Edtech firm Chegg slumps as AI competition prompts strategic review
25/02/2025 12:18
** Shares of U.S. education technology firm Chegg CHGG.N
fall 21% to $1.23 premarket
** The company is considering a sale or take-private deal,
CEO Nathan Schultz said on Monday, as Google's AI overviews have
caused a drop in visitors and subscribers to Chegg's platform
** Co forecasts Q1 revenue below estimates
** Reports a year-on-year drop in revenue for 14th straight
quarter
** Jefferies and Morgan Stanley trim PT on stock after
results
** About 6 out of 9 brokerages rate the stock "hold" and 3
rate it "sell" or lower; median PT at $1.20 - LSEG data
** Jefferies says despite the multitude of free (AI)
solutions on the market, Chegg still offers a unique value
proposition
** Stock down 98.7% from record high touched in 2021
(Reporting by Medha Singh)
((medha.singh@thomsonreuters.com))