Dive Brief:
- Coursera is doubling down on providing both degree programs and entry-level certificates on its platform, even though the latter offerings are the only one of the two that saw revenue growth this past quarter, according to the company’s latest earnings.
- The MOOC platform’s revenue reached $523.8 million in 2022, up 26% from the prior year. That growth was partly driven by increased demand for microcredentials in the fourth quarter, especially the company’s entry-level professional certificates.
- However, the company’s degree revenue fell sharply in the fourth quarter, declining 11% year over year to $11.9 million. Executives told analysts on a call Thursday that they expect the segment to begin growing again in the second half of this year.
Dive Insight:
Coursera has been rapidly looking to expand its offerings since it went public in early 2021. The company made progress on those goals this year, growing its entry-level professional certificates from 18 a year ago to 38 today, according to company officials.
“We believe that industry microcredentials will be a critical component of the transformation of higher education,” Coursera CEO Jeff Maggioncalda said. “They offer learners with no college degree or prior work experience, an affordable, flexible way to start or switch into a digital career.”
Coursera isn’t the only public company seeing success with short-term credentials. 2U — an ed tech firm that recently acquired edX, one of Coursera’s main competitors — also has seen strong revenue growth in this segment, especially from its boot camp offerings.
However, Coursera’s degree business has been on the decline. Ken Hahn, Coursera’s chief financial officer, attributed these decreases to falling enrollment in U.S. graduate programs, where the company’s degree revenue is concentrated.
This past fall, graduate enrollment dipped 1.2% compared to the year before, according to the latest data from the National Student Clearinghouse Research Center.
Still, Coursera has been launching degree programs at a rapid clip, announcing 14 new offerings over the past year.
That includes a liberal studies degree from Georgetown University, a private nonprofit in Washington D.C. The degree program is geared toward adults who left college before finishing their degrees.
Maggioncalda said these types of offerings — those that target working adults — will become a bigger focus for the company. So will short-term credentials that stack into degree programs.
“We are finding that there are certain kinds of degrees that seem to appeal pretty well to sort of working adults who are thinking about switching careers, not unlike the folks who are taking these career certificates,” Maggioncalda said.
