What Happened:

Shares of online learning platform Coursera (NYSE:COUR) jumped 54.9% in the morning session after the company reported second-quarter earnings results. Coursera increased its number of users this quarter. Its revenue and adjusted EBITDA also outperformed Wall Street's estimates. Notably, sales across all major operating segments exceeded Wall Street's estimates, and the company surpassed two million enrollments for its generative AI courses. That the company maintained full-year guidance for revenue, and adjusted EBITDA means it's squarely on track. Overall, this quarter was solid.

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What is the market telling us:

Coursera's shares are not very volatile than the market average and over the last year have had only 9 moves greater than 5%. But moves this big are very rare even for Coursera and that is indicating to us that this news had a significant impact on the market's perception of the business.

The biggest move we wrote about over the last year was 9 months ago, when the stock gained 18.5% on the news that the company reported third quarter results that beat analysts' revenue, EPS, adjusted EBITDA, and free cash flow estimates. Its outperformance was driven by healthy user growth in its consumer division; the company benefitted from increased demand for newly launched entry-level Professional Certificates created by Google, IBM, and Microsoft.

On top of that, Coursera launched the first entry-level Professional Certificate from Amazon Web Services. Given the increasing importance of technology in our world and the shortage of software engineers and other technical white collar workers, these certificates could be a tailwind to growth for years to come. Overall, this quarter's results were great and shareholders should feel optimistic.

Coursera is down 44.7% since the beginning of the year, and at $10.66 per share it is trading 49.3% below its 52-week high of $21.04 from December 2023. Investors who bought $1,000 worth of Coursera's shares at the IPO in March 2021 would now be looking at an investment worth $236.89.

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