Q2 2024 Chegg Inc Earnings Call Transcript
Key Points
- Chegg Inc (CHGG) exceeded its Q2 guidance, delivering $146.8 million in revenue and $44.1 million in adjusted EBITDA.
- The restructuring program is expected to generate non-GAAP expense savings of $40 million to $50 million in 2025.
- 70% of subscribers are engaging in conversational instruction, and the number of questions asked by students increased 74% year over year.
- Chegg Inc (CHGG) is integrating AI into its platform, enhancing student engagement and retention.
- The company is launching a fully localized experience in Mexico by the end of September, with plans for further international expansion.
- Total revenue for Q2 was $163 million, down 11% year over year.
- Subscription services ARPU was down 3% year over year, primarily due to international promotional pricing.
- Free cash flow was negative $3.6 million in Q2, driven by severance payments and an increase in net working capital.
- The company recorded $481.5 million in non-cash impairment charges and a $141.6 million non-cash valuation allowance on deferred tax assets.
- Q3 guidance indicates a revenue range of $133 million to $135 million, which is a decrease compared to previous quarters.
Greetings, and welcome to Chegg, Inc., second-quarter 2024 earnings conference call. (Operator Instructions) As a reminder, this conference is being recorded.
It is now my pleasure to introduce your host, Tracey Ford. Thank you. You may begin.
Good afternoon. Thank you for joining Chegg's second-quarter 2024 conference call. On today's call are Nathan Schultz, President and CEO; and David Longo, Chief Financial Officer.
A copy of our earnings press release, along with our investor presentation, is available on our Investor Relations website, investor.chegg.com. A replay of this call will also be available on our website. We routinely post information on our website and intend to make important announcements on our media center website at chegg.com/mediacenter. We encourage you to make use of these resources. .
Before we begin, I would like to point out that during the course of this call, we will make forward-looking statements regarding future events, including
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