Slide 1: Q3-21 Investor Presentation
Q3-21 Investor Presentation Nov 1, 2021
Slide 2: Safe Harbor Statement
Safe Harbor Statement Forward-Looking Statements This presentation contains forward-looking statements made pursuant to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. Forward-looking statements relate to expectations, beliefs, projections, future plans and strate
Slide 3: Our mission is to help every learner achieve their best
We strive to improve the overall returne investment in education by helping learner: learn more in less time and at a lower co Our mission is to help every learner achi je their best, in school and beyond. »* ‘ \SY sa \ } ~ Ine. / All hs Rasefved . Chegg
Slide 4: Leading Direct-To-Student Connected Learning Platform
Leading Direct-To-Student Connected Learning Platform Large Addressable Market in Early Stages of International Growth with Compelling Market Trends High Margin Model Competitive Moat Given Brand, Reach, Data and Proprietary Content
Slide 5: Industry Update Fall 2021
Industry Update Fall 2021 Chegg Some effects of the COVID-19 pandemic have begun to negatively impact enrollments, student course-loads, and quantity of graded assignments. Learning sites and apps, both free and paid, in the U.S. and Canada have experienced significantly reduced traffic since the fa
Slide 6: Chegg at a Glance
Chegg at a Glance“) 6.6 Million 67% ~19 Million CHEGG SERVICES CHEGG SERVICES SUBSCRIBERS CHEGG PLATFORM UNIQUE SUBSCRIBERS Y/Y GROWTH VISITORS. IN"AN AVERAGE MONTH VOTED 2021 FORTUNE’S BEST Small and Medium Workplaces 0 (0) 57 % 32 % VOTED 2021 COMPARABLY’S BEST CHEGG SERVICES ADJUSTED EBITDA Best
Slide 7: Q3 2021 revenue and adjusted EBITDA highlights
$172 million $46 million Chegg Total Revenue Adjusted EBITDA 12% 27% Year-over-Year Growth Adjusted EBITDA Margin 4.4 million’ Chegg Services subscribers 229 million) Chegg Study Content 17% Views Year-over-Year Growth 1. Adjusted EBITDA is a non-GAAP measure and a reconciliation of Net Income (loss
Slide 8: Student challenges: debt, graduation and underemployment
25 37% Average student.age Don’t graduate ®) 4 0% Of recent graduates are ~40% $30 K underemployed ©) Debt owed by 2018 (2) Are employed graduates “) 1. Hall and Partners Survey, Oct 2019, (College (n=1737)) 2. National Center for Education Statistics, The Condition of Education 2020. 3. National Cl
Slide 9: Chegg's Overwhelming Value is Critically Apparent Today Globally
Chegg’s Overwhelming Value is Critically A parent Today Globally Online s On-demand ( ~ Personalized ;
Slide 10: Large Global Academic Market Opportunity
Large Global Academic Market Opportunity 18M CA, AU and UK Secondary and Tertiary Students 102M Total students can benefit from 48M Chegg English Language Instruction for Medium - Tertiary Students Outside the US, CA, AU, UK" 36M US University?) and High School Students) 6.6M”° Chegg Services Subscr
Slide 11: Chegg's Integrated Platform of Connected Services
Chegg’s Integrated Platform of Connected Services Chegg Services Academic Chegg Study 4 Homework help learning service with a library of 70 million step by step solutions (~64 million expert . Chegg Study Pack answered Q&As and ~6 million textbook solutions) Three-in-one package Chegg Writing that b
Slide 12: Chegg's Approach to ESG: Our Six Pillars
Chegg’s Approach to ESG: Our Six Pillars © Chegg’s mission is to help learners, which includes minimizing our environmental impact on their communities. e Our approach to ESG is tied to our six pillars; detailing the areas where Chegg has the greatest impact for society and business success. © We kn
Slide 13: Chegg student demographics
29% First generation 26% Family income <$25k 53% Minorities 58% Female 28% Over 25 years old 17% Work full-time / 30% work part-time Source: Hall & Partners Annual Brand Tracker, October 2020 (College n=1921). *Chegg Platform users (College n=1200), and Chegg Platform is composed of the overall Cheg
Slide 14: Chegg is Well-Known Among College Students
Chegg is Well-Known Among College Students Chegg scores highest in unaided awareness among college students oo Amazon 7% A Of college students have heard of a Quizlet * all Chegg service Khan Academy Google (1) H&P Annual Survey, October 2019 (College n=1737). Based on the question: “What companies,
Slide 15: Chegg Services are Used by Students Across Several Fields of Study
Chegg Services are Used by Students Across Several Fields of Study Primary Field of Study for Chegg Services Subscribers* 21% Business Humanities, Social Studies, and Other *= Hall & Partners Brand Tracker October 2019 (College n=1737). Chegg may not sum to 100% due to rounding al /© 2021 Chega, Inc
Slide 16: Chegg Delivers Positive Learner Outcomes
Chegg Delivers Positive Learner Outcomes Learn & Better Grades More Efficient Help When You Help Figuring It Understand Need It Out Say that Chegg helps Say they get better Say that they work Say that Chegg helps Say that Chegg often them better understand the concepts they are studying in school. A
Slide 17: FY'16 FY'17 FY'18
FY'16 FY'17 FY'18 FY'19 FY'20 FY'21 (E)
Slide 18: Chegg Services Drives Margin Expansion
Chegg Services Drives Margin Expansion Chegg’s business model supports operating Adjusted EBITDA leverage Chegg Adj. EBITDA (Smillion) & Margin (%) e Proven history of expanding Adj. EBITDA margin while investing in future growth $256 ) ° Majority of subscribers are acquired through eee DA $207 unpa
Slide 19: Business Outlook
Business Outlook Total Net Revenues Chegg Services Revenue Gross Margin % Adjusted EBTIDA* CapEx Free Cash Flow Q3 2021 Results $171.9m $146.8m 61% $46.4m $25.1m $38.5m Q@4 2021 Guidance $194m - $196m $175m - $177m 70%-71% $67m - $69m Full Year 2021 Guidance $762m- $764m $657m - $659m 65%-66% $255m
Slide 20: Appendix
Slide 21: Reconciliation of Net Income (Loss) to EBITDA and Adjusted EBITDA
Reconciliation of Net Income (Loss) to EBITDA and Adjusted EBITDA CHEGG, INC. RECONCILIATION OF NET INCOME (LOSS) TO EBITDA AND ADJUSTED EBITDA (in thousands) (unaudited) Three Months Ended Nine Months Ended September 30, September 30, 2021 2020 2021 2020 Net income (loss) $ 6.651 $ (37,140) $ (25,7
Slide 22: Reconciliation of Net Loss to EBITDA and Adjusted EBITDA
Reconciliation of Net Loss to EBITDA and Adjusted EBITDA CHEGG, INC. RECONCILIATION OF NET LOSS TO EBITDA AND ADJUSTED EBITDA (in thousands) (unaudited) Year Ended December 31, 2020 2019, 2018, 2017 2016 Net loss $ (6221) $ (9,605) $ (14,888) $ (20,283) $ (42,245) Interest expense, net 66,297 44,851
Slide 23: Reconciliation of Forward-Looking Net Income (Loss) to EBITDA and Adjusted EBITDA
Reconciliation of Forward-Looking Net Income (Loss) to EBITDA and Adjusted EBITDA CHEGG, INC. RECONCILIATION OF FORWARD-LOOKING NET INCOME (LOSS) TO EBITDA AND ADJUSTED EBITDA (in thousands) (unaudited) Three Months Ending Year Ending December 31, December 31, 2021 2021 Net income (loss) $ 3,100 $ (
Slide 24: Reconciliation of Required Materials Net Revenues to Non-GAAP
CHEGG, INC. RECONCILIATION OF REQUIRED MATERIALS NET REVENUES TO NON-GAAP REQUIRED MATERIALS NET REVENUES (in thousands, except percentages) (unaudited) ` Year Ended December 31, 2016 2015 2014 2013 2012 Required Materials net revenues $ 124,755 $ 207,088 $ 236,717 $ 213,746 $ 188,530 Adjustment as
Slide 25: Reconciliation of Net Cash Provided by Operating Activities to Free Cash Flow
Reconciliation of Net Cash Provided by Operating Activities to Free Cash Flow CHEGG, INC. RECONCILIATION OF NET CASH PROVIDED BY OPERATING ACTIVITIES TO FREE CASH FLOW Net cash provided by operating activities Purchases of property and equipment Purchases of textbooks Proceeds from disposition of te