Is the EdTech Market growing now?

Why is the EdTech market growing while so many education startups are struggling?

The EdTech market is growing again, but the money is increasingly going to established platforms rather than new startups.

Grand View Research estimates that global education technology revenue will increase from $187 billion in 2025 to $213.2 billion in 2026, a rise of approximately 14%. Meanwhile, HolonIQ reported that EdTech venture funding fell 26% in the first half of 2026, to approximately $1 billion. Research groups size EdTech differently, so we build our own estimate from the ground up, with every assumption visible, in our EdTech market report.

The divide shows up in company results. Duolingo increased second-quarter revenue by 18%, Docebo grew 13%, and Stride reported $2.52 billion in annual revenue. Chegg, meanwhile, lost 51% of its quarterly revenue as its traditional study-help business continued shrinking.

The pandemic originally helped EdTech companies acquire millions of users while investors poured money into online education. Today, customers still spend heavily on educational technology, but free AI tools, weaker demand for standalone courses, and pressure to become profitable have changed which businesses can grow.

The industry is moving in two directions at once: overall spending is rising, while a substantial part of the previous generation of EdTech startups is struggling to survive.

How big is the global EdTech market today?

The global EdTech market is currently worth an estimated $213 billion annually, although the exact figure depends on which education products are counted.

Grand View Research's 2026 industry assessment places the market at $187 billion in 2025 and projects $213.2 billion for 2026. Its forecast reaches $437.5 billion by 2033, equivalent to 10.8% average annual growth from the 2026 baseline.

North America represented 36.1% of the market in 2025, equivalent to approximately $67.5 billion. The same study found that K–12 education accounted for 38.9% of global revenue, while business customers represented 67% of spending under its classification.

Those figures reveal something important about the industry's composition. Consumer learning applications attract considerable attention, but educational hardware, business software and institutional systems account for much of the money.

Grand View Research's separate digital education category is considerably narrower, with an estimated value of $44.6 billion in 2026. The two estimates measure different markets and should not be combined.

Market measurement	Estimated size	What it represents
Broad EdTech market, 2025	$187.0B	Historical market estimate
Broad EdTech market, 2026	$213.2B	Current market estimate
Broad EdTech market, 2033	$437.5B	Long-term forecast
Broad EdTech growth, 2025–2026	14.0%	Implied annual increase
Broad EdTech CAGR, 2026–2033	10.8%	Forecast annual growth
North American EdTech, 2025	~$67.5B	Derived from 36.1% market share
Digital education market, 2026	$44.6B	Narrower education category
Digital education market, 2030	$133.7B	Separate category forecast

Is EdTech growing faster than the overall education industry?

EdTech is expected to grow more than twice as fast as the broader education industry, although the comparison relies on forecasts rather than completed sales.

HolonIQ's 2025 Global Education Outlook projected approximately 4.4% annual growth in overall education spending through 2030. Grand View Research, meanwhile, forecasts 10.8% annual growth for education technology between 2026 and 2033.

On those forecasts, EdTech grows roughly 2.5 times faster.

The difference makes sense when we consider where schools and employers are spending money. Traditional education budgets cover teachers, buildings, administration and other relatively mature expense categories. Technology spending can increase as institutions introduce digital assessments, learning management systems, AI tools and online training.

Grand View Research also expects cloud-based EdTech deployment to grow 15.9% annually through 2033, faster than the overall technology market.

The comparison has limits because the two reports use different market definitions and forecast periods. Still, both point toward digital products taking a larger place in education budgets over time.

Has EdTech startup funding recovered yet?

EdTech startup funding is still in a deep slump, despite the market's growing revenue.

HolonIQ recorded approximately $1 billion of global EdTech venture investment in the first half of 2026, down 26% from $1.35 billion during the same period in 2025. Its historical data shows that funding reached $20.8 billion in 2021 before falling to approximately $2.4 billion in 2025.

That is an 88% drop from the pandemic-era peak.

HolonIQ has published slightly different 2025 totals, including an estimate closer to $2.6 billion. Even using that higher figure, investment remains approximately 87.5% below 2021 levels.

The interesting detail in the latest half-year report is that deal volumes remained relatively stable while total capital declined. Investors were still financing education companies, but the average amount invested per deal was smaller.

Some companies are nevertheless securing substantial rounds. Preply raised $150 million, while Multiverse secured $70 million, both in workforce-related learning categories highlighted by HolonIQ.

The funding drought is therefore especially severe for the kind of large, speculative rounds that characterized the previous boom. Investors still fund EdTech businesses, particularly when they can show a clear customer need and credible commercial growth.

Which EdTech companies are actually growing right now?

Duolingo, Docebo, Stride and Pearson are currently growing, while Chegg and Nerdy show how difficult conditions remain for other parts of the EdTech industry.

Recent financial reports reveal very different trajectories. Duolingo added approximately $46 million in second-quarter revenue year over year, while Chegg lost more than $53 million over its corresponding comparison.

We also reviewed Coursera's reported growth. Its second-quarter revenue rose 60% following the acquisition of Udemy, but normalized revenue declined 1% when comparing the businesses on a more consistent basis. Telling growth bought through an acquisition from organic demand is a market signal we track every quarter in our market report about EdTech.

The acquisition makes a big difference. A larger combined company can report impressive revenue growth even when its underlying customer demand has barely changed.

Among the seven companies below, five reported positive headline growth and two declined. The sample is too small and varied to establish an industry-wide average, but it clearly shows why growing market spending does not translate into growth for every provider.

Company	Latest reporting period	Revenue	Annual change
Duolingo	Q2 2026	$298.5M	+18%
Coursera	Q2 2026	$298.6M	+60% reported
Docebo	Q2 2026	$68.7M	+13%
Stride	FY2026	$2.52B	+4.7%
Pearson	H1 2026	£1.78B	+4% underlying
Nerdy	Q2 2026	$43.2M	-4.5%
Chegg	Q2 2026	$51.8M	-51%

The periods are not identical, and Coursera's acquisition-driven growth is not directly comparable with organic growth at the other companies.

Is Duolingo still growing as fast as before?

Duolingo is still growing quickly, but its paying business is expanding more slowly than its audience.

According to its August 2026 shareholder letter, second-quarter revenue reached $298.5 million, up 18% year over year. Daily active users increased 23%, reaching 58.7 million, while paid subscribers grew 17%, to 12.7 million.

The daily user growth rate actually accelerated by two percentage points from the previous quarter. However, total bookings grew only 8%, compared with 18% revenue growth.

Bookings offer a different view of demand because they measure customer commitments during the period, while reported revenue includes amounts recognized from earlier purchases.

Duolingo also reduced its adjusted EBITDA margin from 31.2% to 25.9%, partly because management chose to invest more in attracting and engaging users.

Its audience remains unusually large for a specialized education application. The concern now is whether the company can turn continued user growth into faster bookings growth without sacrificing too much profitability.

For now, Duolingo looks like a successful consumer EdTech company deliberately prioritizing audience expansion, rather than one whose revenue growth is accelerating across every metric.

Is online learning still growing after the pandemic?

Online learning is still a substantial business, but the market for standalone courses looks much weaker than its headline revenue figures suggest.

Coursera's second-quarter 2026 results provide a good example. The company reported $298.6 million in revenue, up 60% after combining with Udemy. On a normalized basis, however, revenue was down approximately 1%.

The company also expects at least $85 million in annual run-rate savings from the integration by the end of 2026. Management is evidently looking for efficiencies as well as growth from the combination.

The broader industry has already gone through several painful adjustments. Online program manager 2U entered Chapter 11 restructuring in 2024, while Chegg's academic services business has suffered severe losses as students increasingly turn to general-purpose AI.

Coursera's position is different because it also sells subscriptions, professional certificates and corporate learning programs. More than 85% of the combined company's revenue now comes from recurring subscriptions.

That shift helps explain what online learning is becoming. The industry is concentrating around larger platforms offering ongoing access to content and credentials, while businesses dependent on one-off purchases or expensive customer acquisition face tougher economics.

Is corporate training the fastest-growing part of EdTech?

Corporate training is one of EdTech's strongest commercial segments today, especially for companies selling recurring software contracts to employers.

The World Economic Forum's Future of Jobs Report 2025 found that 59% of workers could need reskilling or upskilling by 2030. In the same employer survey, 63% identified skills gaps as a major obstacle to business transformation, and 85% planned to prioritize workforce upskilling.

These survey results describe employer expectations, but company financial statements provide evidence of actual spending.

Docebo reported $68.7 million in second-quarter 2026 revenue, an annual increase of 13%. Its annual recurring revenue reached $255.1 million, while average contract value rose 27%, from $58,900 to $74,800.

Interestingly, Docebo's reported recurring revenue grew 9.5%, slower than its total quarterly revenue. After excluding the effect of its largest OEM customer, acquired recurring revenue and currency changes, the company calculated approximately 13.9% underlying recurring revenue growth.

Larger contracts and continued recurring revenue expansion suggest that employers are committing more money to learning platforms, although Docebo's results alone cannot establish that corporate training is the fastest-growing EdTech category worldwide.

The commercial appeal is straightforward: employers can connect training purchases to specific jobs, compliance requirements and skill shortages. That gives business-oriented learning products a clearer purchasing rationale than many optional consumer courses.

Is AI helping EdTech companies grow or taking away their customers?

AI is already helping some EdTech companies grow while damaging others, with Chegg providing the clearest example of the downside.

Chegg reported $51.8 million in second-quarter 2026 revenue, down 51% from the previous year. Academic Services revenue fell even more sharply, by approximately 61%, as the company continued losing subscribers and traffic.

Chegg had previously identified Google AI Overviews as a contributor to declining search traffic. Students can also obtain explanations and homework assistance directly through ChatGPT, Gemini and other AI systems. Free AI tools replacing paid study help is one of the less obvious risks we rate in our report covering the EdTech market.

Duolingo has taken a different approach. It has introduced AI-powered language practice, including Video Call, while using AI to support content production. Its latest financial results show continued subscriber growth, although the company does not separately disclose enough information to measure the profitability of individual AI features.

Coursera is investing too. In July 2026, it announced a $100 million strategic investment in LearnVector, an AI-native learning company founded by Andrew Ng.

The comparison reveals where the commercial pressure is greatest. Products built around access to answers are easy targets for general-purpose AI, while structured practice, recognized qualifications and software integrated into institutional workflows have more room to charge customers.

AI is already changing where education companies make money. Whether it increases total spending on specialized learning software is still an open question.

Are AI tutors becoming a real business yet?

AI tutoring is attracting investment and product development, but we still lack strong commercial evidence that independent AI tutors can become a large, profitable market.

Duolingo demonstrates that AI-powered educational interactions can be offered within an established subscription business. Its 12.7 million paid subscribers provide a substantial customer base for introducing new learning features.

However, those subscribers pay for the broader Duolingo product. They cannot be counted as customers acquired specifically because of AI tutoring.

HolonIQ's first-half 2026 investment review identified companies such as Subject and Gizmo among startups attracting funding for AI-enabled personalized learning in K–12 education.

These companies are experimenting with different approaches to individual instruction, but funding rounds reveal more about investor expectations than educational effectiveness.

For schools, the difficult questions concern learning outcomes, accuracy, student privacy and assessment integrity. An AI system that can explain a math problem still needs to prove that students learn more effectively when using it.

Commercial adoption will become more convincing when providers can connect AI tutoring to measurable improvements in academic performance and demonstrate that schools or families will pay repeatedly for those improvements.

Are schools spending more on EdTech software today?

Schools are still spending heavily on education technology, although recent growth is stronger in career-focused education than in traditional virtual schooling.

Stride's fiscal 2026 results show the split clearly. Total revenue increased 4.7%, reaching $2.52 billion, while enrollment rose 4.2% to approximately 243,900 students.

General Education revenue fell 2.1%, partly because enrollment declined 2.5%. Career Learning revenue, meanwhile, increased 15%, supported by a 13.9% rise in enrollment.

The company's fourth quarter was weaker than its full-year figures: total revenue declined 2.7% year over year, with General Education revenue falling 9.7%.

There is another useful distinction inside Career Learning. Stride's middle- and high-school career programs generated approximately $1.04 billion during the fiscal year, up 19.1%, while its adult Career Learning business declined 29.6%, to $56.6 million.

So even within a relatively successful provider, different education categories are moving in opposite directions.

School purchasing also depends on public funding, procurement approvals and local curriculum requirements. These constraints make it harder for young companies to sell new products quickly, while established providers benefit from existing relationships and technical integrations.

Are established EdTech companies taking over the K–12 market?

Established K–12 education technology platforms have a major advantage today, particularly when it comes to winning large institutional contracts and attracting acquisition capital.

Bain Capital completed its acquisition of PowerSchool in October 2024 at an enterprise value of approximately $5.6 billion. PowerSchool served more than 60 million students through over 18,000 customers.

A month later, KKR and Dragoneer completed their approximately $4.8 billion acquisition of Instructure, the company behind Canvas. Instructure reported reaching roughly 200 million learners across more than 100 countries.

Combined, the transactions represented approximately $10.4 billion in enterprise value.

That was more than four times the approximately $2.4 billion of global EdTech venture investment reported by HolonIQ for 2024, although acquisitions and startup financing are different measures.

The attraction of these companies is understandable. Schools depend on platforms that manage student records, classroom assignments, grades and administrative operations. Replacing such systems often involves retraining staff and moving large amounts of sensitive data.

A startup offering one useful classroom feature may struggle to compete with a provider already connected to thousands of institutions.

The market remains open to new products, especially AI tools, but large education software platforms have a powerful distribution advantage.

Why are investors buying EdTech companies instead of funding new startups?

Investors are currently putting more emphasis on acquiring established education businesses, while venture funding for younger companies remains weak.

HolonIQ recorded approximately 360 education-sector mergers and acquisitions in 2025, compared with roughly 300 in 2024. That represents a 20% increase in transaction count.

In its first-half 2026 investment review, HolonIQ also reported that private-equity growth-capital deals increased from 10 to 17 year over year. However, the total amount invested fell from $445 million to $290 million. Private equity deals rising while the money invested falls is part of the investor picture we follow in our EdTech market report.

We calculated that the average capital invested per deal therefore declined from approximately $44.5 million to $17.1 million, a reduction of about 62%.

More transactions are happening, but investors are committing substantially less capital to each one on average.

Major transactions have continued, including KKR's $1.3 billion acquisition of XCL Education and Wiley's approximately $450 million acquisition of Emerald Group Publishing. These are broader education investments rather than pure EdTech software deals, so they cannot be used as direct measures of technology valuations.

Nevertheless, the pattern is clear. Investors are willing to finance established education revenue streams, particularly when they can improve margins or combine businesses.

For early-stage startups, the difficult part is proving that their products can turn customer interest into reliable revenue before requiring another large funding round.

Which countries are seeing the strongest EdTech growth?

North America currently leads in EdTech revenue, while Asia-Pacific offers some of the strongest projected growth and investment activity is recovering unevenly across regions.

Grand View Research estimates that North America represented 36.1% of the global education technology market in 2025. It expects Asia-Pacific to be the fastest-growing region through 2033.

European startups, meanwhile, attracted close to half of global EdTech venture funding value in HolonIQ's 2025 assessment, exceeding North America on that particular measure.

HolonIQ's first-half 2026 review found that East Asian EdTech deal volume increased 37% year over year, despite the overall global decline in funding value.

These differences reflect more than geography. North America has a large installed base of paid education software, while several Asian markets are benefiting from growing digital access and demand for vocational skills.

Emerging markets also face different commercial constraints. India's BYJU'S demonstrated how dangerous aggressive expansion can become when expensive customer acquisition and financial obligations grow faster than a business can support.

The opportunity is substantial, especially in affordable mobile education and employment-related training. Still, a large population of potential learners tells us little about how many can afford subscriptions or how much revenue a provider can retain.

Are EdTech companies finally becoming profitable?

Some established EdTech companies are becoming more profitable, and their recent earnings suggest that controlling costs has become just as important as growing revenue.

Pearson reported £1.78 billion in first-half 2026 revenue, up 4% on an underlying basis. Adjusted operating profit increased 14%, reaching £276 million, with a 15.5% operating margin.

Stride delivered an even larger gap between sales and earnings growth. Its fiscal 2026 revenue increased 4.7%, while operating income rose 25.2%, from $360.1 million to $450.8 million.

Docebo also improved its adjusted EBITDA margin from 15.2% to 16.4% in the second quarter. However, net income fell from $3.1 million to $2.3 million, and quarterly free cash flow declined from $11.4 million to $3.1 million.

Those details are worth keeping separate. Adjusted earnings growth does not always mean every measure of profitability or cash generation is improving.

Chegg offers a different situation. Its cost-cutting efforts helped the company report $9.1 million in quarterly adjusted EBITDA despite the collapse in academic revenue.

We see a stronger focus on profitability across the sector, but the healthiest companies are those improving earnings while keeping revenue and customers. Cutting expenses is much less reassuring when the core business is losing half its sales.

Is EdTech moving away from academic courses toward job training?

Job-related learning is becoming an increasingly important part of EdTech, although the shift is much stronger in some companies than in others.

The World Economic Forum's Future of Jobs Report 2025 identified rapid changes in workforce skills, including the growing importance of AI, big data and cybersecurity.

We can see the commercial response in corporate learning software, professional credentials and career-focused education programs.

Stride's middle- and high-school career programs now generate more than $1 billion annually. Docebo's larger enterprise contracts show that employers are investing in organized learning platforms, while Coursera's integration of Udemy strengthens its position in professional and subscription-based education.

Chegg is trying to follow this direction through its Skilling business. However, second-quarter Skilling revenue increased only 2%, reaching $17.5 million. The company has not yet replaced the revenue disappearing from its academic services operation.

Simply moving into career education guarantees nothing. Companies still need established distribution, relevant courses or credentials, and customers willing to pay.

The strongest opportunities appear in training tied to clear professional needs, particularly where employers have specific roles to fill or skills they cannot easily find.

Could free AI tools eventually shrink the EdTech market?

Free AI tools could shrink several EdTech categories, but they are unlikely to eliminate demand for education software across schools, businesses and consumers.

General-purpose AI can now explain concepts, generate practice questions, summarize textbooks and provide basic feedback. Many of these functions previously supported paid study-help subscriptions. What AI can already do for learners, and what is still being tested, is something we cover in our report on EdTech.

Chegg's financial difficulties demonstrate how quickly the value of such products can deteriorate when users discover a cheaper alternative.

But institutional education software serves a different purpose. A school using PowerSchool to manage student information or Canvas to distribute coursework still needs those systems even if teachers and students have access to ChatGPT.

Corporate training platforms face a similar distinction. Companies need to assign courses, monitor compliance, document certifications and report employee progress. A chatbot can help with learning content without automatically replacing those administrative functions.

The real competitive risk is greatest for businesses whose product consists mainly of information that a general-purpose AI assistant can reproduce.

Specialized EdTech providers will increasingly need to offer reliable workflows, recognized results or a better learning experience than users can assemble themselves with free tools.

Can the EdTech market really double in size by 2033?

The EdTech market could double by 2033, but the forecast requires much more growth than the industry's best-known startups can deliver on their own.

Grand View Research projects that annual global education technology revenue will increase from $213.2 billion in 2026 to $437.5 billion in 2033.

That would add approximately $224 billion in annual market revenue over seven years, with the industry growing roughly 10.8% per year.

To put the size of that increase into perspective, Duolingo expects approximately $1.2 billion in annual revenue in 2026, while Stride currently generates about $2.5 billion. The forecast increase is equivalent to more than 180 businesses generating Duolingo's expected annual revenue.

Most of that additional spending would therefore need to come from a much broader set of products and providers, including educational hardware, digital infrastructure, institutional software and enterprise learning systems.

The growth assumptions are demanding, particularly with general-purpose AI competing against specialized education products. But rising adoption of digital assessments, cloud platforms and workforce training provides several plausible sources of demand.

We find the current market expansion credible because it is supported by company results as well as industry estimates. The precise 2033 figure deserves more caution: it remains a forecast, and several years of consistently strong spending growth are still required to reach it.

Is the EdTech market growing now, or is the recovery exaggerated?

Yes, the EdTech market is growing now, with global revenue estimated to rise about 14% in 2026, but the recovery is concentrated in specific parts of the industry.

The clearest growth comes from consumer platforms with large paying audiences, business learning software, institutional education systems and career-oriented programs. Financial reports from Duolingo, Pearson, Stride and Docebo support that conclusion.

The startup investment picture is considerably weaker. Venture funding remains close to 88% below its 2021 peak, while major players in traditional online education continue facing difficult conditions.

AI is also changing the winners. Businesses selling basic academic answers are under intense pressure, while providers offering structured learning, valuable credentials and software embedded in schools or companies have stronger reasons to retain paying customers.

Our conclusion is that EdTech remains a growing market with substantial long-term demand, but the pandemic-era startup boom is over. The industry is increasingly rewarding companies that can turn educational technology into products customers use and pay for consistently.

The growth is real. What has changed is who gets to benefit from it.