Udemy is the world’s largest course marketplace — 70+ million students, 210,000+ courses, and a platform that processes hundreds of millions of dollars in instructor payouts annually. For anyone with expertise worth teaching, Udemy offers the most accessible path to creating and selling an online course.
But Udemy’s economics are brutal for instructors who don’t understand them.
Your $199 course will regularly sell for $9.99–$14.99 during Udemy’s aggressive platform-wide promotions — which run almost continuously. When Udemy drives that sale, you keep just 37% of the discounted price. That’s $3.70 from your “premium” course. And starting January 2026, subscription-based revenue (which now accounts for 74% of Udemy’s consumer revenue) pays instructors just 15% of the pool.
The instructors who earn meaningful income on Udemy understand one thing: the revenue split changes dramatically depending on who drove the sale. Master that distinction, and Udemy can generate $1,000–$10,000+/month. Ignore it, and you’ll wonder why 50,000 students generated only $2,000 in lifetime earnings.
I’ve spent 15+ years evaluating income methods. Here’s the complete picture.
First – A Quick Reality Check
Hey, my name is Mark.
After 15+ years testing income methods, I’ve found that Udemy provides massive reach but takes a massive cut. The instructors who win are those who drive their own traffic — and keep 97% instead of 37%.
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My business partner James built a system for people targeting $3,000–$5,000 monthly. But first — the Udemy economics you need to understand.
What Udemy Is
Udemy is an online course marketplace where anyone can create, publish, and sell video courses on virtually any topic. Students purchase individual courses or subscribe to Udemy’s Personal Plan for access to a broader catalog. Businesses subscribe to Udemy Business for employee training.
The platform handles hosting, payment processing, student management, and promotional marketing. Instructors create content and (optionally) drive their own traffic. There’s no cost to publish a course.
With 70+ million learners and 75,000+ instructors, Udemy is the largest open marketplace for online education. The scale provides unmatched reach — but also intense competition and aggressive pricing dynamics that directly impact what instructors earn.
The Revenue Share Breakdown
This is the most critical section. Udemy’s revenue split depends entirely on how the student found and purchased your course.
Transactional Sales (Individual Course Purchases)
| Sale Source | Your Share | Udemy’s Share | Example on $100 Sale |
|---|---|---|---|
| Your coupon/referral link | 97% | 3% | You earn $97 |
| Udemy organic (student found you) | 37% | 63% | You earn $37 |
| Udemy paid ads | 25% | 75% | You earn $25 |
| Affiliate sale | ~25% | ~37% | You earn ~$25 (affiliate gets rest) |
The difference between 97% and 37% is enormous. This is why every serious Udemy instructor prioritises driving their own traffic through instructor coupons and referral links.
Subscription Revenue (Udemy Business & Personal Plan)
Udemy allocates a portion of subscription revenue to a shared instructor pool, distributed based on minutes consumed. The instructor share has been declining:
| Year | Instructor Share of Subscription Revenue |
|---|---|
| 2023 | 25% |
| 2024 | 20% |
| 2025 | 17.5% |
| 2026 | 15% |
With subscription revenue now representing 74% of Udemy’s consumer revenue (and growing), this declining share directly impacts instructor earnings. Udemy has been actively pushing students away from one-time purchases and toward subscriptions — which pay instructors significantly less per student.
The Discount Reality
Udemy runs platform-wide discount events almost continuously. During these promotions, courses are typically priced at $9.99–$14.99 regardless of their list price.
Why this matters: You set your course price at $199. Udemy runs a sale. Your course sells for $9.99. Udemy drove the sale (organic), so you earn 37%. Your revenue: $3.70 per sale.
Even at $14.99 with a 37% split, you earn $5.55 per student. This means you need volume — hundreds or thousands of sales monthly — to generate meaningful income from Udemy-driven sales.
The Deal Program: Udemy asks instructors to opt into their promotional pricing program. Opting in gives your course more algorithmic visibility but subjects it to deep discounting. Most successful instructors opt in, accepting lower per-sale revenue in exchange for higher visibility and volume.
The strategic response: Use Udemy’s discounts for volume and visibility. Use your own coupons and referral links for margin. Promote your course on YouTube, social media, and your email list using your instructor referral link — and keep 97% instead of 37%.
Course Pricing Strategy
List price: Set it at $49.99–$199.99. During sales, it will be discounted to $9.99–$14.99 regardless, but a higher list price creates perceived value.
Instructor coupons: Create custom coupon links offering your course at $9.99–$19.99. Share these through your own marketing channels. You keep 97% of coupon sales.
Free courses: Some instructors offer free introductory courses to build student lists and reviews, then upsell paid courses. This works but requires a deliberate funnel strategy.
The pricing paradox: You can’t compete on price because Udemy controls promotional pricing. You compete on quality, ratings, and external marketing. The instructors who earn the most aren’t those with the highest-priced courses — they’re those who drive the most self-referred sales at 97% split.
Refund Policy Impact
Udemy offers a 30-day, no-questions-asked refund policy on all course purchases. This directly impacts instructor earnings.
Average refund rates: 5–15% depending on course quality and student expectations. Heavily discounted courses ($9.99 sales) tend to have lower refund rates because the financial commitment is minimal. Higher-priced self-promoted courses can see higher refund rates.
How refunds affect you: The revenue from refunded purchases is deducted from your earnings. If a student buys your course for $14.99, watches half of it, and requests a refund, you receive nothing. Udemy absorbs the processing costs, but you lose the revenue entirely.
Reducing refunds: Clear, honest course descriptions that accurately represent content. Strong first 30 minutes that hook students. No misleading claims about outcomes. Prompt response to student questions.
Income Math Example
New Udemy instructor (1 course, no external marketing): Monthly sales: 50 (mostly Udemy organic at $9.99–$14.99) Average revenue per sale at 37%: $4.44 Refunds (10%): -5 sales Net monthly revenue: $200
Established instructor (5 courses, moderate YouTube presence): Monthly sales: 300 Organic sales (200 at 37%): $888 Self-referred sales (100 at 97%): $970 (at $10 average) Subscription revenue: $200/month Refunds (8%): -$165 Net monthly revenue: $1,893
Top-tier instructor (10+ courses, strong external marketing, 100K+ YouTube subscribers): Monthly sales: 2,000+ Organic sales (800 at 37%): $3,552 Self-referred sales (1,200 at 97%): $11,640 Subscription revenue: $1,000+/month Refunds (6%): -$970 Net monthly revenue: $15,222
The difference between the first scenario and the third is almost entirely explained by self-referred sales volume. Same platform, dramatically different economics.
Course Creation Process
Step 1: Validate your topic. Use Udemy’s Marketplace Insights tool (free for instructors) to research demand, competition, and median revenue for your topic. Look for topics with high student demand and moderate (not extreme) competition.
Step 2: Plan your curriculum. Outline 3–8 hours of content (Udemy’s sweet spot for comprehensive courses). Structure it as progressive modules with clear learning outcomes for each section.
Step 3: Record content. Screen recordings for software courses, slides + voiceover for conceptual content, talking-head for personality-driven courses. Minimum: decent USB microphone and 1080p video. Audio quality is the #1 factor in student satisfaction.
Step 4: Edit and produce. Clean audio, consistent volume levels, minimal dead air. Add text overlays, annotations, and practice exercises where helpful. Udemy requires at least 30 minutes of video content and 5 lectures.
Step 5: Submit for review. Udemy reviews all courses for quality standards before publishing. Review typically takes 2–5 business days. Courses may be rejected and require revisions.
Step 6: Optimise your landing page. Compelling title with keywords. Clear description of what students learn. Promotional video. Strong instructor bio. Quality thumbnail.
Scaling Strategy
Publish multiple courses. Each course acts as a separate revenue stream and cross-promotes others. Instructors with 5–10 courses consistently earn more than single-course publishers.
Build a topic cluster. Create a beginner course, intermediate course, and advanced course in the same subject area. Students who complete one naturally enrol in the next.
Drive your own traffic. YouTube tutorials, blog content, social media, email list — every self-referred student earns you 97% instead of 37%. This is the single highest-leverage activity for Udemy instructors.
Optimise for reviews. Courses with 4.5+ stars and hundreds of reviews dominate Udemy’s search results. Actively encourage reviews through in-course prompts and follow-up messaging.
For choosing the right online business model, Udemy offers the lowest barrier to entry in course creation — but the economics favour platform owners over content creators. Digital assets that pay monthly provides context on alternative recurring income models.
Pros and Cons
What works: Massive student base (70M+ learners). No upfront cost to publish. Platform handles marketing, hosting, and payments. Courses can generate revenue for years after creation. 97% revenue share on self-referred sales is excellent. Credibility of being on a major platform. Built-in promotional engine drives discovery.
What doesn’t: 37% share on Udemy-organic sales is low. Subscription revenue share dropping to 15% in 2026. Deep discounting means courses regularly sell for $9.99. You don’t own student email addresses. 30-day refund policy creates revenue uncertainty. Intense competition in popular categories. Algorithm changes affect visibility unpredictably.
Reality Check
Udemy’s economics have shifted significantly against instructors since 2023. Subscription revenue share dropping from 25% to 15% over three years, combined with the platform’s active push away from individual course sales toward subscriptions, means instructors earn less per student engagement than ever before.
The best online business to start gives you control over pricing, audience relationships, and revenue. Udemy offers reach but surrenders control. For realistic online income expectations, most Udemy instructors earn under $500/month — meaningful income requires multiple courses and active self-promotion.
As an online business with no inventory, course creation has genuine appeal. The question is whether the platform dependency and declining revenue shares make Udemy the right vehicle — or whether self-hosted alternatives offer better long-term economics.
Who Udemy Is NOT For
If you want to control your pricing, Udemy’s promotional engine will override your list price.
If you expect premium pricing to reflect premium content, Udemy’s $9.99 sale culture will frustrate you.
If you won’t market your courses externally, Udemy’s 37% organic share produces modest income.
If you want to own your student relationships, Udemy controls student data and communication.
Frequently Asked Questions
How much do Udemy instructors make? Most: under $500/month. Active instructors with 5+ courses and external marketing: $1,000–$5,000/month. Top instructors: $10,000–$50,000+/month.
What percentage does Udemy take? 3% on instructor-referred sales. 63% on organic sales. 75% on Udemy-advertised sales. Subscription: 82.5–85% as of 2025–2026.
Why do Udemy courses sell for $9.99? Udemy runs near-continuous promotional events offering deep discounts. This drives volume but compresses per-sale revenue for instructors.
Can you make passive income on Udemy? Yes — courses can sell for years after creation. But significant income requires multiple courses and ongoing marketing effort. It’s semi-passive, not fully passive.
How long does it take to create a Udemy course? Minimum: 2–4 weeks for a quality 3–5 hour course. Including planning, recording, editing, and optimisation: 4–8 weeks is typical.
Is Udemy better than Skillshare? Different models. Udemy pays per sale (97% if self-referred). Skillshare pays per minute watched ($0.05–$0.10). Udemy gives you more control over pricing through coupons. Skillshare has no individual pricing at all.
Should I publish on both Udemy and Skillshare? Yes — the platforms serve different audiences with different economics. Publishing on both maximises your reach and provides diversified income streams.
Udemy takes 63–85% of most instructor revenue. Local lead generation builds assets you own, paying $500–$1,200/site monthly with 92–97% margins.
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The Bottom Line
Udemy offers unmatched reach for course creators — 70 million potential students is a market no individual instructor can replicate. But reach comes at a cost: deep discounting, declining revenue shares, and platform dependency. The instructors who thrive treat Udemy as a discovery engine while building their own traffic sources for 97% revenue share sales. Use the platform’s reach. Don’t rely on the platform’s generosity.
The Competition Reality
Udemy hosts 210,000+ courses from 75,000+ instructors. Standing out requires strategic positioning.
Popular categories are crowded. “Python Programming” has thousands of courses. “Python for Data Science Beginners” has fewer. “Python for Healthcare Data Analysis” has fewer still. The more specific your niche, the less competition you face and the more precisely you attract students willing to complete your course.
Ratings drive visibility. Udemy’s search algorithm heavily weights course ratings and review count. A new course with zero reviews is nearly invisible. This creates a chicken-and-egg problem: you need sales to get reviews, but you need reviews to get sales. The solution: promote your course externally to your first 50–100 students, encourage honest reviews, and build algorithmic momentum.
Course updates matter. Udemy’s algorithm favors recently updated courses. Instructors who regularly add new lectures, update outdated content, and respond to student questions maintain better search visibility than those who publish and abandon.
AI’s Impact on Udemy Course Creation
AI tools are reshaping both course creation and competition on Udemy.
Easier course creation: AI tools can help generate course outlines, create supplementary materials, and even assist with video editing. This lowers the barrier to entry — meaning more competition from lower-quality courses flooding the marketplace.
Course quality differentiator: Students increasingly distinguish between AI-generated filler content and genuine instructor expertise. Courses that demonstrate real-world experience, personal insight, and adaptive teaching (responding to student questions, updating based on feedback) outperform generic AI-generated content.
New course categories: AI itself has created massive demand for courses about AI tools, prompt engineering, and AI-assisted workflows. Instructors who quickly create quality content in emerging AI niches capture early-mover advantage.
Udemy’s own AI features: Udemy has introduced AI-driven learning tools and assistant features for students. While these enhance the student experience, they haven’t directly impacted instructor revenue models yet — though they signal Udemy’s continued investment in technology over instructor compensation.
Mark is the founder of MarksInsights and has spent 15+ years testing online business programs and tools. He focuses on honest, experience-based reviews that help people avoid scams and find real, sustainable ways to make money online.