Q2 2025 Chegg Inc Earnings Call Transcript
Key Points
- Chegg Inc (CHGG) surpassed its guidance with $105 million in revenue and $23 million in adjusted EBITDA for Q2 2025.
- Busuu, Chegg's language learning business, achieved a 15% year-over-year revenue increase, with strong performance in both B2C and B2B segments.
- The Skills business saw a 16% increase in enrollments and an 11% increase in monthly active users quarter over quarter.
- Chegg Study's AI-driven enhancements led to a 23% increase in student satisfaction and a 17% increase in students' intent to use the service.
- Chegg Inc (CHGG) identified additional cost savings, expecting to reduce non-GAAP expenses by $165 million to $175 million in 2025 and $110 million to $120 million in 2026.
- Total revenue decreased by 36% year over year, with a significant impact from lower traffic due to Google AI Overviews.
- The number of subscribers declined by 40% year over year, affecting subscription services revenue.
- Free cash flow for the second quarter was negative $12 million, impacted by restructuring-related severance payments.
- Q3 guidance indicates a further decline in revenue, with expectations between $75 million and $77 million.
- Chegg Inc (CHGG) continues to face challenges in adapting to evolving consumer expectations and market turbulence.
Thank you. Greetings, and welcome to Chegg Inc.'s second-quarter 2025 earnings conference call. (Operator Instructions) As a reminder, this conference is being recorded.
It is now my pleasure to introduce your host, Tracey Ford. Thank you. You may begin.
Good afternoon. Thank you for joining Chegg's second-quarter 2025 conference call. On today's call are Nathan Schultz, President and CEO; and David Longo, Chief Financial Officer. A copy of our earnings press release, along with our investor presentation, is available on our Investor Relations website, investor.chegg.com. A replay of this call will also be available on our website. We routinely post information on our website and intend to make important announcements on our Media Center website at chegg.com/mediacenter. We encourage you to make use of these resources.
Before we begin, I would like to point out that during the course of this call, we will make forward-looking statements regarding future events, including the
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