Like a gangly teen being shunned in school, investors gave the cold shoulder to Nerdy (NRDY 2.00%) stock on Hump Day. That's because the online education specialist published quarterly results that came in notably under expectations in terms of profitability -- or the lack thereof. With this albatross weighing it down, Nerdy's stock price headed south by nearly 18% on the day.
Higher revenue and narrower net loss, but...
Nerdy's third-quarter results, published after market hours on Tuesday, showed that revenue was almost $40.3 million for the period, well above the $31.8 million of the same quarter of 2022. The company continues to lose money, though; its generally accepted accounting principles (GAAP) net loss was $20.6 million ($0.13 per share). Yet, that too represented a year-over-year improvement, as the year-ago quarter's shortfall was $32.3 million.
Despite the improvements, Nerdy beat only narrowly on the top line and missed significantly on the bottom. On average, analysts were estimating that the company would book revenue of slightly over $39 million, accompanied by only a $0.08 per share GAAP net loss.
Although the company's bottom-line deficit remains worrying, management touted its recent operational successes.
In a letter to shareholders, founder and CEO Chuck Cohn wrote, "Both our consumer and institutional businesses saw strong demand in the quarter as the school year ramped, which combined with the operating leverage that we are receiving from our new 'always on' recurring revenue models and investments in [artificial intelligence], to also drive bottom-line outperformance.
NYSE: NRDY
Key Data Points
Nerdy guided for an improved top line and EBITDA for 2023
Nerdy also proffered guidance for both its current fourth quarter and the entirety of 2023. For the latter period, it's forecasting revenue of $192 million to $194 million; the 2022 tally was just under $163 million.
In terms of profitability, Nerdy believes its non-GAAP (adjusted) earnings before interest, taxes, depreciation, and amortization (EBITDA) figure will be a loss of roughly $6 million. This compares favorably to the almost $36 million EBITDA deficit of 2022.
