The two companies are joining forces in a $2.5 billion deal to bring their offerings under one roof, boosting revenue and profit as growth tapers.
- The companies said that once the transaction is sealed, the existing Coursera stockholders are expected to own nearly 59% of the combined company.
- The stocks traded at their all-time highs in the initial year of going public but have ever since lost most of their value.
- Telsey Advisory Group analyst Sarang Vora said that the combined company should be able to build a more powerful unified platform and ecosystem by leveraging data and shared resources.
When the world went into lockdown during COVID-19 and living rooms doubled as classrooms, platforms like Coursera and Udemy became unlikely stars of the pandemic era. Millions of people, suddenly flush with time and uncertainty, turned to online courses to upskill, reskill, or simply stay productive — earning certificates from prestigious universities without ever leaving home.
That surge in demand translated into soaring investor enthusiasm. Both companies rode the wave to blockbuster IPOs in 2021, the second year of the pandemic, with their stocks quickly racing to euphoric highs. But the momentum proved fleeting, and demand has tapered as people around the world increasingly turn to artificial intelligence (AI) chatbots for support.
And now, Coursera and Udemy are set to merge in a $2.5 billion all-stock deal, aiming to consolidate their growth and boost their combined revenues and profits rather than struggling as separate companies.
Share Price Below Pandemic Gains
At its peak in April 2021, Coursera traded at $62.53, but has since lost nearly 85% of its value and is now trading at $7.84 as of Thursday’s close. Udemy, on the other hand, was trading at a high of $32.62 but now has a stock price of $6.05, almost an 82% fall from the all-time high.
The Rise Of AI
With the boom in AI, both companies that offer structured courses are seeing more people turning to free AI tools, resulting in fewer learners for introductory classes.
Even these companies have tried to inculcate AI-based training and courses to help individuals upskill in using and training AI, but with many companies now offering in-house upskilling and certifications tied to AI, not many approach Coursera or Udemy for learning.
Coursera offers courses through universities and institutions that encompass degree programs and professional certifications. Still, Wall Street has noted that, with educational institutions also now exploring AI-related learning, the company has seen slow enrollment. Udemy, on the other hand, is focused on organizations to scale workforce development and help individuals build the technical, business, and soft skills most relevant to their careers.
“We’re at a pivotal moment in which AI is rapidly redefining the skills required for every job across every industry. Organizations and individuals around the world need a platform that is as agile as the new and emerging skills learners must master,” said Greg Hart, CEO of Coursera.
The Merger: A Plan Of Survival
Telsey Advisory Group analyst Sarang Vora said that the combined company should be able to build a more powerful unified platform and ecosystem by leveraging data and shared resources, offering a broader content catalog, and adding new capabilities, including AI-native innovations.
Udemy stockholders will receive 0.800 shares of Coursera common stock for each share of Udemy common stock, representing a 26% premium to the average closing price of Udemy and Coursera over the 30 trading days preceding the announcement.
The companies said that once the transaction is sealed, the existing Coursera stockholders are expected to own nearly 59% of the combined company, and the existing Udemy stockholders are expected to own about 41%.
The transaction is expected to close in the second half of 2026, with Hart serving as Chief Executive Officer of the combined company.
What Is Retail Thinking?
Retail sentiment on Coursera jumped to ‘bullish’ from ‘neutral’ territory a week ago, with message volumes at ‘extremely high’ levels, according to data from Stocktwits. The stock also had a 14% jump in users on Stocktwits, adding it to their watchlist.
While sentiment on Udemy also improved to ‘bullish’ territory from ‘neutral’ a week ago, with message volumes at ‘extremely high’ levels. Udemy also saw a 31% increase in users on Stocktwits, adding the stock to the watchlist.
Shares of Udemy have declined by more than 26% this year, and Coursera stock has fallen by nearly 8% year-to-date.
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