Dive Brief:
- Coursera, a high-profile MOOC platform, is laying off employees, though a company spokesperson declined to say how many workers were let go.
- In a public letter Wednesday, Coursera CEO Jeff Maggioncalda said officials decided to reduce the company’s workforce as it navigates “lower growth rates and environmental uncertainty.” The company has notified all affected workers via one-on-one conversations, he said.
- Coursera expects to spend between $10 million and $12 million reducing its personnel expenses, including severance and benefit costs, in 2022’s fourth quarter, according to documents filed with the U.S. Securities and Exchange Commission. The company had 1,138 full-time employees at the end of last year.
Dive Insight:
Coursera went public in early 2021, riding a wave of enthusiasm for online education that erupted during the pandemic. Although the company's shares debuted at $33 each, giving it a market value of more than $4 billion, its closing price has since plummeted from $45.78 a share on April 1, 2021, to just $12.65 the day the layoffs were announced. Shares rose slightly during the day Thursday, but the company's market cap remained under $2 billion.
“2020 was a moment of extraordinary expansion as our business was propelled by customer demand during the pandemic,” Maggioncalda wrote in his public letter. “And we’re entering a different chapter now.”
The company’s revenue growth has significantly slowed since its initial public offering. In its first quarter as a public company, Coursera earned $88.4 million, a 64.1% increase from the same period a year before. In its most recent quarter, that year-over-year growth slowed to 24.1%, with about $136.4 million in revenue.
Coursera’s revenue growth has slowed since it first went public
“While the long-term outlook for Coursera remains promising, a deteriorating macroeconomic environment has forced us to sharpen our focus, prioritize our investments, and optimize our structure and operations,” Maggioncalda wrote.
Coursera isn’t the only large company in the ed tech space that’s resorted to layoffs.
2U, an online program management company that owns edX — one of Coursera’s competitors — announced across-the-board layoffs this summer. The cuts reduced the company’s personnel expenses by about 20%, officials said.
This week, 2U announced flat revenue in the third quarter as it adopts a new strategy. It is now focused on using edX, which it acquired last year, to attract students to free online courses before attempting to move them to paid offerings.
