Slide 1: Q1-25 Investor Presentation
Q1-25 Investor Presentation May 12, 2025 © 2024 Chegg, Inc. / All Rights Reserved
Slide 2: Safe Harbor Statement
Safe Harbor Statement Forward-Looking Statements our expectation that such competition will increase; the outcome of our litigation against Google; our ability to This press release contains forward-looking statements made pursuant to the safe harbor provisions of the maintain our services and syste
Slide 3: Who Are We?
We put learners first. Our mission is to improve learning and learning outcomes by putting students first, in school and beyond. Who Are We? We strive to improve the overall return on investment in education by helping learners learn more in less time and at a lower cost. Chegg’s services leverage m
Slide 4: Chegg has overwhelming value for students
Chegg has Real-time overwhelming Individualized Conversational value for students Affordable and unique Backed by Expert Human competitive Help advantages Satisfaction Guarantee © 2024 Chegg, Inc. / All Rights Reserved 4
Slide 5: Learners need a Platform to Support Them
Today’s Learners Face More Pressure Than Ever It’s Harder to Be a They’re Faced with They Aren’t Prepared for Student Mounting Costs the Workplace 26% 38% Over 25 years old(1) Don’t graduate (2) 52% Of graduates are underemployed, and even a ~38% $36K decade after graduation, 45% are underemployed (
Slide 6: Q1-25 Highlights
Q1-25 Highlights We delivered a good first quarter, surpassing our revenue and adjusted EBITDA guidance, generating approximately $16 million in free cash flow, and diversifying our revenue through: • Our business to institution effort, which has expanded from 5 pilots to 15. • Licensing our Questio
Slide 7: Q1-25 Highlights – Metrics
Q1-25 Highlights – Metrics* Q2'24 Q3'24 Q4'24 Q1'25 Q2'24 Q3'24 Q4'24 Q1'25 Chegg Study/Pack Subscribers Subscription Services Revenue Global 3,419 2,913 2,718 2,295 Global 146,813 119,804 128,543 107,566 YoY -9% -13% -23% -37% YoY -11% -14% -23% -30% US 2,858 2,498 2,326 1,999 US 126,104 102,696 11
Slide 8: AI at Chegg and Chegg differentiators
AI at Chegg The advances in artificial intelligence have created opportunities for Chegg. We pivoted the company to harness AI to better serve learners around the world. We have an individualized, interactive, on-demand learning companion backed by proprietary data, generative AI large language mode
Slide 9: Industry-Leading Proprietary AI Stack That Delivers Individualized Learning
Industry-Leading Proprietary AI Stack That Delivers Individualized Learning • Integration into Chegg Study and Chegg Skills; available across Desktop, Mobile Web, and Mobile Native User Experience • Conversational and guided learning experience based on student needs Layer • Answering routing via Or
Slide 10: We Know Students and We Know Learning
We Know Students and We Know Learning Meeting students where they are and applying learning science to improve outcomes. 100 million Q&A pairs we know the Content designed for learning subjects and topics students need to learn Subject-specific LLMs and prompt design for learning to create on-dema
Slide 11: Chegg's Integrated Platform of Connected Services
Chegg’s Integrated Platform of Connected Services Subscription Services Skills & Other Skills Chegg Study High quality online skills-based courses in areas Personalized step-by-step learning support such as AI Prompt Engineering, Applying AI, powered by artificial intelligence and subject- Data Scie
Slide 12: New Products – Solution Scout
New Products – Solution Scout Students lack trust in generative AI. They spend too much time comparing and verifying solutions across multiple platforms. This results in an incredible amount of wasted time that could be spent learning! Solution Scout allows students to see side-by-side answers from
Slide 13: New Products – Practice and Exam Prep, Personalized for Each Student
New Products – Practice and Exam Prep, Personalized for Each Student We launched an updated feature set for practice and exam preparation, personalized for each student. 67% of students report that they do not have adequate practice resources when preparing for exams. Monthly, our platform collects
Slide 14: Chegg Delivers Positive Learner Outcomes
Chegg Delivers Positive Learner Outcomes Learn & Better Grades More Efficient Help When You Build Confidence Understand Need It 90% 91% 90% 91% 85% Say that Chegg helps Say they get better Say that they work Say that Chegg helps Say that Chegg helps them learn their grades when they use more efficie
Slide 15: Chegg's Core Market is 15M US College Students
Chegg’s Core Market is 15M US College Students Satisfiers Achievers Knowledge Seekers Goal: pass their classes Goal: Get a high grade Goal: Gain a deep understanding 18% 39% 44% • Satisfiers’ main goal in school is just to • Achievers’ main gool in school is to get • Knowledge Seekers' main goal in
Slide 16: Majority of U.S. College Students are taking STEM-B Courses
Majority of U.S. College Students are taking STEM-B Courses 21% Not STEM-B Major but taking STEM-B Courses 61% STEM-B Major 18% No STEM-B Source: Consumer Insights Oct 2023. Dynata Sample US College students n= 895. STEM-B = Science, Tech, Engineering, Math, or Business © 2024 Chegg, Inc. / All Righ
Slide 17: Chegg Serves Students of Diverse Backgrounds
Chegg Serves Students of Diverse Backgrounds 28% First generation 23% Family income <$20k 53% Minorities 61% Female 26% Over 25 years old 5% work Full-Time / 33% Part-Time Source: Chegg Consumer Insights, Oct 2023, Quarterly Marketing Tracker. Chegg Services users in the past 3 months (C
Slide 18: Financial Highlights: Q1 2025 Revenue and Subscribers
Financial Highlights: Q1 2025 Revenue and Subscribers Total revenue was $121 million, a decrease of 30% year-over-year. We had 3.2 million subscribers during the quarter, representing a year-over-year decline of 31%. Skills and Other revenue was $14 million in the quarter, which now includes our
Slide 19: Financial Highlights: Q1 2025 Adj. EBITDA Margin, Free Cash Flow, and CapEx
Financial Highlights: Q1 2025 Adj. EBITDA Margin, Free Cash Flow, and CapEx Free cash flow for the first quarter was $15.8 million, despite incurring approximately $8 million in cash outlays related to employee severance from our restructurings. Adjusted EBITDA and Free Cash Flow are non-GAAP meas
Slide 20: Capital Expenditures
Capital Expenditures Capital Expenditures $30.0 $0.1 $0.1 $25.0 $0.1 $6.0 $9.5 $20.0 $0.2 $0.2 $0.2 $9.3 $0.2 $15.0 $3.3 $2.5 $4.6 $1.0 $5.6 $10.0 $19.6 $3.5 $0.1 $18.4 $1.2 $13.6 $13.9 $14.0 $13.0 $5.0 $10.0 $8.7 $7.4 $0.0 Q1'23 Q2'23 Q3'23 Q4'23 Q1'24 Q2'24 Q3'24 Q4'24 Q1'25 millions Content Softw
Slide 21: Balance Sheet
Balance Sheet In Q1, we opportunistically repurchased $65.2 million in aggregate principal amount of our 2026 convertible notes at a $7.8 million discount to par. Our 2025 convertible notes matured in March, and we repaid the full principal amount of $358.9 million. We ended the quarter with cash
Slide 22: Business Outlook
Business Outlook Q1 2025 Results Q2 2025 Guidance Total Net Revenue $121m $100m - $102m Subscription Services Revenue $108m $85m - $87m Gross Margin % 56% 64%-65% Adjusted EBTIDA1 $19m $16m - $17m CapEx $9m Free Cash Flow1 $16m (1) Non-GAAP financial measure. See appendix for reconciliation of a) Ne
Slide 23: Chegg's Approach to ESG: Our Six Pillars
Chegg’s Approach to ESG: Our Six Pillars Public We foster an environment centered on respect, where We help learners succeed by providing the type of help they Recognition diversity and inclusion are Focus on need, when they need it, in the celebrated, and employees can Help Learners format they wan
Slide 24: Appendix
Appendix © 2024 Chegg, Inc. / All Rights Reserved
Slide 25: Reconciliation of Net Loss to EBITDA and Adjusted EBITDA
Reconciliation of Net Loss to EBITDA and Adjusted EBITDA © 2024 Chegg, Inc. / All Rights Reserved 25
Slide 26: Reconciliation of Forward-Looking Net Loss to EBITDA and Adjusted EBITDA
Reconciliation of Forward-Looking Net Loss to EBITDA and Adjusted EBITDA © 2024 Chegg, Inc. / All Rights Reserved 26
Slide 27: Reconciliation of Net Cash Provided by Operating Activities to Free Cash Flow
Reconciliation of Net Cash Provided by Operating Activities to Free Cash Flow © 2024 Chegg, Inc. / All Rights Reserved 27