Chegg, Inc. (NYSE:CHGG) Q4 2022 Results Conference Call February 6, 2023 4:30 PM ET Company Participants Tracey Ford - Vice President of Investor Relations & ESG Dan Rosensweig - Co-Chairperson & Chief Executive Officer Andy Brown - Chief Financial Officer Conference Call Participants Jeff Silber - BMO Capital Markets Bryan Smilek - JP Morgan Stephen Sheldon - William Blair Josh Baer - Morgan Stanley Ryan MacDonald - Needham & Company Mike Grondahl - Northland Securities Jason Celino - KeyBanc Capital Marke ...

Q3-22 Investor Presentation Nov 1, 2022 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 strategies, anticipated events or trends and similar expressions concerning matters that are not historical facts. In some cases, you can identify forward-looking statements by r ...

Chegg, Inc. (NYSE:CHGG) Q3 2022 Earnings Conference Call November 1, 2022 4:30 PM ET Company Participants Tracey Ford - Vice President of Investor Relations & ESG Dan Rosensweig - Co-Chairperson & Chief Executive Officer Andy Brown - Chief Financial Officer Conference Call Participants Stephen Sheldon - William Blair Bryan Smilek - JPMorgan Mike Grondahl - Northland Securities Ryan MacDonald - Needham Brent Thill - Jefferies Jason Celino - KeyBanc Matt Wilson - Morgan Stanley Alex Fuhrman - Craig-Hallum Cap ...

UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 FORM 10-Q (Mark One) ☒ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the quarterly period ended September 30, 2022 or ☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the transition period from _________ to _________ Commission file number 001-36180 CHEGG, INC. (Exact name of registrant as specified in its charter) Delaware 20-3237489 (State or o ...

Q2-22 Investor Presentation August 4, 2022 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 strategies, anticipated events or trends and similar expressions concerning matters that are not historical facts. In some cases, you can identify forward-looking statements b ...

Chegg, Inc. (NYSE:CHGG) Q2 2022 Earnings Conference Call August 4, 2022 5:00 PM ET Company Participants Tracey Ford - Vice President, Investor Relations and ESG Dan Rosensweig - Co-Chairperson and Chief Executive Officer Andy Brown - Chief Financial Officer Conference Call Participants Bryan Smilek - JPMorgan Stephen Sheldon - William Blair Ryan MacDonald - Needham Josh Baer - Morgan Stanley Brent Thill - Jefferies Jason Celino - KeyBanc Capital Markets Mike Grondahl - Northland Securities Arvind Ramnani - ...

UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 FORM 10-Q (Mark One) ☒ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the quarterly period ended June 30, 2022 or ☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the transition period from _________ to _________ Commission file number 001-36180 CHEGG, INC. (Exact name of registrant as specified in its charter) Delaware 20-3237489 (State or other ...

Chegg Q1-22 Investor Presentation May 2, 2022 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 strategies, anticipated events or trends and similar expressions concerning matters that are not historical facts. In some cases, you can identify forward-looking statement ...

Financial Data and Key Metrics Changes - Total revenue for Q1 2022 grew to $202 million, driven by Chegg Services growth of 14% to $185 million, with subscribers increasing to 5.4 million [18][6] - Adjusted EBITDA margin was 31%, or $62 million, exceeding initial estimates despite significant investments for future growth [18][19] - The company ended the quarter with $1.6 billion in cash and investments, having used $422 million to purchase Busuu and $300 million for an accelerated share repurchase [19][20] Business Line Data and Key Metrics Changes - Chegg Services experienced a 14% year-over-year growth, with a notable increase in subscribers, including approximately 600,000 from the newly acquired Busuu service [6][18] - The gross margin came in slightly higher than expected, benefiting from scaling [18] - The transition to a partnership for textbook offerings is expected to contribute approximately $7 million to $10 million in annual revenue starting in 2023 [20] Market Data and Key Metrics Changes - Approximately 1 million students in the U.S. have postponed or forgo higher education over the last two years, impacting traffic to higher education support services [7][8] - The company is experiencing strong engagement and retention rates, particularly with the Chegg Study Pack, which has seen an increase in average revenue per user (ARPU) [10][15] Company Strategy and Development Direction - The company is focused on international expansion, language learning, skills training, and supplemental support services, aiming to gain greater market share [9][11] - The launch of Uversity is expected to deepen relationships with academic institutions and expand the student base [12] - Chegg is building new B2B channels for skills and language services, with early success noted in partnerships with Guild and Busuu [14] Management's Comments on Operating Environment and Future Outlook - Management acknowledged challenges due to enrollment issues, economic conditions, and inflation impacting the industry, leading to a reduction in guidance [7][8] - Despite current challenges, management remains optimistic about future growth, particularly in international markets and through the skills business [9][29] - The company expects to return to higher and more predictable growth over time, emphasizing the importance of supporting students beyond academics [15][23] Other Important Information - The company is transitioning to a model where it will offer textbooks through a partner, which is expected to improve margins [20] - Management noted that the competitive landscape remains favorable, with Chegg gaining market share despite industry headwinds [42][43] Q&A Session Summary Question: How does Chegg plan to recover from current challenges? - Management indicated that gaining market share and investing in international growth and skills business are key strategies for recovery [26][29] Question: What has changed regarding student enrollment and rigor? - Management attributed the volatility to inflation and wage increases, which have led students to prioritize earning over learning [32][34] Question: How are subscriber numbers trending domestically versus internationally? - Management confirmed that while U.S. subscriber growth has faced headwinds, international markets continue to grow [36][49] Question: What is the competitive environment like? - Management stated that Chegg remains profitable and is gaining market share, with no significant traction lost to competitors [42][43] Question: How is inflation impacting student budgets and price sensitivity? - Management noted that despite inflation, students are increasingly opting for the Chegg Study Pack, indicating strong demand for academic support [80][82] Question: What progress has been made with Uversity? - Management reported strong interest from professors in contributing content, with a full rollout to students expected later in the year [85] Question: How does the company view its free cash flow guidance? - Management maintained that free cash flow guidance remains in the 50% to 60% range, despite current challenges [92]

PART I [Item 1. Financial Statements (unaudited)](index=4&type=section&id=Item%201.%20Financial%20Statements%20(unaudited)) Chegg reported Q1 2022 net revenues of $202.2 million, a net income of $5.7 million, and total assets of $2.66 billion, with the Busuu acquisition impacting goodwill [Condensed Consolidated Balance Sheets](index=4&type=section&id=Condensed%20Consolidated%20Balance%20Sheets) Total assets decreased to $2.66 billion by Q1 2022, driven by reduced cash but offset by increased goodwill from the Busuu acquisition Condensed Consolidated Balance Sheet Highlights (in thousands) | Account | March 31, 2022 | December 31, 2021 | | :--- | :--- | :--- | | **Assets** | | | | Cash and cash equivalents | $267,731 | $854,078 | | Total current assets | $1,246,633 | $1,622,648 | | Goodwill | $641,284 | $289,763 | | Total assets | $2,662,470 | $2,919,246 | | **Liabilities & Equity** | | | | Total current liabilities | $155,431 | $114,344 | | Convertible senior notes, net | $1,679,534 | $1,678,155 | | Total liabilities | $1,853,949 | $1,812,329 | | Total stockholders' equity | $808,521 | $1,106,917 | [Condensed Consolidated Statements of Operations](index=5&type=section&id=Condensed%20Consolidated%20Statements%20of%20Operations) Q1 2022 net revenues increased 2% to $202.2 million, resulting in a net income of $5.7 million, a turnaround from a prior-year net loss Q1 Statement of Operations Summary (in thousands, except per share data) | Metric | Three Months Ended March 31, 2022 | Three Months Ended March 31, 2021 | | :--- | :--- | :--- | | Net revenues | $202,244 | $198,378 | | Gross profit | $147,159 | $126,994 | | Income from operations | $5,376 | $16,779 | | Net income (loss) | $5,742 | $(65,179) | | Diluted net income (loss) per share | $0.04 | $(0.49) | [Condensed Consolidated Statements of Cash Flows](index=8&type=section&id=Condensed%20Consolidated%20Statements%20of%20Cash%20Flows) Q1 2022 saw $80.0 million in operating cash, but significant cash usage for the Busuu acquisition and share repurchases led to a $585.9 million net cash decrease Q1 Cash Flow Summary (in thousands) | Cash Flow Activity | Three Months Ended March 31, 2022 | Three Months Ended March 31, 2021 | | :--- | :--- | :--- | | Net cash provided by operating activities | $80,035 | $73,573 | | Net cash used in investing activities | $(363,072) | $(764,952) | | Net cash (used in) provided by financing activities | $(307,461) | $867,600 | | Net (decrease) increase in cash | $(585,870) | $176,221 | | Cash, cash equivalents and restricted cash, end of period | $270,023 | $657,936 | - The primary uses of cash in Q1 2022 were the acquisition of Busuu for **$401.1 million** (net of cash acquired) and the repurchase of common stock for **$300.5 million**[28](index=28&type=chunk)[146](index=146&type=chunk) [Notes to Condensed Consolidated Financial Statements](index=9&type=section&id=Notes%20to%20Condensed%20Consolidated%20Financial%20Statements) Notes detail the Busuu acquisition, legal proceedings, a $300 million share repurchase, and the post-quarter sale of the print textbook library - On January 13, 2022, Chegg acquired 100% of Busuu for **$421.7 million**, resulting in **$367.4 million** goodwill and **$71.6 million** intangible assets[55](index=55&type=chunk)[56](index=56&type=chunk) - The company is involved in several legal proceedings, including a securities fraud class action, shareholder derivative complaints, and a copyright infringement lawsuit from Pearson Education, Inc[79](index=79&type=chunk)[81](index=81&type=chunk)[82](index=82&type=chunk)[83](index=83&type=chunk) - In February 2022, the company initiated a **$300 million** accelerated share repurchase (ASR) program, with an initial delivery of **8.6 million** shares[90](index=90&type=chunk) - Subsequent to quarter-end, Chegg sold its print textbook library to BBA for **$14 million** and entered a revenue-share partnership for Required Materials[95](index=95&type=chunk)[96](index=96&type=chunk) [Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations](index=22&type=section&id=Item%202.%20Management's%20Discussion%20and%20Analysis%20of%20Financial%20Condition%20and%20Results%20of%20Operations) Management discusses 2% revenue growth driven by Chegg Services and Busuu, offset by Required Materials decline, alongside improved gross margin and increased operating expenses [Results of Operations](index=25&type=section&id=Results%20of%20Operations) Q1 2022 net revenues rose 2% to $202.2 million, with Chegg Services growing 14% and Required Materials declining 52%, impacting operating income Revenue by Product Line (in thousands) | Product Line | Q1 2022 | Q1 2021 | Change ($) | Change (%) | | :--- | :--- | :--- | :--- | :--- | | Chegg Services | $184,812 | $162,351 | $22,461 | 14% | | Required Materials | $17,432 | $36,027 | $(18,595) | (52)% | | **Total net revenues** | **$202,244** | **$198,378** | **$3,866** | **2%** | - The decrease in Required Materials revenue was attributed to print textbook logistics challenges and lower unit volumes from decreased college enrollments[118](index=118&type=chunk) - Sales and marketing expenses increased by **$16.3 million** (**62%**), primarily due to increased international marketing spend, including from the newly acquired Busuu[125](index=125&type=chunk) - The company is experiencing a slowdown in the education industry due to the COVID-19 pandemic and macroeconomic conditions like inflation, resulting in fewer enrollments and less student engagement[104](index=104&type=chunk) [Liquidity and Capital Resources](index=28&type=section&id=Liquidity%20and%20Capital%20Resources) Chegg maintained **$1.6 billion** in liquidity as of March 31, 2022, and executed a **$300 million** accelerated share repurchase program during Q1 - The company's principal sources of liquidity as of March 31, 2022, were cash, cash equivalents, and investments totaling **$1.6 billion**[133](index=133&type=chunk) - A securities repurchase program authorizes up to **$1.0 billion** in repurchases; during Q1 2022, a **$300.0 million** accelerated share repurchase was initiated, with **$65.5 million** remaining available[134](index=134&type=chunk) [Item 3. Quantitative and Qualitative Disclosures About Market Risk](index=31&type=section&id=Item%203.%20Quantitative%20and%20Qualitative%20Disclosures%20About%20Market%20Risk) No material changes in market risk were reported for the quarter compared to the 2021 Annual Report on Form 10-K - No material changes in market risk were reported for the quarter compared to the 2021 Annual Report on Form 10-K[153](index=153&type=chunk) [Item 4. Controls and Procedures](index=31&type=section&id=Item%204.%20Controls%20and%20Procedures) Management concluded that disclosure controls and procedures were effective as of March 31, 2022, with no material changes to internal control over financial reporting - The principal executive officer and principal financial officer concluded that the company's disclosure controls and procedures were effective at a reasonable assurance level as of the end of the period[156](index=156&type=chunk) - No changes in internal control over financial reporting occurred during the quarter that have materially affected, or are reasonably likely to materially affect, the company's internal controls[157](index=157&type=chunk) PART II [Item 1. Legal Proceedings](index=32&type=section&id=Item%201.%20Legal%20Proceedings) The company is subject to various legal proceedings, including shareholder derivative suits and a copyright infringement case, as detailed in Note 8 - The company is subject to various legal proceedings and claims, with detailed information cross-referenced to Note 8, "Commitments and Contingencies," in the financial statements[159](index=159&type=chunk) [Item 1A. Risk Factors](index=32&type=section&id=Item%201A.%20Risk%20Factors) No material changes to the company's risk factors were reported compared to the 2021 Annual Report on Form 10-K - There have been no material changes in the company's risk factors from its Annual Report on Form 10-K for the fiscal year ended December 31, 2021[160](index=160&type=chunk) [Item 2. Unregistered Sales of Equity Securities and Use of Proceeds](index=32&type=section&id=Item%202.%20Unregistered%20Sales%20of%20Equity%20Securities%20and%20Use%20of%20Proceeds) No unregistered sales occurred in Q1 2022, while the company completed a 2021 ASR and initiated a new **$300 million** ASR, repurchasing **10.7 million** shares - The company had no unregistered sales of securities during the three months ended March 31, 2022[161](index=161&type=chunk) Share Repurchase Activity (Q1 2022) | Period | Total Securities Repurchased | Notes | | :--- | :--- | :--- | | Jan 1 - Jan 31 | 2,163,219 | Final settlement of 2021 ASR agreement | | Feb 1 - Feb 28 | 8,562,255 | Initial delivery from new 2022 ASR agreement for $300M | | **Total** | **10,725,474** | | [Item 6. Exhibits](index=34&type=section&id=Item%206.%20Exhibits) The exhibits filed include CEO and CFO certifications required by Sarbanes-Oxley and Inline XBRL Instance Documents - The exhibits filed with the report include certifications from the CEO and CFO pursuant to Sections 302 and 906 of the Sarbanes-Oxley Act, as well as XBRL data files[168](index=168&type=chunk)