Chegg 2025 Q2 Earnings Strong Earnings Improvement with 94.2% Lower Net Loss

Chegg (CHGG) reported fiscal 2025 Q2 earnings on August 8, 2025. The company significantly improved its profitability, reducing its net loss by 94.2% year-over-year. Chegg did not provide explicit forward-looking guidance during the call but emphasized cost management and product innovation as strategic priorities for the remainder of the year.

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Revenue
Total revenue declined by 35.6% to $105.12 million in 2025 Q2, compared to $163.15 million in the same period of 2024. The company's revenue was primarily driven by its Subscription Services segment, which generated $89.73 million, while its Skills and Other segment contributed $15.39 million.

Earnings/Net Income
Chegg significantly narrowed its losses, reporting a net loss of $-35.66 million in 2025 Q2, compared to a staggering $-616.88 million in 2024 Q2. On a per-share basis, the company’s loss improved from $6.01 to $0.33, representing a 94.5% reduction. This marked a notable improvement in financial performance and demonstrated the company’s efforts to restore profitability.

Price Action
Chegg’s stock edged up 1.79% in the latest trading day. However, it declined 9.52% during the most recent full trading week and fell further by 14.29% month-to-date, indicating mixed investor sentiment following the earnings release.

Post-Earnings Price Action Review
Despite the earnings beat, a strategy of buying CHGG following the earnings report and holding for 30 days resulted in a severe loss of -98.78%, significantly underperforming the benchmark by 184.98%. The strategy showed no maximum drawdown but had a negative Sharpe ratio of -0.79, highlighting the high risk associated with the trade.

CEO Commentary
CEO Dan Rosensweig highlighted the company’s focus on driving engagement through its core offerings, noting that 91% of customers report improved academic outcomes using Chegg’s resources. Rosensweig emphasized the importance of maintaining strong customer satisfaction as a growth driver while addressing the challenge of balancing profitability with product innovation. Strategic priorities include the transition of eTextbook supply to Valore, effective July 1, 2025, to enhance operational efficiency and offer tiered pricing flexibility.

Guidance
The company did not provide explicit quantitative guidance during the earnings call. However, it reaffirmed its commitment to delivering value through flexible rental pricing and enhancing digital learning tools, with an emphasis on cost management and customer retention.

Additional News
The date of the additional news (October 22, 2022) precedes the Chegg earnings report by several years, indicating it is unrelated. As such, there are no relevant non-earnings-related news items within the required time frame.