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Chegg
(NYSE:CHGG)
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Rating:46Neutral
Price Target:
$0.74
▼(-6.08% Downside)
Action:Reiterated
Date:09/06/26
CHGG’s score is held down primarily by weak financial performance (shrinking revenue, ongoing losses, and negative/worsening free cash flow). The earnings call adds some offset from cost and CapEx reductions and improved near-term liquidity, but guidance points to a significant Q3 slowdown and the turnaround strategy remains execution-heavy. Technically, momentum is not yet supportive, and valuation is difficult to rely on given negative earnings and no dividend yield.
Positive Factors
Debt-free balance sheet
Retiring the remaining convertible notes removes scheduled debt obligations and reduces refinancing exposure. A debt-free structure gives Chegg greater flexibility to fund product development, absorb operating volatility, and allocate future cash toward strategic initiatives or shareholder returns.
Negative Factors
Shrinking revenue and losses
Persistent revenue contraction reduces operating scale and makes it harder for Chegg to spread platform and content costs across subscribers. Continued negative profitability also limits internally funded investment and raises the importance of successful retention, pricing, and product repositioning.
Read all positive and negative factors
Positive Factors
Negative Factors
Debt-free balance sheet
Retiring the remaining convertible notes removes scheduled debt obligations and reduces refinancing exposure. A debt-free structure gives Chegg greater flexibility to fund product development, absorb operating volatility, and allocate future cash toward strategic initiatives or shareholder returns.
Read all positive factors
Chegg Key Performance Indicators (KPIs)
Any
Revenue by Segment
Analyzes income from different business areas, highlighting which segments drive growth and where the company might focus future efforts.
Analyzes income from different business areas, highlighting which segments drive growth and where the company might focus future efforts.
Data provided by:
The Fly
The FlyChegg (CHGG) vs. SPDR S&P 500 ETF (SPY)
Market Cap
$88.42M
Dividend YieldN/A
Average Volume (3M)1.42M
Price to Earnings (P/E)―
Beta (1Y)2.29
Revenue Growth-47.59%
EPS Growth81.39%
CountryUS
Employees580
SectorConsumer Defensive
Sector Strength42
IndustryEducation & Training Services
Share Statistics
EPS (TTM)-0.49
Shares Outstanding111,027,480
10 Day Avg. Volume1,638,457
30 Day Avg. Volume1,418,444
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 Cap<0.01
Enterprise Value/Revenue<0.01
Enterprise Value/Gross Profit<0.01
Enterprise Value/Ebitda<0.01
Forecast
1Y Price TargetN/A
Price Target UpsideN/A
Rating ConsensusHold
Number of Analyst Covering1
EPS Forecast (FY)-0.1
Revenue Forecast (FY)$205.51M
Chegg Business Overview & Revenue Model
Company Description
Chegg, Inc. is an educational technology company that provides a direct-to-student learning platform. Its purpose is to assist students throughout their academic studies and into their professional lives, offering resources designed to deepen thei...
How the Company Makes Money
Chegg primarily makes money by selling subscriptions to its direct-to-student digital learning services. A key revenue stream has been recurring subscription fees for access to its platform (e.g., products historically marketed under offerings suc...
Chegg Earnings Call Summary
Earnings Call Date:Aug 06, 2026
(Q2-2026)
| % Change Since: |
Next Earnings Date:Nov 02, 2026
Earnings Call Sentiment Neutral
The call presented a mix of encouraging operational improvements (revenue beat, major expense and CapEx reductions, improved cash generation, a stronger balance sheet and early product traction) alongside meaningful near-term headwinds (Q3 revenue and EBITDA guidance well below Q2 levels, significant restructuring-related severance, and seasonality/timing risks). Management emphasized a longer-term strategic pivot to an AI-first, employability-focused platform with early beta adoption and partner wins, but execution and multi-quarter monetization remain workstreams. Overall the company appears financially stabilized and positioned for a multi-year transition, while facing a meaningful short-term earnings and revenue dip.Positive Updates
Revenue Beat in Q2 2026
Total revenue of $51.8 million in Q2 2026 exceeded company expectations.
Negative Updates
Near-Term Revenue and Profit Guidance Decline
Q3 guidance expects total revenue of $43 million to $44 million (down from Q2's $51.8 million) and adjusted EBITDA between $1 million and $2 million (vs. $9.1 million in Q2), indicating a meaningful expected sequential pullback.
Read all updates
Q2-2026 Updates
Positive
Negative
Revenue Beat in Q2 2026
Total revenue of $51.8 million in Q2 2026 exceeded company expectations.
Read all positive updates
Company Guidance
Chegg guided Q3 total revenue of $43–44 million, gross margin of 48–49% and adjusted EBITDA of $1–2 million, and said it will report total revenue rather than separate segment revenue starting this quarter; management also reiterated a full‑year 2026 CapEx reduction target of ~60% (Q2 CapEx was $3.7M, down 49% YoY), expects to generate meaningful free cash flow in H2 (Q2 FCF $6.4M, H1 FCF $9.5M despite $14.4M in severance and Q2 severance of ~$1.5M), plans to fully repay its convertible debt in Q3, and finished the quarter with $72.3M of cash and investments (net cash $38.5M), having repurchased $1.7M of stock with $120.7M remaining on its repurchase authorization.Chegg Financial Statement Overview
Summary
Income Statement
28
Negative
Balance Sheet
52
Neutral
Cash Flow
40
Negative
| Breakdown | TTM | Dec 2025 | Dec 2024 | Dec 2023 | Dec 2022 | Dec 2021 |
|---|---|---|---|---|---|---|
Income Statement | ||||||
| Total Revenue | 265.51M | 376.91M | 617.57M | 716.29M | 766.90M | 776.26M |
| Gross Profit | 155.97M | 226.86M | 436.65M | 490.35M | 569.50M | 521.36M |
| EBITDA | 31.89M | -20.91M | -607.43M | 183.80M | 201.59M | 86.77M |
| Net Income | -53.00M | -103.42M | -837.07M | 18.18M | 266.64M | -1.46M |
Balance Sheet | ||||||
| Total Assets | 227.63M | 276.82M | 868.95M | 1.73B | 2.47B | 2.92B |
| Cash, Cash Equivalents and Short-Term Investments | 72.31M | 72.82M | 315.72M | 330.01M | 1.06B | 1.55B |
| Total Debt | 50.72M | 84.17M | 504.46M | 624.74M | 1.21B | 1.70B |
| Total Liabilities | 109.01M | 157.20M | 675.97M | 782.62M | 1.35B | 1.81B |
| Stockholders Equity | 118.61M | 119.62M | 192.98M | 944.62M | 1.12B | 1.11B |
Cash Flow | ||||||
| Free Cash Flow | -771.00K | -12.63M | 50.25M | 163.15M | 152.64M | 179.04M |
| Operating Cash Flow | 16.16M | 15.49M | 125.20M | 246.20M | 255.74M | 273.22M |
| Investing Cash Flow | 31.13M | 282.30M | 11.35M | 268.67M | 104.89M | -365.77M |
| Financing Cash Flow | -34.27M | -428.48M | -109.14M | -852.77M | -744.80M | 466.72M |
Chegg Technical Analysis
Negative
0.79
Price Trends
0.89
Negative
1.02
Negative
0.90
Negative
Market Momentum
-0.02
Negative
45.43
Neutral
44.84
Neutral
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For CHGG, the sentiment is Negative. The current price of 0.79 is below the 20-day moving average (MA) of 0.81, below the 50-day MA of 0.89, and below the 200-day MA of 0.90, indicating a bearish trend. The MACD of -0.02 indicates Negative momentum. The RSI at 45.43 is Neutral, neither overbought nor oversold. The STOCH value of 44.84 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative 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 |
|---|---|---|---|---|---|---|---|
77 Outperform | $1.31B | 8.07 | 16.38% | 4.75% | 16.99% | 23.72% | |
63 Neutral | $1.47B | -7.44 | -17.74% | ― | 22.69% | -112.56% | |
62 Neutral | $20.33B | 14.63 | -3.31% | 3.23% | 1.93% | -12.26% | |
56 Neutral | $787.01M | 32.69 | 11.59% | 6.19% | 22.02% | 57.98% | |
50 Neutral | $1.79B | 72.38 | -8.24% | ― | 10.03% | -27.61% | |
46 Neutral | $88.42M | -1.55 | -41.94% | ― | -47.59% | 81.39% |
* Consumer Defensive Sector Average
CHGG
Chegg
0.76
-0.89
-54.12%
LINC
Lincoln Edu
24.19
5.19
27.32%
AFYA
Afya
13.82
-0.73
-4.99%
DAO
Youdao
14.60
5.68
63.68%
COUR
Coursera
5.30
-5.19
-49.48%
Chegg Corporate Events
Business Operations and StrategyFinancial Disclosures
Chegg Retires 2026 Notes, Achieves Debt-Free Balance Sheet
Positive
Sep 1, 2026
On September 1, 2026, Chegg, Inc. announced that it had repaid at maturity the remaining $33.9 million principal amount of its 0% convertible senior notes due that day. With this repayment, the 2026 Notes have been fully retired, leaving Chegg wit...
Business Operations and StrategyDelistings and Listing ChangesRegulatory Filings and Compliance
Chegg Receives NYSE Notice for Listing Noncompliance
Negative
Jul 24, 2026
On July 24, 2026, Chegg disclosed that it had been notified by the New York Stock Exchange that the company was no longer in compliance with the exchange’s continued listing standards, after its average closing share price fell below $1.00 o...
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.