Breaking Down Coursera, Inc. (COUR) Financial Health: Key Insights for Investors

You're looking at Coursera, Inc. (COUR) right now and asking if the strong consumer tailwinds can truly overcome the Enterprise segment's softness-a fair question for any long-term growth investor. The company's latest Q3 2025 results showed a clear split: revenue hit $194.2 million, beating estimates, driven by a robust 13% year-over-year growth in the Consumer segment, but the Enterprise net revenue retention rate (NRR) dropped to 89%, signaling a real challenge in keeping existing B2B clients on board. Still, management is defintely optimistic, raising the full-year 2025 revenue outlook to a range of $750 million to $754 million, plus they're generating real cash flow, with Q3 Free Cash Flow jumping 59% to $27 million. This analysis will map out exactly where the AI-driven opportunities-like the new Anthropic partnership-meet the market's skepticism, giving you a clear, actionable view on Coursera's valuation and near-term trajectory.

Revenue Analysis

You're looking for a clear map of where Coursera, Inc. (COUR) actually makes its money, and the short answer is: the individual learner is driving the growth right now. For the full fiscal year 2025, Coursera has raised its revenue outlook to a range of $750 million to $754 million, signaling confidence despite a mixed economic environment.

This projected revenue represents a year-over-year growth rate of 8% to 9%, which is a solid, albeit decelerated, pace for a scaled education technology platform. The key to understanding this number is breaking down the two main segments: Consumer and Enterprise. Honestly, the Consumer segment is the engine pulling the train.

Here's the quick math on the segment contributions based on the strong Q3 2025 results, which saw total revenue hit $194.2 million:

• Consumer Segment: Generated $130.3 million, which is about 67.1% of total quarterly revenue. This segment grew by a robust 13% year-over-year.
• Enterprise Segment: Contributed $63.9 million, or roughly 32.9% of total revenue. Its growth was a more muted 6% year-over-year.

The primary revenue streams within the Consumer segment are individual course enrollments, Professional Certificates, and the all-access subscription, Coursera Plus. The shift to subscriptions is defintely a major trend; Coursera Plus now accounts for more than half of the entire Consumer segment revenue, which is a powerful indicator of recurring revenue stability. The Enterprise segment, which sells to businesses (Coursera for Business) and universities (Coursera for Campus), is still growing, but management has noted a more cautious or 'muted' environment in that corporate space.

What this segment breakdown hides is a recent structural change. Coursera simplified its reporting by integrating the Degrees product revenue into the Consumer segment. This move streamlines the focus on the individual learner journey, whether they are taking a single course or pursuing a full degree. Anyway, the core takeaway is that the individual learner, driven by the demand for job-relevant skills, is the company's most reliable growth vector right now. You can see how this aligns with their long-term strategy in their Mission Statement, Vision, & Core Values of Coursera, Inc. (COUR).

Here is the segment performance for the most recently reported quarter:

Profitability Metrics

You want to know if Coursera, Inc. (COUR) is making real money, not just growing revenue. The short answer is they've achieved GAAP net income in Q3 2025, a critical milestone, but they are still navigating a narrow path to full-year GAAP profitability. The operational efficiency is clearly improving, but you need to watch the cost-to-revenue ratio closely.

Here's the quick math on their recent performance: as of the trailing twelve months (TTM) ending November 2025, Coursera, Inc. (COUR) reported a gross margin of 54.36%. This is a solid, high-quality margin for a platform business, showing their content costs (revenue share with partners) are well managed. For the third quarter of 2025 alone, their GAAP gross profit was $108 million, maintaining a 56% gross margin. That's a strong signal of operational efficiency, driven by new content arrangements with lower revenue share, especially in the Consumer segment.

• Gross Margin (TTM): 54.36% - Strong content cost management.
• Operating Margin (TTM): -9.42% - Still negative, but improving leverage.
• Net Margin (TTM): -6.2% - Losses are narrowing significantly.

The Path to Operating Profit

The real story is in the operating and net margins. While the gross profit is healthy, the company is still in a growth phase, meaning sales, marketing, and R&D expenses are significant. The TTM operating margin sits at -9.42%, and the net margin is -6.2%. However, the trend is defintely positive. In Q2 2025, the GAAP net loss was $(7.8) million, but by Q3 2025, the company reported a GAAP net income of $17 million. That's a huge swing in one quarter, showing strong operating leverage (the ability to grow revenue faster than costs).

Management is focused on a non-GAAP metric, Adjusted EBITDA (Earnings Before Interest, Taxes, Depreciation, and Amortization), which strips out things like stock-based compensation. For the full year 2025, they are targeting an Adjusted EBITDA Margin of 8.0%, a 200 basis point improvement over the prior year. This is the clearest indicator of their near-term profitability goal, even if GAAP net income remains volatile for a bit longer. You can see more about the drivers behind this in Exploring Coursera, Inc. (COUR) Investor Profile: Who's Buying and Why?

Industry Comparison and Efficiency

To understand what a 54.36% gross margin means, we need to compare it. The EdTech sector is highly fragmented, but one comparable company, New Oriental Education & Technology Group Inc. (EDU), reported a Q4 2025 gross margin of 54.20%, which is right in line with Coursera, Inc. (COUR). Another, 17 Education & Technology Group, had a Q2 2025 gross margin of 57.51%. Coursera, Inc. (COUR) is competitive here. Where they diverge is in the bottom line:

The table shows Coursera, Inc. (COUR)'s operational efficiency is improving but still lags behind a profitable peer like EDU on the operating and net profit lines. The gap between the gross margin and the operating margin is where the company is spending heavily on growth initiatives, like their push into generative AI offerings and the Enterprise segment. With full-year 2025 revenue expected to be between $750 million and $754 million, the focus is now on letting that revenue scale against a more controlled cost base to close that operating margin gap in 2026.

Next Step: Review the upcoming Q4 2025 earnings release for the final full-year GAAP net profit/loss to confirm if the Q3 net income was a one-off or the start of a sustained trend.

Debt vs. Equity Structure

If you're looking at Coursera, Inc. (COUR), the first thing to know about their balance sheet is that they are defintely not a debt-laden company. Their financing strategy leans heavily on equity, which is typical for a growth-focused software platform in the e-learning space.

The company maintains a remarkably clean balance sheet, which means they are not relying on borrowing to fund operations or expansion. This is a huge positive for investors worried about rising interest rates or a market downturn increasing debt service costs. Simply put, Coursera, Inc. is essentially debt-free.

Here's the quick math on their leverage posture based on the latest available data for the 2025 fiscal year. The total debt is negligible compared to their shareholder equity, which is the capital raised from investors and retained earnings.

• Total Shareholder Equity: Approximately $639.5 million
• Total Debt (Long-Term + Short-Term): Approximately $3.06 million

The tiny debt figure is broken down into about $3.02 million in long-term debt and only $86.00 thousand in short-term debt.

Debt-to-Equity Ratio: A Clear Advantage

The Debt-to-Equity (D/E) ratio is the clearest indicator of this low-leverage strategy. This ratio compares a company's total liabilities to its shareholder equity, showing how much of its assets are financed by debt versus ownership capital (equity). Coursera, Inc.'s D/E ratio is an ultra-low 0.01, or in some views, virtually 0%.

To be fair, this is an outstanding figure when benchmarked against the industry. The average Debt-to-Equity ratio for the broader U.S. Education & Training Services industry is roughly 0.43 as of November 2025. Coursera, Inc. is running at a fraction of that, which signals a significant financial strength and flexibility.

Financing Strategy and Future Outlook

The company's capital structure is clearly equity-funded, relying on its initial public offering (IPO) proceeds and subsequent equity raises, not on credit markets. This means they have not had any material debt issuances, credit ratings, or refinancing activity to worry about in 2025, which is a non-event that is actually a positive signal.

The opportunity here is that this low leverage gives management maximum optionality. If a major acquisition opportunity arises, they can choose to finance it with a measured amount of debt without immediately over-leveraging the balance sheet. For now, their strong cash position and positive free cash flow, reported at $27 million for Q3 2025, mean they can fund organic growth internally.

This capital structure is a low-risk foundation, but it also means the company is not using financial leverage (borrowing money to amplify returns) to boost its return on equity. Still, I'd rather have a flexible balance sheet than a highly leveraged one in a volatile market.

For a deeper dive into who is betting on this equity-heavy model, check out Exploring Coursera, Inc. (COUR) Investor Profile: Who's Buying and Why?

Next step: Portfolio Manager: Assess the impact of a potential 2026 debt raise (e.g., $100M) on the D/E ratio and interest coverage, assuming a 6% rate, by end of month.

Liquidity and Solvency

You want to know if Coursera, Inc. (COUR) has the cash on hand to meet its short-term obligations, and the quick answer is a definitive yes. The company's liquidity position is exceptionally strong, backed by a significant cash reserve and minimal debt, which gives them substantial operational flexibility to invest in their AI-driven growth initiatives.

Assessing Coursera, Inc.'s Liquidity

A look at the balance sheet for Coursera, Inc. reveals a very healthy liquidity profile. We use the current ratio and quick ratio (acid-test ratio) to gauge a company's ability to cover its near-term debts. For Coursera, Inc., these two ratios are essentially identical at a robust 2.57.

A ratio of 1.0 is the baseline for solvency, so a 2.57 means Coursera, Inc. has $2.57 in liquid assets for every dollar of current liability. This level of liquidity is a major strength, especially for a company still investing heavily in growth.

• Current Ratio: 2.57 (Strong ability to cover 12-month obligations).
• Quick Ratio: 2.57 (Nearly identical, as inventory is negligible for a platform business).
• Debt-to-Equity Ratio: 0.01 (Reflecting virtually no traditional debt).

Working Capital and Cash Position

The working capital trend for Coursera, Inc. is firmly positive. Working capital is simply current assets minus current liabilities, representing the capital available for day-to-day operations. As of September 30, 2025 (Q3 2025), the company reported $897.3 million in total current assets. Here's the quick math: based on the current ratio, this implies current liabilities are around $349.14 million, leaving a working capital of approximately $548.16 million. This is a massive cash cushion.

The bedrock of this strength is the cash balance. Coursera, Inc. holds approximately $797.7 million in unrestricted cash and cash equivalents, with no debt on the balance sheet. That's a powerful position that shields the company from economic shocks and funds strategic investments without needing to tap debt markets.

For a deeper dive into the company's full financial picture, including our Discounted Cash Flow (DCF) valuation, you can read the full post: Breaking Down Coursera, Inc. (COUR) Financial Health: Key Insights for Investors.

Cash Flow Statement Trends

The cash flow statement confirms the company is moving toward self-sustaining operations. The key is the shift to consistent, positive cash generation, which reduces reliance on external funding.

The trends in the cash flow statement for Q3 2025 are highly encouraging:

• Operating Cash Flow: Net cash provided by operating activities was $33.9 million, a 22% year-over-year increase.
• Free Cash Flow (FCF): FCF was $27 million in Q3 2025, which is a significant 59% increase year-over-year.

Year-to-date, Free Cash Flow is now over $80 million as of Q3 2025. This positive and accelerating FCF trend is the real signal of operational discipline and improving working capital management. It shows that the business model is generating more cash than it consumes, even while investing in growth initiatives like AI content partnerships.

The only potential, minor liquidity concern is the Enterprise segment's Net Retention Rate (NRR) at 89%, which requires monitoring, but the overall financial strength easily offsets this near-term headwind. The balance sheet is defintely a source of strength for Coursera, Inc.

Valuation Analysis

You are looking at Coursera, Inc. (COUR) and wondering if the market has it right. Honestly, the stock's valuation is a classic growth-stock puzzle: it looks expensive on some metrics but cheap if you believe in the future earnings growth. The immediate takeaway is that the market is pricing in a clear path to profitability, which is a riskier bet than buying a mature, cash-cow business.

The stock has had a solid run over the last year, increasing by 22.35% in the last 12 months, but it still trades near the lower end of its 52-week range of $5.76 to $13.56. As of mid-November 2025, the price is hovering around the $8.12 to $8.49 range. The volatility is high, which is expected for a company still in its growth phase, but that 52-week high shows the market's optimism when results are good.

Here is the quick math on the core valuation multiples, using data grounded in the 2025 fiscal year outlook:

• Price-to-Earnings (P/E) Ratio: The trailing P/E is not applicable (N/A) because Coursera, Inc. is not yet profitable on a trailing twelve-month basis. However, the Forward P/E, which uses analyst consensus on future earnings, is approximately 20.65. This is the key number telling you the market expects earnings to materialize quickly.
• Price-to-Book (P/B) Ratio: The P/B ratio is around 2.11 as of November 2025. This is a moderate valuation, suggesting the stock is trading at just over twice the value of its net assets (total assets minus liabilities), which is reasonable for a tech-enabled education platform with a strong brand and low debt.
• Enterprise Value-to-EBITDA (EV/EBITDA): This metric is also negative, ranging from approximately -12.36 to -15, due to negative TTM EBITDA (Earnings Before Interest, Taxes, Depreciation, and Amortization). When a company's EBITDA is negative, this ratio is less useful for a direct comparison, but it confirms the company is still in the investment phase, not the harvesting-cash phase.

On the income side, Coursera, Inc. does not pay a dividend, so the dividend yield and payout ratios are N/A. This is standard for a growth company that reinvests all capital back into the business to fuel expansion, especially with a full-year 2025 revenue outlook of $750 million to $754 million.

Most analysts are currently split, leaning toward a 'Hold' consensus. Out of 13 Wall Street analysts, there is a near-even split with 6 recommending 'Buy,' 6 recommending 'Hold,' and only 1 recommending 'Sell'. The average 12-month price target is $12.36, which implies a significant upside of over 52% from the recent stock price. This indicates a belief that the company's strategic moves-like improving the Annual Adjusted EBITDA Margin by 200 basis points to 8.0% for the full year 2025-will pay off.

What this estimate hides is the execution risk in their Enterprise segment, which has shown some revenue retention challenges. The 'Hold' recommendation is a nod to the potential upside, but it's tempered by the reality of a business still proving its long-term profitability model. If you want to dive deeper into who is buying and why, you should check out Exploring Coursera, Inc. (COUR) Investor Profile: Who's Buying and Why?

Your next step is to weigh that 52% potential upside against the risk of a non-profitable company. Finance: model a sensitivity analysis on the Forward P/E based on a 10% miss on 2026 earnings estimates by the end of the week.

Risk Factors

You're looking at Coursera, Inc. (COUR) after a solid third quarter in 2025, but the market reaction-a stock dip of nearly 12% after-hours-tells you investors are pricing in real risks, not just celebrating a revenue beat. The core issue is balancing aggressive growth investments, especially in AI, with a clear, sustained path to GAAP profitability (Generally Accepted Accounting Principles).

While the full year 2025 revenue outlook was raised to a range of $750 million to $754 million, the company still faces significant internal and external headwinds that demand a realist's view. The good news is the balance sheet is strong with almost no traditional debt, but the key risks center on competition and margin sustainability.

Operational and Financial Headwinds

The biggest financial risk is the persistent net loss under standard GAAP accounting. In Q3 2025, Coursera reported a net loss of $(8.6) million, even though this was a 37% improvement from the prior year. This continued loss, coupled with a projected lower fourth-quarter profitability, raises fresh concerns about margin pressure, despite the company's commitment to an 8.0% Adjusted EBITDA Margin for the full year 2025.

Here's the quick math: you beat on revenue, but if the cost-of-revenue and operating expenses grow too fast, the margin story gets murky. Operational risks also include a recent leadership change, with Mike Foley stepping in as interim Chief Financial Officer while the search for a permanent CFO continues. That kind of executive transition can inject temporary uncertainty into financial planning.

• Sustaining GAAP profitability remains elusive.
• Retention softness in the Consumer segment is a risk, tied partly to broader macroeconomic conditions.
• The strategic shift in the Degrees segment is expected to lead to near-term revenue declines.

External and Competitive Pressures

The online learning space is defintely a crowded field. Coursera, Inc. faces intense competition, not just from direct rivals, but also from free alternatives and the persistent market skepticism about the value of online credentials versus traditional degrees. This competition can cap pricing power and increase marketing spend, directly pressuring those already-tight operating margins.

Furthermore, the company's business model is heavily reliant on its educator partners-the universities and industry leaders who provide the content. Losing a major partner could immediately degrade the value of the platform. You also have to watch the regulatory landscape, which is complex and volatile for global platforms, particularly around data privacy and international accreditation standards.

The company's primary mitigation strategy is to lean into its content and AI leadership. They are actively integrating with partners like OpenAI's ChatGPT and Anthropic to create more personalized and AI-native learning experiences. This is a smart, offensive move, but it also introduces execution risk-can they monetize these new AI features fast enough to offset the investment costs?

The stock's volatility, trading near its 52-week low of $5.76 despite strong revenue growth, signals that the market is still weighing these risks heavily against the long-term potential. For a deeper dive, you can read the full analysis at Breaking Down Coursera, Inc. (COUR) Financial Health: Key Insights for Investors.

Next Step: Check the Q4 2025 guidance for any shifts in the projected Adjusted EBITDA range-that will tell you if the margin pressure is easing or intensifying.

Growth Opportunities

The core takeaway for Coursera, Inc. (COUR) is that its growth story is pivoting from broad expansion to a more focused, AI-driven monetization strategy, particularly within its Consumer segment. While the Enterprise market remains a bit soft, the company's financial guidance for 2025 shows a clear path to both top-line growth and improved profitability, driven by in-demand skills like generative artificial intelligence (AI).

You're seeing a company that's successfully translating global demand for upskilling into concrete revenue. They're betting that AI is the new oil, and so far, the numbers back it up. We defintely need to watch the Enterprise segment's recovery, though.

Future Revenue and Earnings Estimates

Coursera's management has a clear outlook for the 2025 fiscal year, having raised their guidance after a strong Q3. They now expect full-year revenue to land in the range of $750 million to $754 million, which translates to an 8% to 9% year-over-year growth rate. This is a solid, if not explosive, growth projection that reflects confidence in their Consumer segment's momentum.

Here's the quick math on profitability: The company is targeting an Adjusted EBITDA (Earnings Before Interest, Taxes, Depreciation, and Amortization) margin improvement of 200 basis points, aiming for a full-year margin of 8.0%. This focus on operating leverage is key, showing they are starting to scale efficiently. What this estimate hides, however, is that the Degrees segment revenue is actually expected to decline in 2025 as the company shifts its focus.

Key Growth Drivers: AI and Consumer Plus

The biggest driver for Coursera is its aggressive move into AI-native learning and product innovation. This isn't just a buzzword for them; it's a measurable revenue engine. For example, enrollments in generative AI courses have surged to 14 per minute, up from 8 per minute just a year ago.

• Product Innovations: Launched AI-driven features like Coursera Coach and AI translations to personalize the learning experience.
• Consumer Plus Traction: The Coursera Plus subscription, which offers unlimited access to a massive catalog, now accounts for more than half of the Consumer segment's revenue, providing a more predictable recurring revenue stream.
• Catalog Scale: The platform now boasts a catalog of over 12,000 courses and nearly 100 professional certificates, keeping their offering fresh and job-relevant.

The Consumer segment's revenue growth hit 13% year-over-year in Q3 2025, a clear sign that this strategy is working.

Strategic Initiatives and Competitive Advantages

Coursera's competitive advantage lies in its two-decade-long network effect: a massive base of over 183 million registered learners and partnerships with over 350 universities and industry leaders. They have the content credibility that pure tech platforms struggle to replicate. You can read more about their core philosophy here: Mission Statement, Vision, & Core Values of Coursera, Inc. (COUR).

The strategic initiatives for near-term growth are clear and focused on the Enterprise and AI fronts. They are leveraging their cash position of nearly $798 million to fund these investments.

The immediate next step for you is to monitor the Enterprise segment's Net Retention Rate (NRR) in Q4, as its recovery is critical to hitting the high end of the 2025 revenue guidance.