Most people know Udemy as the place to buy a coding course for a few dollars. Almost nobody knows the company behind it spent 15 years losing money. That is where this story about the Udemy business model starts.
In 2025, that changed. Revenue reached $789.8 million, essentially flat from $786.6 million in 2024. Yet Udemy posted its first full-year net income, $3.8 million, after losing $85.3 million the year before. A large part of that swing came from cutting what it pays instructors. The courses stayed. The economics changed.
The platform itself is huge. It reaches nearly 84 million learners, with more than 290,000 courses across 78 languages.
And yet, the company behind that scale stopped being independent. The all-stock merger with Coursera, its biggest rival, closed on May 11, 2026.
What Is Udemy?
The name gives it away: “You” + “Academy.” Udemy is an online platform built on a simple idea. Instructors create the courses, and the Udemy Business Model takes a share of every sale.
Eren Bali co-founded the company in 2010. It is currently led by Hugo Sarrazin, who took over as CEO in March 2025. Bali returned to Udemy in June 2025.
Today the platform lists more than 290,000 courses across 78 languages. It has reached nearly 84 million learners worldwide, and more than 90,000 instructors now teach on the platform.
The audience has broadened too. Udemy still serves individual learners who want to build new skills. It also sells courses to companies through Udemy Business, its enterprise arm for workplace learning.
Udemy Business Model
Udemy operates on a marketplace business model. The firm acts as a mediator between instructors and learners. Instructors set list prices on the courses they create, and Udemy earns a commission on each sale.
Like eBay and Amazon, Udemy connects buyers and sellers instead of producing the product itself. But the firm also controls promotions. Ruzuku, a rival course-hosting platform, captured a live Udemy course page in August 2026. The instructor list price was $199.99, and Udemy set the actual sale price at $22.99. Udemy routinely caps list prices and runs deep discounts.
That Udemy revenue model now runs on two engines. The consumer marketplace sells individual courses to learners. Udemy Business sells subscriptions to companies. It accounted for 66% of revenue in 2025. Consumer revenue made up the remaining 34% and declined 9% year over year.
Its FY2025 Form 10-K puts annual revenue at $789.8 million, flat from $786.6 million in 2024. Subscriptions accounted for 72% of that total. Udemy staff describe the open marketplace as a foundational part of the company’s future after the merger.
How Does Udemy Work?
The Udemy business model works on 4 major lines and aims to provide the following to its students:
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Convenience
Udemy provides its students with the freedom to choose what and when to study. If a particular course is made available on Udemy, students can enrol for it whenever they want. Moreover, there’s no set time limit, so the students get to learn at their own suitable pace.
- Instructors received 20% of subscription revenue, effective January 1, 2024.
- The share fell to 17.5%, effective January 1, 2025.
- It dropped again to 15%, effective January 1, 2026.
The subscription share pays from a pool, not per sale. Ruzuku, a course-hosting rival, describes Udemy’s Personal Plan as a fixed monthly 15% pool distributed by minutes watched.
That shift is visible in Udemy’s own numbers. Content costs, mostly instructor payments, fell to 32% of consumer segment revenue in 2025, down from 35%. Gross margin climbed to 66%.
Instructors earned $168 million collectively in 2025. The top 11 each earned over $1 million.
An r/Udemy instructor wrote in 2026 that Udemy had “deliberately shifted toward a subscription model, significantly reducing our instructors’ income.”
Future Of Udemy
Udemy stopped being an independent company on May 11, 2026, when its all-stock merger with Coursera closed. Announced on December 17, 2025, the deal was valued at roughly $2.5 billion. The FY2025 10-K set the exchange ratio at 0.800 Coursera shares per Udemy share. Udemy holders ended with about 41% of the combined company. Shareholders approved it on April 9, 2026, with more than 99% voting in favor.
Most of what students know survives. In an instructor-community thread, Udemy staff said the brand “is not going away.” They compared the structure to Marriott running several hotel brands. They called the open marketplace “a foundational part of the future.” Courses bought on Udemy keep their lifetime access.
Unified reporting showed 12,107 enterprise customers and 1.655 million paid consumer subscribers as of June 30, 2026. Enterprise revenue hit $140.0 million in Q2 2026, up 118% year over year. Coursera guided FY2026 revenue to $1.220 to $1.245 billion. It targets at least $85 million in annual run-rate net synergies by year-end 2026. The company also committed $100 million to LearnVector, an AI-native learning company founded by Andrew Ng.
Class Central reports that combined market value fell from $3.8 billion to $1.7 billion and that layoffs are likely. It also notes two failed earlier merger attempts and competing bidders in Coursera’s prospectus.
Class Central founder Dhawal Shah noted the instructor gap. Udemy instructors earned roughly $70 million less than Coursera’s content partners in Q3 2025. Both platforms together pay instructors about $440 million a year. Coursera also announced a new 15% platform fee for partners starting in 2026. The brand and the open marketplace survive, but Udemy now answers to Coursera shareholders. Integration and layoffs remain open questions, and so does the instructor payout model.
