Looking back on consumer subscription stocks’ Q2 earnings, we examine this quarter’s best and worst performers, including Match Group (NASDAQ:MTCH) 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 slower Q2. As a group, revenues beat analysts’ consensus estimates by 1.1% while next quarter’s revenue guidance was 2.9% below.
Inflation progressed towards the Fed's 2% goal recently, leading the Fed to reduce its policy rate by 50bps (half a percent or 0.5%) in September 2024. This is the first cut in four years. While CPI (inflation) readings have been supportive lately, employment measures have bordered on worrisome. The markets will be debating whether this rate cut's timing (and more potential ones in 2024 and 2025) is ideal for supporting the economy or a bit too late for a macro that has already cooled too much.
Thankfully, consumer subscription stocks have been resilient with share prices up 6.4% on average since the latest earnings results.
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 $864.1 million, up 4.2% year on year. This print was in line with analysts’ expectations, but overall, it was a softer quarter for the company with a decline in its users and underwhelming revenue guidance for the next quarter.
Interestingly, the stock is up 9.9% since reporting and currently trades at $37.01.
Is now the time to buy Match Group? Access our full analysis of the earnings results here, it’s free.
Best Q2: 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 $178.3 million, up 40.6% year on year, in line with analysts’ expectations. The business had a strong quarter with impressive growth in its users and exceptional revenue growth.
Duolingo delivered the fastest revenue growth and highest full-year guidance raise among its peers. The company reported 103.6 million users, up 39.8% year on year. The market seems happy with the results as the stock is up 71.9% since reporting. It currently trades at $278.20.
Is now the time to buy Duolingo? Access our full analysis of the earnings results here, it’s free.
Weakest Q2: Chegg (NYSE:CHGG)
Started as a physical textbook rental service, Chegg (NYSE:CHGG) is now a digital platform addressing student pain points by providing study and academic assistance.
Chegg reported revenues of $163.1 million, down 10.8% year on year, exceeding analysts’ expectations by 2%. Still, it was a softer quarter as it posted a decline in its users and slow revenue growth.
Chegg delivered the slowest revenue growth in the group. The company reported 4.37 million users, down 9.1% year on year. As expected, the stock is down 43.2% since the results and currently trades at $1.67.
Read our full analysis of Chegg’s results here.
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 $170.3 million, up 10.8% year on year. This print beat analysts’ expectations by 3.5%. More broadly, it was a softer quarter as it also logged strong growth in its users but slow revenue growth.
Coursera pulled off the biggest analyst estimates beat among its peers. The company reported 155 million users, up 20.2% year on year. The stock is up 8.1% since reporting and currently trades at $8.
Read our full, actionable report on Coursera here, it’s free.
Udemy (NASDAQ:UDMY)
With courses ranging from investing to cooking to computer programming, Udemy (NASDAQ:UDMY) is an online learning platform that connects learners with expert instructors who specialize in a wide range of topics.
Udemy reported revenues of $194.4 million, up 9% year on year. This number met analysts’ expectations. Aside from that, it was a softer quarter as it produced underwhelming revenue guidance for the next quarter and slow revenue growth.
Udemy had the weakest full-year guidance update among its peers. The company reported 16,595 active buyers, up 11% year on year. The stock is down 15.8% since reporting and currently trades at $7.79.
Read our full, actionable report on Udemy here, it’s free.
Join Paid Stock Investor Research
Help us make StockStory more helpful to investors like yourself. Join our paid user research session and receive a $50 Amazon gift card for your opinions. Sign up here.