The upcoming report from Chegg (CHGG) is expected to reveal quarterly earnings of $0.17 per share, indicating a decline of 52.8% compared to the year-ago period. Analysts forecast revenues of $142.03 million, representing a decrease of 24.5% year over year.The current level reflects no revision in the consensus EPS estimate for the quarter over the past 30 days. This demonstrates how the analysts covering the stock have collectively reappraised their initial projections over this period.Before a company ann ...

Some stocks occasionally experience significant price drops due to shortsighted reasons. When that happens, it presents an excellent opportunity for careful and patient investors to buy the dip.Other times, shares of companies move in the wrong direction for good reasons. In those cases, it is generally best to stay away unless there are good reasons to think the corporation in question can overcome whatever headwinds it is facing.That brings leads to fuboTV (FUBO) and Chegg (CHGG -5.60%), which have signif ...

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Chegg (CHGG) reported $136.59 million in revenue for the quarter ended September 2024, representing a year-over-year decline of 13.5%. EPS of $0.09 for the same period compares to $0.18 a year ago.The reported revenue compares to the Zacks Consensus Estimate of $133.78 million, representing a surprise of +2.10%. The company delivered an EPS surprise of +28.57%, with the consensus EPS estimate being $0.07.While investors scrutinize revenue and earnings changes year-over-year and how they compare with Wall St ...

Financial Data and Key Metrics Changes - In Q3 2024, the company reported revenue of $137 million, a decrease of 13% year-over-year, with subscription services revenue at $120 million, down 14% year-over-year [25] - Adjusted EBITDA was $22 million, representing a margin of 16% [25] - The company recorded a noncash impairment charge of $196 million against goodwill due to industry pressures [26] - Free cash flow for the quarter was $24 million, with capital expenditures of $15.8 million, down 32% year-over-year [28] Business Line Data and Key Metrics Changes - The company had 3.8 million subscribers in Q3, reflecting a decline of 13% year-over-year [25] - Subscription services ARPU decreased by 2% year-over-year, although this was a 1-point improvement from Q2 2024 [25] - Engagement metrics showed a 79% year-over-year increase in the number of questions asked [7][28] Market Data and Key Metrics Changes - Global nonsubscriber traffic to Chegg declined year-over-year by 19% in Q3, with a further decline of 37% year-over-year in October [12] - The company noted that the adoption of generative AI products by students has negatively impacted traffic and revenue outlook [11][12] Company Strategy and Development Direction - The company is undergoing a strategic restructuring, reducing headcount by 21% to align costs with market conditions, expecting annualized non-GAAP cost savings of $60 million to $70 million in 2025 [13][30] - Chegg aims to differentiate itself by focusing on high-quality educational content and personalized learning experiences, despite the challenges posed by generative AI [15][22] - The company launched a brand marketing campaign and introduced a content quality guarantee to build trust and loyalty among subscribers [18][21] Management's Comments on Operating Environment and Future Outlook - Management acknowledged the significant headwinds from advancements in AI and the competitive landscape, particularly the impact of Google's AI search experience [8][10] - The company does not expect to meet its 2025 goals of a 30% adjusted EBITDA margin and $100 million in free cash flow due to current challenges [12] - Despite the difficulties, management remains optimistic about the market for high-quality educational tools, citing a study indicating that over 75% of students are willing to pay for tools that improve academic performance [15] Other Important Information - The company announced a $300 million increase in its securities repurchase program [29] - The restructuring plan is expected to incur charges of $22 million to $26 million, primarily related to severance payments [30] Q&A Session Summary Question: Key investments versus cost structure reduction - Management emphasized the importance of maintaining investments in differentiation and product development while managing costs [34][35] Question: Impact of Google AIO on traffic - Management clarified that while SEO traffic has been affected, they are exploring new channels like TikTok and Discord to reach students [39][41] Question: Subscriber base traction and brand awareness - Management noted that they are targeting students who need deeper learning and are focusing on brand campaigns to enhance awareness [42][43] Question: Engagement versus subscriber decline - Management acknowledged the increase in questions asked but highlighted the need to convert engagement into subscriptions [45] Question: Softening in nonsubscriber traffic trends - Management attributed the decline to the Google AIO experience and discussed efforts to diversify marketing channels [51]

Chegg (CHGG) came out with quarterly earnings of $0.09 per share, beating the Zacks Consensus Estimate of $0.07 per share. This compares to earnings of $0.18 per share a year ago. These figures are adjusted for non-recurring items.This quarterly report represents an earnings surprise of 28.57%. A quarter ago, it was expected that this an online learning platform would post earnings of $0.21 per share when it actually produced earnings of $0.24, delivering a surprise of 14.29%.Over the last four quarters, th ...

Financial Performance - Net revenues for the three months ended September 30, 2024, were $136.6 million, a decrease of 13.5% compared to $157.9 million for the same period in 2023[114]. - Total net revenues for the nine months ended September 30, 2024, decreased by $54.2 million, or 10%, to $474.1 million compared to $528.3 million in the same period in 2023[125]. - Total operating expenses for Q3 2024 were $315.5 million, a substantial increase from $132.1 million in Q3 2023, primarily due to the impairment expense[123]. - The loss from operations for the three months ended September 30, 2024, was $(222.3) million, compared to a loss of $(57.9) million in the same period last year[123]. - Impairment expense for the nine months ended September 30, 2024, was $677.2 million, significantly higher than $3.6 million in the same period in 2023[131]. - Impairment expense increased significantly to $195.7 million for the three months and $677.2 million for the nine months ended September 30, 2024, compared to $3.6 million for both periods in 2023[140]. Revenue Streams - Subscription Services accounted for 88% of net revenues in Q3 2024, down from 89% in Q3 2023, indicating a slight decline in reliance on this revenue stream[116]. - Skills and Other revenues represented 12% of net revenues in Q3 2024, up from 11% in Q3 2023, indicating a slight growth in this segment[118]. - Subscription Services revenues decreased by $20.1 million, or 14%, during the three months ended September 30, 2024, primarily due to a 13% decrease in subscribers[125]. Expenses and Cost Management - The company recorded an impairment expense of $195.7 million for the three months ended September 30, 2024, significantly impacting operating results[113]. - Total operating expenses increased significantly to $315.5 million for the three months ended September 30, 2024, from $132.1 million in the same period in 2023, primarily due to an impairment expense of $195.7 million[129]. - Research and development expenses decreased by $4.9 million, or 11%, during the three months ended September 30, 2024, compared to the same period in 2023[132]. - Sales and marketing expenses decreased by $2.4 million, or 8%, during the three months ended September 30, 2024, compared to the same period in 2023[134]. - General and administrative expenses decreased by $1.6 million, or 3%, during the three months ended September 30, 2024, compared to the same period in 2023[137]. Cash Flow and Liquidity - Cash, cash equivalents, and investments increased by $51.7 million (9%) to $631.2 million as of September 30, 2024, driven by net cash from operating activities[145]. - Net cash flows from operating activities decreased by $61.6 million (37%) during the nine months ended September 30, 2024, attributed to lower bookings and timing of bill payments[149]. - Net cash flows from investing activities decreased by $238.7 million (154%) during the nine months ended September 30, 2024, primarily due to lower proceeds from investments and higher property and equipment purchases[150]. - Net cash flows from financing activities increased by $696.3 million (99%) during the nine months ended September 30, 2024, due to the absence of repayments of convertible debt and stock repurchases[151]. - The company believes existing liquidity sources and net cash flows will be sufficient to fund operations and debt service obligations for at least the next 12 months[146]. Strategic Initiatives - The company announced a strategic restructuring plan in November 2024, which included workforce reductions and office closures to align costs with revenue trends[112]. - The company expects to realize cost savings in fiscal year 2025 as a result of the restructuring plans implemented in 2024[112]. - The ongoing shift towards generative AI services has negatively impacted traffic to the company's website and subscription growth, posing significant challenges for the business[110]. - The company is focused on integrating artificial intelligence into its platform to enhance student engagement and improve its product offerings[109]. Other Financial Metrics - Interest expense decreased by $0.1 million (10%) for the three months and $1.2 million (37%) for the nine months ended September 30, 2024, primarily due to early extinguishments of convertible senior notes[142]. - Other income, net dropped by $32.9 million (81%) for the three months and $91.2 million (78%) for the nine months ended September 30, 2024, mainly due to the absence of gains from early extinguishments of notes[143]. - The company incurred cumulative losses of $883.3 million from operations as of September 30, 2024, with potential for additional future losses[146]. - The company plans to repatriate earnings from its subsidiary in India, accruing $4.4 million in tax expense related to future distributions[148].

EXHIBIT 99.01 Chegg Reports 2024 Third Quarter Earnings SANTA CLARA, Calif., November 12, 2024 /BUSINESS WIRE/ -- Chegg, Inc. (NYSE:CHGG), the leading student-first connected learning platform, today reported financial results for the three months ended September 30, 2024. "While the global education industry continues to experience tremendous change, in Q3, we showed early progress against our strategic plan and delivered better-than-expected revenue and adjusted EBITDA. However, recent technology shifts a ...

The upcoming report from Chegg (CHGG) is expected to reveal quarterly earnings of $0.07 per share, indicating a decline of 61.1% compared to the year-ago period. Analysts forecast revenues of $133.78 million, representing a decrease of 15.3% year over year.The consensus EPS estimate for the quarter has remained unchanged over the last 30 days. This represents how the covering analysts, as a whole, have reassessed their initial estimates during this timeframe.Ahead of a company's earnings disclosure, it is c ...

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