Actually, it reproduce by both methods but you may have read the fact that regeneration isn't totally a method of reproduction, it occurs whenever the parts of any organisms cut accidentally that exactly done with hydra. Hydra reproduce by budding and regeneration too.


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Hydra Reproduction

Hydra is a freshwater invertebrate that belongs to the phylum Cnidaria. The hydra reproduces asexually through two methods: regeneration and budding.

Regeneration

Regeneration is the process by which a hydra can regrow a part of its body that has been lost or damaged. In the case of hydra reproduction, regeneration occurs when a hydra is cut into pieces, and each piece is capable of regenerating a complete hydra. The process of regeneration begins when cells migrate to the site of the wound, and a mass of cells called a blastema forms. The blastema divides and differentiates into the various cell types needed to form a complete hydra. Regeneration is a slow process and can take several weeks to complete.

Budding

Budding is the most common method of hydra reproduction. It occurs when a small outgrowth or bud forms on the body of the hydra. The bud grows and develops into a miniature hydra that detaches from the parent and becomes an independent organism. The newly formed hydra will continue to grow and develop until it is fully mature and capable of reproducing.

Conclusion

In conclusion, hydra are capable of reproducing asexually through two methods: regeneration and budding. Regeneration occurs when a hydra is cut into pieces, and each piece is capable of regenerating a complete hydra. Budding occurs when a small outgrowth or bud forms on the body of the hydra, which develops into a miniature hydra that detaches from the parent and becomes an independent organism.