased derivative litigation, which would require management’s attention, and, as a result, may adversely impact our management’s ability to effectively execute our strategy. Additionally, any such derivative litigation may be costly, which may harm our financial condition and results of operations.
If we are unable to hire, develop, and retain talented sales or marketing personnel, if our new sales or marketing personnel are unable to achieve desired productivity levels in a reasonable period of time (including as a result of working remotely), if our sales and marketing programs are not effective, or if expected sales and marketing programs by our educator partners do not materialize or are not effective, our ability to broaden our customer base and achieve broader market acceptance of our platform could be harmed.
If we are unable to hire, develop, and retain talented sales or marketing personnel, if our new sales or marketing personnel are unable to achieve desired productivity levels in a reasonable period of time (including as a result of working remotely), if our sales and marketing programs are not effective, or if expected sales and marketing programs by our content creators do not materialize or are not effective, our ability to broaden our customer base and achieve broader market acceptance of our platform could be harmed.
Our decisions and actions aimed at achieving long-term success and enhancing long-term stockholder value—such as improving platform trust and safety, altering community support delivery, strengthening relationships with learners, customers, educator partners, and employees, introducing new offerings and services, investing in social impact initiatives, and adapting to regulatory changes—may not yield the anticipated long-term benefits.
Our decisions and actions aimed at achieving long-term success and enhancing long-term stockholder value—such as improving platform trust and safety, altering community support delivery, strengthening relationships with learners, customers, content creators, and employees, introducing new offerings and services, investing in social impact initiatives, and adapting to regulatory changes—may not yield the anticipated long-term benefits.
We will need to continue to expand our relationships with businesses, government organizations, academic institutions, and other organizations, enhance our platform and technology-enabled services, increase the volume of new educational content and credentialing programs developed by our educator partners, attract a higher volume of learners and customers in a cost-effective manner, deploy preferred local payment methods and pricing models, satisfy our existing educator partners’ requirements, respond to competitive challenges, and otherwise execute our business plan.
We will need to continue to expand our relationships with businesses, government organizations, academic institutions, and other organizations, enhance our platform and technology-enabled services, increase the volume of new educational content and credentialing programs developed by our content creators, attract a higher volume of learners and customers in a cost-effective manner, deploy preferred local payment methods and pricing models, satisfy our existing content creators’ requirements, respond to competitive challenges, and otherwise execute our business plan.
To launch new educational content or a new credentialing program, whether synchronous or asynchronous, we may need to integrate our platform with the various learner information and other operating systems our educator partners use to manage functions within their institutions.
To launch new educational content or a new credentialing program, whether synchronous or asynchronous, we may need to integrate our platform with the various learner information and other operating systems our content creators use to manage functions within their institutions.
Although we view DeepLearning.AI Corp. as a valued educator partner and believe our agreement is on commercially reasonable terms, there may nonetheless be a perception of a conflict of interest. As a result of the foregoing, our directors and officers may have conflicts of interest in determining to which entity particular opportunities or information should be presented.
Although we view DeepLearning.AI Corp. as a valued content creator and believe our agreement is on commercially reasonable terms, there may nonetheless be a perception of a conflict of interest. As a result of the foregoing, our directors and officers may have conflicts of interest in determining to which entity particular opportunities or information should be presented.
Our learners, customers, and educators rely on access to the internet and mobile networks to access our platform. Internet service providers may choose to disrupt or degrade access to our platform or increase the cost of such access. Internet service providers or mobile network operators could also attempt to charge us for providing access to our platform.
Our learners, customers, and content creators rely on access to the internet and mobile networks to access our platform. Internet service providers may choose to disrupt or degrade access to our platform or increase the cost of such access. Internet service providers or mobile network operators could also attempt to charge us for providing access to our platform.
If we are not able to provide our customers and educator partners with the functionality to deliver a rewarding experience on mobile devices, their ability to attract learners to their programs may be harmed and, consequently, our business may suffer. As new mobile devices and features are released, we may encounter problems in developing or supporting apps for them.
If we are not able to provide our customers and content creators with the functionality to deliver a rewarding experience on mobile devices, their ability to attract learners to their programs may be harmed and, consequently, our business may suffer. As new mobile devices and features are released, we may encounter problems in developing or supporting apps for them.
In addition, sustained or recurring disruptions in our platform or its underlying technology could adversely affect our, or our educator partners’, compliance with applicable regulations and accrediting body standards. Further, if we fail to accurately predict the rate or timing of our platform growth, we may be required to incur significant additional costs to maintain reliability.
In addition, sustained or recurring disruptions in our platform or its underlying technology could adversely affect our, or our content creators’, compliance with applicable regulations and accrediting body standards. Further, if we fail to accurately predict the rate or timing of our platform growth, we may be required to incur significant additional costs to maintain reliability.
Factors that may cause fluctuations in our quarterly operating results include, but are not limited to, the following: • our ability to maintain existing customers and attract new customers, including businesses, government organizations, academic institutions, and other organizations that subscribe to our Enterprise platform, as well as learners who access the content and credentialing programs available on our platform; • our ability to continue to offer compelling content and degrees or other credentialing programs created by our educator partners; • changes in, or trends affecting, subscriptions to our platform from businesses, government organizations, academic institutions, and other organizations; • changes in, or trends affecting, learner enrollment and retention levels, including with respect to learners electing to access our paid offerings; • our ability to increase and manage the growth of our international operations, including our international learner and customer base, and our ability to manage the risks associated therewith; • the timing of costs we incur, the timing and amount of revenue generated, the pricing models, or the payment terms associated with launching new content or offerings; • trends and factors impacting the demand for, and acceptance of, online learning and credentialing programs and the prices consumers and businesses are willing to pay for such programs; • changes in, or trends affecting, the mix of educator partners, including academic institutions, offering open online courses only and those offering certification, degree, or other credentialing programs; • changes in the rate, volume, quality, and demand for new content and credentialing programs created and offered by our educator partners on our platform; • changes in the terms of our existing educator partner agreements and the timing and terms of any new educator partner agreements; • the timing and amount of our sales and marketing expenses; • the timing and breadth of platform subscription discounts and promotions; • costs necessary to improve and maintain our platform and compete on the basis of emerging technologies and functionality; 18 Table of Contents • changes in our key metrics or the methods used to calculate our key metrics; • revenue mix shifts between our segments and seasonality, including seasonal engagement patterns of learners and customers, which may vary from quarter to quarter or year to year, and seasonal operating practices or engagement patterns of educator partners resulting from academic calendars or fiscal years that may differ from our own; • changes in laws, regulations, or accounting principles that impact our business; and • general political, economic, or market conditions and events affecting any of the above, including the impact of inflation, currency and interest rate fluctuations, labor strikes or other widespread work stoppages, the political environment, the impact of the election season, changes in government spending policies or priorities, geopolitical tensions or hostilities, such as the conflicts in Ukraine and the Middle East, supply chain disruptions, natural disasters, public health crises, or other catastrophic events.
Factors that may cause fluctuations in our quarterly operating results include, but are not limited to, the following: • our ability to maintain existing customers and attract new customers, including businesses, government organizations, academic institutions, and other organizations that subscribe to our Enterprise platform, as well as learners who access the content and credentialing programs available on our platform; • our ability to continue to offer compelling content and degrees or other credentialing programs created by our content creators; • changes in, or trends affecting, subscriptions to our platform from businesses, government organizations, academic institutions, and other organizations; 19 Table of Contents • changes in, or trends affecting, learner enrollment and retention levels, including with respect to learners electing to access our paid offerings; • our ability to increase and manage the growth of our international operations, including our international learner and customer base, and our ability to manage the risks associated therewith; • the timing of costs we incur, the timing and amount of revenue generated, the pricing models, or the payment terms associated with launching new content or offerings; • trends and factors impacting the demand for, and acceptance of, online learning and credentialing programs and the prices consumers and businesses are willing to pay for such programs; • changes in, or trends affecting, the mix of content creators, including academic institutions, offering open online courses only and those offering certification, degree, or other credentialing programs; • changes in the rate, volume, quality, and demand for new content and credentialing programs created and offered by our content creators on our platform; • changes in the terms of our existing content creator agreements and the timing and terms of any new content creator agreements; • the timing and amount of our sales and marketing expenses; • the timing and breadth of platform subscription discounts and promotions; • costs necessary to improve and maintain our platform and compete on the basis of emerging technologies and functionality; • changes in our key metrics or the methods used to calculate our key metrics; • revenue mix shifts between our segments and seasonality, including seasonal engagement patterns of learners and customers, which may vary from quarter to quarter or year to year, and seasonal operating practices or engagement patterns of content creators resulting from academic calendars or fiscal years that may differ from our own; • changes in laws, regulations, or accounting principles that impact our business; and • general political, economic, or market conditions and events affecting any of the above, including the impact of inflation, currency fluctuations, tariffs, government shutdowns, labor strikes or other widespread work stoppages, the political environment, changes in government spending policies or priorities, geopolitical tensions or hostilities, such as ongoing trade disputes and geopolitical tensions between the U.S. and other countries, the conflicts in Ukraine and the Middle East, supply chain disruptions, natural disasters, public health crises, or other catastrophic events.
We have incorporated, and expect to continue to incorporate, AI in the content and credentials offerings from our educator partners, as well as in our AI-powered platform innovations and features. The incorporation of AI in our business and operations may become more significant over time.
We have incorporated, and expect to continue to incorporate, AI in the content and credentials offerings from our content creators, as well as in our AI-powered platform innovations and features. The incorporation of AI in our business and operations may become more significant over time.
New or existing companies in the online education industry provide or may in the future provide offerings similar to what we offer on our platform, and such companies may pursue relationships with our educator partners that may reduce the educational content our educator partners produce for our platform.
New or existing companies in the online education industry provide or may in the future provide offerings similar to what we offer on our platform, and such companies may pursue relationships with our content creators that may reduce the educational content our content creators produce for our platform.
Further, as we continue to expand internationally, we may become more exposed to fluctuations in currency exchange rates. Future agreements with international learners, customers, and educator partners may require payments to be denominated in local currencies. In such cases, fluctuations in the local currency value relative to the U.S. dollar could impact our operating results.
Further, as we continue to expand internationally, we may become more exposed to fluctuations in currency exchange rates. Future agreements with international learners, customers, and content creators may require payments to be denominated in local currencies. In such cases, fluctuations in the local currency value relative to the U.S. dollar could impact our operating results.
In addition, educator partners generally do not grant us exclusive rights to their content, and any such arrangements are of limited duration. As such, educator partners may choose to offer the same content on one of our competitors’ platforms or their own platform, which could limit the number of learners enrolled in such partner’s courses or programs on our platform.
In addition, content creators generally do not grant us exclusive rights to their content, and any such arrangements are of limited duration. As such, content creators may choose to offer the same content on one of our competitors’ platforms or their own platform, which could limit the number of learners enrolled in their courses or programs on our platform.
In addition, the use of AI technology has resulted in, and may in the future result in, cybersecurity incidents that implicate the personal data of end users of AI applications.
In addition, the use of AI technology has resulted in, and may in the future result in, cybersecurity incidents that implicate the personal information of end users of AI applications.
Further, if such certifications are obtained and maintained, but do not, or cease to, signal to learners and employers the high quality or reliability we, or our educator partners, intend to signal through such certifications, our business would be adversely affected. Any of the foregoing could materially and adversely affect our results of operations, competitive position, and growth prospects.
Further, if such certifications are obtained and maintained, but do not, or cease to, signal to learners and employers the high quality or reliability we, or our content creators, intend to signal through such certifications, our business would be adversely affected. Any of the foregoing could materially and adversely affect our results of operations, competitive position, and growth prospects.
We may be unable to provide learners and customers with the information and outcomes they seek if our educator partners do not contribute content that is helpful and reliable, if they remove content, or if supplemental or derivative materials are not reliable.
We may be unable to provide learners and customers with the information and outcomes they seek if our content creators do not contribute content that is helpful and reliable, if they remove content, or if supplemental or derivative materials are not reliable.
As a result of any of the foregoing, we may ultimately be unable to recover the full investment that we make in a new offering or achieve any level of profitability from such offering. If we pursue unsuccessful educator partner opportunities, we may forego more profitable opportunities, and our operating results and growth could be harmed.
As a result of any of the foregoing, we may ultimately be unable to recover the full investment that we make in a new offering or achieve any level of profitability from such offering. If we pursue unsuccessful content creator opportunities, we may forego more profitable opportunities, and our operating results and growth could be harmed.
If we cannot quickly and efficiently scale our sales, marketing, and technology teams, which includes the hiring and training of new employees, we may not be successful in attracting potential learners and customers to our platform, which would negatively impact our ability to generate revenue, and our educator partners could lose confidence in us.
If we cannot quickly and efficiently scale our sales, marketing, and technology teams, which includes the hiring and training of new employees, we may not be successful in attracting potential learners and customers to our platform, which would negatively impact our ability to generate revenue, and our content creators could lose confidence in us.
In addition, we believe that our status as a PBC and our commitment to providing global access to flexible and affordable world-class learning that supports personal development, career advancement, and economic opportunity distinguish us from our competitors and promote a relationship founded on trust among our learners, customers, educator partners, and employees.
In addition, we believe that our status as a PBC and our commitment to providing global access to flexible and affordable world-class learning that supports personal development, career advancement, and economic opportunity distinguish us from our competitors and promote a relationship founded on trust among our learners, customers, content creators, and employees.
In addition, the elimination of a particular medium or platform on which we advertise or changes in advertising practices or advertising spending fluctuations by our largest educator partners have had, and may in the future have, an adverse impact on directing traffic to our offerings and recruiting new learners on a cost-effective basis.
In addition, the elimination of a particular medium or platform on which we advertise or changes in advertising practices or advertising spending fluctuations by our largest content creators have had, and may in the future have, an adverse impact on directing traffic to our offerings and recruiting new learners on a cost-effective basis.
Our success depends on our ability to provide learners and customers with the information, outcomes, academic credit, and certifications they seek, which in turn depends on the quantity, quality, and format of the educational content provided by our educator partners.
Our success depends on our ability to provide learners and customers with the information, outcomes, academic credit, and certifications they seek, which in turn depends on the quantity, quality, and format of the educational content provided by our content creators.
Some of our third-party service providers, such as identity verification and payment processing providers, also regularly have access to personal data. In an effort to protect sensitive information, we rely on a variety of security measures, including encryption and authentication technology licensed from third parties.
Some of our third-party service providers, such as identity verification and payment processing providers, also regularly have access to personal information. In an effort to protect personal, confidential, or otherwise sensitive information, we rely on a variety of security measures, including encryption and authentication technology licensed from third parties.
In addition, our employees, our educator partners, or third parties acting at our direction may knowingly or inadvertently make use of social media in ways that could lead to the loss or infringement of IP, as well as the public disclosure of proprietary, confidential, or sensitive personal information of our business, employees, learners, customers, educator partners, or others.
In addition, our employees, our content creators, or third parties acting at our direction may knowingly or inadvertently make use of social media in ways that could lead to the loss or infringement of IP, as well as the public disclosure of proprietary, confidential, or sensitive personal information of our business, employees, learners, customers, content creators, or others.
We believe that focusing on the long-term best interests of our Company as a PBC and our consideration of all of our stakeholders, including our stockholders, learners, customers, educator partners, employees, the communities in which we operate, and other stakeholders we may identify from time to time, is essential to the long-term success of our Company and to long-term stockholder value.
We believe that focusing on the long-term best interests of our Company as a PBC and our consideration of all of our stakeholders, including our stockholders, learners, customers, content creators, employees, the communities in which we operate, and other stakeholders we may identify from time to time, is essential to the long-term success of our Company and to long-term stockholder value.

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Item 1C. Cybersecurity

Cybersecurity — threats and controls disclosure

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Biggest changeOur CTO provides quarterly updates to the audit committee on these topics, as well as cybersecurity risk exposure and steps taken to monitor and mitigate such exposure. The board of directors receives reports from management on our information security and cybersecurity matters on an annual basis.
Biggest changeOur CTO and Vice President, Information Security provide quarterly updates to the audit committee on these topics, as well as cybersecurity risk exposure and steps taken to monitor and mitigate such exposure. The board of directors receives reports from management on our information security and cybersecurity matters on an annual basis.
We have data and cybersecurity protection and control policies to facilitate a secure environment for sensitive information and to ensure the availability of critical data and systems. The information security management system supporting our online learning platform has been independently certified to the International Organization for Standardization (“ISO”) / International Electrotechnical Commission 27001:2013 standard.
We have data and cybersecurity protection and control policies to facilitate a secure environment for sensitive information and designed to ensure the availability of critical data and systems. The information security management system supporting our online learning platform has been independently certified to the International Organization for Standardization (“ISO”) / International Electrotechnical Commission 27001 standard.
Our information security team is led by our Senior Vice President, Chief Technology Officer (“CTO”) and our Vice President, Information Security, who together have over 36 years of technology industry experience and expertise in information security, cybersecurity, and distributed systems.
Our information security team is led by our Senior Vice President, Chief Technology Officer (“CTO”) and our Vice President, Information Security, who together have over 40 years of technology industry experience and expertise in information security, cybersecurity, and distributed systems.
Our online learning platform is hosted by major cloud-hosting providers, and we require such providers and other third parties that have access to PII or certain other highly sensitive data to be independently SOC 2 attested and/or ISO 27001 certified to ensure that such service providers conform to our security standards.
Our online learning platform is hosted by major cloud-hosting providers, and we require such providers and other third parties that have access to PII or certain other highly sensitive data to be independently SOC 2 attested and/or ISO 27001 certified for the purpose that such service providers conform to our security standards.
We have annual independent third-party audits conducted on system security and availability, such as Systems and Organization Controls 2 Type 2 (“SOC 2”) audit reports and ISO 27001 certification. Certain highly sensitive information, such as personally identifiable information (“PII”) about our learners in our online learning platform, is encrypted at rest and in transit using industry standards.
We conduct annual third-party audits on system security and availability, such as Systems and Organization Controls 2 Type 2 (“SOC 2”) attestation and ISO 27001 certification. Certain highly sensitive information, such as personally identifiable information (“PII”) about our learners in our online learning platform, is encrypted at rest and in transit using industry standards.

Item 5. Market for Registrant's Common Equity

Market for Common Equity — stock, dividends, buybacks

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Biggest changeDuring the years ended December 31, 2024 and 2023, we repurchased an aggregate of 3,099,800 shares of our common stock for $36.7 million and 4,829,803 shares of our common stock for $58.5 million.
Biggest changeDuring the year ended December 31, 2024, we repurchased an aggregate of approximately 3.1 million shares of our common stock for $36.7 million under the aforementioned program.
Stock Performance Graph The graph below shows the cumulative total return to our stockholders since our IPO on March 31, 2021 through December 31, 2024, in comparison to the NASDAQ Composite Index and the S&P North American Technology Software Index, assuming an initial investment of $100 and reinvestment of dividends, if any.
Stock Performance Graph The graph below shows the cumulative total return to our stockholders since our IPO on March 31, 2021 through December 31, 2025, in comparison to the Nasdaq Composite Index and the S&P North American Technology Software Index, assuming an initial investment of $100 and reinvestment of dividends, if any.
The stockholder return shown on the graph below represents past performance and is not indicative of, nor intended to forecast, future performance of our common stock. 61 Table of Contents December 31, Initial 2021 2022 2023 2024 Coursera $100.00 $54.31 $26.29 $43.04 $18.89 NASDAQ Composite Index $100.00 $118.10 $79.01 $113.32 $145.78 S&P North American Technology Software Index $100.00 $119.57 $76.27 $121.37 $151.15 This performance graph shall not be deemed “soliciting material” or to be “filed” for purposes of Section 18 of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), or incorporated by reference into any of our other filings under the Securities Act of 1933, as amended, or the Exchange Act, except as shall be expressly set forth by specific reference in such filing.
The stockholder return shown on the graph below represents past performance and is not indicative of, nor intended to forecast, future performance of our common stock. 61 Table of Contents December 31, Initial 2021 2022 2023 2024 2025 Coursera $100.00 $54.31 $26.29 $43.04 $18.89 $16.36 NASDAQ Composite Index $100.00 $118.10 $79.01 $113.32 $145.78 $175.45 S&P North American Technology Software Index $100.00 $119.57 $76.27 $121.37 $151.15 $158.39 This performance graph shall not be deemed “soliciting material” or to be “filed” for purposes of Section 18 of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), or incorporated by reference into any of our other filings under the Securities Act of 1933, as amended, or the Exchange Act, except as shall be expressly set forth by specific reference in such filing.
Holders of Record As of February 14, 2025, there were 74 holders of record of our common stock. The actual number of holders of our common stock is greater than the number of record holders and includes stockholders who are beneficial owners, but whose shares are held in street name by brokers or by other nominees.
Holders of Record As of February 13, 2026, there were 63 holders of record of our common stock. The actual number of holders of our common stock is greater than the number of record holders and includes stockholders who are beneficial owners, but whose shares are held in street name by brokers or by other nominees.
Removed
Use of Proceeds On April 5, 2021, we completed our initial public offering of common stock, in which we sold 14,664,776 shares and certain selling stockholders sold 1,065,224 shares. On April 19, 2021, the underwriters exercised in full the right to purchase 2,359,500 additional shares of common stock from us (together, the “IPO”).
Removed
In total, we received net proceeds of $525.3 million after deducting underwriting discounts and commissions. There has been no material change in the planned use of proceeds from the IPO as described in our Prospectus for the IPO filed with the SEC, pursuant to Rule 424(b)(4), on March 31, 2021.

Item 7. Management's Discussion & Analysis

Management's Discussion & Analysis (MD&A) — revenue / margin commentary

88 edited+33 added−45 removed24 unchanged
Biggest changeAdjusted EBITDA and Adjusted EBITDA Margin Adjusted EBITDA and Adjusted EBITDA Margin are key measures used by our management to help us analyze our financial results, establish budgets and operational goals for managing our business, evaluate our performance, and make strategic decisions. 76 Table of Contents We define Adjusted EBITDA as our GAAP net loss excluding: (i) depreciation and amortization; (ii) interest income, net; (iii) income tax expense; (iv) other (income) expense, net; (v) stock-based compensation expense; (vi) payroll tax expense related to stock-based compensation; (vii) M&A related transaction costs; (viii) costs and settlement (gains) losses related to significant and non-recurring legal matters, net of insurance recoveries; and (ix) restructuring related charges.
Biggest changeThe following tables provide a reconciliation of GAAP gross profit and GAAP net loss, the most directly comparable GAAP financial measure, to non-GAAP gross profit and non-GAAP net income: Year Ended December 31, 2025 2024 2023 (in millions) Gross profit $ 413.4 $ 371.4 $ 329.8 Stock-based compensation expense 2.5 2.7 2.6 Amortization of stock-based compensation capitalized as internal-use software costs 5.7 5.5 5.0 Payroll tax expense related to stock-based compensation — — 0.1 Non-GAAP gross profit $ 421.6 $ 379.6 $ 337.5 Year Ended December 31, 2025 2024 2023 (in millions, except per share data) Net loss $ (51.0) $ (79.5) $ (116.6) Stock-based compensation expense 96.7 108.1 115.2 Amortization of stock-based compensation capitalized as internal-use software costs 5.7 5.5 5.0 Payroll tax expense related to stock-based compensation 2.8 2.9 4.0 M&A related transaction costs 11.9 3.4 — Significant and non-recurring legal and regulatory matters 1.6 6.3 — Restructuring related charges (0.9) 8.9 (5.8) Non-GAAP net income $ 66.8 $ 55.6 $ 1.8 Weighted-average shares used in computing net loss per share—basic 163.8 157.4 151.0 Effect of dilutive securities 5.9 7.1 15.6 Weighted-average shares used in computing non-GAAP net income per share—diluted 169.7 164.5 166.6 Net loss per share—basic and diluted $ (0.31) $ (0.51) $ (0.77) Non-GAAP net income per share—diluted $ 0.39 $ 0.34 $ 0.01 Adjusted EBITDA and Adjusted EBITDA Margin Adjusted EBITDA and Adjusted EBITDA Margin are key measures used by our management to help us analyze our financial results, establish budgets and operational goals for managing our business, evaluate our performance, and make strategic decisions. 76 Table of Contents We define Adjusted EBITDA as our GAAP net loss excluding: (i) depreciation and amortization; (ii) interest income, net; (iii) income tax expense; (iv) other (income) expense, net; (v) stock-based compensation expense; (vi) payroll tax expense related to stock-based compensation; (vii) M&A related transaction costs; (viii) costs and settlement (gains) losses related to significant and non-recurring legal and regulatory matters, net of insurance recoveries; and (ix) restructuring related charges.
Impact of Macroeconomic Factors Our business and financial conditions have been, and may continue to be, impacted by adverse macroeconomic factors, including inflation, interest rates fluctuations, and volatility in foreign currency rates. Global, regional, macroeconomic, and geopolitical conditions have impacted overall student engagement and may continue to negatively impact total student enrollments.
Impact of Macroeconomic and Geopolitical Factors Our business and financial conditions have been, and may continue to be, impacted by adverse macroeconomic factors, including inflation, interest rates fluctuations, and volatility in foreign currency rates. Global, regional, macroeconomic, and geopolitical conditions have impacted overall student engagement and may continue to negatively impact total student enrollments.
We encourage investors to carefully consider our results under GAAP, as well as our supplemental non-GAAP information and the reconciliations of GAAP to non-GAAP financial measures to more fully understand our business. 75 Table of Contents Non-GAAP Gross Profit, Non-GAAP Net Income (Loss), and Non-GAAP Net Income (Loss) Per Share We define non-GAAP gross profit and non-GAAP net income (loss) as GAAP gross profit and GAAP net loss excluding: (i) stock-based compensation expense; (ii) amortization of stock-based compensation expense capitalized as internal-use software costs; (iii) payroll tax expense related to stock-based compensation; (iv) M&A related transaction costs; (v) costs and settlement (gains) losses related to significant and non-recurring legal matters, net of insurance recoveries; and (vi) restructuring related charges.
We encourage investors to carefully consider our results under GAAP, as well as our supplemental non-GAAP information and the reconciliations of GAAP to non-GAAP financial measures to more fully understand our business. 75 Table of Contents Non-GAAP Gross Profit, Non-GAAP Net Income, and Non-GAAP Net Income Per Share We define non-GAAP gross profit and non-GAAP net income as GAAP gross profit and GAAP net loss excluding: (i) stock-based compensation expense; (ii) amortization of stock-based compensation expense capitalized as internal-use software costs; (iii) payroll tax expense related to stock-based compensation; (iv) M&A related transaction costs; (v) costs and settlement (gains) losses related to significant and non-recurring legal and regulatory matters, net of insurance recoveries; and (vi) restructuring related charges.
Non-GAAP net income (loss) per share is calculated by dividing non-GAAP net income (loss) by the diluted weighted average shares of common stock outstanding. We believe the presentation of these adjusted operating results provides useful supplemental information to investors and facilitates the analysis and comparison of our operating results across reporting periods.
Non-GAAP net income per share is calculated by dividing non-GAAP net income by the diluted weighted average shares of common stock outstanding. We believe the presentation of these adjusted operating results provides useful supplemental information to investors and facilitates the analysis and comparison of our operating results across reporting periods.
We estimate revenue using an expected value method, which is based on what we expect to earn in return for our performance of the Degrees services, reduced by the amount, if any, considered probable of reversing in a future period.
We estimate revenue using an expected value method, which is based on what we expect to earn in return for our performance of the services, reduced by the amount, if any, considered probable of reversing in a future period.
It includes the following sections: • Overview • Recent Developments • Factors Affecting Our Performance • Impact of Macroeconomic Conditions • Components of Results of Operations • Results of Operations • Liquidity and Capital Resources • Key Business Metrics and Non-GAAP Financial Measures • Critical Accounting Estimates • Recent Accounting Pronouncements In this section of the Form 10-K, we discuss our financial condition and results of operations for the years ended December 31, 2024 and 2023.
It includes the following sections: • Overview • Key Financial Results • Recent Developments • Factors Affecting Our Performance • Impact of Macroeconomic Conditions • Components of Results of Operations • Results of Operations • Liquidity and Capital Resources • Key Business Metrics and Non-GAAP Financial Measures • Critical Accounting Estimates • Recent Accounting Pronouncements In this section of the Form 10-K, we discuss our financial condition and results of operations for the years ended December 31, 2025 and 2024.
For purposes of determining our Paid Enterprise Customer count, we exclude our Enterprise customers who do not purchase Coursera via our direct sales force, including organizations engaging on our platform through our Coursera for Teams offering or through our channel partners. For the year ended December 31, 2024, approximately 94% of Enterprise revenue was generated from our Paid Enterprise Customers.
For purposes of determining our Paid Enterprise Customer count, we exclude our Enterprise customers who do not purchase Coursera via our direct sales force, including organizations engaging on our platform through our Coursera for Teams offering or through our channel partners. For the year ended December 31, 2025, approximately 94% of Enterprise revenue was generated from our Paid Enterprise Customers.
For purposes of determining our registered learner count, we treat each customer account that registers with a unique email as a registered learner and adjust for any spam, test accounts, and cancellations. Our registered learner count is not intended as a measure of active engagement. New registered learners are individuals that register in a particular period.
For purposes of determining our Registered Learner count, we treat each customer account that registers with a unique email as a “Registered Learner” and adjust for any spam, test accounts, and cancellations. Our Registered Learner count is not intended as a measure of active engagement. New Registered Learners are individuals that register in a particular period.
We expect to maintain this full valuation allowance until it becomes more likely than not that the deferred tax assets will be realized. Results of Operations The following table summarizes our results of operations, which are not necessarily indicative of future results.
We expect to maintain this full valuation allowance until it becomes more likely than not that the deferred tax assets will be realized. 67 Table of Contents Results of Operations The following table summarizes our results of operations, which are not necessarily indicative of future results.
Personnel costs, which include salaries, stock-based compensation expense, payroll taxes, commissions, bonuses, and benefits, make up the most significant component of our operating expenses. Our operating expenses also include marketing and advertising expenses, consulting and services expenses, office expenses, depreciation and amortization, and facilities costs. Research and development.
Personnel costs, which include salaries, stock-based compensation expense, payroll taxes, commissions, bonuses, and benefits, make up the most significant component of our operating expenses. Our operating expenses also include marketing and advertising expenses, consulting and services expenses, office expenses, depreciation and amortization, and facilities costs.
Our general and administrative expenses primarily consist of personnel and personnel-related costs, including stock-based compensation expense, as well as professional services fees, costs related to compliance and reporting obligations, legal settlements, and other corporate expenses.
Our general and administrative expenses primarily consist of personnel and personnel-related costs, including stock-based compensation expense, as well as professional services fees, costs related to compliance and reporting obligations, legal settlements, and other corporate expenses. Restructuring related charges .
Our research and development expenses primarily consist of personnel and personnel-related costs, including stock-based compensation expense, and costs related to the ongoing management, maintenance, and expansion of content, features, and services offered on our platform. We believe that continued investment in our platform is important for future growth and for maintaining and attracting educator partners and learners.
Research and development. Our research and development expenses primarily consist of personnel and personnel-related costs, including stock-based compensation expense, and costs related to the ongoing management, maintenance, and expansion of content, features, and services offered on our platform. We believe that continued investment in our platform is important for future growth and for maintaining and attracting content creators and learners.
Our principal uses of cash in the years ended December 31, 2024 and 2023 include the funding of our business operations, investments in our internal-use software, purchases of content assets, and repurchases of our common stock.
Our principal uses of cash in the years ended December 31, 2025 and 2024 include the funding of our business operations, investments in our internal-use software, purchases of content assets, and repurchases of our common stock.
The amount varies each reporting period based on our average balance of cash, cash equivalents, and marketable securities during the period, as well as market interest rates. Other Expense, Net Other expense, net primarily consists of foreign exchange gains (losses) and impairment charges related to equity investments.
The amount varies each reporting period based on our average balance of cash and cash equivalents, during the period, as well as market interest rates. Other Income (Expense), Net Other income (expense), net primarily consists of foreign exchange gains (losses) and impairment charges related to equity investments.
Our financial condition and results of operations for the years ended December 31, 2023 and 2022 can be found in “Management’s Discussion and Analysis of Financial Condition and Results of Operations” in Part II, Item 7 of our Annual Report on Form 10-K for the fiscal year ended December 31, 2023 filed with the United States (“U.S.”) Securities and Exchange Commission (“SEC”) on February 22, 2024.
Our financial condition and results of operations for the years ended December 31, 2024 and 2023 can be found in “Management’s Discussion and Analysis of Financial Condition and Results of Operations” in Part II, Item 7 of our Annual Report on Form 10-K for the fiscal year ended December 31, 2024 filed with the United States (“U.S.”) Securities and Exchange Commission (“SEC”) on February 24, 2025.
As we control the performance obligation and are the primary obligor with respect to delivering access to course content for Consumer and Enterprise contracts and have inventory risk through recoupable advances paid to educator partners, we are the principal in such transactions.
As we control the performance obligation and are the primary obligor with respect to delivering access to course content for Consumer and Enterprise contracts and have inventory risk through recoupable advances paid to content creators, we are the principal in such transactions.
We believe that of our significant accounting policies described in Note 2, “Significant Accounting Policies”, in the Notes to Consolidated Financial Statements included in Part II, Item 8 of this Form 10-K, the critical accounting estimates, assumptions, and judgments that have the most significant impact on our Consolidated Financial Statements are described below.
We believe that of our significant accounting policies described in Note 2, Significant Accounting Policies , included in Part II, Item 8 of this Form 10-K, the critical accounting estimates, assumptions, and judgments that have the most significant impact on our Consolidated Financial Statements are described below.
If we are unable to raise additional capital when desired and on terms acceptable to us, our business, results of operations, and financial condition could be materially and adversely affected. Contractual Obligations and Commitments Our estimated future obligations as of December 31, 2024 include both current and long-term obligations.
If we are unable to raise additional capital when desired and on terms acceptable to us, our business, results of operations, and financial condition could be materially and adversely affected. 71 Table of Contents Contractual Obligations and Commitments Our estimated future obligations as of December 31, 2025 include both current and long-term obligations.
Our operating lease obligations as of December 31, 2024 were approximately $4.7 million, which consisted of facility lease payments remaining on those agreements through their staggered expiration concluding in 2030. We have office facility operating leases in the U.S., Canada, the United Kingdom, India, the United Arab Emirates, and the Kingdom of Saudi Arabia.
Our operating lease obligations as of December 31, 2025 were approximately $6.5 million, which consisted of facility lease payments remaining on those agreements through their staggered expiration concluding in 2030. We have office facility operating leases in the U.S., Canada, the United Kingdom, India, the United Arab Emirates, and the Kingdom of Saudi Arabia.
Our main source of operating cash is payments received from our customers. Our primary use of cash from operating activities is for personnel-related expenses, educator partner fees, marketing and advertising expenses, indirect taxes, and third-party cloud infrastructure expenses.
Our main source of operating cash is payments received from our customers. Our primary use of cash from operating activities is for personnel-related expenses, content creator fees, marketing and advertising expenses, indirect taxes, and third-party cloud infrastructure expenses.
Cost of Revenue Cost of revenue consists of content costs, which are fees paid to educator partners, and expenses associated with the operation and maintenance of our platform.
Cost of Revenue Cost of revenue consists of content costs, which are fees paid to content creators, and expenses associated with the operation and maintenance of our platform.
Content costs as a percentage of revenue for the Consumer and Enterprise segments can vary based on the content mix of each segment. Operating Expenses Operating expenses consist of research and development, sales and marketing, and general and administrative expenses.
Content costs as a percentage of revenue for our Consumer and Enterprise offerings can vary based on the content mix of each segment. 66 Table of Contents Operating Expenses Operating expenses consist of research and development, sales and marketing, and general and administrative expenses.
Our sales and marketing expenses primarily consist of personnel and personnel-related costs, including stock-based compensation expense, as well as costs related to acquiring learners, customers, and educator partners, support efforts, and marketing. Sales and marketing expenses also include hosting and bandwidth costs.
Sales and marketing . Our sales and marketing expenses primarily consist of personnel and personnel-related costs, including stock-based compensation expense, as well as costs related to acquiring learners, customers, and content creators, support efforts, and marketing. Sales and marketing expenses also include hosting and bandwidth costs. General and administrative .
Our restructuring related charges consist of costs associated with our restructuring and expense reduction initiatives and are primarily personnel expenses, such as employee severance and benefits costs, net of the reversal of stock-based compensation expense from forfeitures .
Our restructuring related charges consist of costs associated with our restructuring and expense reduction initiatives and are primarily personnel expenses, such as employee severance and benefits costs, net of the reversal of stock-based compensation expense from forfeitures . Interest Income, Net Interest income, net primarily consists of interest income earned on our cash and cash equivalents.
December 31, 2024 2023 Paid Enterprise Customers 1,612 1,369 YoY growth 18 % Net Retention Rate for Paid Enterprise Customers We disclose Net Retention Rate for Paid Enterprise Customers as a supplemental measure of our Enterprise revenue growth.
December 31, 2025 2024 Paid Enterprise Customers 1,730 1,612 YoY growth 7 % Net Retention Rate for Paid Enterprise Customers We disclose Net Retention Rate for Paid Enterprise Customers as a supplemental measure of our Enterprise revenue growth.
We see a significant opportunity to expand our offerings into regions with large, underserved adult learning populations. As part of our growth strategy, we have invested, and plan to continue investing in marketing efforts to support our international expansion and grow our customer and learner base.
We see significant opportunity to grow our learner base, particularly in regions with large, underserved adult learning populations. As part of our growth strategy, we have invested and plan to continue investing in marketing, localized discovery, and translation efforts to support international growth and grow our global customer and learner base.
Under our operating leases, as described in Note 6, “Leases”, to the Consolidated Financial Statements included in Part II, Item 8 of this Form 10-K, we have an immaterial current obligation and a long-term obligation of $3.0 million.
Under our operating leases, as described in Note 6, Leases , included in Part II, Item 8 of this Form 10-K, we have an immaterial current obligation and a long-term obligation of $5.7 million.
Net cash provided by operating activities for the year ended December 31, 2024 was $95.4 million, primarily the result of improved operating leverage and working capital driven by (i) deferred revenue growth, (ii) an increase in incentive compensation and severance accruals, and (iii) an acceleration of accounts receivable collections.
Net cash provided by operating activities for the year ended December 31, 2024 was $95.4 million, primarily resulting from improved operating leverage and working capital driven by (i) deferred revenue growth, (ii) an increase in incentive compensation and severance accruals, and (iii) an acceleration of accounts receivable collections. 72 Table of Contents Cash provided by operating activities increased by $13.3 million during the year ended December 31, 2025, compared to the prior year, primarily resulting from improved operating leverage.
Research and development expenses for the year ended December 31, 2024 were $132.0 million, compared to $160.1 million for the prior year.
Research and development expenses for the year ended December 31, 2025 were $121.6 million, compared to $132.1 million for the prior year.
Investing Activities Net cash provided by investing activities for the year ended December 31, 2024 was $29.9 million, primarily the result of proceeds from the maturities of marketable securities, partially offset by purchases of content assets, purchases of capitalized internal-use software costs, and purchases of property, equipment, and software. 72 Table of Contents Net cash provided by investing activities for the year ended December 31, 2023 was $384.8 million, primarily the result of proceeds from maturities of marketable securities, partially offset by purchases of marketable securities, capitalized internal-use software costs, purchases of property, equipment, and software, and purchases of content assets.
Net cash provided by investing activities for the year ended December 31, 2024 was $29.9 million, due to (i) proceeds from the maturities of marketable securities, partially offset by (ii) capitalized internal-use software costs, (iii) purchases of content assets, and (iv) purchases of property, equipment, and software.
Income Tax Expense Year Ended December 31, Change 2024 2023 $ % (in thousands, except percentages) Income tax expense $ 1,029 $ 5,371 $ (4,342) (81) % Income tax expense for the year ended December 31, 2024 was $1.0 million, compared to $5.4 million for the prior year.
Income Tax Expense Year Ended December 31, Change 2025 2024 $ % (in millions, except percentages) Income tax expense $ 5.1 $ 1.0 $ 4.1 410 % Income tax expense for the year ended December 31, 2025 was $5.1 million, compared to $1.0 million for the prior year.
Year Ended December 31, 2024 2023 Net Retention Rate for Paid Enterprise Customers 87 % 98 % YoY change (11) % 74 Table of Contents Segment Revenue We generate revenue from our three reportable segments: Consumer, Enterprise, and Degrees.
Year Ended December 31, 2025 2024 Net Retention Rate for Paid Enterprise Customers 93 % 87 % YoY change 600 bps 74 Table of Contents Segment Revenue We generate revenue from two reportable segments: Consumer and Enterprise.
Capital Expenditures Our capital expenditures primarily include investments in property, equipment, and software, capitalized internal-use software costs, and purchases of content assets. We expect our purchases of content assets during 2025 to increase relative to 2024.
Capital Expenditures Our capital expenditures primarily include investments in property, equipment, and software, capitalized internal-use software costs, and purchases of content assets.
The following table provides a reconciliation of net loss, the most directly comparable GAAP financial measure, to Adjusted EBITDA: Year Ended December 31, 2024 2023 2022 (in thousands, except percentages) Net loss $ (79,530) $ (116,554) $ (175,357) Depreciation and amortization 25,082 22,270 18,503 Interest income, net (36,726) (34,432) (9,144) Income tax expense 1,029 5,371 4,720 Other expense, net 2,008 19 2,401 Stock-based compensation expense 108,084 115,175 110,663 Payroll tax expense related to stock-based compensation 2,991 3,957 1,120 M&A related transaction costs 3,369 — — Significant and non-recurring legal matters 6,258 — — Restructuring related charges 8,942 (5,806) 10,149 Adjusted EBITDA $ 41,507 $ (10,000) $ (36,945) Net loss margin (11) % (18) % (33) % Adjusted EBITDA Margin 6 % (2) % (7) % Free Cash Flow We define Free Cash Flow as net cash provided by (used in) operating activities, less purchases of property, equipment, and software, capitalized internal-use software costs, and purchases of content assets as we consider these capital expenditures necessary to support our ongoing operations.
The following table provides a reconciliation of net loss, the most directly comparable GAAP financial measure, to Adjusted EBITDA: Year Ended December 31, 2025 2024 2023 (in millions, except percentages) Net loss $ (51.0) $ (79.5) $ (116.6) Depreciation and amortization 28.8 25.1 22.3 Interest income, net (32.0) (36.7) (34.4) Income tax expense 5.1 1.0 5.4 Other expense, net 0.5 2.0 — Stock-based compensation expense 96.7 108.1 115.2 Payroll tax expense related to stock-based compensation 2.8 2.9 4.0 M&A related transaction costs 11.9 3.4 — Significant and non-recurring legal and regulatory matters 1.6 6.3 — Restructuring related charges (0.9) 8.9 (5.8) Adjusted EBITDA $ 63.5 $ 41.5 $ (9.9) Net loss margin (6.7) % (11.4) % (18.3) % Adjusted EBITDA Margin 8.4 % 6.0 % (1.6) % Free Cash Flow We define Free Cash Flow as net cash provided by operating activities, less capitalized internal-use software costs, purchases of content assets, and purchases of property, equipment, and software, as we consider these capital expenditures necessary to support our ongoing operations.
We funded these share repurchases with our existing cash and cash equivalents and completed the purchase authorization on May 7, 2024. During the years ended December 31, 2024 and 2023, we repurchased an aggregate of 3,099,800 shares of our common stock for $36.7 million and 4,829,803 shares of our common stock for $58.5 million.
We funded these share repurchases with our existing cash and cash equivalents and completed the purchase authorization on May 7, 2024. During the year ended December 31, 2024, we repurchased an aggregate of approximately 3.1 million shares of our common stock for $36.7 million under the aforementioned program.
These expenses include the cost of servicing support requests from both paid learners and educator partners, content translation and captioning, hosting and bandwidth costs, amortization of acquired technology, internal-use software, and content assets, customer payment processing fees, and facilities costs. Content costs only apply to Consumer and Enterprise offerings. There are no content costs attributable to our Degrees offering.
These expenses include the cost of servicing support requests from both paid learners and content creators, content translation and captioning, hosting and bandwidth costs, amortization of acquired technology, internal-use software, and content assets, customer payment processing fees, and facilities costs.
Content costs for the Consumer segment were $183.8 million and $172.2 million for the years ended December 31, 2024 and 2023, with content costs as a percentage of revenue of 46% and 47% for the same periods.
Content costs for the Consumer segment were $193.9 million and $183.8 million for the years ended December 31, 2025 and 2024, with content costs as a percentage of revenue of 38.6% and 40.3% for the same periods.
Similarly, Enterprise segment gross margin increased to 69% from 68% when comparing the same periods. The improvements in gross margin were primarily the result of lower content cost rates in both our Consumer and Enterprise segments for the year ended December 31, 2024, partly due to one-time benefits.
Similarly, Enterprise segment gross margin increased to 69.8% from 68.6% when comparing the same periods. The improvements in gross margin were primarily the result of lower content cost rates in both our Consumer and Enterprise segments for the year ended December 31, 2025, due to higher learner engagement in content created under new production arrangements with lower revenue share.
The following table provides a reconciliation of net cash provided by (used in) operating activities, the most directly comparable GAAP financial measure, to Free Cash Flow: Year Ended December 31, 2024 2023 2022 (in thousands) Net cash provided by (used in) operating activities $ 95,361 $ 29,639 $ (38,051) Less: purchases of property, equipment, and software (1,585) (1,147) (1,578) Less: capitalized internal-use software costs (17,219) (15,254) (12,299) Less: purchases of content assets (17,295) (5,344) (1,377) Free Cash Flow $ 59,262 $ 7,894 $ (53,305) 77 Table of Contents Critical Accounting Estimates Our Consolidated Financial Statements have been prepared in accordance with GAAP.
The following table provides a reconciliation of net cash provided by operating activities, the most directly comparable GAAP financial measure, to Free Cash Flow: Year Ended December 31, 2025 2024 2023 (in millions) Net cash provided by operating activities $ 108.7 $ 95.4 $ 29.7 Less: purchases of property, equipment, and software (1.5) (1.6) (1.1) Less: capitalized internal-use software costs (18.1) (17.2) (15.3) Less: purchases of content assets (10.6) (17.3) (5.3) Free Cash Flow $ 78.5 $ 59.3 $ 8.0 77 Table of Contents Critical Accounting Estimates Our Consolidated Financial Statements have been prepared in accordance with GAAP.
The reduction in income tax expense was primarily due to the release of a reserve for an uncertain tax position pertaining to a foreign subsidiary. Liquidity and Capital Resources Overview As of December 31, 2024, our principal source of liquidity was cash and cash equivalents totaling $726.1 million.
The increase in income tax expense was primarily driven by a one-time benefit recognized in 2024 related to the release of a reserve for an uncertain tax position. Liquidity and Capital Resources Overview As of December 31, 2025, our principal source of liquidity was cash and cash equivalents totaling $792.6 million.
Interest income, net was higher during the year ended December 31, 2024, compared to the prior year, due to higher interest rates and our average rate of return on investments in U.S. Treasury securities.
Interest income, net decreased during the year ended December 31, 2025, compared to the prior year, due to lower interest rates and our average rate of return on investments in U.S. Treasury securities. Other income (expense), net for 2025 and 2024 were primarily comprised of unrealized foreign exchange gains and losses.
Components of Results of Operations Revenue We generate revenue from contracts with customers for access to the educational content hosted on our platform and related services across our three reportable segments: Consumer, Enterprise, and Degrees. 65 Table of Contents Consumer and Enterprise revenue primarily consists of subscriptions, with terms ranging from 30 days for certain Consumer subscriptions to one to three years for Enterprise license subscriptions.
Components of Results of Operations Revenue We generate revenue from contracts with customers for access to the educational content hosted on our platform and related services across our two reportable segments: Consumer and Enterprise.
You should review the disclosure under the heading "Risk Factors" under Part I, Item 1A in this Form 10-K for a discussion of important factors that could cause our actual results to differ materially from those anticipated in these forward-looking statements. 62 Table of Contents Organization of Information Management’s discussion and analysis provides a narrative on our financial performance and condition that should be read in conjunction with the accompanying Consolidated Financial Statements.
You should review the disclosure under the heading “Risk Factors” under Part I, Item 1A in this Form 10-K for a discussion of important factors that could cause our actual results to differ materially from those anticipated in these forward-looking statements.
Financing Activities Net cash used in financing activities for the years ended December 31, 2024 and 2023 was $54.9 million and $79.2 million, primarily the result of payments for repurchases of common stock and payments for tax withholdings on vesting of RSUs, partially offset by proceeds from exercise of stock options and proceeds from the employee stock purchase plan.
Net cash used in financing activities for the year ended December 31, 2024 was $55.0 million, primarily driven by (i) payments related to repurchases of common stock under our share repurchase program and (ii) payments for tax withholdings on vesting of RSUs, partially offset by (iii) proceeds from the exercise of stock options, and (iv) proceeds from our employee stock purchase plan.
Cash Flows The following table summarizes our cash flows: Year Ended December 31, 2024 2023 2022 (in thousands) Net cash provided by (used in) operating activities $ 95,361 $ 29,639 $ (38,051) Net cash provided by (used in) investing activities 29,901 384,798 (234,024) Net cash (used in) provided by financing activities (54,944) (79,229) 12,234 Net increase (decrease) in cash, cash equivalents, and restricted cash $ 70,318 $ 335,208 $ (259,841) Operating Activities Cash provided by (used in) operating activities mainly consists of our net loss adjusted for certain non-cash items, including stock-based compensation expense, depreciation and amortization, accretion of marketable securities, and impairment losses, as well as the effect of changes in operating assets and liabilities during each period.
Cash Flows The following table summarizes our cash flows: Year Ended December 31, 2025 2024 2023 (in millions) Net cash provided by operating activities $ 108.7 $ 95.4 $ 29.7 Net cash provided by (used in) investing activities (30.2) 29.9 384.8 Net cash used in financing activities (13.5) (55.0) (79.3) Net increase in cash, cash equivalents, and restricted cash $ 65.0 $ 70.3 $ 335.2 Operating Activities Cash provided by operating activities mainly consists of our net loss adjusted for certain non-cash items, including stock-based compensation expense, depreciation and amortization, and impairment losses, as well as the effect of changes in operating assets and liabilities during each period.
We have also been improving the front-end experience for our Consumer learners and tailoring our pricing and check-out options, including selling our offerings in foreign currency, in select markets. Our business results and operations will depend on our ability to effectively price and package our Consumer products to meet demand and manage foreign currency risk.
We have adapted the front-end experience for Consumer learners, tailoring our pricing and checkout options, including offering local currency transactions in select markets. Our results will depend on our ability to effectively price and package our Consumer products to meet local demand and manage foreign currency risks. Ability to retain and expand our Enterprise customer relationships.
Content costs for the Enterprise segment were $75.0 million and $69.2 million for the years ended December 31, 2024 and 2023, with content costs as a percentage of revenue of 31% and 32% for the same periods. Content costs as a percentage of revenue for both segments decreased due to a shift to lower-cost content.
Content costs for the Enterprise segment were $77.2 million and $75.0 million for the years ended December 31, 2025 and 2024, with content costs as a percentage of revenue of 30.3% and 31.4% for the same periods.
Our Degrees services revenue is determined based on a fee percentage applied to the total tuition collected from Degrees students, net of refunds, by the university partner. As a result, the revenue earned by us is dependent upon the number of learners enrolled and the tuition charged by the university partner. This is a form of variable consideration.
As a result, the revenue earned by us is dependent upon the number of learners enrolled and the tuition charged by the university partner. This is a form of variable consideration.
Our Net Retention Rate for Paid Enterprise Customers was 87% for the year ended December 31, 2024, compared to 98% for the prior year, and was primarily the result of non-renewal of certain large government contracts in North America and the Asia Pacific regions.
Our Net Retention Rate for Paid Enterprise Customers was 93% for the year ended December 31, 2025, compared to 87% for the prior year, and was primarily the result of improvement in net retention in Coursera for Government and Coursera for Campus.
Other Income, Net Year Ended December 31, Change 2024 2023 $ % (in thousands, except percentages) Interest income, net $ 36,726 $ 34,432 $ 2,294 7 % Other expense, net (2,008) (19) (1,989) nm Total other income, net $ 34,718 $ 34,413 $ 305 1 % 70 Table of Contents Total other income, net for the year ended December 31, 2024 was primarily comprised of interest income earned on cash and cash equivalents.
Other Income (Expense) Year Ended December 31, Change 2025 2024 $ % (in millions, except percentages) Interest income, net $ 32.0 $ 36.7 $ (4.7) (13) % Other income (expense), net (0.5) (2.0) 1.5 nm Total other income, net $ 31.5 $ 34.7 $ (3.2) (9) % Total other income (expense), net for the year ended December 31, 2025 was primarily comprised of interest income earned on cash and cash equivalents.
Revenue growth was primarily driven by a 19% increase in the average total number of registered learners, resulting in more paid learners, an 18% increase in the average total number of Paid Enterprise Customers, and a 22% increase in the number of Degrees students.
Revenue growth was primarily driven by an 18% increase in the average total number of Registered Learners, resulting in more paid learners, and a 10% increase in the average total number of Paid Enterprise Customers with growth supported by increased Coursera Plus subscription adoption, ongoing platform improvements, and localized pricing, payment, and promotional capabilities.
This decrease was primarily due to lower personnel-related expenses of $18.3 million, including $8.4 million in stock-based compensation expense, from shifting resources to lower-cost regions, lower content creation costs of $6.1 million, lower attributed facilities costs of $1.6 million, and a decrease in consulting services expense of $1.4 million.
This decrease was primarily due to lower personnel-related expenses of $12.9 million, including $7.0 million in stock-based compensation expense, resulting from our October 2024 expense reduction initiative and from shifting resources to lower-cost regions, partially offset by higher content creation costs of $1.0 million.
We also maintain foreign-currency cash and cash equivalents in our foreign subsidiaries to support their ongoing operations.
Our foreign subsidiaries’ operating costs are typically denominated in the local currencies for each country and are subject to foreign currency fluctuations. We also maintain foreign-currency cash and cash equivalents in our foreign subsidiaries to support their ongoing operations.
Segment gross profit represents segment revenue less content costs paid to educator partners; segment gross margin is the quotient of segment gross profit and segment revenue. Content costs only apply to the Consumer and Enterprise segments as there is no content cost attributable to the Degrees segment.
Segment gross profit represents segment revenue less segment content costs paid to content creators; segment gross margin is the quotient of segment gross profit and segment revenue.
The primary drivers of the increase were revenue growth, which resulted in an increase of $17.4 million in educator partner fees, a $3.3 million increase in amortization expense for internal-use software and website development costs, and a $1.7 million increase in platform costs.
The primary drivers of the increase were revenue growth, which resulted in an increase of $12.3 million in content-related costs and a $4.6 million increase in amortization expense of content assets.
In response to these developments, in October 2024, we announced a commitment to reduce overall expenses, focus efforts, and prioritize future investments in key initiatives that we expect will drive long-term, sustainable growth.
Related cash payments approximated the expense amount for the period and are reflected as cash used in operating activities within our Consolidated Statements of Cash Flows. In October 2024, we announced a commitment to further reduce overall expenses, focus our efforts, and prioritize future investments in key initiatives that we expect will drive long-term, sustainable growth.
Year Ended December 31, 2024 2023 2022 (in millions) New Registered Learners 26.3 23.7 21.5 December 31, 2024 2023 (in millions, except percentages) Total Registered Learners 168.2 141.9 Total Registered Learners year-over-year (“YoY”) growth 19 % Number of Degrees Students We count the total number of Degrees students for each period.
Year Ended December 31, 2025 2024 2023 (in millions) New Registered Learners 29.1 26.3 23.7 73 Table of Contents December 31, 2025 2024 (in millions, except percentages) Total Registered Learners 197.3 168.2 Total Registered Learners year-over-year (“YoY”) growth 17 % Paid Enterprise Customers We count the total number of Paid Enterprise Customers that are active on our platform at the end of each period.
Year Ended December 31, 2024 2023 2022 (in thousands) Revenue $ 694,674 $ 635,764 $ 523,756 Cost of revenue (1) 323,261 305,993 192,277 Gross profit 371,413 329,771 331,479 Operating expenses: Research and development (1) 132,048 160,077 165,134 Sales and marketing (1) 234,908 222,771 227,676 General and administrative (1) 108,734 98,325 105,900 Restructuring related charges (1) 8,942 (5,806) 10,149 Total operating expenses 484,632 475,367 508,859 Loss from operations (113,219) (145,596) (177,380) Other income (expense): Interest income, net 36,726 34,432 9,144 Other expense, net (2,008) (19) (2,401) Loss before income taxes (78,501) (111,183) (170,637) Income tax expense 1,029 5,371 4,720 Net loss $ (79,530) $ (116,554) $ (175,357) 67 Table of Contents (1) Includes stock-based compensation expense as follows: Year Ended December 31, 2024 2023 2022 (in thousands) Cost of revenue $ 2,657 $ 2,593 $ 3,089 Research and development 41,846 49,931 48,779 Sales and marketing 28,104 31,299 30,092 General and administrative 35,477 31,352 28,703 Restructuring related charges — (5,605) 122 Total stock-based compensation expense $ 108,084 $ 109,570 $ 110,785 The following table summarizes our results of operations as a percentage of revenue: Year Ended December 31, 2024 2023 2022 Revenue 100 % 100 % 100 % Cost of revenue 47 48 37 Gross profit 53 52 63 Operating expenses: Research and development 19 25 32 Sales and marketing 34 35 43 General and administrative 15 16 20 Restructuring related charges 1 (1) 2 Total operating expenses 69 75 97 Loss from operations (16) (23) (34) Other income (expense): Interest income, net 5 6 2 Other expense, net — — — Loss before income taxes (11) (17) (32) Income tax expense — 1 1 Net loss (11) % (18) % (33) % Comparison of the Years Ended December 31, 2024 and 2023 Revenue Year Ended December 31, Change 2024 2023 $ % (in thousands, except percentages) Revenue: Consumer $ 398,094 $ 365,221 $ 32,873 9 % Enterprise 238,865 219,542 19,323 9 % Degrees 57,715 51,001 6,714 13 % Total revenue $ 694,674 $ 635,764 $ 58,910 9 % 68 Table of Contents Revenue for the year ended December 31, 2024 was $694.7 million, an increase of $58.9 million , or 9%, from $635.8 million for the prior year.
Year Ended December 31, 2025 2024 2023 (in millions) Revenue $ 757.5 $ 694.7 $ 635.8 Cost of revenue (1) 344.1 323.3 306.0 Gross profit 413.4 371.4 329.8 Operating expenses: Research and development (1) 121.6 132.1 160.1 Sales and marketing (1) 255.7 234.9 222.8 General and administrative (1) 114.4 108.7 98.3 Restructuring related charges (1) (0.9) 8.9 (5.8) Total operating expenses 490.8 484.6 475.4 Loss from operations (77.4) (113.2) (145.6) Interest income, net 32.0 36.7 34.4 Other expense, net (0.5) (2.0) — Loss before income taxes (45.9) (78.5) (111.2) Income tax expense 5.1 1.0 5.4 Net loss $ (51.0) $ (79.5) $ (116.6) (1) Includes stock-based compensation expense as follows: Year Ended December 31, 2025 2024 2023 (in millions) Cost of revenue $ 2.5 $ 2.7 $ 2.6 Research and development 34.8 41.8 49.9 Sales and marketing 20.8 28.1 31.3 General and administrative 38.6 35.5 31.4 Restructuring related charges (1.6) — (5.6) Total stock-based compensation expense $ 95.1 $ 108.1 $ 109.6 68 Table of Contents The following table summarizes our results of operations as a percentage of revenue: Year Ended December 31, 2025 2024 2023 Revenue 100.0 % 100.0 % 100.0 % Cost of revenue 45.4 46.5 48.1 Gross profit 54.6 53.5 51.9 Operating expenses: Research and development 16.1 19.0 25.2 Sales and marketing 33.8 33.8 35.0 General and administrative 15.0 15.7 15.5 Restructuring related charges (0.1) 1.3 (0.9) Total operating expenses 64.8 69.8 74.8 Loss from operations (10.2) (16.3) (22.9) Other income (expense): Interest income, net 4.2 5.3 5.4 Other expense, net (0.1) (0.3) — Loss before income taxes (6.1) (11.3) (17.5) Income tax expense 0.6 0.1 0.8 Net loss (6.7) % (11.4) % (18.3) % Comparison of the Years Ended December 31, 2025 and 2024 Revenue Year Ended December 31, Change 2025 2024 $ % (in millions, except percentages) Revenue: Consumer $ 502.2 $ 455.8 $ 46.4 10 % Enterprise 255.3 238.9 16.4 7 % Total revenue $ 757.5 $ 694.7 $ 62.8 9 % Revenue for the year ended December 31, 2025 was $757.5 million, an increase of $62.8 million, or 9%, compared to $694.7 million for the prior year.
Refer to Note 11, “Employee Benefit Plans,” in the Notes to Consolidated Financial Statements included in Part II, Item 8 of this Form 10-K for additional information.
For additional information, refer to Note 1, Basis of Presentation and Description of Business , and Note 11, Employee Benefit Plans , both included in the Notes to Consolidated Financial Statements included in Part II, Item 8 of this Form 10-K and Item 9B, Other Information, included in Part II of this Form 10-K. 64 Table of Contents Reporting Segments Our chief operating decision maker (“CODM”) is our CEO.
Consumer subscriptions are paid in advance, while Enterprise subscriptions are usually invoiced in advance in annual or quarterly installments. Since access to our platform represents a series of distinct services that we continually provide over the subscription term, revenue is recognized ratably over that period.
Since access to our platform represents a series of distinct services that we continually provide over the subscription term, revenue is recognized ratably over that period. We typically serve as the principal for revenue generated from sales to Consumer and Enterprise customers, as we control the performance obligation and are responsible for delivering content access.
Restructuring related charges for the year ended December 31, 2024 were $8.9 million, compared to $(5.8) million for the prior year. For 2024, the expenses primarily consist of personnel expenses, such as employee severance and benefits costs, related to our expense reduction initiatives initiated in January and October 2024.
For 2024, the expenses primarily consist of personnel expenses, such as employee severance and benefits costs, related to our expense reduction initiative initiated in January 2024. Refer to Note 14, Restructuring Related Charges , included in Part II, Item 8 of this Form 10-K for further information.
Year Ended December 31, 2024 2023 2022 (in thousands, except percentages) Consumer revenue $ 398,094 $ 365,221 $ 295,583 YoY growth 9 % 24 % Enterprise revenue $ 238,865 $ 219,542 $ 181,284 YoY growth 9 % 21 % Degrees revenue $ 57,715 $ 51,001 $ 46,889 YoY growth 13 % 9 % Total revenue $ 694,674 $ 635,764 $ 523,756 YoY growth 9 % 21 % Segment Gross Profit We monitor segment gross profit as a key metric to help us evaluate the financial performance of our individual segments.
Year Ended December 31, 2025 2024 2023 (in millions, except percentages) Consumer revenue $ 502.2 $ 455.8 $ 416.2 YoY growth 10 % 10 % Enterprise revenue $ 255.3 $ 238.9 $ 219.6 YoY growth 7 % 9 % Total revenue $ 757.5 $ 694.7 $ 635.8 YoY growth 9 % 9 % Segment Gross Profit We monitor segment gross profit as a key metric to help us evaluate the financial performance of our individual segments.
These estimates are continually evaluated until such time as the uncertainties are resolved, generally at the time the final term enrollment report is provided by the university partner.
These estimates are continually evaluated until such time as the uncertainties are resolved, generally at the time the final term enrollment report is provided by the university partner. Recent Accounting Pronouncements Refer to Note 2, Significant Accounting Policies , included in Part II, Item 8 of this Form 10-K for a discussion of recent accounting pronouncements.
Enterprise revenue for the year ended December 31, 2024 increased by $19.3 million, or 9%, from the prior year, attributable to an increase in new customers. Acquisitions of new customers drove an increase of $27.1 million, offset by a $7.8 million decrease due to contraction of existing customer spend.
Enterprise revenue for the year ended December 31, 2025 increased by $16.4 million, or 7%, compared to the prior year, attributable to an increase in new customers.
Sales and marketing expenses for the year ended December 31, 2024 were $234.9 million, compared to $222.8 million for the prior year. The increase was primarily due to an increase in marketing and advertising expenses of $11.6 million and an increase in commission expenses of $2.4 million.
Sales and marketing expenses for the year ended December 31, 2025 were $255.7 million, compared to $234.9 million for the prior year.
Factors Affecting Our Performance We believe that the growth of our business and our future success are dependent upon many factors. While each of these factors present significant opportunities for us, these factors also pose challenges that we must successfully address in order to sustain the growth of our business and enhance our results of operations.
While these factors present opportunities for us, they also pose challenges that we must address to sustain growth and improve our results of operations. Ability to innovate our products. Central to our strategy is the continued innovation of our products.
To be the platform of choice for educator partners, we continue to invest in increasing the size and engagement of our learner base, developing AI-powered product innovations (e.g., Course Builder and Coach), providing a suite of academic integrity features (e.g., identity verification and anti-plagiarism detection), improving recommendation and personalization features, engaging in marketing efforts that drive higher conversion into paid offerings, and enhancing the analytics tools available for learners, educators, organizations, and institutions.
To remain a preferred platform for trusted content creators, we continue to invest in growing and engaging our learner base, enhancing the learning and authoring experience through AI-powered product innovations (e.g., Coach, AI translations, and Course Builder), and providing a suite of academic integrity features to verify skills mastery (e.g., identity verification and anti-plagiarism detection).
Cost of Revenue, Gross Profit, and Gross Margin Year Ended December 31, Change 2024 2023 $ % (in thousands, except percentages) Cost of revenue $ 323,261 $ 305,993 $ 17,268 6 % Gross profit $ 371,413 $ 329,771 $ 41,642 13 % Gross margin 53 % 52 % Cost of revenue for the year ended December 31, 2024 was $323.3 million, compared to $306.0 million for the prior year.
Acquisitions of new customers drove an increase of $16.7 million. 69 Table of Contents Cost of Revenue, Gross Profit, and Gross Margin Year Ended December 31, Change 2025 2024 $ % (in millions, except percentages) Cost of revenue $ 344.1 $ 323.3 $ 20.8 6 % Gross profit $ 413.4 $ 371.4 $ 42.0 11 % Gross margin 54.6 % 53.5 % Cost of revenue for the year ended December 31, 2025 was $344.1 million, compared to $323.3 million for the prior year.
Cash provided by operating activities increased by $65.7 million during the year ended December 31, 2024, compared to the prior year, primarily the resulting of (i) improved operating leverage, (ii) an improvement in the timing of accounts receivables collections, and (iii) the timing of vendor prepayments, partially offset by (iv) the timing of content fees payable to our largest educator partner resulting from the prior year extension of our multi-year agreement with them.
Net cash provided by operating activities for the year ended December 31, 2025 was $108.7 million, primarily resulting from improved operating leverage and working capital driven by (i) deferred revenue growth (ii) timing of vendor payments, partially offset by (iii) an increase in accounts receivable due to timing of invoicing and collections.
We engage our free learners through both our on-platform and off-platform marketing efforts, highlighting premium features that encourage conversion to our paid offerings, such as subscriptions. These efforts include campaigns targeting existing learners, personalized recommendations, and performance marketing on the internet. Ability to expand our international footprint.
New learners often begin with free courses on our platform, which serve as a funnel to grow our learner base and generate referrals to paid offerings. We engage these learners through targeted marketing, personalized recommendations, and performance campaigns to highlight premium features and encourage conversion. Ability to grow in international markets.
Our data-driven learner experience helps identify potential Enterprise prospects. complemented by our direct sales team, which finds and engages with potential business, academic, government, and other institutional customers. Recent Developments Leadership Transition Effective February 3, 2025, our Board of Directors (the “Board”) appointed Gregory Hart as our President, Chief Executive Officer, and a Class III director on our Board.
Organizational Updates and Strategic Realignment Leadership Transitions Effective February 3, 2025, our Board of Directors (the “Board”) appointed Gregory Hart as our President, Chief Executive Officer (“CEO”), and a Class III director on our Board.
The increase in gross margin was driven by lower content cost rates in both our Consumer and Enterprise segments. 69 Table of Contents Operating Expenses Year Ended December 31, Change 2024 2023 $ % (in thousands, except percentages) Operating expenses: Research and development $ 132,048 $ 160,077 $ (28,029) (18) % Sales and marketing 234,908 222,771 12,137 5 % General and administrative 108,734 98,325 10,409 11 % Restructuring related charges 8,942 (5,806) 14,748 nm Total operating expenses $ 484,632 $ 475,367 $ 9,265 2 % Total operating expenses for the year ended December 31, 2024 were $484.6 million, compared to $475.4 million for the prior year.
Operating Expenses Year Ended December 31, Change 2025 2024 $ % (in millions, except percentages) Operating expenses: Research and development $ 121.6 $ 132.1 $ (10.5) (8) % Sales and marketing 255.7 234.9 20.8 9 % General and administrative 114.4 108.7 5.7 5 % Restructuring related charges (0.9) 8.9 (9.8) nm Total operating expenses $ 490.8 $ 484.6 $ 6.2 1 % Total operating expenses for the year ended December 31, 2025 were $490.8 million, compared to $484.6 million for the prior year.
We also recognized a reversal of stock-based compensation expense of approximately $5.6 million during the year ended December 31, 2023, resulting from the forfeiture of RSUs and stock options.
During the year ended December 31, 2025, we recognized charges of $0.7 million, made cash payments of $5.2 million, and also recognized a reversal of stock-based compensation expense of $1.6 million due to the forfeiture of restricted stock units (“RSUs”) and stock options. Factors Affecting Our Performance Our business growth and future success depend on many factors.
Overview Coursera is one of the world’s largest online learning destinations, connecting an ecosystem of learners, educators, organizations, and institutions through high-quality content, credentials, data, and technology. As the digital economy evolves, the demand for new skills increases. We partner with over 350 university and industry partners (collectively, “educator partners”) to create and distribute high-quality, modular, flexible, and affordable content.
Overview Coursera operates a global online learning platform that connects an ecosystem of learners, content creators, organizations, and institutions. The platform offers high-quality educational content, credentials, and learning tools to support skills development and career advancement. We partner with over 375 content creators, including universities and industry organizations, to create and distribute educational content that is modular, flexible, and affordable.
We expect sales and marketing expenses as a percentage of revenue to vary from period to period but generally decrease over the long term. General and administrative .
We are focused on investing in initiatives which will drive operational efficiency while focusing resources on high-growth opportunities, therefore operating expenses as a percentage of revenue may vary from period to period, in part due to the extent and timing of sales and marketing initiatives, but over the long term we anticipate our operating expenses will generally decrease as a percentage of revenue.
Therefore, shifts in the mix between our three segments are expected to be a significant driver of our overall gross margin, financial performance, and profitability.
Given that content costs are the largest individual cost of our revenue, and that these costs contractually vary as a percentage of revenue between our Consumer and Enterprise offerings, mix shifts between our two segments can be a significant factor of our overall gross margin, financial performance, and profitability.
Year Ended December 31, 2024 2023 2022 (in thousands, except percentages) Consumer gross profit $ 214,335 $ 193,001 $ 214,305 Consumer segment gross margin % 54 % 53 % Enterprise gross profit $ 163,877 $ 150,384 $ 126,573 Enterprise segment gross margin % 69 % 68 % Degrees gross profit $ 57,715 $ 51,001 $ 46,889 Degrees segment gross margin % 100 % 100 % Consumer segment gross margin increased to 54% in the year ended December 31, 2024, up from 53% in the prior year.
Year Ended December 31, 2025 2024 2023 (in millions, except percentages) Consumer gross profit $ 308.3 $ 272.0 $ 244.0 Consumer segment gross margin % 61.4 % 59.7 % Enterprise gross profit $ 178.1 $ 163.9 $ 150.4 Enterprise segment gross margin % 69.8 % 68.6 % Consumer segment gross margin increased to 61.4% in the year ended December 31, 2025, up from 59.7% in the prior year.
With regards to the expense reduction initiative, we expect this initiative to generate at least $30 million in annualized structural cost savings primarily from a global workforce reduction of approximately 9%, creating capacity for targeted investments, as well as incremental profitability.
This initiative resulted in a reduction of our global workforce by approximately 9%, creating capacity for targeted investments, as well as incremental profitability. As a result of these actions, we recognized restructuring related charges of $6.8 million during the year ended December 31, 2024.
Ability to source in-demand content from our educator partners. We believe that learners and enterprises are attracted to Coursera largely because of the high quality and wide selection of content provided by our educator partners.
We believe learners and customers are attracted to Coursera due to the quality, trust, and job-relevance of our wide selection of educational content provided by our content creators. We intend to accelerate our content development efforts, continuing to source and produce in-demand content and credentials to attract, convert, and retain learners and grow our revenue over time.
We typically serve as the principal for revenue generated from sales to Consumer and Enterprise customers, as we control the performance obligation and are responsible for delivering content access. Degrees revenue is generated from contracts with university partners to host and deliver their online bachelor’s and master’s degrees or postgraduate diplomas.
Consumer revenue also includes degree product revenue generated from contracts with university partners to host and deliver their online bachelor’s and master’s degrees or postgraduate diplomas. We earn a service fee, determined as a percentage of the total tuition collected from students in degree programs, net of refunds.

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Item 7A. Quantitative and Qualitative Disclosures About Market Risk

Market Risk — interest-rate, FX, commodity exposure

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Biggest changeTreasury securities and U.S. government-backed money market funds, with maturities of one year or less. 78 Table of Contents Based on our investment positions as of December 31, 2024 and 2023, a hypothetical 100 basis point increase or decrease in interest rates across all maturities would have resulted in a $0.6 million and $0.5 million incremental decline or improvement in the fair value of our portfolio.
Biggest changeOur holdings as of December 31, 2025 and 2024 consist of securities with remaining maturities of three months or less. 78 Table of Contents A hypothetical 100 basis point increase or decrease in interest rates as of December 31, 2025 and 2024 would have resulted in (i) a $0.6 million incremental decline or improvement for both periods in the fair value of our portfolio, which would only be realized if we sold the investments prior to their maturities, and (ii) a $7.9 million and $7.3 million increase or decrease in our annualized interest income based on the balances of our cash and cash equivalents for the periods presented.
A 10% increase or decrease in current exchange rates would have resulted in an impact of $1.2 million and $3.4 million on our loss before income taxes in our Consolidated Financial Statements for the years ended December 31, 2024 and 2023. 79 Table of Contents
A 10% increase or decrease in current exchange rates would have resulted in an impact of $0.5 million and $1.2 million on our loss before income taxes in our Consolidated Financial Statements for the years ended December 31, 2025 and 2024. 79 Table of Contents
Interest Rate Risk Our exposure to interest rate changes primarily relates to our investment portfolio. Although we are exposed to global interest rate fluctuations, U.S. interest rate fluctuations tend to have the most significant impact on our interest income, affecting the interest earned on our cash, cash equivalents, and marketable securities as well as the fair value of those securities.
Interest Rate Risk Our exposure to interest rate changes primarily relates to our investment portfolio. Although we are exposed to global interest rate fluctuations, U.S. interest rate fluctuations tend to have the most significant impact on our interest income, affecting the interest earned on our cash and cash equivalents.
Our investment policy and strategy are focused on preserving capital and supporting our liquidity requirements. We use a combination of internal and external management to execute our investment strategy and achieve our investment objectives, typically investing in highly-rated securities, such as U.S.
Our investment policy and strategy are focused on preserving capital and supporting our liquidity requirements. We use a combination of internal and external management to execute our investment strategy and achieve our investment objectives, typically investing in highly-rated securities, such as U.S. Treasury securities and U.S. government-backed money market funds, with maturities of one year or less.
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However, such hypothetical losses would only be realized if we sold the investments prior to their maturities.
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Based on the balance of our cash, cash equivalents, and marketable securities as of December 31, 2024 and 2023, a hypothetical 100 basis point increase or decrease in interest rates would have resulted in a $7.3 million and $7.2 million increase or decrease in our interest income on an annualized basis.

Other COUR 10-K year-over-year comparisons