Nerdy Inc. (NYSE: NRDY), a prominent player in the online learning industry, has released its financial results for the third quarter ended September 30, 2025. The results highlight both challenges and progress as the company continues to innovate and improve its operations.

1. Strong Performance Amid Challenges

Chuck Cohn, Founder, Chairman, and CEO of Nerdy, expressed optimism in the results, stating, “In the third quarter, our revenue was in-line with our guidance range and we beat adjusted EBITDA guidance. We drove nearly 1,000 basis points of improvement in adjusted EBITDA margins year-over-year, reflecting steady progress on cost controls and AI-enabled operations.” The company's recent product updates, including the launch of a 2.0 version of its flagship Live Learning Platform, have also received positive early feedback from customers.

Key Financial Highlights

Revenue: Nerdy reported revenue of $37.0 million for Q3 2025, aligning with its guidance range of $37 to $40 million. This marks a slight decrease of 1% year-over-year compared to $37.5 million in Q3 2024. The decline was attributed to lower Institutional revenue, although this was partially offset by a 5% increase in Consumer revenue.

Learning Membership Revenue: The Consumer Learning Membership revenue, which made up 89% of total company revenue, increased by 5% year-over-year to $33.0 million. The average revenue per member (ARPM) also saw a substantial rise of 24% year-over-year to $374.

Institutional Revenue: Institutional revenue came in at $3.7 million, representing 10% of total revenue, with a decrease in bookings attributed to delays in federal and state funding affecting high-dosage tutoring contracts.

Gross Margin: The gross margin for the quarter was 62.9%, down from 70.5% in the same period last year, primarily due to investments in Expert pay and incentives. However, the gross margin improved sequentially by approximately 140 basis points compared to Q2 2025.

Adjusted EBITDA and Path to Profitability

Nerdy posted a non-GAAP adjusted EBITDA loss of $10.2 million, which was better than the guidance of a loss between $11 million to $13 million. This improvement reflects enhanced operational efficiencies, reduced marketing spend, and stringent cost control measures. Cohn highlighted that the company is on a promising path to profitability, with a significant 960 basis point improvement in adjusted EBITDA margins year-over-year.

Increased Liquidity and Future Outlook

As of September 30, 2025, Nerdy reported $32.7 million in cash on its balance sheet. On November 3, 2025, the company secured a term loan agreement providing up to $50 million, with the initial draw of $20 million already completed. This move is expected to enhance Nerdy’s financial flexibility and support its growth initiatives without diluting equity.

Looking ahead, Nerdy has provided guidance for Q4 2025, expecting revenue between $45 million to $47 million and a non-GAAP adjusted EBITDA loss ranging from $2 million to breakeven. For the full year, the company anticipates revenue between $175 million and $177 million, with a non-GAAP adjusted EBITDA loss projected between $19 million and $21 million.

2. Conclusion

Nerdy Inc. continues to navigate a challenging landscape in the online learning market while demonstrating resilience and strategic growth. The company's focus on operational enhancements and AI-enabled efficiencies positions it favorably for future profitability. As it embarks on the fourth quarter of 2025, stakeholders will be keen to see how its innovative product offerings and financial strategies unfold.

Original press release