Chegg Q4 Earnings Beat Expectations Despite Revenue Decline

Written by Emily J. Thompson, Senior Investment Analyst

Source: seekingalpha

Updated: 6 days ago

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CHGG+1.62%

Should l Buy CHGG?

Source: seekingalpha

Earnings Beat: Chegg reported a Q4 non-GAAP EPS of -$0.01, surpassing expectations by $0.09, indicating effective cost management despite ongoing performance challenges.
Significant Revenue Decline: The company generated $72.7 million in revenue for Q4, a 49.3% year-over-year decrease, although it beat estimates by $1.7 million, highlighting the market challenges and weakened customer demand.
Annual Performance Overview: For the full year 2025, total net revenues were $376.9 million, down 39% year-over-year, reflecting ongoing pressures during the company's transition, particularly with a 7% decline in skilling revenues.
Financial Health: Despite a net loss of $103.4 million, Chegg reported a non-GAAP net income of $3.9 million and an adjusted EBITDA of $68.5 million, suggesting resilience in adjusting operational strategies to navigate market changes.

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About CHGG

Chegg, Inc. provides a student-first connected learning platform. The Company provides individualized learning support to students as they pursue their educational journeys. Available on demand 24/7 and powered by quality learning insights, the Chegg platform offers students artificial intelligence (AI)-powered academic support thoughtfully designed for education, coupled with access to a vast network of subject matter experts who help ensure quality and accuracy. Its service and product offerings fall into two categories: Subscription Services, which encompass its Chegg Study Pack, Chegg Study, Chegg Writing, Chegg Math, and Busuu offerings that can be accessed internationally through its websites and on mobile devices, and Skills and Other, which include its Chegg Skills, advertising services, content licensing, print textbooks and eTextbooks offerings. Chegg Study subscribers have access to personalized, step-by-step learning support powered by AI and computational engines.

About the author

Emily J. Thompson

Emily J. Thompson, a Chartered Financial Analyst (CFA) with 12 years in investment research, graduated with honors from the Wharton School. Specializing in industrial and technology stocks, she provides in-depth analysis for Intellectia’s earnings and market brief reports.

Chegg Reorganizes to Focus on Skilling Market

6 days agoseekingalpha

Strategic Reorganization: Chegg has announced a restructuring into two business units, with Chegg Skilling positioned as the growth engine, targeting double-digit revenue growth in 2026, having achieved $18 million in Skilling revenue in Q4, indicating strong market potential.
Course Catalog Expansion: The company is expanding its offerings in high-demand technical AI language and professional skills while broadening its B2B distribution channels, with new partnerships including DHL and Wolf University, aimed at enhancing global market competitiveness.
Financial Performance Exceeds Expectations: CFO Longo reported that Q4 non-GAAP operating expenses were $44.8 million, a 47% year-over-year reduction, while adjusted EBITDA reached $13 million, reflecting the success of restructuring efforts and maintained fiscal discipline.
Future Outlook: Chegg anticipates Skilling business revenue of $17.5 million to $18 million in 2026, with total revenue targets between $60 million and $62 million and gross margins projected at 57% to 58%, showcasing strong growth prospects and profitability.

Chegg Reports Q4 Loss, Focuses on $40 Billion Skilling Market

6 days agostocktwits

Earnings Miss: Chegg reported Q4 net revenues of $72.7 million, a 49% decline year-over-year, although it surpassed analysts' expectations of $71 million, indicating significant challenges that led to a nearly 5% drop in after-hours trading.
Adjusted Loss: The company posted an adjusted loss per share of $0.01, a stark contrast to a profit of $0.17 per share in the same quarter last year, reflecting financial pressures during its reinvention phase that may impact investor confidence.
Future Outlook: Chegg projected Q1 total net revenues between $60 million and $62 million, below analysts' expectations of $64 million, yet its adjusted EBITDA forecast of $11 million to $12 million exceeds the $7.2 million expected by analysts, indicating potential during its restructuring.
Market Sentiment: Despite a 47.5% decline in stock price over the past 12 months, retail sentiment on Stocktwits for CHGG trended “extremely bullish,” suggesting market optimism regarding its future transformation.

Chegg Reports Q4 Earnings Beat Expectations

6 days agoBenzinga

Quarterly Financial Performance: Chegg reported a quarterly loss of one cent per share, surpassing the market's expectation of a ten-cent loss, indicating resilience despite a revenue drop to $72.66 million from $143.48 million year-over-year, reflecting intensified market competition.
Skilling Revenue Growth: The Chegg Skilling segment generated $17.7 million in revenue, an 11% year-over-year increase, highlighting the company's focus on the skills training market during its transformation, which is expected to drive double-digit growth and strong cash flow in the future.
Profitability Metrics: With a non-GAAP gross margin of 60%, despite facing a net loss of $700,000, the adjusted EBITDA stood at $12.9 million, showcasing the company's efforts in cost control and operational efficiency, thereby enhancing investor confidence.
Strategic Transformation Plan: CEO Dan Rosensweig stated that Chegg is reinventing itself around the $40 billion skilling market, planning to split the company into two focused businesses, aiming for a debt-free operation by 2026 while maintaining a strong cash balance, demonstrating a long-term strategic vision.

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Upwork Client Decline: Upwork revealed that active clients at the end of 2025 totaled 785,000, down from 832,000 the previous year, leading to a 22% plunge in shares; additionally, the current quarter revenue guidance of $192 million to $197 million fell short of the $201 million consensus estimate, highlighting weakening market demand.
Chegg Performance Decline: Chegg's fourth-quarter adjusted EBITDA was $12.9 million, a significant 65% drop year-over-year, with revenue at $72.7 million, down 49%, causing a 5% decline in shares; this stark performance decline underscores the challenges facing the online education sector.
Aecom Earnings Beat Expectations: Aecom posted first-quarter adjusted earnings of $1.29 per share on revenue of $1.85 billion, surpassing analyst expectations of $1.17 per share and $1.76 billion in revenue, resulting in a roughly 3% increase in shares, reflecting the company's competitive strength and a rebound in market demand.