📊 CHGG Key Takeaways
Investment Thesis
Chegg is in severe financial distress with deteriorating fundamentals across all key metrics. Revenue has collapsed 39% YoY while the company burns cash with negative operating margins of -31% and free cash flow of -12.6M, indicating structural profitability problems that extend beyond cyclical challenges. The liquidity crisis (0.86x current ratio) combined with persistent operating losses and negative returns on equity/assets suggests the business model is fundamentally broken.
CHGG Strengths
- Maintains positive gross margin of 59.6% indicating core service has some value
- Still generating $15.5M in operating cash flow despite losses, showing some cash generation ability
- Accumulated $31.1M in cash reserves providing short-term runway
CHGG Risks
- Revenue declined 39% YoY with accelerating business deterioration
- Operating losses of $116.9M with negative operating margin of -31%, indicating inability to control costs
- Current ratio of 0.86x signals liquidity crisis; company may struggle to meet short-term obligations
- Free cash flow is negative at -12.6M; capital expenditures exceed operating cash generation
- Negative ROE of -86.5% and ROA of -37.2% indicate shareholder value destruction
- Interest coverage ratio of -15.8x shows operational performance insufficient to service any debt obligations
- Massive revenue contraction suggests loss of competitive position or market demand disruption
Key Metrics to Watch
- Revenue trend - stabilization vs. further decline would be critical inflection point
- Operating margin improvement - path to profitability is essential for survival
- Free cash flow - negative FCF is unsustainable; need to see positive conversion within 2-3 quarters
- Cash burn rate and cash runway - with $31.1M cash and negative FCF, company has limited time
- Gross margin sustainability - any decline below 59% would indicate pricing power loss
CHGG Financial Metrics
💡 AI Analyst Insight
The current ratio below 1.0x warrants monitoring of short-term liquidity.
CHGG Profitability Ratios
CHGG vs Default Sector
How CHEGG, INC compares to Default sector averages
Sector benchmarks are approximate industry averages. Actual sector performance may vary.
CHGG Balance Sheet & Liquidity
CHGG 5-Year Financial Trend
5-Year Trend Summary: CHEGG, INC's revenue has remained relatively flat over the 5-year period, with a 8% decline. The most recent EPS of $-0.34 indicates the company is currently unprofitable.
CHGG Growth Metrics (YoY)
CHGG Quarterly Performance
| Quarter | Revenue | Net Income | EPS |
|---|---|---|---|
| Q3 2025 | $77.7M | -$17.5M | $-0.16 |
| Q2 2025 | $105.1M | -$35.7M | $-0.33 |
| Q1 2025 | $121.4M | -$1.4M | $-0.01 |
| Q3 2024 | $136.6M | $8.5M | $-0.16 |
| Q2 2024 | $163.1M | $24.6M | $-0.08 |
| Q1 2024 | $174.4M | -$1.4M | $-0.01 |
| Q3 2023 | $157.9M | $8.5M | $-0.16 |
| Q2 2023 | $182.9M | $7.5M | $0.06 |
Data sourced from SEC EDGAR 10-Q quarterly filings. Figures may represent quarterly or cumulative values.
CHGG Capital Allocation
CHGG SEC Filings
Access official SEC EDGAR filings for CHEGG, INC (CIK: 0001364954)
📋 Recent SEC Filings
❓ Frequently Asked Questions about CHGG
What is the AI rating for CHGG?
CHEGG, INC (CHGG) has an AI rating of STRONG SELL with 92% confidence, based on fundamental analysis of SEC EDGAR filings.
What are CHGG's key strengths?
Maintains positive gross margin of 59.6% indicating core service has some value. Still generating $15.5M in operating cash flow despite losses, showing some cash generation ability.
What are the risks of investing in CHGG?
Revenue declined 39% YoY with accelerating business deterioration. Operating losses of $116.9M with negative operating margin of -31%, indicating inability to control costs.
What is CHGG's revenue and growth?
CHEGG, INC reported revenue of $376.9M.
Does CHGG pay dividends?
CHEGG, INC does not currently pay dividends.
Where can I find CHGG SEC filings?
Official SEC filings for CHEGG, INC (CIK: 0001364954) including 10-K, 10-Q, and 8-K reports are available on SEC EDGAR.
What is CHGG's EPS?
CHEGG, INC has a diluted EPS of $-0.96.
How is the AI analysis conducted?
Our AI (Claude) analyzes publicly available SEC EDGAR filings including 10-K annual reports and 10-Q quarterly reports to evaluate financial health, profitability ratios, balance sheet strength, and growth metrics.