Udemy, Inc. (UDMY): Business Model Canvas [Dec-2025 Updated]

You're trying to figure out if the big pivot at Udemy, Inc. is working, and frankly, the Q3 2025 numbers tell a compelling story: this isn't just tinkering, it's a full-scale shift. As an analyst who's seen a few of these transformations up close, I see a company where subscription revenue is now 74% of the quarterly take, pushing the Udemy Business (UB) Annual Recurring Revenue (ARR) to $527 million by that same quarter, all while guiding for $787 million to $790 million in total revenue for FY 2025. This Business Model Canvas distills exactly how they are structuring the business-from their key activities in AI to their enterprise customer base of over 17,216 organizations-to make that subscription-first vision a reality. Keep reading to see the defintely crucial nine-block view.

Udemy, Inc. (UDMY) - Canvas Business Model: Key Partnerships

You're looking at the engine room of Udemy, Inc. (UDMY)'s growth, which is heavily reliant on external creators and strategic platform integrations. Honestly, the numbers show a clear pivot to the enterprise side, but the creator ecosystem remains the core value driver.

Expert instructors who create and own the course content

The content creators are the lifeblood here. As of the latest reporting for 2025, the platform is built on the expertise of a massive pool of educators. While the growth has slowed from pandemic highs, the scale is still impressive.

• Number of instructors reached 75,000 as of 2024, up from 50,000 in 2019.
• The total course catalog is estimated at over 210,000 offerings.
• The top 5,000 instructors generate the majority of platform revenue.

The financial relationship with these partners is structured differently for the two main segments. For Udemy Business (UB), a portion of the subscription revenue flows back to instructors.

If your courses drive engagement, you tap into that pool. For example, in 2023, the instructor pool was about $88.62 million based on the 20% share. That pool percentage is set to decrease, which is a near-term risk for instructor satisfaction, defintely.

Regional reseller partners for global UB sales and localization

Resellers are key to scaling Udemy Business (UB) globally, feeding into the strong enterprise numbers we see. The enterprise segment is clearly the focus for sustainable, predictable revenue.

Here's the quick math on the enterprise segment performance as of Q2 2025:

The Large Customer Net Dollar Retention Rate (NDRR) was 99% in Q2 2025, showing existing large clients are spending almost the same or more. In Q1 2025, the company added nearly 120 net new Enterprise customers. New partnerships in late 2025, like the one with HSM to empower Brazil's workforce, show the continued focus on regional expansion.

HR/Workforce platforms like UKG for enterprise integration

Integrating with major Human Capital Management (HCM) and Workforce Management systems streamlines adoption for enterprise clients. The partnership with UKG is a prime example of embedding the learning platform directly into existing HR workflows.

• Udemy content integrates with UKG Pro Learning and UKG Ready Learning.
• Integration capabilities include Course Sync and Reporting Sync - Learner Progress.

This means administrators can assign and track completions directly within the UKG environment, reducing friction for large-scale deployment.

Career marketplaces like Indeed to connect learning with jobs

The collaboration with Indeed, announced in mid-2025, directly links skill acquisition to employment opportunities, which is a major value proposition for the consumer side and a differentiator for enterprise upskilling validation.

This alignment is already showing results, with learners in this channel exhibiting materially higher consumer subscription start conversion rates than the general Udemy average.

Affiliate marketers on the Impact Network driving consumer traffic

While specific financial data tied to the Impact Network isn't public, affiliate marketing drives traffic to the consumer marketplace, which is seeing a shift toward subscriptions.

Consumer segment performance as of Q2 2025:

• Consumer segment revenue was $70.6 million, a 4% decrease year-over-year.
• Consumer subscriptions now account for 15% of that segment's revenue, up 2 percentage points from the prior quarter.
• The Personal Plan consumer subscription surpassed 200,000 paid subscribers as of Q2 2025.

Finance: draft 13-week cash view by Friday.

Udemy, Inc. (UDMY) - Canvas Business Model: Key Activities

You're looking at the core actions Udemy, Inc. takes to run its business as of late 2025. Honestly, the focus is clearly on shifting the mix toward more predictable, higher-margin subscription revenue, especially through the enterprise channel, while integrating AI everywhere.

Developing the AI-powered skills acceleration platform.

Udemy, Inc. is actively building out features that go beyond simple course consumption. This involves combining AI with human expertise to create structure and support. For instance, the platform is developing AI-enabled role plays and assessments to help learners master skills. The demand for this focus is clear from user behavior; a September 2025 report highlighted that content consumption for specific AI tools saw massive spikes, with GitHub CoPilot content consumption increasing by 13,534% year-over-year and Microsoft Copilot content consumption surging 3,400% year-over-year. To date, there have been 11 million generative AI course enrollments across the platform.

Curating and vetting content for the high-margin Udemy Business collection.

This activity is central to the company's strategy, as subscription customers are emphasized as the best customers. The success of this curation is reflected in the financial mix. For the three months ended September 30, 2025, consolidated subscription revenue reached $144 million, making up 74% of total revenue, an increase of 600 basis points from the prior year. This higher-margin mix helped lift the Gross Margin to 66% in Q3 2025, up 300 basis points year-over-year. The Udemy Business segment itself generated $133 million in revenue for Q3 2025, showing a 5% year-over-year increase.

Maintaining and scaling the global, multi-language e-learning marketplace.

Scaling means managing both the consumer and enterprise sides globally. Total revenue for Q3 2025 was $195.7 million. The consumer segment, which includes individual transactional and subscription sales, brought in $62.9 million in revenue for the quarter. A key scaling metric is the consumer subscription base, which ended Q3 2025 with 294,000 paid subscribers, beating the full 2025 target ahead of schedule. The platform still sees significant activity, with Monthly Average Buyers at 1.20 in the third quarter.

Executing a direct sales strategy for Udemy Business contracts.

The direct sales effort focuses on securing and growing enterprise contracts. Udemy Business Annual Recurring Revenue (ARR) stood at $527.2 million at the end of Q3 2025, with $7 million in net new ARR added during that quarter. The total number of Udemy Business customers was 17,111 as of September 30, 2025, representing a 2% year-over-year increase. For the largest accounts, the Large Customer Net Dollar Retention Rate (NDRR) was a very strong 97% in Q3 2025, indicating existing large clients are spending more or staying put.

Supporting the global network of expert instructors (IPP, community).

Supporting instructors is vital for content quality and platform stickiness. Management noted plans to launch virtual instructor-led training to allow instructors to engage with groups of learners simultaneously, which is expected to strengthen engagement. This move supports the broader strategy of creating structured, cohort-based experiences, which helps transform knowledge into real-world capabilities for learners.

Here's a quick look at the segment performance driving these activities for the three months ended September 30, 2025:

Finance: draft 13-week cash view by Friday.

Udemy, Inc. (UDMY) - Canvas Business Model: Key Resources

You're looking at the core assets Udemy, Inc. (UDMY) relies on to run its global online learning marketplace as of late 2025. These aren't just abstract concepts; they are the hard numbers and tangible assets driving the business.

The sheer volume of content is a primary resource. Udemy, Inc. maintains a massive content library of over 250,000 total courses. This catalog is curated, with a subset of about 26,000 of their highest-rated courses specifically included in the Personal Plan subscription offering.

Financially, the shift to recurring revenue is key. As of the end of Q3 2025, the Annual Recurring Revenue (ARR) base stood at $527 million (non-GAAP). Breaking that down, the Enterprise Segment alone reported an ARR of $527.2 million at that same quarter-end, slightly missing the analyst average estimate of $529.52 million. This recurring revenue base is supported by a growing customer base, with the Enterprise Segment reporting 17,111 total customers.

Technology is another critical resource, especially with the focus on AI. Udemy, Inc. deploys AI-powered technology for labs, role-play, and content creation. For instance, their AI Role Play feature, which lets employees rehearse scenarios like negotiation, was launched in May of this year. This technology underpins the platform's ability to offer immersive learning experiences.

The data generated from platform usage is invaluable. Udemy, Inc. possesses proprietary data on global in-demand skills and learning trends. This data directly informs their content strategy; for example, their analysis based on Udemy Business usage from the last year was used to reveal the 10 Fastest-Growing AI Workplace Skills for 2025. On the consumer side, the platform supported nearly 295,000 paid subscribers in Q3 2025.

Finally, the underlying digital assets are non-negotiable. This includes the core Udemy.com platform and mobile application infrastructure, which must handle millions of learners. The platform's scale is evident in its Q3 2025 GAAP revenue of $195.7 million, with subscription revenue making up 74% of that total.

Here's a quick look at some of the key financial and operational metrics tied to these resources:

The platform's technology stack also supports a significant user base engaging with AI content. For example, one specific AI course on the platform includes 5,275,410 learners across 2,149 courses related to Artificial Intelligence (AI) in one category listing. This defintely shows the scale of the digital asset.

You can also see the resource utilization in the following operational points:

• AI Role Play launched in May of the current year.
• AI-related enrollments have surged fivefold in the past year, surpassing 11 million globally.
• The Personal Plan subscription includes a curated selection of 26,000+ on-demand courses.
• The platform features over 9,000 top instructors.

Finance: draft 13-week cash view by Friday.

Udemy, Inc. (UDMY) - Canvas Business Model: Value Propositions

You're looking at the core reasons customers choose Udemy, Inc. (UDMY) over other options, especially as the company pushes hard into subscriptions and AI-focused corporate training. Here's the breakdown of what Udemy offers to its three main customer groups, grounded in the latest financial reporting through the third quarter of 2025.

For Enterprise: A single platform for employee upskilling and AI fluency

Udemy Business provides organizations with a centralized place to manage workforce skills, a proposition that resonated as Udemy Business ARR reached $527.2 million at the end of Q3 2025. The platform supports AI fluency initiatives, with management noting the introduction of new AI Packages designed to help organizations develop this capability. The focus is on building core workforce capabilities to extract value from AI investments.

The scale of enterprise adoption is significant, with the total number of Udemy Business customers standing at 17,111 as of the end of Q3 2025. Furthermore, the stickiness of these relationships is measured by the Large Customer Net Dollar Retention Rate (NDRR), which was 97% for Q3 2025. In 2024, 80% of Fortune 100 companies trusted Udemy for upskilling.

For Consumers: Affordable, on-demand access to a vast, practical course catalog

The consumer value proposition centers on breadth and accessibility. Udemy hosts a massive catalog, reported to be around 250,000 courses as of the end of 2024. This vast selection is supported by a global learner base of 79 million as of Q1 2025. The platform has over 70,000 instructors creating content.

The shift to subscription is key here; while consumer revenue was $62.88 million in Q3 2025, down 9.3% year-over-year, the subscription component is growing faster within that segment.

For Instructors: A global marketplace to monetize expertise with a revenue share model

Instructors gain access to a global marketplace to sell their expertise. The platform hosts over 70,000 creators. The monetization model is based on revenue share, which varies significantly depending on the sales channel. For marketplace sales, the instructor revenue share is 37%. For subscription revenue, the planned share for January 2025 was set to drop to 17.5%.

Subscription-First: Predictable, all-you-can-learn access to 26,000-31,000 top courses

The strategic pivot to subscription-first drives predictability. Consolidated subscription revenue reached $143.9 million in Q3 2025, marking an 8% year-over-year increase. This revenue stream now accounts for 74% of total revenue, a 600 basis point increase from the prior year. The consumer side has seen strong uptake, surpassing the full-year paid subscriber target early, ending Q3 2025 with 294,000 paid consumer subscribers. Revenue from consumer subscriptions increased an impressive 43% year-over-year in Q3.

Skill Validation: Hands-on practice, assessments, and certification prep

Udemy is strengthening its offering beyond passive video learning by embedding validation tools. The platform now features AI learning paths, an AI Assistant, and AI-generated assessments. This focus aims to bridge the gap between skill acquisition and career advancement through structure, support, and validation. The company is also building out features like Role Play capabilities.

Here is a snapshot of key financial and operational metrics as of late 2025:

The value proposition for enterprise clients is supported by the fact that Udemy Business revenue grew 5.3% year-over-year in Q3 2025, reaching $132.8 million. For consumers, the platform offers access to a catalog of around 250,000 courses as of late 2024. The focus on subscription is clear: the year-over-year growth in consolidated subscription revenue was 8% in Q3 2025.

For instructors, the marketplace revenue share is 37%, while the planned subscription share for 2025 was reduced to 17.5%. You can see the financial commitment to scale in the full-year 2025 Adjusted EBITDA guidance midpoint of $93 million.

Udemy, Inc. (UDMY) - Canvas Business Model: Customer Relationships

For Udemy Business, the relationship is managed through dedicated structures designed to drive retention and expansion, which is critical given the subscription focus. You see this commitment in the metrics around Annual Recurring Revenue (ARR) and Net Dollar Retention Rate (NDRR).

The focus on high-touch service for enterprise clients is evident in the metrics surrounding customer value retention. Here's a look at the key performance indicators for the Enterprise segment as of late 2025:

The company explicitly states that subscription customers are their best customers, driving the push for this stickier revenue base. For the consumer side, the relationship relies heavily on automation and scale, though a shift is occurring.

Automated self-service and promotional efforts are key for the Consumer segment, which still involves millions of learners. The platform ended Q3 2025 with 294,000 paid consumer subscribers, having surpassed its full-year target early. Revenue from consumer subscriptions specifically grew an impressive 43% year-over-year in Q3. Still, the overall Consumer segment revenue was $62.88 million in Q3 2025, reflecting a decline year-over-year for the segment overall, which management expects to decline about 9% for the full year 2025. The Monthly Average Buyers count for the entire platform stood at 1.2 million in Q3 2025.

To deepen engagement beyond simple course access, Udemy is building out support mechanisms. This includes community-based Q&A forums where learners can get help from peers and instructors. Furthermore, the platform is rolling out new instructor-led support options, such as virtual instructor-led training to allow learners to participate in structured, cohort-based experiences. This is complemented by new AI tools designed to strengthen stickiness, like the AI Role Play feature, which helps learners build and refine real-world soft skills through immersive simulations.

Data-driven personalization is central to scaling the value proposition for both segments. The platform uses AI to embed personalized learning experiences, supporting career transformations for consumers. For enterprise clients, the AI-driven Skills Mapping capability was employed by more than 1,800 enterprise customers as of Q1 2025, with more than a third of learning paths created through this capability. The platform also offers AI readiness and AI growth packages to help organizations build AI fluency across roles. The focus on in-demand skills is clear: paid enrollment across GenAI courses alone surpassed 11 million.

Udemy, Inc. (UDMY) - Canvas Business Model: Channels

You're looking at how Udemy, Inc. gets its offerings-from individual courses to enterprise subscriptions-into the hands of learners and organizations. It's a multi-pronged approach, blending self-service digital access with direct sales efforts, all crucial for hitting those 2025 financial targets.

Udemy.com website and native mobile apps (iOS/Android)

This is the core, high-volume channel for the Consumer segment. The platform relies heavily on direct traffic and app engagement to drive sales, especially with the subscription pivot.

• Total registered learners on the platform reached 79 million as of the end of the first quarter of 2025.
• Monthly average buyers in Q1 2025 were 1.41 million, though this metric dipped to 1.24 million in Q2 2025.
• The platform hosts over 210,000 courses, with Technology and Business courses accounting for 74.6% of all enrollments in a prior period analysis.
• Mobile learning is a significant driver, with projections suggesting 60% of all lecture hours are consumed on mobile apps as of 2026, reflecting the late-2025 trend.

Direct Enterprise Sales Force for Udemy Business

The Enterprise segment, Udemy Business (UB), uses a dedicated direct sales force to land and expand contracts with organizations globally. This channel is the primary driver of the higher-margin subscription revenue.

Here's a look at the Enterprise segment performance as of the third quarter of 2025:

The company surpassed its 2025 consumer subscription target early, ending Q3 2025 with 294,000 paid consumer subscribers, which is a separate but related metric showing success in subscription adoption across the board.

Global network of resellers and channel partners

While direct enterprise sales are key, Udemy, Inc. also relies on partners to extend its reach, particularly in international markets where local presence matters. Specific revenue figures attributed solely to resellers aren't typically itemized in the primary earnings releases, but the global footprint gives you an idea of the channel's breadth.

• Udemy Business operates in over 75 countries as of projections for 2026, indicating a wide international channel presence beyond the core U.S. base.
• For the full year 2024, the company attracted nearly 1,400 new Enterprise accounts.

Large-scale Affiliate Marketing program

The Affiliate Marketing program acts as a performance-based digital distribution channel, leveraging external content creators and publishers to drive traffic and course/subscription purchases.

Here are the key commercial terms for affiliates promoting Udemy, Inc. products:

The program uses a 7-day cookie duration and a 50-day validation period for tracking referred sales.

Udemy, Inc. (UDMY) - Canvas Business Model: Customer Segments

You're looking at the core groups Udemy, Inc. serves to generate revenue and build its platform. This is not just about learners; the instructors are a critical, revenue-enabling segment too.

Udemy Business (UB): Organizations seeking workforce upskilling. These are enterprise clients buying seats for their employees. As of September 30, 2025, Udemy, Inc. reported having 17,111 total customers in this segment. The Large Customer Net Dollar Retention Rate for these enterprise accounts was 97% as of the end of Q3 2025. This segment generated $132.8 million in revenue for Q3 2025.

Individual Consumers: This group consists of global learners looking to advance their careers or pursue personal development through single course purchases or subscriptions. The Consumer segment generated $62.88 million in revenue for Q3 2025. The Monthly Average Buyers for the Consumer segment in Q3 2025 was 1.20 million.

Paid Subscribers (Personal Plan): Consumers opting into the recurring subscription model, which Udemy, Inc. management views as their best customer type due to better engagement and outcomes. Udemy, Inc. surpassed its full-year consumer subscription target early, ending Q3 2025 with 294,000 paid consumer subscribers. Subscription revenue within the Consumer segment grew 43% year-over-year in Q3 2025.

Course Instructors: Subject matter experts who create and publish content, forming the supply side of the marketplace. As of the Q3 2025 investor overview, Udemy, Inc. reported having 85,000 instructors on the platform. These instructors have published approximately 250,000 courses in total.

Here's a quick look at the scale across the primary segments as of September 30, 2025:

The platform supports these segments with a massive global reach:

• Total Learners on the platform: 82 Million.
• Total Courses available: 250,000.
• Languages supported: 75.
• Companies relying on Udemy Business include Ericsson, Samsung SDS America, and Volkswagen.

Udemy, Inc. (UDMY) - Canvas Business Model: Cost Structure

You're looking at the core expenses that drive Udemy, Inc.'s operations as of late 2025. Honestly, understanding these numbers is key to seeing where the profitability push is coming from, especially with the shift to subscriptions.

Instructor Revenue Share

This is definitely your largest variable cost, directly tied to what learners spend. The split varies significantly between the marketplace and the Udemy Business (UB) subscription model.

For individual course purchases through the marketplace, the instructor revenue share remains fixed at 37%. However, if an instructor drives the sale themselves using their own coupon or referral link, they keep 97% of that revenue. For the high-growth UB segment, the cost structure is different and has been actively managed to improve Udemy, Inc.'s margin.

Here's the quick math on the UB subscription share changes:

What this estimate hides is the total dollar commitment; for context, in 2023, the UB instructor revenue pool amounted to $88.62 million, which was 20% of the $443.1 million in UB subscription revenue that year. The goal is to keep total instructor payouts equal to or exceeding prior levels each year despite the lower percentage, relying on expected growth.

Technology and Platform Costs

These costs cover keeping the lights on, scaling the infrastructure, and, critically now, funding the AI development that the company is betting on. These are bundled into Cost of Revenue, alongside content costs and payment processing fees.

For the first quarter of 2025, the Cost of Revenue was $70,857 thousand. This helped drive a Gross Profit of $129,443 thousand, resulting in a Gross Margin of 65% for Q1 2025. By the third quarter of 2025, the Gross Margin improved to 66% (GAAP) or 67% (non-GAAP), partly due to this shift toward higher-margin subscription revenue and the reduced instructor share.

Key components within this area include:

• Hosting and cloud infrastructure expenses.
• Research and Development (R&D) spend, which supports AI-driven functionality.
• Capitalized software costs, which are part of capital expenditures to support ongoing operations.

Sales and Marketing Expenses

Acquiring new Udemy Business customers and driving consumer subscriptions requires substantial, ongoing investment here. This is a major operating expense category.

Looking at the first quarter of 2025, Sales and Marketing expenses were $82,500 thousand. This compares to $87,301 thousand in the first quarter of 2024, showing some initial cost management, though the focus remains on acquiring UB customers.

Here's a snapshot of the operating expense structure for Q1 2025 (in thousands):

The company is intentionally slowing transactional course sales to favor recurring subscription revenue, which management noted creates a short-term headwind for Consumer segment revenue growth but promises stronger unit economics (LTV/CAC greater than 3x for subscriptions versus approximately 1x for transactional sales).

Personnel Costs

Salaries for the teams building the product (engineering, product) and those selling to enterprises (UB direct sales team) form a significant portion of the operating expenses. You've seen active management here to improve efficiency.

The total number of employees peaked in 2022 at 1,678 and fell to 1,443 in 2023 following layoffs. The strategic restructuring plan announced in September 2024 impacted approximately 280 global employees, with the goal of completion by March 31, 2025. These cost-cutting measures in 2023 and 2024 were noted to save between $30-32 million annually. The non-GAAP Operating Expenses for Q3 2025 totaled $112 million, representing 57% of revenue.

Personnel costs are embedded within the operating expense line items, specifically:

• Salaries for the engineering and product teams (R&D).
• Salaries for the UB direct sales force (S&M).
• Salaries for G&A functions.

Finance: draft 13-week cash view by Friday.

Udemy, Inc. (UDMY) - Canvas Business Model: Revenue Streams

You're looking at how Udemy, Inc. (UDMY) converts its platform value into hard cash as of late 2025. The focus has clearly shifted to locking in more predictable income streams, which makes sense for long-term valuation.

The company's overall financial target for the full fiscal year ending December 31, 2025, is Total Revenue Guidance for FY 2025 is $787 million to $790 million.

Udemy Business (UB) Subscriptions are a major driver, representing the Annual Recurring Revenue from enterprise customers. This metric hit an ARR of $527.2 million in Q3 2025, showing continued, albeit slower, growth of 4% year-over-year.

The strategic pivot is evident in the subscription mix. Consolidated subscription revenue for Q3 2025 was $144 million, which the company stated represented 74% of total revenue for that quarter. This is a deliberate move to secure more durable revenue.

Here's a look at the revenue breakdown for the third quarter of 2025, showing the relative weight of the two main segments:

Within the Consumer Segment, the shift to subscriptions is aggressive. You can see the direct impact of this focus:

• Consumer Subscription Revenue for Q3 2025 was $11.7 million, a significant 43% increase year-over-year.
• This growth pushed the total number of paid Consumer Subscriptions (Personal Plan) to 294,000 by the end of Q3 2025, beating the internal 2025 target ahead of schedule.
• The remaining Consumer Segment revenue comes from Consumer Transactional Sales, which are the one-time purchases of individual courses. Based on the segment totals, this implies transactional sales were approximately $51.2 million ($62.9 million total minus $11.7 million subscription revenue) for the quarter.
• The focus on subscriptions means transactional revenue is declining, as the Consumer Segment revenue overall fell 9.3% year-over-year.

For the Enterprise side, the health of the recurring contracts is key. The Large Customer Net Dollar Retention Rate (NDRR) was reported at 97% in Q3 2025, indicating that the largest clients are largely maintaining or increasing their spend.

Finance: draft 13-week cash view by Friday.