Chegg Inc (CHGG)
NYSE:CHGG
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Chegg
(NYSE:CHGG)
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Rating:53Neutral
Price Target:
$1.50
▲(63.04% Upside)
Action:Reiterated
Date:05/23/26
The score is held back primarily by weak TTM fundamentals (revenue decline, losses, and recent cash burn), partially offset by improving leverage and a more manageable balance sheet. Technical momentum is supportive, but valuation is demanding (high P/E), and while the latest call improved the near-term narrative (cost discipline, skilling momentum, and debt repayment plan), execution risks and traffic headwinds remain material.
Positive Factors
Improved leverage and net cash position
Chegg materially strengthened its balance sheet with a net cash position and a plan to retire convertible debt by September. Reduced leverage and extinguished convertible obligations improve financial flexibility, lower refinancing risk, and sustainably expand strategic optionality over coming quarters.
Negative Factors
Sharp revenue decline and ongoing losses
Trailing revenue deterioration and continued net losses reflect weakening demand and impaired operating leverage. Persistent top-line decline and negative profitability erode retained capital, constrain reinvestment, and make sustained margin recovery contingent on durable revenue stabilization.
Read all positive and negative factors
Positive Factors
Negative Factors
Improved leverage and net cash position
Chegg materially strengthened its balance sheet with a net cash position and a plan to retire convertible debt by September. Reduced leverage and extinguished convertible obligations improve financial flexibility, lower refinancing risk, and sustainably expand strategic optionality over coming quarters.
Read all positive factors
Chegg Key Performance Indicators (KPIs)
Any
Subscribers
Monitors the number of active users paying for services, indicating the company's market reach, customer retention, and potential for revenue growth.
Monitors the number of active users paying for services, indicating the company's market reach, customer retention, and potential for revenue growth.
Data provided by:
The Fly
The FlyChegg (CHGG) vs. SPDR S&P 500 ETF (SPY)
Market Cap
$173.54M
Dividend YieldN/A
Average Volume (3M)2.57M
Price to Earnings (P/E)90.8
Beta (1Y)2.41
Revenue Growth-43.54%
EPS Growth90.44%
CountryUS
Employees1,241
SectorConsumer Defensive
Sector Strength42
IndustryEducation & Training Services
Share Statistics
EPS (TTM)-0.79
Shares Outstanding111,958,840
10 Day Avg. Volume3,501,986
30 Day Avg. Volume2,571,513
Financial Highlights & Ratios
PEG Ratio0.01
Price to Book (P/B)0.84
Price to Sales (P/S)0.27
P/FCF Ratio-7.91
Enterprise Value/Market Cap1.08
Enterprise Value/Revenue0.59
Enterprise Value/Gross Profit0.95
Enterprise Value/Ebitda15.41
Forecast
1Y Price TargetN/A
Price Target UpsideN/A
Rating ConsensusModerate Sell
Number of Analyst Covering2
EPS Forecast (FY)-0.13
Revenue Forecast (FY)$202.25M
Chegg Business Overview & Revenue Model
Company Description
Chegg, Inc. operates direct-to-student learning platform that supports students starting with their academic journey and extending into their careers with products and services to support and help them better understand their academic course mater...
How the Company Makes Money
Chegg primarily generates revenue from direct-to-consumer subscriptions to its digital learning services. Users typically pay recurring fees (e.g., monthly/term subscriptions) to access features such as study support tools and on-demand academic a...
Chegg Earnings Call Summary
Earnings Call Date:May 06, 2026
(Q1-2026)
| % Change Since: |
Next Earnings Date:Aug 10, 2026
Earnings Call Sentiment Positive
The call conveyed a largely positive tone driven by stronger-than-expected Q1 financials (positive net income, $15.5M Adjusted EBITDA, significant OPEX and CapEx reductions), clear progress on debt reduction and cash position, and momentum in the AI-first skilling strategy with new enterprise partnerships. Key risks remain short-term: search-driven traffic headwinds to Academic Services, sizeable severance-related cash outflows, and the need for successful execution of partner rollouts to scale skilling revenue. On balance, the positives around profitability, cost discipline, partnerships, and AI-driven product differentiation outweigh the near-term headwinds.Positive Updates
Revenue and Profitability Beat
Q1 results exceeded expectations across revenue, profitability, and free cash flow; company reported positive net income for the first time in two years and Adjusted EBITDA of $15.5M (24% margin).
Negative Updates
Search Traffic Headwinds
Search headwinds continue to impact traffic for Chegg Study, creating pressure on top-line Academic Services growth despite strong retention.
Read all updates
Q1-2026 Updates
Positive
Negative
Revenue and Profitability Beat
Q1 results exceeded expectations across revenue, profitability, and free cash flow; company reported positive net income for the first time in two years and Adjusted EBITDA of $15.5M (24% margin).
Read all positive updates
Company Guidance
Chegg’s Q2 guidance calls for Chegg Skilling revenue of $17.5–$18.0M, total revenue of $49–$50M, gross margins of 51%–52%, and adjusted EBITDA of $5–$6M; for 2026 the company expects double‑digit skilling revenue growth with back‑half acceleration and meaningful free cash flow, is targeting a 60% reduction in CapEx this year (Q1 CapEx was $1M, down 88% YoY) with ~90% of CapEx focused on skilling, and plans to fully repay its convertible debt by September while continuing to evaluate share repurchases. Key Q1 metrics cited that underpin the outlook include Skilling revenue of $17.6M (up 9% YoY), Academic Services revenue of $45.7M, non‑GAAP operating expenses of $36.4M (down $44.1M or 55% YoY), adjusted EBITDA of $15.5M (24% margin), Q1 free cash flow of $3.1M (which included ~$12.9M of severance with an additional ~$2.1M expected in Q2), cash and investments of $67.9M, and a net cash position of $34.1M.Chegg Financial Statement Overview
Summary
Income Statement
27
Negative
Balance Sheet
58
Neutral
Cash Flow
35
Negative
| Breakdown | TTM | Dec 2025 | Dec 2024 | Dec 2023 | Dec 2022 | Dec 2021 |
|---|---|---|---|---|---|---|
Income Statement | ||||||
| Total Revenue | 318.78M | 376.91M | 617.57M | 716.29M | 766.90M | 776.26M |
| Gross Profit | 197.33M | 226.86M | 436.65M | 490.35M | 569.50M | 521.36M |
| EBITDA | 12.17M | 15.32M | -607.43M | 183.80M | 201.59M | 86.77M |
| Net Income | -85.71M | -103.42M | -837.07M | 18.18M | 266.64M | -1.46M |
Balance Sheet | ||||||
| Total Assets | 244.10M | 276.82M | 868.95M | 1.73B | 2.47B | 2.92B |
| Cash, Cash Equivalents and Short-Term Investments | 65.91M | 72.82M | 315.72M | 330.01M | 1.06B | 1.55B |
| Total Debt | 47.50M | 84.17M | 504.46M | 624.74M | 1.21B | 1.70B |
| Total Liabilities | 122.96M | 157.20M | 675.97M | 782.62M | 1.35B | 1.81B |
| Stockholders Equity | 121.14M | 119.62M | 192.98M | 944.62M | 1.12B | 1.11B |
Cash Flow | ||||||
| Free Cash Flow | -25.43M | -12.63M | 50.25M | 163.15M | 152.64M | 179.04M |
| Operating Cash Flow | -4.93M | 15.49M | 125.20M | 246.20M | 255.74M | 273.22M |
| Investing Cash Flow | 25.50M | 282.30M | 11.35M | 268.67M | 104.89M | -365.77M |
| Financing Cash Flow | -31.57M | -428.48M | -109.14M | -852.77M | -744.80M | 466.72M |
Chegg Technical Analysis
Positive
0.92
Price Trends
0.93
Positive
0.83
Positive
1.02
Positive
Market Momentum
0.10
Negative
69.93
Neutral
90.77
Negative
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For CHGG, the sentiment is Positive. The current price of 0.92 is below the 20-day moving average (MA) of 1.14, below the 50-day MA of 0.93, and below the 200-day MA of 1.02, indicating a bullish trend. The MACD of 0.10 indicates Negative momentum. The RSI at 69.93 is Neutral, neither overbought nor oversold. The STOCH value of 90.77 is Negative, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for CHGG.
Chegg Risk Analysis
Chegg disclosed 47 risk factors in its most recent earnings report. Chegg reported the most risks in the "Finance & Corporate" category.
Finance & Corporate - Financial and accounting risks. Risks related to the execution of corporate activity and strategy
Latest Risks Added 0 New Risks
Chegg Peers Comparison
UnderperformOutperform
Sector (62)
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
73 Outperform | $1.26B | 6.82 | 16.00% | <0.01% | 13.36% | 15.90% | |
66 Neutral | $1.54B | 72.68 | 11.72% | ― | 19.92% | 84.00% | |
62 Neutral | $20.33B | 14.63 | -3.31% | 3.23% | 1.93% | -12.26% | |
60 Neutral | $677.28M | -13.30 | -3.21% | ― | -1.15% | 89.07% | |
55 Neutral | $1.55B | 52.14 | -3.46% | ― | 9.41% | -51.90% | |
53 Neutral | $173.54M | 90.81 | -62.94% | ― | -43.54% | 90.44% |
* Consumer Defensive Sector Average
CHGG
Chegg
1.55
0.57
58.16%
LINC
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48.40
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119.80%
AFYA
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14.00
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-22.52%
DAO
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12.96
4.01
44.80%
COUR
Coursera
―
―
―
UDMY
Udemy Inc
4.63
-2.24
-32.61%
Chegg Corporate Events
Executive/Board ChangesRegulatory Filings and ComplianceShareholder Meetings
Chegg Rebalances Board Structure, Revises Director Class Terms
Neutral
Mar 31, 2026
On March 25, 2026, Chegg’s board rebalanced its staggered director classes by shifting director Renee Budig from Class I, which was set to expire at the June 12, 2026 annual meeting, to Class III with a term extending to the 2028 annual meet...
Glossary
BuyA stock rated as a "Buy" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock is likely to deliver higher returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
HoldA stock rated as a "Hold" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly compelling nor unfavorable for investment. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
SellA stock rated as a "Sell" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock may deliver lower returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
Disclaimer
This AI Analyst Stock Report is automatically generated by our AI systems using advanced algorithms and publicly available financial, technical, and market data. While the information provided aims to be accurate and insightful, it is intended for informational purposes only and should not be considered financial advice. Any content created by an AI (Artificial Intelligence) system may contain inaccuracies and/or contain errors. Investing in stocks carries inherent risks, and past performance is not indicative of future results. This report does not account for your personal financial circumstances, objectives, or risk tolerance. Always conduct your own research or consult with a qualified financial advisor before making investment decisions. The analysis and recommendations provided are based on historical and current data and may not fully reflect future market conditions or unexpected developments. Neither the creators of this report nor its affiliated entities guarantee the accuracy, completeness, or reliability of the information presented. Use this report at your own discretion and risk.