Coursera Inc at Needham Technology & Media Conference (Virtual) Transcript

The following is excerpted from the question-and-answer section of the transcript.

Question: Ryan MacDonald - Needham & Company, LLC - Analyst : Yes, it is. We'll go deeper into detail later for sure. So let's start with a macro-environment question first. Post pandemic, the education ecosystem continues to change, jobs continue to be automated, and there's a shortage of workers in really top need areas. And when you're on top of that, the current generation of learners don't necessarily believe that the traditional college degree is the only path to employment. So given these dynamics, we've seen a number of online learning platforms in marketplaces emerging. How does Coursera differentiate versus all those other vendors? REFINITIV STREETEVENTS | www.refinitiv.com | Contact Us consent of Refinitiv. 'Refinitiv' and the Refinitiv logo are registered trademarks of Refinitiv and its affiliated companies. MAY 18, 2022 / 5:30PM, COUR.N - Coursera Inc at Needham Technology & Media Conference (Virtual)

Question: Ryan MacDonald - Needham & Company, LLC - Analyst : Got it. And then as we dig into those three segments, you know, starting on the consumer side, the company recently surpassed 100 million registered learners on the platform and has really developed a nice cadence over the last year plus of adding pretty consistently 5 million new learners to the platforms a quarter. Can you talk about what you saw most effective in the evolution of your content and marketing strategy to try and produce those consistent results? How should we think about for the next year what that cadence can continue to look like? Can you stay at 5 million a quarter?

Question: Ryan MacDonald - Needham & Company, LLC - Analyst : All right. Now during the IPO process, you had talked about sort of (inaudible) this cohort analysis, which showed once a learner purchases a course and is on the platform, the consistency over the years or -- of them purchasing additional content. You know, I'd be curious. As you look at the 2020, or you have looked at the 2020 cohort, how has that usage trended compared to the pre-pandemic levels? Are you seeing similar sort of purchase patterns and sort of learners continuing to buy more content or looking to use more content on the platform?

Question: Ryan MacDonald - Needham & Company, LLC - Analyst : Yeah, and I think[DN3] there's a real value to understanding it. I think, on the consumer side, what we found in a lot of direct-to-consumer models is that sometimes that consumer behavior can be a bit choppy[DN4]. So understanding and having, sort of, that kind of (inaudible) I think it's the usage patterns. It's, I think, one of the best things about how the consumer businesses perform. One of the biggest successes in the consumer business, and you mentioned it a little bit earlier, is the introduction of the professional certifications. Now, the value proposition to the learner is, I think quite apparent, especially as these learners are trying to reskill and upskill. Can you talk a bit more about what the value proposition is to your partners that are helping to create the content and particularly given that the fee that they pay compared to, say, a university -- you pay them versus a university tend to be a bit lower? REFINITIV STREETEVENTS | www.refinitiv.com | Contact Us consent of Refinitiv. 'Refinitiv' and the Refinitiv logo are registered trademarks of Refinitiv and its affiliated companies. MAY 18, 2022 / 5:30PM, COUR.N - Coursera Inc at Needham Technology & Media Conference (Virtual)

Question: Ryan MacDonald - Needham & Company, LLC - Analyst : That's very helpful. And when you think about sort of content expansion and where you want to go deeper on certain areas, how do you decide which content subject areas warrant a full certification versus just an individual course? And how does that translate into how you think about the pipeline for new certifications heading into the back half of this year and '23?

Question: Ryan MacDonald - Needham & Company, LLC - Analyst : It seems like obviously from a partner perspective, there's quite a bit of demand as well as building out that pipeline, because I think you were at the recent Coursera conference that the pipeline for additional certifications, I think you announced 12 over the next year, year-and-a-half here. Is that right?

Question: Ryan MacDonald - Needham & Company, LLC - Analyst : Yeah, makes sense. Professional certifications I think are a good segue from consumer into enterprise because within the three enterprise segments, you've got Coursera for Government. And you've been seeing some healthy demand for these pro certs with those Coursera for Government customers. Can you provide a bit more color on what's driving that demand and perhaps discuss that broader evolution of where we started in terms of adoption on Coursera for Government and what you're seeing now? How that's changed? REFINITIV STREETEVENTS | www.refinitiv.com | Contact Us consent of Refinitiv. 'Refinitiv' and the Refinitiv logo are registered trademarks of Refinitiv and its affiliated companies. MAY 18, 2022 / 5:30PM, COUR.N - Coursera Inc at Needham Technology & Media Conference (Virtual)

Question: Ryan MacDonald - Needham & Company, LLC - Analyst : Yeah, shifting over to Coursera for Business. 2021 was a really strong year for content adoption as the Great Resignation created an environment where organizations needed to find ways to not only retain but develop their talent. However, we're currently in an environment where we're starting to see hiring freezes. And the markets have been and the economy are generally on crossroad, concerns about a recession, so I'm curious if the labor market continues to cool, what impact, if any, would this have on Coursera for Business?

Question: Ryan MacDonald - Needham & Company, LLC - Analyst : And historically, L&D has been where we've seen budgets tighten during a recession, correct? Right? And so given the resiliency you've talked about with the offering and what you think how the L&D model has evolved, right, I'd be curious, we see five to seven vendors could be, you know, putting content into an enterprise at one time. Do you think if budgets do tighten that you see sort of an acceleration of this consolidation trend around core vendors over time?

Question: Ryan MacDonald - Needham & Company, LLC - Analyst : Yeah. And I think you touched on it earlier as well, the introduction of level sets and skill sets really, I think, is this offers this differentiated approach in terms of not only identifying the skill sets within organizations, but then creating that stackable content to help truly develop it, sort of get the organizations to catch up in those areas. I'd be curious, both offerings relatively new, how they're resonating within the existing base so far? And I guess if you can quantify it, what sort of uplift do you see when skill sets and level sets are adopted by a customer?

Question: Ryan MacDonald - Needham & Company, LLC - Analyst : And I guess looking at the net -- from metrics perspective, looking at the enterprise segment, a question that we're often asked about is net dollar retention rate, NDRR, and how that's trended over the past year. Because despite the really strong growth you've seen in the enterprise side, we've seen this gradual decline in NDRR. And then we've gotten questions from investors who are concerned about what's going on there. But just curious, as you think about the three segments that are built into enterprise -- Coursera for Business, Coursera for Government, and Coursera for Campus -- is there a difference -- a big difference in NDRR there? And maybe, is that indicating why we're seeing some (multiple speakers)?

Question: Ryan MacDonald - Needham & Company, LLC - Analyst : That's helpful. Now, I only got about a minute left. But maybe just quick on the degrees segment. There's a lot of questions around enrollment trajectory given the state of the labor market, but then also what we're seeing in, sort of, undergrad declines continuing to happen. You're having success signing new partners. But as we think about the back half of the year, and as you look out for that business, what assumptions are you making for overall enrollment trends? And when you're thinking about the forecasting of the degrees business?

Question: Ryan MacDonald - Needham & Company, LLC - Analyst : Excellent. Per usual, Ken, we sped through the time, but it was a very interesting conversation as usual. I appreciate you taking the time to join us today, and thanks for everyone who joined as well. Have a great rest of your day.