It expects its revenue to rise 33% this year. But Coursera is also growing roughly twice as rapidly as Chegg: Analysts expect its revenue to rise 39% this year.Ĭhegg's online tutoring competitor Nerdy ( NYSE:NRDY), which connects private tutors to students via a gig economy marketplace, trades at 10 times this year's sales. Even after being cut in half, Chegg's stock still trades at about six times this year's sales.Ĭhegg's industry peer Coursera ( NYSE:COUR), which provides online courses and degree programs, still trades at 12 times this year's sales. Chegg's valuations were simply too highĬhegg's business isn't headed off a cliff yet, but its previous guidance was too optimistic and its stock had gotten too expensive.
FREE CHEGG REDDIT 2021 FULL
However, Chegg's forecast for 23% to 24% adjusted EBITDA growth for the full year still came in far below its August guidance for 42% to 45% growth. It also completely overshadowed the fact that Chegg's net loss narrowed again in the first nine months of 2021 as its adjusted earnings before interest, taxes, depreciation, and amortization ( EBITDA) improved 58% year over year. That guidance reduction, which CFO Andrew Brown blamed on a "temporary industry slowdown," caused Chegg's stock to plummet. However, its forecast for a 5% to 6% year-over-year decline in revenue in the fourth quarter completely missed the consensus forecast for 17% growth.įor the full year, Chegg only expects its revenue to rise 18% to 19%, which was significantly lower than its August forecast for 25% to 26% growth. As a result, Chegg's revenue growth of 12% in the third quarter slightly missed analysts' expectations for 13% growth.
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