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)

UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 FORM 10-K (Mark One) ☒ ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the fiscal year ended December 31, 2021 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 jurisdic ...

Chegg Q4-21 Investor Presentation Feb 7, 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 ...

Chegg, Inc. (NYSE:CHGG) Q4 2021 Earnings Conference Call February 7, 2022 4:30 PM ET Company Participants Tracey Ford - VP of Investor Relations and ESG Daniel Rosensweig - Co-Chairperson and CEO Andrew Brown - CFO Conference Call Participants Jeffrey Silber - BMO Capital Markets Ryan MacDonald - Needham & Company Douglas Anmuth - JPMorgan Brian Peterson - Raymond James Stephen Sheldon - William Blair Brent Thill - Jefferies Arvind Ramnani - Piper Sandler Joshua Baer - Morgan Stanley Jason Celino - Ke ...

Chegg, Inc. (NYSE:CHGG) Q3 2021 Earnings Conference Call November 1, 2021 4:30 PM ET Company Participants Tracey Ford - Head of IR Daniel Rosensweig - CEO Andrew Brown - CFO Conference Call Participants Jeffrey Silber - BMO Capital Markets Stephen Sheldon - William Blair & Company Douglas Anmuth - JPMorgan Brian Peterson - Raymond James Ryan MacDonald - Needham & Company Brent Thill - Jefferies Michael Grondahl - Northland Capital Markets Joshua Baer - Morgan Stanley Jason Celino - KeyBanc Capital Mar ...

Chegg Q3-21 Investor Presentation Nov 1, 2021 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 ...

PART I - FINANCIAL INFORMATION [Financial Statements (unaudited)](index=4&type=section&id=Item%201.%20Financial%20Statements%20(unaudited)) Unaudited financials show total assets at **$3.19 billion**, net income of **$6.7 million** for Q3 2021, and strong operating cash flow Condensed Consolidated Balance Sheets (in thousands) | | September 30, 2021 | December 31, 2020 | | :--- | :--- | :--- | | **Assets** | | | | Total current assets | $ 1,825,964 | $ 1,182,955 | | Total assets | $ 3,187,495 | $ 2,251,258 | | **Liabilities and Stockholders' Equity** | | | | Total current liabilities | $ 133,821 | $ 109,732 | | Convertible senior notes, net | $ 1,676,749 | $ 1,506,922 | | Total liabilities | $ 1,832,978 | $ 1,641,623 | | Total stockholders' equity | $ 1,354,517 | $ 609,635 | | Total liabilities and stockholders' equity | $ 3,187,495 | $ 2,251,258 | Condensed Consolidated Statements of Operations (in thousands, except per share data) | | Three Months Ended Sep 30, | Nine Months Ended Sep 30, | | :--- | :--- | :--- | :--- | :--- | | | **2021** | **2020** | **2021** | **2020** | | Net revenues | $171,942 | $154,018 | $568,798 | $438,617 | | Gross profit | $104,840 | $91,648 | $369,604 | $290,333 | | Income (loss) from operations | $361 | $(17,802) | $51,910 | $7,535 | | Net income (loss) | $6,651 | $(37,140) | $(25,764) | $(32,264) | | Diluted net income (loss) per share | $0.05 | $(0.29) | $(0.18) | $(0.26) | Condensed Consolidated Statements of Cash Flows Data (in thousands) | | Nine Months Ended September 30, | | :--- | :--- | :--- | | | **2021** | **2020** | | Net cash provided by operating activities | $208,123 | $168,655 | | Net cash used in investing activities | $(742,537) | $(750,942) | | Net cash provided by financing activities | $768,299 | $722,445 | - Financing activities were primarily driven by net proceeds of **$1.09 billion** from an equity offering, partially offset by **$300.8 million** in repayment of convertible senior notes[178](index=178&type=chunk) Notes to Condensed Consolidated Financial Statements Notes detail accounting policy changes, revenue, convertible notes, restructuring, and legal proceedings - The company adopted ASU 2020-06 on January 1, 2021, which simplifies accounting for convertible instruments. This resulted in an increase to convertible senior notes of **$378.1 million**, a decrease to additional paid-in capital of **$465.0 million**, and is expected to decrease interest expense in future periods[53](index=53&type=chunk)[80](index=80&type=chunk) Net Revenues by Product Line (in thousands) | | Three Months Ended Sep 30 | Nine Months Ended Sep 30 | | :--- | :--- | :--- | :--- | :--- | | | **2021** | **2020** | **2021** | **2020** | | Chegg Services | $146,790 | $118,895 | $482,654 | $345,258 | | Required Materials | $25,152 | $35,123 | $86,144 | $93,359 | | **Total net revenues** | **$171,942** | **$154,018** | **$568,798** | **$438,617** | - In February 2021, the company completed an equity offering, selling **10,974,600** shares of common stock and generating net proceeds of **$1.09 billion**[109](index=109&type=chunk) - In September 2021, the company initiated a restructuring plan for its Thinkful product offering, impacting approximately **60** full-time and **120** part-time employees, with expected total costs of around **$2.2 million**[126](index=126&type=chunk) - The company is facing a copyright infringement lawsuit filed by Pearson Education, Inc. on September 13, 2021. Chegg disputes the claims and intends to defend itself vigorously[98](index=98&type=chunk) [Management's Discussion and Analysis of Financial Condition and Results of Operations](index=27&type=section&id=Item%202.%20Management%27s%20Discussion%20and%20Analysis%20of%20Financial%20Condition%20and%20Results%20of%20Operations) Management discusses **30%** revenue growth, market slowdown, strong liquidity, and Thinkful restructuring Overview Chegg's mission is to improve education via Chegg Services and Required Materials, focusing on service expansion - Chegg's business is structured around two main offerings: Chegg Services (subscription-based learning support) and Required Materials (textbooks)[130](index=130&type=chunk)[131](index=131&type=chunk)[134](index=134&type=chunk) - The long-term strategy is centered on expanding Chegg Services to increase student engagement and drive long-term profitability and positive cash flow[133](index=133&type=chunk) Results of Operations Q3 2021 net revenues grew **12%** to **$171.9 million** from Chegg Services, impacted by market slowdown - As students returned to school, a slowdown in the education market led to a decline in traffic to education technology services, resulting in lower growth rates for Chegg's services, which is expected to continue into fiscal year 2022[145](index=145&type=chunk) Revenue Change by Product Line - Q3 2021 vs Q3 2020 (in thousands) | Product Line | Q3 2021 | Q3 2020 | Change ($) | Change (%) | | :--- | :--- | :--- | :--- | :--- | | Chegg Services | $146,790 | $118,895 | $27,895 | 23% | | Required Materials | $25,152 | $35,123 | $(9,971) | (28)% | | **Total net revenues** | **$171,942** | **$154,018** | **$17,924** | **12%** | - Sales and marketing expenses increased **24%** for the nine-month period, driven by increased marketing spend, including expansion into international markets[155](index=155&type=chunk) - General and administrative expenses decreased **17%** in Q3 2021 compared to Q3 2020, primarily because the prior-year period included a **$10.0 million** impairment charge on an an investment in WayUp[156](index=156&type=chunk) - Interest expense decreased significantly due to the adoption of ASU 2020-06, which eliminated the requirement to account for the debt discount on convertible notes as non-cash interest expense[158](index=158&type=chunk) Liquidity and Capital Resources Liquidity is strong at **$2.6 billion** in cash and investments, bolstered by a **$1.09 billion** equity offering - Principal sources of liquidity as of September 30, 2021, were cash, cash equivalents, and investments totaling **$2.6 billion**[164](index=164&type=chunk) - In November 2021, the board of directors increased the securities repurchase program by **$500.0 million**, authorizing up to **$1.0 billion** for repurchasing common stock and/or convertible notes[165](index=165&type=chunk) - A February 2021 equity offering raised net proceeds of **$1.09 billion**[166](index=166&type=chunk) Critical Accounting Policies, Significant Judgments and Estimates Critical accounting policies are unchanged except for share-based compensation, requiring judgment for PSUs - There have been no material changes to critical accounting policies, except for share-based compensation expense[184](index=184&type=chunk) - Management exercises significant judgment in assessing the achievement of performance targets for PSU awards, which can lead to volatility in share-based compensation expense period-to-period[188](index=188&type=chunk) [Quantitative and Qualitative Disclosures About Market Risk](index=39&type=section&id=Item%203.%20Quantitative%20and%20Qualitative%20Disclosures%20About%20Market%20Risk) No material changes in the company's market risk profile were observed during the reporting period - There were no material changes in the company's market risk profile during the reporting period[192](index=192&type=chunk) [Controls and Procedures](index=39&type=section&id=Item%204.%20Controls%20and%20Procedures) Management concluded disclosure controls and procedures are effective, with no material changes to internal controls - Management concluded that disclosure controls and procedures are effective at a reasonable assurance level[195](index=195&type=chunk) - No material changes to internal control over financial reporting were identified during the quarter[196](index=196&type=chunk) PART II - OTHER INFORMATION [Legal Proceedings](index=40&type=section&id=Item%201.%20Legal%20Proceedings) The company is involved in various legal proceedings, with details in Note 8 of the financial statements - The company is involved in various legal proceedings. For detailed information, refer to Note 8, "Commitments and Contingencies," in the financial statements[198](index=198&type=chunk) [Risk Factors](index=40&type=page&id=Item%201A.%20Risk%20Factors) No material changes have occurred in the company's risk factors since the last Annual Report on Form 10-K - No material changes have occurred in the company's risk factors since the last Annual Report on Form 10-K[199](index=199&type=chunk) [Unregistered Sales of Equity Securities and Use of Proceeds](index=40&type=section&id=Item%202.%20Unregistered%20Sales%20of%20Equity%20Securities%20and%20Use%20of%20Proceeds) The company reported no unregistered sales of equity securities during the period - There were no unregistered sales of equity securities in the period[200](index=200&type=chunk) [Exhibits](index=41&type=section&id=Item%206.%20Exhibits) This section lists exhibits filed with Form 10-Q, including CEO/CFO certifications and Inline XBRL documents