Cantor Fitzgerald raises Udemy stock price target to $10 on turnaround signs

Cantor Fitzgerald raised its price target for Udemy Inc. (UDMY) to $10.00 from $9.00, maintaining an Overweight rating, citing early success of the 'Udemy 2.0' turnaround plan under new CEO Hugo Sarrazin. The online learning platform exceeded H1 2025 consensus expectations across key financial metrics and reported strong Q2 2025 results, with EPS of $0.16 and revenue of $200 million, both surpassing analyst forecasts. This positive performance, attributed to strategic shifts including an uptick in recurring subscriptions and transformation into an 'AI-powered skills acceleration platform,' has led to upward earnings estimate revisions from multiple analysts despite initial mixed stock reaction.

Analysis

Udemy Inc. (UDMY) is showing tangible evidence of a successful operational turnaround under its new CEO, a development validated by Cantor Fitzgerald's decision to raise its price target to $10.00 while maintaining an Overweight rating. This optimism is underpinned by a strong financial performance where the company surpassed FactSet consensus expectations for the first half of 2025 across key metrics including revenue, operating income, adjusted EBITDA, and free cash flow. Specifically, Q2 2025 results demonstrated this momentum with revenue reaching $200 million against a $196.79 million forecast and EPS of $0.16 beating the $0.12 analyst estimate. The strategic drivers for this outperformance, termed 'Udemy 2.0', include a notable uptick in the recurring subscription model and progress in transforming the company into an 'AI-powered skills acceleration platform'. The positive outlook is further reinforced by broader market sentiment, with eight analysts revising their earnings estimates upward, signaling growing confidence in the company's new strategic direction despite a mixed immediate stock reaction in regular trading.

Key Decisions for Investors

• Given the strong execution on the 'Udemy 2.0' plan, a significant earnings beat, and Cantor Fitzgerald's price target suggesting potential upside from its current $7.72 price, investors could consider the stock favorably as a turnaround play.
• Investors should closely monitor future earnings reports for sustained growth in recurring subscription revenue and further developments in its AI platform, as these are the key pillars of the current investment thesis.
• The initial stock decline despite positive news suggests some market skepticism, so it is prudent to watch for confirmation of the uptrend and assess whether the positive fundamental shifts are being fully recognized by the market.