Chegg (CHGG) Q4 2025 earnings summary

Executive summary

• Company reorganized into Chegg Skilling (growth engine) and Academic Services (cash generation) to drive long-term value.

• Chegg Skilling delivered $18 million in Q4 2025 revenue, up 11% year-over-year, with a focus on double-digit growth and strong margins.

• Strategic focus on the $40 billion global skilling market, especially in AI, language, and technical skills.

• New partnerships with DHL, Gi Group, Woolf University, and contract extensions with L'Oréal and PPG expand reach and credential offerings.

• Streamlined operations and leadership additions aim for debt-free status and substantial cash by end of 2026.

Financial highlights

• Q4 2025 total net revenue: $73 million; Chegg Skilling revenue: $18 million, up 11% year-over-year.

• Academic Services revenue: $55 million in Q4 2025, focused on cash generation.

• Q4 2025 adjusted EBITDA: $13 million, 18% margin, exceeding guidance by $2 million.

• Q4 2025 CapEx: $6 million, down 51% year-over-year; targeting a further 60% reduction in 2026, with 90% allocated to Skilling.

• Ended Q4 2025 with $85 million in cash and investments, net cash balance of $31 million.

Outlook and guidance

• Q1 2026 Chegg Skilling revenue expected at $17.5–$18 million; total Q1 revenue guidance: $60–$62 million.

• Q1 2026 gross margin guidance: 57–58%; adjusted EBITDA: $11–$12 million.

• Double-digit Skilling revenue growth expected through 2026, with stronger performance in H2.

• Targeting adjusted EBITDA margin of at least 20% for Skilling business in coming years.

• Non-GAAP expenses to be reduced to under $250 million in 2026, a 53% decline from 2024.