Nerdy Reports Q2 2025 Earnings: Accelerating Live+AI Adoption Drives Revenue and Gross Margin Growth

Nerdy, Inc. (NRDY) reported Q2 2025 earnings with a focus on its Live+AI vision, which aims to embed real-time intelligence in each stage of the learning journey. CEO Charles Cohn highlighted meaningful progress and enhancements leading to stronger engagement and adoption. The company outlined sequential revenue and gross margin growth through 2025 with accelerating Live+AI adoption.

Nerdy, Inc. (NRDY) reported its Q2 2025 earnings, highlighting significant progress in its Live+AI vision, which aims to embed real-time intelligence in each stage of the learning journey. CEO Charles Cohn emphasized meaningful advancements, including enhanced engagement and adoption, leading to stronger revenue and gross margin growth through 2025.

The company reported a return to year-over-year growth in learning membership revenue, with a 4% increase driven by more engaged customers and AI-powered product improvements. Varsity Tutors for Schools bookings grew by 21% year-over-year, supported by high dosage tutoring demand and positive feedback on the Live+AI platform. Cohn stated, "We continue to expect consumer revenue to accelerate in growth each quarter throughout 2025."

Nerdy Inc. announced several product enhancements, including interactive video playback, AI-generated session summaries, AI-powered Learner-Expert match explanations, automated calendar invites, and streamlined mobile-friendly checkout. A major overhaul of practice resources was completed, evolving them into modern AI-powered interactive learning experiences covering hundreds of subjects. Additionally, the desktop Nerdy app for tutors was launched, providing real-time guidance and context-aware AI features.

For institutional clients, over 30 new AI tools will be available this back-to-school season, automating tasks and enhancing personalization. In a recent partnership with a top 10 U.S. school district, students using high-dosage tutoring saw an average 11-point improvement from midyear to year-end and significant gains in early literacy and state assessment scores.

The company reported total revenue for Q2 2025 of $45.3 million, a decrease of 11% year-over-year, attributed to the absence of a non-recurring state-funded program and lower institutional revenue. Gross margin expanded by 350 basis points sequentially. Sales and marketing expenses declined to $13.5 million from $15.5 million in the prior year quarter.

Nerdy Inc. expects consolidated and consumer revenues to return to being positive year-over-year in Q3 2025, driven by higher customer acquisition and improved ARPM. For Q3, revenue is expected in the range of $37 million to $40 million, and full-year revenue is projected at $191 million to $197 million. Institutional revenue is expected to return to year-over-year growth in Q4 2025. Non-GAAP adjusted EBITDA loss for Q3 is forecast at $11 million to $13 million, and for the full year at $13 million to $17 million. The company expects to be profitable on a non-GAAP adjusted EBITDA basis in Q4 2025, ending the year with cash in the range of $30 million to $35 million and no debt.

Management maintained a confident and upbeat tone during the earnings call, describing recent months as "the single most productive period in our company history." Analysts expressed cautious optimism, focusing on growth levers, early cohort trends, and the impact of AI initiatives, while seeking clarity on execution and rollout timelines.

References:
[1] https://seekingalpha.com/news/4482896-nerdy-outlines-sequential-revenue-and-gross-margin-growth-through-2025-with-accelerating-live
[2] https://finance.yahoo.com/news/nerdy-inc-nrdy-q2-2025-074410641.html