Is Chegg profitable in 2026?

Chegg posted EPS of $0.03 in Q1 2026, its first positive net income in two years, per investing.com (2026-05-12). But FY2025 saw a net loss of $(0.96) per share on revenue down 39% to $376.9M, and Q2 2026 guidance of $49-50M signals continued core collapse.

Will AI replace Chegg's homework help business?

It largely already has. Chegg's management publicly attributes revenue declines to ChatGPT and Google AI Overviews since May 2023; Academic Services revenue fell 43% in FY2025 and Q4 2025 revenue dropped 49% YoY to $72.7M (stocktitan.net, 2026-02-09).

Is Chegg being sold or acquired?

No. After a 2025 strategic review with Goldman Sachs exploring a sale, Chegg's Board announced on October 27, 2025 it would remain a standalone public company, though activist Galloway Capital Partners (5.44% stake, April 2026) is pushing for a unit breakup.

Who is Chegg's biggest competitor?

Chegg's real threat isn't Course Hero or Quizlet but Google's AI Overviews and OpenAI's ChatGPT, which diverted its search traffic and offer free answers. Chegg sued Alphabet over AI Overviews in February 2025; the case remains pending.

Is Chegg stock at risk of delisting from NYSE?

Chegg fell below NYSE minimum-price rules but regained compliance on June 1, 2026 without executing a shareholder-approved reverse split. Shares traded near $0.82-$1.13 in mid-2026, down from a 2021 peak market cap of about $14.7B.

What is Chegg doing to survive the AI disruption?

Chegg is pivoting to B2B 'Skilling' (Busuu plus corporate upskilling), which grew to about $70M in FY2025 (9-14% YoY) versus a shrinking $300M+ core, and began pursuing AI data-licensing deals in 2026 to monetize its ~120 million-answer library.

Education companies · United States

Chegg

chegg.com ↗

Chegg rents textbooks and sells subscription homework help online.

Little protection left

Assessed 22 July 2026 · Evidence as of 22 July 2026

Not much stands between this business and its pressures.

On the recordSince 22 July 2026 · Checkable from Aug-Sept 2026 · Every call on the record Checkpoint: Q2 2026 earnings and convertible debt repayment deadline

The call

Chegg's core homework business is being replaced by free AI tools, leaving a shrinking legacy segment next to an unproven Skilling pivot and a shell of its former valuation.

Chegg charges students for access to human-written answers to homework questions. The company is easy to replace because ChatGPT and Google's AI tools give away similar answers for free, and students can switch instantly with zero cost. Chegg tried to pivot into job training (selling to companies, not students), but that business is tiny and growing slowly in a crowded field, while the original homework business is shrinking fast. The one thing that could change this: if the company's job-training business suddenly takes off and becomes profitable enough to matter, or if activist investors force a breakup that unlocks hidden value.

Why

AI pressure: ChatGPT and Google AI Overviews. Free AI answers homework questions instantly, gutting Chegg's paid subscriber base and search traffic funnel. Could AI do the core job? Yes, likely.

Bigger players: Google. Google's AI Overviews intercept search traffic before it reaches Chegg, killing the free distribution channel Chegg relied on. Could a giant copy it? Yes, easily.

What protects it. A 120 million answer archive it hopes to license to AI labs, plus a small but growing Skilling business.

What would change this call

Chegg reports Q2 2026 revenue on or near Aug 6, 2026. Confirms whether the 43-49% core revenue decline is continuing or stabilizing.
Chegg's convertible debt repayment due September 2026. Shows whether the company can meet obligations without default or forced dilution.
Chegg stock price relative to NYSE's $1.00 minimum listing threshold. Indicates renewed delisting risk if shares fall below that level again.

Key numbers

FY2025 revenue $376.9M, down 39% YoY (2025-12-31)
Q4 2025 revenue fell 49% YoY to $72.7M (2025-12-31)
Market cap fell from $14.7B to about $100M (2026-06-29)

Named risks

Core Academic Services revenue in structural collapse from free AI substitutes (39-49% declines). Severity: high
Convertible senior notes due for full repayment by September 2026 amid cash pressure. Severity: high
Activist investor Galloway Capital pushing for breakup, risking further restructuring or forced sale. Severity: medium
Renewed NYSE minimum-price non-compliance if shares slide again below $1.00. Severity: medium
Skilling pivot (~$70M/yr) remains small and unproven against shrinking $300M+ core. Severity: medium

Rivals, as read in July 2026

Rival	Direction	Evidence
Google (AI Overviews)	losing to	Chegg sued Alphabet Feb 26 2025 over AI Overviews diverting search traffic; case pending
OpenAI/ChatGPT	losing to	Chegg first blamed ChatGPT for revenue decline in May 2023, triggering 48% stock drop
Course Hero	contesting	Both legacy homework-help sites lag: Chegg 19th, Course Hero 21st in 5W AI Visibility Index, June 2026
Quizlet	contesting	Quizlet ranked 17th vs Chegg 19th in AI chatbot citation rankings, June 2026
Khan Academy, Duolingo, Coursera	losing to	These ranked in AI-visibility top tier while Chegg ranked 19th, per June 2026 index

Questions people ask

Is Chegg profitable in 2026?: Chegg posted EPS of $0.03 in Q1 2026, its first positive net income in two years, per investing.com (2026-05-12). But FY2025 saw a net loss of $(0.96) per share on revenue down 39% to $376.9M, and Q2 2026 guidance of $49-50M signals continued core collapse.
Will AI replace Chegg's homework help business?: It largely already has. Chegg's management publicly attributes revenue declines to ChatGPT and Google AI Overviews since May 2023; Academic Services revenue fell 43% in FY2025 and Q4 2025 revenue dropped 49% YoY to $72.7M (stocktitan.net, 2026-02-09).
Is Chegg being sold or acquired?: No. After a 2025 strategic review with Goldman Sachs exploring a sale, Chegg's Board announced on October 27, 2025 it would remain a standalone public company, though activist Galloway Capital Partners (5.44% stake, April 2026) is pushing for a unit breakup.
Who is Chegg's biggest competitor?: Chegg's real threat isn't Course Hero or Quizlet but Google's AI Overviews and OpenAI's ChatGPT, which diverted its search traffic and offer free answers. Chegg sued Alphabet over AI Overviews in February 2025; the case remains pending.
Is Chegg stock at risk of delisting from NYSE?: Chegg fell below NYSE minimum-price rules but regained compliance on June 1, 2026 without executing a shareholder-approved reverse split. Shares traded near $0.82-$1.13 in mid-2026, down from a 2021 peak market cap of about $14.7B.
What is Chegg doing to survive the AI disruption?: Chegg is pivoting to B2B 'Skilling' (Busuu plus corporate upskilling), which grew to about $70M in FY2025 (9-14% YoY) versus a shrinking $300M+ core, and began pursuing AI data-licensing deals in 2026 to monetize its ~120 million-answer library.

Timeline

2026-07-15Chegg announces Q2 2026 earnings release date of August 6, 2026
2026-06-17Chegg regains NYSE compliance; Board skips reverse stock split
2026-05-24Chegg targets AI data-licensing deals with tech giants
2026-05-12Q1 2026 revenue $63.3M beats estimates; EPS $0.03, first profit in two years
2026-05-05CEO cites 55% YoY non-GAAP OpEx cut; plans full convertible debt repay by Sept 2026
2026-04-08Galloway Capital Partners discloses 5.44% stake, pushes for business separation
2026-03-09FY2025 10-K shows revenue $376.9M, down 39% YoY
2026-02-09Q4 2025 revenue falls 49% YoY to $72.7M
2025-10-27Dan Rosensweig returns as CEO; Board keeps Chegg standalone
2025-02-26Chegg sues Alphabet/Google over AI Overviews in federal court
2023-05Chegg first attributes revenue decline to ChatGPT; stock drops 48% in a day

Revision history

22 July 2026

First assessed. Little protection left. The text above is fixed as of this date and is not edited afterwards.

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