Chegg (NYSE:CHGG) Issues Earnings Results, Beats Expectations By $0.04 EPS

Chegg (NYSE:CHGG) issued its earnings results on Tuesday. The technology company reported ($0.05) EPS for the quarter, topping the consensus estimate of ($0.09) by $0.04, FiscalAI reports. The business had revenue of $46.47 million during the quarter, compared to the consensus estimate of $43.50 million. Chegg had a negative return on equity of 13.38% and a negative net margin of 19.96%.

Here are the key takeaways from Chegg’s conference call:

• Chegg eliminated its remaining convertible debt and ended Q3 with $43.6 million in cash and investments, while generating $5.5 million in free cash flow.
• The company launched a new employability platform on Internships.com, attracting more than 100,000 visitors in its first eight weeks, with early engagement in resume uploads, job searches, applications, and interview-related tools described as encouraging.
• Chegg signed pilot programs with four universities and is pursuing additional institutional partnerships, offering schools employment-outcome data and tools intended to improve students’ access to internships and jobs.
• The skilling business is expected to generate more than $65 million in 2026 revenue, and Chegg has added 11 distribution partners; however, partner rollouts have taken longer than expected, leaving the timing and scale of growth uncertain.
• The legacy homework-help business continues to decline, and management guided for Q4 revenue of $38 million to $40 million and adjusted EBITDA of approximately $1 million, down from Q3 revenue of $46.5 million and adjusted EBITDA of $5.4 million.

Chegg Stock Performance

Shares of CHGG traded up $0.02 during mid-day trading on Wednesday, reaching $0.67. The company had a trading volume of 199,867 shares, compared to its average volume of 1,372,143. The firm has a 50-day moving average price of $0.74 and a 200 day moving average price of $0.86. Chegg has a 52 week low of $0.45 and a 52 week high of $1.56. The company has a market capitalization of $74.72 million, a price-to-earnings ratio of -1.38 and a beta of 2.26.

Insider Buying and Selling

In related news, Director Renee Budig sold 54,347 shares of Chegg stock in a transaction dated Thursday, August 13th. The stock was sold at an average price of $0.78, for a total value of $42,390.66. Following the completion of the sale, the director directly owned 376,311 shares in the company, valued at approximately $293,522.58. This trade represents a 12.62% decrease in their position. The transaction was disclosed in a filing with the Securities & Exchange Commission, which can be accessed through the SEC website. The transaction was executed under a pre-arranged Rule 10b5-1 trading plan. Company insiders own 3.00% of the company’s stock.

Wall Street Analyst Weigh In

Separately, Weiss Ratings reiterated a “sell (d-)” rating on shares of Chegg in a research report on Friday, September 18th. Two equities research analysts have rated the stock with a Hold rating and one has assigned a Sell rating to the stock. According to MarketBeat.com, the company presently has an average rating of “Reduce”.

About Chegg

Chegg, Inc is an education technology company that provides digital learning tools and academic support services to students. Its platform offers study assistance, expert answers, practice materials, writing support, and other resources intended to help students understand course content and complete academic work.

The company’s products have included Chegg Study, Chegg Writing, and Mathway, a mobile mathematics problem-solving service. Chegg has also offered language-learning services through Busuu, which it acquired in 2022.