Coursera (COUR) risk factors, FY2024 10-K

Risks Related to Our Business and Industry

1. 01Our historical growth may not be indicative of our future growth, and our revenue may not grow or could decline compared to prior years
2. 02Our quarterly and annual revenue and operating results have historically fluctuated from period to period, and may do so in the future, which could cause our stock price to fluctuate and the value of your investment to decline
3. 03Our offerings continue to evolve, and given our limited operating history, predicting our future financial and operating results may be affected by a number of uncertainties
4. 04Market adoption of online learning solutions and generative AI are relatively new and may not grow, evolve as we expect, or lead to increased demand for our offerings, which may harm our business and results of operations
5. 05If we change the contract terms with our educator partners, including pricing or contract length, it could materially and adversely affect our business, financial condition, and results of operations
6. 06If we fail to establish, maintain, and expand our educator partners relationships, our ability to grow our business and revenue will suffer
7. 07Our ability to grow and improve our financial performance depends heavily on our ability to attract and retain learners, including converting our freemium learners to paid learners
8. 08If we fail to manage the growth of our business both in terms of scale and complexity, our financial results, including profit margins and financial condition, could be adversely affected
9. 09We may change the contract terms, including our pricing models, for our offerings, which in turn could impact our operating results
10. 10Our current operations are international in scope, and we plan to expand our international operations, which exposes us to related inherent risks
11. 11We intend to launch new offerings and services to learners and customers to grow our business. If our efforts are not successful, our business, results of operations, and financial condition could be adversely affected
12. 12We have incurred significant net losses since inception, and we may not achieve or maintain profitability in the future
13. 13We may not generate sufficient revenue from a new offering to offset our costs
14. 14If we pursue unsuccessful educator partner opportunities, we may forego more profitable opportunities, and our operating results and growth could be harmed
15. 15Failure to effectively expand our sales and marketing capabilities could harm our ability to increase our customer base and achieve broader market acceptance of our platform
16. 16If we fail to quickly and efficiently scale our operations and platform capabilities to support the needs of new and existing educator partners, our reputation and our revenue will suffer
17. 17Disruptions to the operations of one or more of our third-party service providers may adversely affect our business operations and financial condition
18. 18If we fail to adapt and respond effectively to rapidly changing technology, evolving industry standards, and changing customer needs or requirements, our platform may become less competitive
19. 19If we fail to increase sales of our Enterprise offerings, or if we need to change the contract terms associated therewith, including with respect to pricing or contract length, it could negatively affect our business, financial condition, and results of operations
20. 20If we fail to maintain sufficient high-quality content from our educator partners, we will be unable to attract and retain learners and customers
21. 21The ecosystem for global adult online learning is highly fragmented and rapidly evolving. We expect alternative modes of learning to continue to accelerate as existing players and new entrants in this industry introduce new and more competitive products, enhancements, and bundles
22. 22If for-profit postsecondary institutions, which offer online education alternatives different from ours, or other for-profit higher education service providers, perform poorly, it could nonetheless tarnish the reputation of online education as a whole, which could impair our ability to grow our business
23. 23Our growth strategy may contemplate acquisitions, and we may be unsuccessful in executing, implementing, integrating, or leveraging such acquisitions
24. 24We may invest in private companies, and if the value of any such equity investments were to decline, it could adversely affect our results of operations and financial condition
25. 25Our directors may encounter conflicts of interest involving us and other organizations with which they may be affiliated, including matters that involve corporate opportunities
26. 26We depend on our senior management and other key employees to grow and operate our business, and if we are unable to hire, retain and motivate our personnel, we may not be able to grow effectively
27. 27We may need additional capital in the future to pursue our business objectives. Additional capital may not be available on favorable terms, or at all, which could compromise our ability to maintain and grow our business
28. 28If we fail to successfully or appropriately balance longer-term growth and short-term results, our results of operations could be negatively impacted, including in the near term
29. 29Our results of operations could be adversely affected by natural disasters, public health crises, political crises, geopolitical crises, or other catastrophic events
30. 30Our metrics and market estimates used to evaluate our performance are subject to inherent challenges in measurement, and real or perceived inaccuracies in those estimates may harm our reputation and negatively affect our business
31. 31Increasing scrutiny and evolving expectations from customers, educator partners, regulators, investors, and other stakeholders with respect to our environmental, social, and governance (“ESG”) practices may impose additional costs on us, expose us to new or additional risks, or harm our reputation
32. 32Climate change may have an adverse impact on our business
33. 33Our workforce primarily operates on a remote basis, which could have a negative impact on the execution of our business plans and operations and create productivity, connectivity, and oversight challenges

Risks Related to Regulatory Matters and Litigation

1. 34Laws and regulations can have a negative impact on our business
2. 35If our educator partners fail to comply with international, federal, and state education laws and regulations, including any applicable state authorizations for their programs, it could harm our business and reputation
3. 36Our future growth could be impaired if we, or our educator partners, fail to obtain timely approval from applicable regulatory agencies to offer new programs, make substantive changes to existing programs, or expand their programs into or within certain jurisdictions
4. 37If our educator partners fail to maintain institutional or programmatic accreditation for their programs, our revenue could be materially adversely affected
5. 38As a service provider to higher education institutions both in the U.S. and internationally, either directly or indirectly through our arrangements with educator partners, we are required to comply with certain education laws and regulations
6. 39Changes in spending policies or budget priorities for government funding of academic institutions and other education providers, could result in adverse legislation or regulatory action
7. 40While our Degrees business model is designed to align with guidance from a DOE “Dear Colleague” Letter, such guidance is not codified by statute or regulation and may be subject to change
8. 41In addition, the legal weight the DCL would carry in litigation over the propriety of any specific compensation arrangements under the HEA or the incentive compensation rule is uncertain
9. 42State legislation could negatively affect our Degrees business model
10. 43If we were to become classified as a third-party service (“TPS”) under the HEA, we, and our Title IV participating university partners, would be subject to new compliance requirements, which could adversely impact our business and operations
11. 44If we violate the misrepresentation rule, or similar federal and state regulatory requirements, we could face fines, sanctions, and other liabilities
12. 45We are required to comply with the Family Educational Rights and Privacy Act (“FERPA”) for certain of our offerings, and failure to do so could harm our reputation and negatively affect our business
13. 46We could face liability, or our reputation might be harmed, as a result of the activities of our customers, educator partners, or learners for content on or accessible through our platform
14. 47We are subject to government export and import controls and anti-corruption laws and regulations that could impair our ability to compete in international markets and subject us to liability if we are not in compliance with applicable laws
15. 48We may become involved in claims, lawsuits, government investigations, and other proceedings that could adversely affect our business, financial condition, and results of operations

Risks Related to Privacy, Cybersecurity, and Infrastructure

1. 49If sensitive information about our learners, customers, educator partners, or their employees is disclosed, or if we, or our third-party providers, are subject to cyberattacks, use of our platform could be curtailed, we may be exposed to liability, and our reputation would suffer
2. 50Disruption to or failures of our platform could result in our educator partners and learners becoming dissatisfied with our platform and could harm our reputation
3. 51If we do not maintain the compatibility of our learning management platform with third-party applications that our customers use, our revenue will decline
4. 52Our payments system depends on third-party providers and is subject to evolving laws and regulations
5. 53Our business depends to a significant degree on continued access to the internet and mobile networks
6. 54If the mobile solutions available to our learners, customers, and educator partners are not effective, the use of our platform could decline
7. 55As new mobile devices and features are released, we may encounter problems in developing or supporting apps for them. In addition, supporting new devices and mobile device operating systems may require substantial time and resources
8. 56Our use and processing of personal information and other data is subject to laws and obligations relating to privacy and data protection, and our failure to comply with such laws and obligations could harm our business
9. 57Similar data privacy laws, rules, and regulations in other countries may also impact our business, such as laws in the People’s Republic of China, Singapore, Brazil, and India
10. 58We cannot yet fully determine the impact that these or future laws, rules, and regulations may have on our business or operations. These laws, rules, and regulations may be inconsistent from one jurisdiction to another, subject to differing interpretations, and may be interpreted to conflict with our practices
11. 59Our use of social media, emails, push notifications, and text messages in ways that do not comply with applicable laws and regulations, may lead to the loss or infringement of IP, result in unintended disclosure, harm our reputation, or subject us to fines or other penalties

Risks Related to Intellectual Property

1. 60Any failure to obtain, maintain, protect, or enforce our IP and proprietary rights could impair our ability to protect our proprietary technology and our brand and could materially harm our business
2. 61We may be subject to IP claims, which are extremely costly to defend, could require us to pay significant damages, and could limit our ability to use certain technologies in the future
3. 62Confidentiality agreements with employees and others may not adequately prevent disclosure of trade secrets and proprietary information
4. 63Our use of open source software (“OSS”) could negatively affect our ability to offer our solutions and subject us to possible litigation
5. 64Individuals that appear in content hosted on our platform may claim violation of their rights

Risks Related to Tax, Accounting, and Operations

1. 65Our business is subject to indirect taxes
2. 66Amendments to existing tax laws, rules, or regulations or enactment of new unfavorable tax laws, rules, or regulations could have an adverse effect on our business and operating results
3. 67Our ability to use our net operating loss (“NOL”) carryforwards and certain other tax attributes may be limited
4. 68Our reported results of operations may be adversely affected by changes in generally accepted accounting principles
5. 69Our operations as a public company require substantial costs and substantial management attention, and we may not be able to manage our operations as a public company effectively or efficiently

Risks Related to Our Common Stock

1. 70Our stock price has been volatile in the past and may be volatile in the future, and you may lose all or part of your investment
2. 71In addition, as of December 31, 2024, we had 25,438,046 shares that were issuable upon exercise of outstanding stock options or the vesting of outstanding restricted and performance stock units. Sales of stock by these equity holders or the perception that such sales could occur could adversely affect our stock price
3. 72Our actual operating results may not meet our guidance or analyst or investor expectations, which would likely cause our stock price to decline
4. 73We do not intend to pay dividends on our common stock for the foreseeable future, so any returns on your investment will be limited to changes in the value of our common stock
5. 74Anti-takeover provisions in our charter documents and under Delaware law could make an acquisition of our Company more difficult, limit attempts by our stockholders to replace or remove our current management, and reduce our stock price
6. 75The exclusive forum provision in our organizational documents may limit a stockholder’s ability to bring a claim in a judicial forum that it finds favorable for disputes with us or any of our directors, officers, or other employees, which may discourage lawsuits with respect to such claims

Risks Relating to Our Existence as a Public Benefit Corporation

1. 76Although we operate as a Delaware PBC, we cannot assure that we will achieve our public benefit purpose
2. 77If our publicly reported Certified B CorporationTM (“B Corp”) score declines, if we lose our certified B Corp status, or if we choose not to renew our B Corp certification, our reputation could be harmed and our business could suffer
3. 78As a PBC, our focus on a specific public benefit purpose and producing a positive effect for society may negatively impact our financial performance
4. 79Our directors have a fiduciary duty to consider not only our stockholders’ interests, but also our specific public benefit and the interests of other stakeholders affected by our actions. If a conflict between such interests arises, there is no guarantee such a conflict would be resolved in favor of our stockholders
5. 80As a PBC, we may be subject to increased derivative litigation concerning our duty to balance stockholder and public benefit interests, the occurrence of which may have an adverse impact on our financial condition and results of operations
6. 81If we cannot maintain our company culture and public benefit commitment, our business could be harmed