Looking back on consumer subscription stocks’ Q2 earnings, we examine this quarter’s best and worst performers, including Coursera (NYSE: COUR) and its peers.
Consumers today expect goods and services to be hyper-personalized and on demand. Whether it be what music they listen to, what movie they watch, or even finding a date, online consumer businesses are expected to delight their customers with simple user interfaces that magically fulfill demand. Subscription models have further increased usage and stickiness of many online consumer services.
The 8 consumer subscription stocks we track reported a mixed Q2. As a group, revenues beat analysts’ consensus estimates by 2.5% while next quarter’s revenue guidance was in line.
Thankfully, share prices of the companies have been resilient as they are up 7.6% on average since the latest earnings results.
Coursera (NYSE: COUR)
Founded by two Stanford University computer science professors, Coursera (NYSE: COUR) is an online learning platform that offers courses, specializations, and degrees from top universities and organizations around the world.
Coursera reported revenues of $187.1 million, up 9.8% year on year. This print exceeded analysts’ expectations by 3.7%. Overall, it was a very strong quarter for the company with EBITDA guidance for next quarter exceeding analysts’ expectations.
“Coursera’s market opportunity continues to expand with the global demand to embrace new technology and skills. This quarter, we attracted more than seven million new learners looking to master emerging skills that can advance their careers,” said Coursera CEO Greg Hart.
Coursera achieved the highest full-year guidance raise of the whole group. The company reported 183 million active customers, up 18% year on year. Unsurprisingly, the stock is up 29.4% since reporting and currently trades at $11.75.
Is now the time to buy Coursera? Access our full analysis of the earnings results here, it’s free.
Best Q2: Roku (NASDAQ: ROKU)
With a name meaning six in Japanese because it was the founder's sixth company that he started, Roku (NASDAQ: ROKU) makes hardware players that offer access to various online streaming TV services.
Roku reported revenues of $1.11 billion, up 14.8% year on year, outperforming analysts’ expectations by 3.8%. The business had a very strong quarter with a solid beat of analysts’ EBITDA estimates and full-year EBITDA guidance exceeding analysts’ expectations.
The market seems happy with the results as the stock is up 8.1% since reporting. It currently trades at $101.89.
Is now the time to buy Roku? Access our full analysis of the earnings results here, it’s free.
Slowest Q2: Match Group (NASDAQ: MTCH)
Originally started as a dial-up service before widespread internet adoption, Match (NASDAQ: MTCH) was an early innovator in online dating and today has a portfolio of apps including Tinder, Hinge, Archer, and OkCupid.
Match Group reported revenues of $863.7 million, flat year on year, exceeding analysts’ expectations by 1.2%. Still, it was a softer quarter as it posted a decline in its users and a slight miss of analysts’ number of payers estimates.
Interestingly, the stock is up 14.2% since the results and currently trades at $38.52.
Read our full analysis of Match Group’s results here.
Duolingo (NASDAQ: DUOL)
Founded by a Carnegie Mellon computer science professor and his Ph.D. student, Duolingo (NASDAQ: DUOL) is a mobile app helping people learn new languages.
Duolingo reported revenues of $252.3 million, up 41.5% year on year. This result surpassed analysts’ expectations by 4.8%. It was a strong quarter as it also produced an impressive beat of analysts’ EBITDA estimates and full-year EBITDA guidance exceeding analysts’ expectations.
Duolingo delivered the biggest analyst estimates beat and fastest revenue growth among its peers. The company reported 128.3 million users, up 23.8% year on year. The stock is down 15.4% since reporting and currently trades at $291.25.
Read our full, actionable report on Duolingo here, it’s free.
Netflix (NASDAQ: NFLX)
Launched by Reed Hastings as a DVD mail rental company until its famous pivot to streaming in 2007, Netflix (NASDAQ: NFLX) is a pioneering streaming content platform.
Netflix reported revenues of $11.08 billion, up 15.9% year on year. This print was in line with analysts’ expectations. Zooming out, it was a satisfactory quarter as it also logged EPS guidance for next quarter topping analysts’ expectations but number of global streaming paid memberships in line with analysts’ estimates.
Netflix had the weakest performance against analyst estimates among its peers. The company reported 310.5 million users, up 11.8% year on year. The stock is down 4.1% since reporting and currently trades at $1,224.
Read our full, actionable report on Netflix here, it’s free.
Market Update
As a result of the Fed’s rate hikes in 2022 and 2023, inflation has come down from frothy levels post-pandemic. The general rise in the price of goods and services is trending towards the Fed’s 2% goal as of late, which is good news. The higher rates that fought inflation also didn't slow economic activity enough to catalyze a recession. So far, soft landing. This, combined with recent rate cuts (half a percent in September 2024 and a quarter percent in November 2024) have led to strong stock market performance in 2024. The icing on the cake for 2024 returns was Donald Trump’s victory in the U.S. Presidential Election in early November, sending major indices to all-time highs in the week following the election. Still, debates around the health of the economy and the impact of potential tariffs and corporate tax cuts remain, leaving much uncertainty around 2025.
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