Chegg Inc (CHGG) Q2 2025 Earnings Call: A Tale of Challenges and Opportunities

Chegg Inc reported Q2 2025 revenue of $105 million, surpassing guidance, with Busuu's language learning business achieving a 15% YoY revenue increase and the Skills business seeing a 16% increase in enrollments. However, total revenue decreased by 36% YoY and the number of subscribers declined by 40% YoY. Chegg expects to reduce non-GAAP expenses by $165-175 million in 2025 and $110-120 million in 2026.

Title: Chegg Inc Reports Mixed Q2 2025 Results, Focuses on Strategic Growth

Chegg Inc (CHGG) reported mixed financial results for the second quarter of 2025, with a revenue of $105 million, surpassing guidance, but facing significant challenges in subscriber decline and cost reduction expectations. The company's language learning business, Busuu, achieved a 15% year-over-year (YoY) revenue increase, while the Skills business saw a 16% increase in enrollments. However, total revenue decreased by 36% YoY, and the number of subscribers declined by 40% YoY [1].

Chegg Inc's President and CEO, Nathan Schultz, highlighted the company's strategic focus on cost-saving measures and growth areas. The company expects to reduce non-GAAP expenses by $165 million to $175 million in 2025 and by $110 million to $120 million in 2026 [1]. Schultz also emphasized the company's commitment to adapting to evolving consumer expectations and market turbulence.

The earnings call also provided insights into the company's strategic review process. Chegg is exploring various options, including potential acquisitions, going private, or remaining a standalone public company, with active engagement from select parties [3]. The company aims to maximize long-term shareholder value through these strategic initiatives.

Despite the challenges, Chegg's Busuu platform demonstrated strong growth, with B2C revenue increasing by 6% and B2B revenue surging by 39% [4]. The company's AI-driven enhancements in Chegg Study also led to a 23% increase in student satisfaction and a 17% increase in students' intent to use the service [1].

Looking ahead, Chegg Inc expects revenue in the range of $75 million to $77 million for the third quarter, with subscription services revenue expected between $67 million and $69 million [2]. The company continues to face challenges in adapting to evolving consumer expectations and market turbulence but remains committed to its strategic growth initiatives.

References:
[1] https://www.gurufocus.com/news/3038963/chegg-inc-chgg-q2-2025-earnings-call-highlights-navigating-challenges-and-seizing-opportunities
[2] https://finance.yahoo.com/news/chegg-inc-chgg-q2-2025-073005786.html
[3] https://www.ainvest.com/news/chegg-exceeds-48m-busuu-revenue-target-strategic-review-ai-transformation-2508/
[4] https://www.theglobeandmail.com/investing/markets/stocks/CHGG/pressreleases/33983949/chegg-inc-earnings-call-mixed-sentiments-and-strategic-focus/