10q10k10q10k.net

What changed in CHEGG, INC's 10-K — 2023 vs 2024

vs

Paragraph-level year-over-year comparison of CHEGG, INC's 2023 and 2024 10-K annual filings, covering the Business, Risk Factors, Legal Proceedings, Cybersecurity, MD&A and Market Risk sections. Every new, removed and edited paragraph is highlighted side-by-side so you can see exactly what management changed in the 2024 report.

+311 added−271 removedSource: 10-K (2025-02-24) vs 10-K (2024-02-20)

Top changes in CHEGG, INC's 2024 10-K

311 paragraphs added · 271 removed · 205 edited across 8 sections

Item 1. Business

Business — how the company describes what it does

27 edited+11 added−10 removed76 unchanged
Biggest changeTo learn more about our ESG efforts, please visit the ESG section of our investor relations site: investor.chegg.com/esg. 10 Table of Contents Seasonality Information about seasonality is set forth in the section “Seasonality of Our Business” in Part II, Item 7 of this Annual Report on Form 10-K.
Biggest changeSeasonality Information about seasonality is set forth in the section “Seasonality of Our Business” in Part II, Item 7 of this Annual Report on Form 10-K. Corporate History We were incorporated in Delaware in July 2005 and appointed our current Chief Executive Officer in 2024, who has served in multiple leadership roles over the last 16 years within Chegg.
Information Security Our learning platform includes encryption, antivirus, firewall, intrusion prevention, and patch-management technologies to help protect our systems distributed across cloud-hosting providers and our offices. Our existing products and services undergo periodic security assessments. New features are developed according to our secure software development lifecycle 5 Table of Contents process.
Information Security Our learning platform includes encryption, antivirus, firewall, intrusion prevention, and patch-management technologies to help protect our systems distributed across cloud-hosting providers and our offices. Our existing products and services 5 Table of Contents undergo periodic security assessments. New features are developed according to our secure software development lifecycle process.
The General Data Protection Regulation (GDPR) which went into effect in May 2018 gives European Union (EU) residents, among other things, rights to right to know what personal data we collect from them, how it is used, and the right to access, correct, delete, and opt out of the sale of their personal information to third parties.
The General Data Protection Regulation (GDPR) which went into effect in May 2018 gives European Union (EU) residents, among other things, the right to know what personal data we collect from them, how it is used, and the right to access, correct, delete, and opt out of the sale of their personal information to third parties.
We offer programs designed to train learners on the latest technical skills, such as AI, coding, data analytics, and cybersecurity. Our programs are available directly through our website, through partners that connect employers with top learning providers, and directly to large employers.
We offer programs designed to train learners on the latest technical skills, such as AI, coding, data analytics, and cybersecurity. Our programs are available through partners that connect employers with top learning providers, and directly to large employers.
Chegg Study also includes a collection of free perks where available, including services students care about in and out of the classroom, such as Tinder Gold and DashPass Student. Chegg Study Pack.
Chegg Study also includes a collection of free perks where available, including services students care about in and out of the classroom, such as Tinder Gold, DashPass Student, and Max. Chegg Study Pack.
Subscribers to Busuu have access to a premium learning language platform that offers comprehensive support through self-paced lessons, live classes with expert tutors and a huge community of members to practice alongside. A team of leading experts have developed an online learning pedagogy to bring students from novice to advanced speakers in a fast-paced, enjoyable environment.
Subscribers to Busuu have access to a premium language learning platform that offers comprehensive support through self-paced lessons, live classes with expert tutors and a huge community of members to practice alongside. A team of leading experts have developed an online learning instruction to bring students from novice to advanced speakers in a fast-paced, enjoyable environment.
The result is an online advertising platform that continuously maximizes the value of the digital impressions we serve. Customers In 2023, 2022 and 2021, 7.7 million, 8.1 million, and 7.8 million customers subscribed to our Subscription Services, respectively. Sales and Marketing Students Our direct-to-consumer marketing strategy focuses on brand and performance marketing.
The result is an online advertising platform that continuously maximizes the value of the digital impressions we serve. Customers In 2024, 2023 and 2022, 6.6 million, 7.7 million, and 8.1 million customers subscribed to our Subscription Services, respectively. Sales and Marketing Students Our direct-to-consumer marketing strategy focuses on brand and performance marketing.
We are subject to the informational requirements of the Exchange Act and file or furnish reports, proxy statements, and other information with the SEC. Such reports and other information filed by the Company with the SEC are available free of charge on our website at www.investor.chegg.com when such reports are available on the SEC’s website.
We are subject to the informational requirements of the Exchange Act and file or furnish reports, proxy statements, and other information with the SEC. Such reports and other information filed with the SEC are available free of charge on our website at www.investor.chegg.com and on the SEC’s website.
The key elements of our technology platform are: AI Our technology, which includes computational engines, machine learning, decision tools, proprietary generative AI capabilities, allow us to build an industry-leading personalized learning assistant without compromising quality and safety. We are building large language models specific to academic subjects and use cases that cater to learner needs.
The key elements of our technology platform are: AI Our technology, which includes computational engines, machine learning, decision tools, proprietary generative AI capabilities, allow us to build an industry-leading personalized learning assistant without compromising quality and safety. We have built large language models, and are leveraging frontier models, specific to academic subjects and use cases that cater to learner needs.
In 2023, 7.7 million students subscribed to our Subscription Services, a decrease of 6% year over year from 8.1 million in 2022. Subscription Services Chegg Study. Chegg Study subscribers have access to personalized, step-by-step learning support powered by AI, computational engines, and subject matter experts. Subscribers engage with our conversational experience that delivers the right support, at the right time.
In 2024, 6.6 million students subscribed to our Subscription Services, a decrease of 14% year over year from 7.7 million in 2023. Subscription Services Chegg Study. Chegg Study subscribers have access to personalized, step-by-step learning support powered by AI, computational engines, and subject matter experts. Subscribers engage with our conversational experience that delivers the right support, at the right time.
If we fail to comply with these rules or requirements, or if our data security systems are breached or compromised, we may be liable for card issuing banks’ costs, subject to fines and higher transaction fees, reputational damage, and lose our ability to accept credit and debit card payments from our customers, process electronic funds transfers, or facilitate other types of online payments, and our business and results of operations could be adversely affected. 7 Table of Contents Regulations related to the Program Participation Agreement of the U.S.
If we fail to comply with these rules or requirements, or if our data security systems are breached or compromised, we may be liable for card issuing banks’ costs, subject to fines and higher transaction fees, reputational damage, and lose our ability to accept credit and debit 7 Table of Contents card payments from our customers, process electronic funds transfers, or facilitate other types of online payments, and our business and results of operations could be adversely affected.
Subscribers can also have a writing professional proofread papers for personalized feedback. Chegg Writing also includes the popular website properties EasyBib, Citation Machine, BibMe, and CiteThisForMe. Chegg Math. Our Chegg Math offerings, including Mathway, provide students with a computational engine to help them understand and solve math problems.
Subscribers can also have a writing professional proofread papers for personalized feedback. Chegg Writing also includes the popular website properties EasyBib, Citation Machine, BibMe, and CiteThisForMe. Chegg Math. Our Chegg Math subscription service provides students with a computational engine to help them understand and solve math problems.
We foster an environment centered on respect for all people, where diversity and inclusion are celebrated, and people have the opportunity to develop and advance their careers. Our employees are one of our biggest competitive advantages, and it's our responsibility to take care of them.
We foster an environment centered on respect for all people, where diversity and inclusion are celebrated, and people have the opportunity to develop and advance their careers. Our employees are one of our biggest competitive advantages, and it's our responsibility to take care of them. We are proud to have received numerous awards for our outstanding workplace culture.
We are leveraging this data for our large language models and have built proprietary algorithms to optimize the quality and accuracy of our content. Our unique dataset enables personalized learning and powers new capabilities to enhance the learning experience.
Proprietary Data We have over a hundred million pieces of proprietary learning content powering our personalized learning assistant. We are leveraging this data for our large language models and have built proprietary algorithms to optimize the quality and accuracy of our content. Our unique dataset enables personalized learning and powers new capabilities to enhance the learning experience.
In 2021, we disclosed our baseline scope 1 and scope 2 emissions and in 2023 we expanded our disclosure to include scope 3 GHG emission. These assessments will inform future reduction opportunities.
In 2021, we disclosed our baseline scope 1 and scope 2 emissions and in 2023 we expanded our disclosure to include scope 3 greenhouse gas (GHG) emission. These assessments will 10 Table of Contents inform future reduction opportunities.
They have similar requirements to those noted above relating to GDPR. The Data Protection Act and UK GDPR set a maximum fine of £17.5 million or 4% of annual global turnover for infringements – whichever is greater – for infringements.
The Data Protection Act and UK GDPR set a maximum fine of £17.5 million or 4% of annual global turnover for infringements – whichever is greater – for infringements.
If we are unable to transfer data between and among countries in which we operate, it could affect the manner in which we provide our services, the geographical location or segregation of our systems and operations and could adversely affect our financial results. 8 Table of Contents The United Kingdom’s Data Protection Act 2018 (Data Protection Act) and UK General Data Protection Regulation (“UK GDPR”) apply to our activities in the United Kingdom.
If we are unable to transfer data between and among countries in which we operate, it could affect the manner in which we 8 Table of Contents provide our services, the geographical location or segregation of our systems and operations and could adversely affect our financial results.
We are extremely proud to have helped so many learners succeed on their learning-to-earning journey. Give Back Chegg’s business activities as well as our philanthropic, research and community efforts align with many of the United Nations’ Sustainable Development Goals.
Learners need more flexibility when it comes to education, including affordable, on-demand help that delivers positive learning outcomes. We are extremely proud to have helped so many learners succeed on their learning-to-earning journey. Give Back Chegg’s business activities as well as our philanthropic, research and community efforts align with many of the United Nations’ Sustainable Development Goals.
Our common stock is listed on the New York Stock Exchange under the symbol “CHGG.” Our principal executive offices are located at 3990 Freedom Circle, Santa Clara, California 95054 and our telephone number is (408) 855-5700. Available Information Our website address is www.chegg.com and our Investor Relations website address is investor.chegg.com.
Our principal executive offices are located at 3990 Freedom Circle, Santa Clara, California 95054 and our telephone number is (408) 855-5700. Available Information Our website address is www.chegg.com and our Investor Relations website address is www.investor.chegg.com.
Department of Education and other similar laws that regulate the recruitment of students to colleges and other institutions of higher learning.
Regulations related to the Program Participation Agreement of the U.S. Department of Education and other similar laws that regulate the recruitment of students to colleges and other institutions of higher learning.
Violators of CAN-SPAM are subject to both civil and potentially criminal penalties. The U.S. Federal Trade Commission (FTC) has guidelines that impose responsibilities on us with respect to communications with consumers and impose fines and liability for failure to comply with rules with respect to advertising or marketing practices it may deem misleading or deceptive.
Federal Trade Commission (FTC) has guidelines that impose responsibilities on us with respect to communications with consumers and impose fines and liability for failure to comply with rules with respect to advertising or marketing practices it may deem misleading or deceptive.
Human Capital As of December 31, 2023, we had 1,979 employees, of which 1,903 were full-time and 76 were part-time, with 1,140 located outside the United States.
Human Capital As of December 31, 2024, we had 1,271 employees, of which 1,241 were full-time and 30 were part-time, with 764 located outside the United States.
We know that we owe it to our customers, employees, and society to use environmentally sound practices and to find ways to limit our contribution to global climate change.
We know that we owe it to our customers, employees, and society to use environmentally sound practices and to find ways to limit our contribution to global climate change. To learn more about our ESG efforts, please visit the ESG section of our investor relations site: investor.chegg.com/esg.
Our service and product offerings fall into two categories: Subscription Services, which encompasses our Chegg Study Pack, Chegg Study, Chegg Writing, Chegg Math, and Busuu offerings that can be accessed internationally through our websites and on mobile devices, and Skills and Other, which encompasses our Chegg Skills, advertising services, print textbooks and eTextbooks offerings.
Our ability to achieve these long-term objectives is subject to numerous risks and uncertainties, which are described in greater detail below and in Part II, Item 1A, “Risk Factors.” Our service and product offerings fall into two categories: Subscription Services, which encompasses our Chegg Study Pack, Chegg Study, Chegg Writing, Chegg Math, and Busuu offerings that can be accessed internationally through our websites and on mobile devices, and Skills and Other, which encompasses our Chegg Skills, advertising services, print textbooks and eTextbooks offerings.
Numerous laws and regulatory schemes have been adopted at the national and state level in the United States, and internationally, that have a direct impact on our business and operations. For example: The CAN-SPAM Act of 2003 (CAN-SPAM) establishes requirements for sending commercial email and requires commercial email senders to honor consumers’ requests to not receive email.
Numerous laws and regulatory schemes have been adopted at the national and state level in the United States, and internationally, that have a direct impact on our business and operations.
Additionally, we established our first ever employee charitable contribution matching program worldwide. 9 Table of Contents Environmental, Social, and Corporate Governance (ESG) At Chegg, our approach to ESG is tied to our mission to help every learner achieve their best, in school and beyond.
We continued to offer our award-winning suite of benefits that are highly appreciated by our employee population. Environmental, Social, and Corporate Governance (ESG) At Chegg, our approach to ESG is tied to our mission to help every learner achieve their best, in school and beyond.
Our AI capabilities allow us to leverage our data and expertise to optimize the learning experience effectively and efficiently. Proprietary Data We have over a hundred million pieces of proprietary learning content powering our personalized learning assistant.
We are building an AI Arena whereby we will automatically update to newer models as they are released and tested to improve solution accuracy and speed. Our AI capabilities allow us to leverage our data and expertise to optimize the learning experience effectively and efficiently.
Removed
ITEM 1. BUSINESS Overview Millions of people all around the world learn with Chegg. No matter the goal, level, or style, Chegg helps learners learn with confidence.
Added
ITEM 1. BUSINESS Overview Chegg provides individualized learning support to students as they pursue their educational journeys.
Removed
We provide 24/7 on-demand support, and our personalized learning assistant leverages the power of artificial intelligence (“AI”), more than a hundred million pieces of proprietary content, as well as a decade of learning insights.
Added
Available on demand 24/7 and powered by over a decade of learning insights, the Chegg platform offers students artificial intelligence (“AI”)-powered academic support thoughtfully designed for education coupled with access to a vast network of subject matter experts who help ensure quality and accuracy.
Removed
Our platform also helps learners build essential life and job skills to accelerate their path from learning to earning, and we work with companies to offer learning programs for their employees. We are combining the power of generative AI and human capabilities to provide a personalized learning assistant to be included in our Chegg Study offering.
Added
No matter the goal, level, or style, Chegg helps millions of students around the world learn with confidence by helping them build essential academic, life, and job skills to achieve success. Our long-term strategy is centered upon our ability to utilize our Subscription Services to increase student engagement with our learning platform.
Removed
Our new experience is trained on our proprietary content and unique data sets, allowing us to offer a high quality, high value personalized learning journey that can anticipate students' needs, adapt to their strengths and weaknesses, provide personal learning plans, and suggest interactive tools to optimize and reinforce the learning process.
Added
We continue to invest in the expansion of our offerings and technology platform to provide a more compelling and personalized solution and deepen engagement with students. We continue to integrate artificial intelligence into our platform, and it is now conversational, more instructional, and interactive.
Removed
Students can currently engage with a simple conversational user interface, personalized learning, and more in-depth content. As the new experience evolves, we plan to have the ability to transform our content automatically into innovative study tools, such as practice tests, assessments, study guides and flash cards, as well as connect our learning community, enabling real-time sharing among community members.
Added
We remain focused on providing a holistic and differentiated product offering that supports the whole student with 360 degrees of individualized academic and functional support, including the delivery of high-quality and accurate content. We believe the investments we are making will allow us to return to revenue growth over time.
Removed
We aim to build personalized coaching and analytics so students can assess and compare their progress with others, while also extending beyond academic support to help navigate real-time challenges and learn core job skills.
Added
For example: The Controlling the Assault of Non-Solicited Pornography and Marketing Act of 2003 (CAN-SPAM) establishes requirements for sending commercial email and requires commercial email senders to honor consumers’ requests to not receive email. Violators of CAN-SPAM are subject to both civil and potentially criminal penalties. The U.S.
Removed
On June 12, 2023, we announced a reduction of our global workforce by about 90 employees, or approximately 4% of our current workforce, to better position us to execute against our AI strategy and to create long-term, sustainable value for our students and investors.
Added
The United Kingdom’s Data Protection Act 2018 (Data Protection Act) and UK General Data Protection Regulation (“UK GDPR”) apply to our activities in the United Kingdom. They have similar requirements to those noted above relating to GDPR.
Removed
In 2023, in order to continue to attract and retain a highly engaged workforce, we expanded our employee benefits, to include counseling and services for employees or their dependents struggling with substance abuse, travel benefits for employees needing medical services outside their normal geographic areas and additional contributions to employees’ health savings accounts.
Added
In November 2024 and June 2024, we announced restructuring plans that included reductions of our global workforce of approximately 760 employees, or approximately 22% of our workforce, to better align our cost structure with recent industry challenges that are negatively impacting our business, including increased competition and student adoption of generative AI products.
Removed
We are proud to have received numerous awards for our outstanding workplace culture, including Fortune’s Best Workplaces (for Women, Parents, Technology, and Millennials), and fifteen Comparably awards in 2023. Help Learners Learners are evolving and so is Chegg. Learners need more flexibility when it comes to education, including affordable, on-demand help that delivers positive learning outcomes.
Added
In 2024, in order to continue to attract and retain a highly engaged workforce, we implemented a company-wide short-term retention cash bonus plan initially intended to run from July 1, 2024, through June 30, 2025.
Removed
Corporate History We were incorporated in Delaware in July 2005 and hired our current Chief Executive Officer in 2010, who implemented our current business strategy to create the leading direct-to-student learning platform for students to help them improve their outcomes.
Added
In January 2025, we modified 9 Table of Contents the short-term retention cash bonus plan to run on a calendar year, from January 1, 2025 through December 31, 2025, and implemented an annual cash bonus plan based on the attainment of revenue and adjusted EBITDA goals for a select group of vice presidents and above.
Added
Chegg has been certified as a Great Place to Work seven years in a row. In 2024, Great Place to Work recognized Chegg as one of Fortune’s Best Workplaces, including best workplaces in the Bay Area, ranking #5 within the Small and Medium category. Help Learners Learners are evolving and so is Chegg.

Item 1A. Risk Factors

Risk Factors — what could go wrong, per management

94 edited+63 added−25 removed259 unchanged
Biggest changeRisks Related to Our Business and Growth • Our future revenue and growth depend on our ability to continue to attract new learners to, and retain existing learners on, our learning platform. • If we fail to innovate and offer new products and services in response to rapidly evolving technological and market developments, including AI, our competitive position and business prospects may be harmed. • We face competition in all aspects of our business, including with respect to AI, and we expect such competition to increase. • U.S. colleges have faced, and may continue to face, reduced enrollment, which could negatively impact our business and results of operations. • Our international operations, and the expansion thereof, subject us to increased challenges, risks, and costs, which could adversely affect our business, financial condition, and results of operations. 11 Table of Contents • We have a limited operating history in international jurisdictions and our expansion efforts into international markets may not be successful. • The uncertainty surrounding the evolving educational landscape, including the impact of AI on learning and education, the state of the student including the amount and the extent to which AI will impact study habits and how students learn and/or complete their assignments, and the demand for our evolving offerings make it difficult to predict our operational trends and results of operations. • If our efforts to drive user traffic, including search engine optimization, social media campaigns, and other marketing, are not successful, student discovery of, and engagement with, our learning platform could decline, which may harm our business and results of operations. • If our efforts to build and maintain strong brands are not successful, we may not be able to grow our student user base, which could adversely affect our results of operations. • Our business depends on general economic conditions and their effect on spending behavior by students and advertising budgets. • We have a history of losses, and we may not achieve or sustain profitability in the future. • If we do not retain our senior management team and key employees, we may not be able to sustain our growth or achieve our business objectives. • We depend on mobile app stores and operating systems to grow our student user base and their engagement with our learning platform. • Our wide variety of accepted payment methods subjects us to third-party payment processing-related risks, including risks associated with credit card fraud. • We rely on AWS and other third-party software and service providers to provide systems, storage, and services for our website and any disruption of such services or a material change to our arrangements could adversely affect our business. • Our growth strategy includes acquisitions, and we may not be able to execute on our acquisition strategy or integrate acquisitions successfully. • If we fail to convince brands of the benefits of advertising on our learning platform, or if platforms such as Google Chrome, Safari, or Firefox limit our access to advertising and marketing audiences, or the data required to effectively reach those audiences, our business could be harmed. • We may need additional capital, and we cannot be sure that additional financing will be available on favorable terms, if at all. • Our core value of putting students first may conflict with the short-term interests of our business. • Adverse litigation judgments or settlements resulting from legal proceedings in which we are or may be involved could expose us to monetary damages or limit our ability to operate our business. • If we are not able to manage the growth of our business both in terms of scale and complexity, our business could be adversely affected. • Our business is seasonal, and disruptions during peak periods can make, and have made, our operating results difficult to predict.
Biggest changeAdditional discussion of the risks summarized in this risk factor summary, and other risks that we face, can be found below under the heading “Risk Factors” and should be carefully considered, together with other information in this Form 10-K and our other filings with the SEC, before making an investment decision regarding our common stock. 11 Table of Contents Risks Related to Our Business and Growth • Our revenue has declined and our business depends on our ability to continue to attract new learners to, and retain existing learners on, our learning platform. • If we fail to innovate and offer new products and services in response to rapidly evolving technological and market developments, including AI, our competitive position and business prospects may be harmed. • We face competition in all aspects of our business, including with respect to AI, and we expect such competition to increase. • Our exploration of strategic alternatives may not be successful and may disrupt our ongoing business, result in increased expenses and present certain other risks. • U.S. colleges have faced, and may continue to face, reduced enrollment, which could negatively impact our business and results of operations. • Our international operations, and the expansion thereof, subject us to increased challenges, risks, and costs, which could adversely affect our business, financial condition, and results of operations. • We have a limited operating history in international jurisdictions and our expansion efforts into international markets may not be successful. • The uncertainty surrounding the evolving educational landscape, including the impact of AI on learning and education, the state of the student including the amount and the extent to which AI will impact study habits and how students learn and/or complete their assignments, and the demand for our evolving offerings make it difficult to predict our operational trends and results of operations. • If our efforts to drive user traffic, including search engine optimization, social media campaigns, and other marketing, are not successful, student discovery of, and engagement with, our learning platform could decline, which may harm our business and results of operations. • If our efforts to build and maintain strong brands are not successful, we may not be able to grow our student user base, which could adversely affect our results of operations. • Our business depends on general economic conditions and their effect on spending behavior by students and advertising budgets. • We have a history of losses, and we may not achieve or sustain profitability in the future. • If we do not retain our senior management team and key employees, we may not be able to sustain our growth or achieve our business objectives. • We have undertaken, and may in the future undertake, internal restructuring activities that could result in disruptions to our business or otherwise materially harm our results of operations or financial condition. • We depend on mobile app stores and operating systems to grow our student user base and their engagement with our learning platform. • Our wide variety of accepted payment methods subjects us to third-party payment processing-related risks, including risks associated with credit card fraud. • We rely on Amazon Web Services (AWS) and other third-party software and service providers to provide systems, storage, and services for our website and any disruption of such services or a material change to our arrangements could adversely affect our business. • Our growth strategy includes acquisitions, and we may not be able to execute on our acquisition strategy or integrate acquisitions successfully. • If we fail to convince brands of the benefits of advertising on our learning platform, or if platforms such as Google Chrome, Safari, or Firefox limit our access to advertising and marketing audiences, or the data required to effectively reach those audiences, our business could be harmed. • We may need additional capital, and we cannot be sure that additional financing will be available on favorable terms, if at all. • Our core value of putting students first may conflict with the short-term interests of our business. • Adverse litigation judgments or settlements resulting from legal proceedings in which we are or may be involved could expose us to monetary damages or limit our ability to operate our business. • If we are not able to manage the growth of our business both in terms of scale and complexity, our business could be adversely affected. • Our business is seasonal, and disruptions during peak periods can make, and have made, our operating results difficult to predict. 12 Table of Contents Risks Related to Our Industry • Government regulation of education and student information is evolving, and unfavorable developments could have an adverse effect on our business, results of operations, and financial condition. • Colleges and certain governments may restrict online access or access to our website, which could lead to the loss of or slowing of growth in our student user base and their level of engagement with our platform. • If we are required to discontinue certain of our current marketing activities, our ability to attract new students may be adversely affected. • We are subject to U.S. trade control laws that may restrict growth prospects and impose liability if we are non-compliant.
The rate at which our student user base expands or declines, the rate at which we retain existing students, and the engagement with our learning platform may fluctuate because of several factors, including, among others: • our ability to engage students with our suite of Subscription Services and the content contained therein; • our ability to introduce new products and services that are favorably received by students, including a new AI-enabled interactive and personalized user experience; • our ability to convert visitors to paying subscribers given the availability of free competitors and content; • piracy and unauthorized use of our content; • the decreasing number of students attending U.S. colleges; • our ability to localize our content, localize our pricing, localize our payment and commerce tools, and create new apps in different languages and for different geographies to further our international expansion through increased conversion and retention; • our ability to increase our total addressable market beyond STEM-B (science, technology, engineering, mathematics and business); • our ability to grow our skills business-to-business partnerships and partnerships with providers who link us to employers and their learners; • changes in student spending levels and habits; and • the effectiveness of our sales and marketing efforts, including generating word-of-mouth referrals.
The rate at which our student user base expands or declines, the rate at which we 13 Table of Contents retain existing students, and the engagement with our learning platform may fluctuate because of several factors, including, among others: • our ability to engage students with our suite of Subscription Services and the content contained therein; • our ability to introduce new products and services that are favorably received by students, including a new AI-enabled interactive and personalized user experience; • our ability to convert visitors to paying subscribers given the availability of free competitors and content; • piracy and unauthorized use of our content; • the decreasing number of students attending U.S. colleges; • our ability to localize our content, localize our pricing, localize our payment and commerce tools, and create new apps in different languages and for different geographies to further our international expansion through increased conversion and retention; • our ability to increase our total addressable market beyond STEM-B (science, technology, engineering, mathematics and business); • our ability to grow our skills business-to-business partnerships and partnerships with providers who link us to employers and their learners; • changes in student spending levels and habits; and • the effectiveness of our sales and marketing efforts, including generating word-of-mouth referrals.
Risks Related to Intellectual Property • Failure to protect or enforce our intellectual property and other proprietary rights could adversely affect our business, financial condition, and results of operations. 12 Table of Contents • Misuse of our platform and content, including digital piracy and improper sharing and misappropriation of user credentials, may continue to adversely affect our business, financial condition, and results of operation. • If we become subject to liability for the Internet content that we publish or that is uploaded to our websites by students or other users, our results of operations could be adversely affected. • Changes in or our failure to comply with the requirements for eligibility for the Digital Millennium Copyright Act (DMCA) safe harbors could harm our business. • We are, and may in the future be, subject to intellectual property claims, which are costly to defend and could harm our business, financial condition, and results of operations. • Some aspects of our technology include open-source software, and any failure to comply with the terms of one or more of these open-source licenses could harm our business.
Risks Related to Intellectual Property • Failure to protect or enforce our intellectual property and other proprietary rights could adversely affect our business, financial condition, and results of operations. • Misuse of our platform and content, including digital piracy and improper sharing and misappropriation of user credentials, may continue to adversely affect our business, financial condition, and results of operation. • If we become subject to liability for the Internet content that we publish or that is uploaded to our websites by students or other users, our results of operations could be adversely affected. • Changes in or our failure to comply with the requirements for eligibility for the Digital Millennium Copyright Act (DMCA) safe harbors could harm our business. • We are, and may in the future be, subject to intellectual property claims, which are costly to defend and could harm our business, financial condition, and results of operations. • Some aspects of our technology include open-source software, and any failure to comply with the terms of one or more of these open-source licenses could harm our business.
Factors that could negatively affect our brands include, among others: 17 Table of Contents • changes in student sentiment about the quality or usefulness of our products and services, especially as we introduce our new AI-enabled interactive and personalized user experience; • the quality and accuracy of our content; • technical or other problems that prevent us from providing our products and services reliably or otherwise negatively affect the student experience with our products and services; • concern from colleges and regulatory agencies regarding how students use our content offerings, such as our Expert Questions and Answers service; • student concerns related to privacy and use of data in our products and services; • the reputation of the products and services of competitive companies; and • students’ misuse of our products and services in ways that violate our Terms of Use, our Honor Code, other company policies, applicable laws, or the code of conduct at their educational institutions.
Factors that could negatively affect our brands include, among others: • changes in student sentiment about the quality or usefulness of our products and services, especially as we introduce our new AI-enabled interactive and personalized user experience; • the quality and accuracy of our content; • technical or other problems that prevent us from providing our products and services reliably or otherwise negatively affect the student experience with our products and services; • concern from colleges and regulatory agencies regarding how students use our content offerings, such as our Expert Questions and Answers service; • student concerns related to privacy and use of data in our products and services; • the reputation of the products and services of competitive companies; and • students’ misuse of our products and services in ways that violate our Terms of Use, our Honor Code, other company policies, applicable laws, or the code of conduct at their educational institutions.
For instance, we have been subject to litigation and investigations as a result of past security incidents, as further described in the risk factor titled “ The compromise of our information technology systems or data, including through computer malware, viruses, hacking, phishing attacks, spamming and other security incidents, could harm our business and results of operations ,” and a consent order has been finally approved and entered by the FTC related to the 31 Table of Contents same, as further described in Note 10, “Commitments and Contingencies,” of our accompanying Notes to Consolidated Financial Statements included in Part II, Item 8, “Consolidated Financial Statements and Supplementary Data” of this Annual Report on Form 10-K.
For instance, we have been subject to litigation and investigations as a result of past security incidents, as further described in the risk factor titled “ The compromise of our information technology systems or data, including through computer malware, viruses, hacking, phishing attacks, spamming and other security incidents, could harm our business and results of operations ,” and a consent order has been finally approved and entered by the FTC related to the same, as further described in Note 10, “Commitments and Contingencies,” of our accompanying Notes to Consolidated Financial Statements included in Part II, Item 8, “Consolidated Financial Statements and Supplementary Data” of this Annual Report on Form 10-K.
A failure to adequately control fraudulent transactions could harm our business and results of operations. We rely on AWS and other third-party software and service providers to provide systems, storage, and services for our website and any disruption of such services or a material change to our arrangements could adversely affect our business.
A failure to adequately control fraudulent transactions could harm our business and results of operations. We rely on Amazon Web Services (AWS) and other third-party software and service providers to provide systems, storage, and services for our website and any disruption of such services or a material change to our arrangements could adversely affect our business.
From time to time, third parties have alleged and are likely to allege in the future that we or our business infringes, misappropriates, or otherwise violates their intellectual property or proprietary rights beyond those circumstances discussed in other risk factors contained in this Section, “Risks Relating to Our Intellectual Property.” Many companies, including various “non-practicing entities” or “patent trolls,” devote significant resources to developing or acquiring patents that could affect aspects of our business.
From time to time, third parties have alleged and are likely to allege in the future that we or our business infringes, misappropriates, or otherwise violates their intellectual property or proprietary rights beyond those circumstances discussed in 28 Table of Contents other risk factors contained in this Section, “Risks Relating to Our Intellectual Property.” Many companies, including various “non-practicing entities” or “patent trolls,” devote significant resources to developing or acquiring patents that could affect aspects of our business.
We are dependent on the interoperability of our mobile apps with popular third-party mobile operating systems such as Google's Android and Apple's iOS, and their placement in popular app stores like the Google Play Store and the Apple App Store, and any changes in such systems that degrade our products’ functionality or give preferential treatment or app store placement to competitive products could adversely affect the access and usage of our applications on mobile devices.
We are dependent on the interoperability of our mobile apps with popular third-party mobile operating systems such as Google's Android and Apple's iOS, and their placement in popular app stores like the Google Play Store and the Apple App Store, and any changes in such systems that degrade our products’ functionality or 20 Table of Contents give preferential treatment or app store placement to competitive products could adversely affect the access and usage of our applications on mobile devices.
Our status as a Delaware corporation and the anti-takeover provisions of the Delaware General Corporation Law may discourage, delay or prevent a change in control by prohibiting us from engaging in a business combination with an interested stockholder for a period of three years after the person becomes an interested stockholder, even if a change of control would be beneficial to our existing stockholders.
Our status as a Delaware corporation and the anti-takeover provisions of the Delaware General Corporation Law may discourage, delay or prevent a change in control by prohibiting us from engaging in a business combination with an interested 35 Table of Contents stockholder for a period of three years after the person becomes an interested stockholder, even if a change of control would be beneficial to our existing stockholders.
As individuals become increasingly aware of and resistant to the collection, use, and sharing of personal information in connection with advertising, some users have opted out of our processing of personal data for advertising 30 Table of Contents purposes, which has negatively impacted our ability to collect certain user data and our advertising partners’ ability to deliver relevant content, and more may do so in the future.
As individuals become increasingly aware of and resistant to the collection, use, and sharing of personal information in connection with advertising, some users have opted out of our processing of personal data for advertising purposes, which has negatively impacted our ability to collect certain user data and our advertising partners’ ability to deliver relevant content, and more may do so in the future.
Adverse economic conditions, including inflation, rising interest rates, market uncertainty, and war (including the war in Ukraine and the Israel-Hamas war), may adversely impact our ability to attract new students to, and retain existing students on, our platform.
Adverse economic conditions, including inflation, fluctuating interest rates, market uncertainty, and war (including the war in Ukraine and the Israel-Hamas war), may adversely impact our ability to attract new students to, and retain existing students on, our platform.
For example, proposed or recently adopted EU laws could significantly affect our business in the future. For example, the Digital Services Act or “DSA”, effective in February of 2024, imposes new restrictions and requirements for our products and services, such as a prohibition on targeted advertising to minors in the EEA, and may significantly increase our compliance costs.
For example, proposed or recently adopted EU laws could significantly affect our business in the future. For example, the Digital Services Act or “DSA”, took effect in February of 2024, imposes new restrictions and requirements for our products and services, such as a prohibition on targeted advertising to minors in the EEA, and may significantly increase our compliance costs.
Newly enacted laws such CDPA and CPA will place additional restrictions on our marketing practices. 23 Table of Contents Notwithstanding existing laws, we may discontinue use or support of these activities if we become concerned that students or potential students deem them intrusive, or they otherwise adversely affect our reputation, goodwill and brand.
Newly enacted laws such CDPA and CPA will place additional restrictions on our marketing practices. Notwithstanding existing laws, we may discontinue use or support of these activities if we become concerned that students or potential students deem them intrusive, or they otherwise adversely affect our reputation, goodwill and brand.
If we elect to deliver shares of our common stock to settle such conversion, the issuance of our common stock may cause immediate and significant dilution. 34 Table of Contents In addition, our ability to repurchase the notes or to pay cash upon conversions of notes may be limited by law, regulatory authority or agreements governing any future indebtedness.
If we elect to deliver shares of our common stock to settle such conversion, the issuance of our common stock may cause immediate and significant dilution. In addition, our ability to repurchase the notes or to pay cash upon conversions of notes may be limited by law, regulatory authority or agreements governing any future indebtedness.
Also, despite the potential benefits of AI technology, the advancement of AI may increase certain risks and adverse impacts associated with misuse of our content, including the development of AI applications that may facilitate piracy and new forms of intellectual property infringement through the unauthorized reproduction of copyrighted content to “train” AI applications and to create unauthorized derivative works.
Also, despite the potential benefits of AI technology, the advancement of AI may increase certain risks and adverse impacts associated with misuse of our content, including the development of AI 27 Table of Contents applications that may facilitate piracy and new forms of intellectual property infringement through the unauthorized reproduction of copyrighted content to “train” AI applications and to create unauthorized derivative works.
Any determination in litigation that a DMCA safe harbor does not shield us from liability could negatively impact our business, financial condition, and results of operations. 26 Table of Contents We are, and may in the future be, subject to intellectual property claims, which are costly to defend and could harm our business, financial condition, and results of operations.
Any determination in litigation that a DMCA safe harbor does not shield us from liability could negatively impact our business, financial condition, and results of operations. We are, and may in the future be, subject to intellectual property claims, which are costly to defend and could harm our business, financial condition, and results of operations.
For example, the European Union’s General Data Protection Regulation (“EU GDPR”), the United Kingdom’s GDPR (“UK GDPR”), Brazil’s General Data Protection Law (Lei Geral de Proteção de Dados Pessoais, or “LGPD”) (Law No. 13,709/2018), and China’s Personal Information Protection Law (“PIPL”) impose strict requirements for processing personal data.
For example, the European Union’s General Data Protection Regulation (“EU GDPR”), the United Kingdom’s GDPR (“UK GDPR” and together with the EU GDPR, the "GDPR"), Brazil’s General Data Protection Law (Lei Geral de Proteção de Dados Pessoais, or “LGPD”) (Law No. 13,709/2018), and China’s Personal Information Protection Law (“PIPL”) impose strict requirements for processing personal data.
Additionally, we expect our results of operations to fluctuate in the future based on a variety of factors, many of which are outside our control and difficult to predict. As a result, period-to-period comparisons of our results of operations may not be a good indicator of our future or long-term performance.
Additionally, we expect our results of operations to fluctuate in the future based on a variety of factors, many of which are outside our control and difficult to predict. As a result, period-to-period comparisons of our results of operations may not be a good indicator of our 17 Table of Contents future or long-term performance.
The accounting standards that we use in preparing our financial statements are often complex and require us to make significant estimates and assumptions in interpreting and applying those standards. These estimates and assumptions affect the 24 Table of Contents reported values of assets, liabilities, revenues and expenses, and the disclosure of contingent liabilities.
The accounting standards that we use in preparing our financial statements are often complex and require us to make significant estimates and assumptions in interpreting and applying those standards. These estimates and assumptions affect the reported values of assets, liabilities, revenues and expenses, and the disclosure of contingent liabilities.
The impact of misuse of our platform and content on our revenues and subscriptions is hard to quantify, but we believe that illegal copying and dissemination of our content, improper sharing and misappropriation of user credentials, and other forms of unauthorized activity have had a substantial 25 Table of Contents negative impact on our revenues and subscriptions.
The impact of misuse of our platform and content on our revenues and subscriptions is hard to quantify, but we believe that illegal copying and dissemination of our content, improper sharing and misappropriation of user credentials, and other forms of unauthorized activity have had a substantial negative impact on our revenues and subscriptions.
Sanctions and export violations can result in significant fines or penalties, as well as reputational harm and loss of business. Our customers outside of the United States generated approximately 14% of our net revenues during the year ended December 31, 2023, and our growth strategy includes further expanding our operations and customer base across all major global markets.
Sanctions and export violations can result in significant fines or penalties, as well as reputational harm and loss of business. Our customers outside of the United States generated approximately 13% of our net revenues during the year ended December 31, 2024, and our growth strategy includes further expanding our operations and customer base across all major global markets.
The European Commission's proposed Artificial Intelligence (AI) Act could also impose new obligations or limitations affecting our business, if and when it enters into force.
The European Commission's proposed AI Act could also impose new obligations or limitations affecting our business, if and when it enters into force.
Moreover, damage to or total destruction of our executive offices resulting from earthquakes may not be covered in whole or in part by any insurance we may have. ITEM 1B. UNRESOLVED STAFF COMMENTS None.
Moreover, damage to or total destruction of our executive offices resulting from earthquakes may not be covered in whole or in part by any insurance we may have. 37 Table of Contents ITEM 1B. UNRESOLVED STAFF COMMENTS None.
If our marketing activities are curtailed, our ability to attract new students may be adversely affected. We are subject to U.S. trade control laws that may restrict growth prospects and impose liability if we are non-compliant. As a U.S. company with U.S. origin software applications, we are required to comply with U.S. trade controls.
If our marketing activities are curtailed, our ability to attract new students may be adversely affected. 25 Table of Contents We are subject to U.S. trade control laws that may restrict growth prospects and impose liability if we are non-compliant. As a U.S. company with U.S. origin software applications, we are required to comply with U.S. trade controls.
This exclusive forum provision will not apply to claims that are vested in the exclusive jurisdiction of a court or forum other than the Court of Chancery of the State of Delaware, or for which the Court of 33 Table of Contents Chancery of the State of Delaware does not have subject matter jurisdiction.
This exclusive forum provision will not apply to claims that are vested in the exclusive jurisdiction of a court or forum other than the Court of Chancery of the State of Delaware, or for which the Court of Chancery of the State of Delaware does not have subject matter jurisdiction.
Furthermore, European legislative proposals and present laws and regulations – other than the EU and UK GDPR – apply to cookies and similar tracking technologies, electronic communications, and marketing and regulators are increasingly focusing on compliance with requirements related to the behavioral, interest-based, or tailored advertising ecosystem.
Furthermore, European legislative proposals and present laws and regulations – other than the EU and UK GDPR – apply to cookies and similar tracking technologies, electronic communications, and marketing and regulators are increasingly 32 Table of Contents focusing on compliance with requirements related to the behavioral, interest-based, or tailored advertising ecosystem.
Attracting new students depends not only on our investment in our brand and content and our 13 Table of Contents marketing efforts, but also on the perceived value of our products and services versus alternatives, some of which are free.
Attracting new students depends not only on our investment in our brand and content and our marketing efforts, but also on the perceived value of our products and services versus alternatives, some of which are free.
In addition to the factors discussed in this Annual Report on Form 10-K, the trading price of our common stock may fluctuate significantly in response to numerous factors, many of which are beyond our control, including, among others: • our announcement of actual results for a fiscal period that are higher or lower than projected results or our announcement of revenues or earnings guidance that is higher or lower than expected; • issuance of new or updated research or reports by securities analysts, including unfavorable reports or change in recommendation or downgrading of our common stock; • announcements by us, our competitors, or other parties of significant products or features, technologies (including AI-related developments), acquisitions, strategic relationships and partnerships, joint ventures, or capital commitments; • actual or anticipated changes in our growth rate relative to our competitors; • changes in the economic performance or market valuations of actual or perceived comparable companies; • future sales of our common stock by our officers, directors, and existing stockholders or the anticipation of such sales; • issuances of additional shares of our common stock or convertible instruments in connection with acquisitions and capital raising transactions; • share price and volume fluctuations attributable to inconsistent trading volume levels of our shares, including any common stock issued upon conversion of the notes; • lawsuits threatened or filed against us; • regulatory developments in our target markets affecting us, students, colleges, brands, publishers, or our competitors; • the U.S. political climate, with a focus on cutting budgets, higher education, and taxation; • terrorist attacks or natural disasters or similar events impacting countries where we operate; and • general economic and market conditions. 32 Table of Contents Furthermore, both domestic and international stock markets have experienced extreme price and volume fluctuations that have affected and continue to affect the market prices of equity securities of companies in general and technology companies in particular.
In addition to the factors discussed in this Annual Report on Form 10-K, the trading price of our common stock may fluctuate significantly in response to numerous factors, many of which are beyond our control, including, among others: • our announcement of actual results for a fiscal period that are higher or lower than projected results or our announcement of revenues or earnings guidance that is higher or lower than expected; • issuance of new or updated research or reports by securities analysts, including unfavorable reports or change in recommendation or downgrading of our common stock; • announcements by us, our competitors, or other parties of significant products or features, technologies (including AI-related developments), acquisitions, strategic relationships and partnerships, joint ventures, or capital commitments; • actual or anticipated changes in our growth rate relative to our competitors; • changes in the economic performance or market valuations of actual or perceived comparable companies; • future sales of our common stock by our officers, directors, and existing stockholders or the anticipation of such sales; • issuances of additional shares of our common stock or convertible instruments in connection with acquisitions and capital raising transactions; • share price and volume fluctuations attributable to inconsistent trading volume levels of our shares, including any common stock issued upon conversion of the notes; • lawsuits threatened or filed against us; • regulatory developments in our target markets affecting us, students, colleges, brands, publishers, or our competitors; • the U.S. political climate, with a focus on cutting budgets, higher education, and taxation; • terrorist attacks or natural disasters or similar events impacting countries where we operate; and • general economic and market conditions.
Brands may not do business with us, or may reduce their advertising spend with us, if we do not deliver ads, sponsorships, and other commercial content and marketing 20 Table of Contents programs effectively, or if they do not believe that their investment will generate a competitive return relative to other alternatives.
Brands may not do business with us, or may reduce their advertising spend with us, if we do not deliver ads, sponsorships, and other commercial content and marketing programs effectively, or if they do not believe that their investment will generate a competitive return relative to other alternatives.
During times of war and other major conflicts, we, our service providers and other third parties 27 Table of Contents upon which we rely, may be vulnerable to a heightened risk of these attacks.
During times of war and other major conflicts, we, our service providers and other third parties upon which we rely, may be vulnerable to a heightened risk of these attacks.
The timing, volume, and nature of the repurchases will be determined by management based on the capital needs of the business, market conditions, applicable legal requirements, and other factors.
The timing, volume, and nature of the repurchases will be determined by management based on the capital needs of the business, market conditions, applicable legal requirements, alternative investment opportunities, and other factors.
The aggregate principal amounts of both the 2026 notes and 2025 notes include $100 million from the initial purchasers fully exercising their option to purchase additional notes. As of December 31, 2023, the outstanding principal amount of our 2026 notes and 2025 notes was $244 million and $359 million, respectively.
The aggregate principal amounts of both the 2026 notes and 2025 notes include $100 million from the initial purchasers fully exercising their option to purchase additional notes. As of December 31, 2024, the outstanding principal amount of our 2026 notes and 2025 notes was $128 million and $359 million, respectively.
As of December 31, 2023, we had $3.7 million remaining under the securities repurchase program, which has no expiration date and will continue until otherwise suspended, terminated or modified at any time for any reason by our board of directors. Repurchases pursuant to our securities repurchase program could affect the price of our common stock and increase its volatility.
As of December 31, 2024, we had $207.5 million remaining under the securities repurchase program, which has no expiration date and will continue until otherwise suspended, terminated or modified at any time for any reason by our board of directors. Repurchases pursuant to our securities repurchase program could affect the price of our common stock and increase its volatility.
As of December 31, 2023, we had an accumulated deficit of $52.4 million. We expect to make significant investments in the development and expansion of our business and, as a result, our cost of revenues and operating expenses may increase.
As of December 31, 2024, we had an accumulated deficit of $889.4 million. We expect to make significant investments in the development and expansion of our business and, as a result, our cost of revenues and operating expenses may increase.
Developing, protecting, and enhancing our “Chegg” brands are critical to expanding our student user base and increasing student engagement. Having a strong brand can counteract the significant student turnover we experience from year to year as students graduate and differentiate us from our competitors.
We believe our brands are a key asset of our business. Developing, protecting, and enhancing our “Chegg” brands are critical to expanding our student user base and increasing student engagement. Having a strong brand can counteract the significant student turnover we experience from year to year as students graduate and differentiate us from our competitors.
Although our policy is to avoid knowingly collecting personal information from children under the age of 13 and we do not believe that our websites or online services are directed to children under the age of 13, regulators or private plaintiffs could disagree with this assessment and challenge our compliance with the federal Children’s Online Privacy Protection Act and its implementing rules (“COPPA”) which impose enhanced notice, verifiable parental consent, data minimization, security and other data privacy requirements on child-directed sites and online services that our services are not designed to support.
Although our policy is to avoid knowingly collecting personal information from children under the age of 13 and we do not believe that our websites or online services are directed to children under the age of 13, regulators or private plaintiffs could disagree with this assessment and challenge our compliance with the COPPA which impose enhanced notice, verifiable parental consent, data minimization, security and other data privacy requirements on child-directed sites and online services that our services are not designed to support.
If we do not retain our senior management team and key employees, we may not be able to sustain our growth or achieve our business objectives. We depend on the continued contributions of our senior management and other key personnel. In particular, we rely on the contributions of our President, Chief Executive Officer, and Co-Chairperson, Dan Rosensweig.
If we do not retain our senior management team and key employees, we may not be able to sustain our growth or achieve our business objectives. We depend on the continued contributions of our senior management and other key personnel. In particular, we rely on the contributions of our President and Chief Executive Officer, Nathan Schultz.
The growth of our business depends on our ability to attract new students to use our products and services and to increase retention and the level of engagement by existing students with our learning platform.
Our business depends on our ability to attract new students to use our products and services and to increase retention and the level of engagement by existing students with our learning platform and maintain pricing levels.
It is possible that new laws and regulations will be adopted in the U.S. (at the federal or state level) or in non-U.S. jurisdictions, or that existing laws and regulations may be interpreted in ways that would affect the operation of our business, including our learning platform and the ways in which we use artificial intelligence and machine learning technology.
(at the federal or state level) or in non-U.S. jurisdictions, or that existing laws and regulations may be interpreted in ways that would affect the operation of our business, including our learning platform and the ways in which we use artificial intelligence and machine learning technology.
We may experience some loss from fraudulent credit card transactions, including potential liability for not obtaining signatures from students in connection with the use of credit cards or fraudulent payments to educators as part of Uversity. While we do have safeguards in place, we cannot be certain that other fraudulent schemes will not be successful.
We may experience some loss from fraudulent credit card transactions, including potential liability for not obtaining signatures from students in connection with the use of credit cards. While we do have safeguards in place, we cannot be certain that other fraudulent schemes will not be successful.
In addition to our employee base in the United States, we have employees in Canada, Israel, India, the United Kingdom, and Spain, and we have retained professional employer organizations and staffing agencies to engage personnel in certain additional international locations.
In addition to our employee base in the United States, as of December 31, 2024 we had employees in Canada, Israel, India, the United Kingdom, and Spain, and we have retained professional employer organizations and staffing agencies to engage personnel in certain additional international locations.
In August 2023, our Board of Directors approved a $200.0 million increase to our existing securities repurchase program authorizing the repurchase of up to $2.2 billion of our common stock and/or convertible notes, through open market purchases, block trades, and/or privately negotiated transactions or pursuant to Rule 10b5-1 plans, in compliance with applicable securities laws and other legal requirements.
In November 2024, our board of directors approved a $300.0 million increase to our existing securities repurchase program authorizing the repurchase of our common stock and/or convertible notes, through open market purchases, block trades, and/or privately negotiated transactions or pursuant to Rule 10b5-1 plans, in compliance with applicable securities laws and other legal requirements.
Upon expiration or termination of our agreement with AWS, we may not be able to replace the services provided to us in a timely manner or on terms and conditions, including service levels and cost, that are favorable to us, and a transition from one vendor to another vendor could subject us to operational delays and inefficiencies until the transition is complete.
Upon expiration or termination of our agreement with AWS, we may not be able to replace the services provided to us in a timely manner or on terms and conditions, including service levels and cost, that are favorable to us, and a transition from one vendor to another vendor could subject us to operational delays and inefficiencies until the transition is complete. 21 Table of Contents Our growth strategy includes acquisitions, and we may not be able to execute on our acquisition strategy or integrate acquisitions successfully.
The uncertainty surrounding the evolving educational landscape, the state of the student, and the demand and market for our products and services make it difficult to predict our operational trends and results of operations, particularly with respect to our newer offerings, and the ultimate market size for our products and services.
The uncertainty surrounding the evolving educational landscape, the state of the student, the use by students of free generative AI products for academic support, and the demand and market for our products and services make it difficult to predict our operational trends and results of operations, particularly with respect to our newer offerings, and the ultimate market size for our products and services.
Risks Related to Our Business and Growth Our future revenue and growth depend on our ability to continue to attract new learners to, and retain existing learners on, our learning platform.
Risks Related to Our Business and Growth Our revenue has declined and our business depends on our ability to continue to attract new learners to, and retain existing learners on, our learning platform.
The following factors, including the risks more fully described throughout this "Risk Factors" section, may affect us from period-to-period and may affect our long-term performance: • our ability to attract, retain and engage students with our offerings; • rapidly changing technological developments, such as AI and machine learning, that may disrupt the education landscape and our response to those developments, including our ability to successfully integrate AI technology into our offerings; • increased competition as a result of advances in AI technology from companies that have not historically competed with us in education services, such as Alphabet, OpenAI, Microsoft, Meta, and Anthropic; 16 Table of Contents • changes to the way students discover our content or a decline in our search engine result page rankings; • the rate of adoption of our offerings; • the trend of declining college enrollment; • changes by our competitors to their product and service offerings, including price and content; • our ability to accurately forecast financial results for future periods, especially at the time we present our second quarter financial results, which will generally occur midsummer and precede our “fall rush”; • our ability to integrate acquired businesses, including personnel; • government regulations, in particular regarding privacy, academic integrity, advertising and taxation policies; • operating costs and capital expenditures relating to content and the expansion of our business; and • general macroeconomic conditions, including inflation, recession, and global conflicts.
The following factors, including the risks more fully described throughout this "Risk Factors" section, may affect us from period-to-period and may affect our long-term performance: • our ability to attract, retain and engage students with our offerings; • rapidly changing technological developments, such as AI and machine learning, that have impacted and are expected to continue impacting the education landscape and our response to those developments, including our ability to successfully integrate AI technology into our offerings; • increased competition as a result of advances in AI technology from companies that have not historically competed with us in education services, such as Google, OpenAI, Microsoft, Meta, and Anthropic, who may offer free generative AI products for academic support or whose general AI offerings are being adopted by students in lieu of our offerings; • changes to the way students discover our content or a decline in our search engine result page rankings; • changes to Google’s search experience, including its AI overviews search experience, which displays AI-generated content at the top of its search results, including questions and solutions for education, that keeps users on Google's search results instead of leading them to our site; • the rate of adoption of our offerings; • the trend of declining college enrollment; • changes by our competitors to their product and service offerings, including price and content; • our ability to accurately forecast financial results for future periods, especially at the time we present our second quarter financial results, which will generally occur midsummer and precede our “fall rush”; • our ability to integrate acquired businesses, including personnel; • government regulations, in particular regarding privacy, academic integrity, advertising, “click-to-cancel” and taxation; • operating costs and capital expenditures relating to content and the expansion of our business; and • general macroeconomic conditions, including inflation, recession, and global conflicts.
We may not be successful in anticipating or responding to these developments on a timely and cost-effective basis. We may invest in new products, services, and other initiatives, but there is no guarantee these approaches will be successful.
Our business has been negatively impacted by these developments, and we may not be successful in anticipating or responding to further developments, on a timely and cost-effective basis or at all. We may invest in new products, services, and other initiatives, but there is no guarantee these approaches will be successful.
Given the number of shares available for grant and given the decrease in our stock price, we may need to request that our shareholders vote on a new equity incentive plan sooner than previously anticipated.
As of December 31, 2024, there were 10,340,723 shares available for grant under the 2023 Equity Incentive Plan. Given the number of shares available for grant and given the decrease in our stock price, we may need to request that our shareholders vote on a new equity incentive plan sooner than previously anticipated.
Although we believe we have the experience and processes to enable us to formulate appropriate assumptions and produce reasonably dependable estimates, these assumptions and estimates may change significantly in the future and could result in the reversal of previously recognized amounts.
These estimates and assumptions involve matters that are inherently uncertain and require us to make subjective and complex judgments. Although we believe we have the experience and processes to enable us to formulate appropriate assumptions and produce reasonably dependable estimates, these assumptions and estimates may change significantly in the future and could result in the reversal of previously recognized amounts.
For a small percentage of the impacted users who had entered details into our scholarship search service, the incident also exposed information about additional personal characteristics, including dates of birth, parents’ income range, sexual orientation, religious denomination, heritage and information concerning disabilities. Following the 2018 Data Incident, a purported securities class action captioned Shah v. Chegg, Inc. et. al.
For a small percentage of the impacted users who had entered details into our scholarship search service, the incident also exposed information about additional personal characteristics, including dates of birth, parents’ income range, sexual orientation, religious denomination, heritage and information concerning disabilities.
Our effective tax rate may fluctuate in the future as a result of new tax laws. Due to the complexities involved in applying the provisions of new tax legislation, we may make reasonable estimates of the effects in our financial statements.
Due to the complexities involved in applying the provisions of new tax legislation, we may make reasonable estimates of the effects in our financial statements.
Any disruption in the services provided by third-party providers, including AWS, could harm our reputation or brand, cause us to lose subscribers or revenues or incur substantial recovery costs and distract management from operating our business.
Any disruption in the services provided by third-party providers, including AWS, could harm our reputation or brand, cause us to lose subscribers or revenues or incur substantial recovery costs and distract management from operating our business. Further, these third-party software and service providers may experience operational difficulties, including increased usage of their software and services from time to time.
The legal landscape with respect to privacy and data security in the U.S. and elsewhere is similarly in flux with a number of pending legislative and regulatory proposals that could have significant impacts on our business, if effected. Risks Related to Ownership of Our Common Stock Our stock price has been and will likely continue to be volatile.
The legal landscape with respect to privacy and data security in the U.S. and elsewhere is similarly in flux with a number of pending legislative and regulatory proposals that could have significant impacts on our business, if effected.
Our international operations subject us to the compensation and benefits regulations of those jurisdictions, as well as other employer duties and obligations, that differ from the compensation and benefits regulations and duties and obligations in the United States. Further, enrollments of learners from other countries requires us to comply with international data privacy and education regulations of those countries.
Our international operations subject us to the compensation and benefits regulations of those jurisdictions, as well as other employer duties and obligations, that differ from the compensation and benefits regulations and duties and obligations in the United States.
We may elect not to respond to the communication if we believe it is without merit or we may try to resolve disputes out-of-court by removing content or services we offer or paying licensing or other fees. If we fail to resolve such disputes, litigation may result. For example, on September 13, 2021, Pearson Education, Inc.
We may elect not to respond to the communication if we believe it is without merit or we may try to resolve disputes out-of-court by removing content or services we offer or paying licensing or other fees. If we fail to resolve such disputes, litigation may result. For example, we have been subject to lawsuits alleging copyright infringement.
Additionally, such events could lead to loss of customers; interruptions or stoppages in our business operations; inability to process personal data or to operate in certain jurisdictions; limited ability to develop or commercialize our products; expenditure of time and resources to defend any claim or inquiry; adverse publicity; or substantial changes to our business model or operations.
Additionally, such events could lead to loss of customers; interruptions or stoppages in our business operations; inability to process personal data or to operate in certain jurisdictions; limited ability to develop or commercialize our products; expenditure of time and resources to defend any claim or inquiry; adverse publicity; or substantial changes to our business model or operations. 33 Table of Contents Noncompliance with certain privacy and data security laws we may be subject to could subject us to particularly significant penalties.
We may incur significant losses in the future for a number of reasons, including slowing or lower demand for our products and services, increasing competition, decreased spending on education, and other risks described in this Annual Report on Form 10-K. We may encounter unforeseen expenses, challenges, complications, delays, and other unknown factors, as we pursue our business plan.
We may incur significant losses in the future for a number of reasons, including slowing or lower demand for our products and services, increasing competition, decreased spending on education, 19 Table of Contents and other risks described in this Annual Report on Form 10-K.
If our new offerings or changes to existing offerings fail to engage students, or if our business plans are unsuccessful, we may fail to attract or retain students or to generate sufficient revenue, operating margin, or other value to justify our investments, and our business may be materially adversely affected.
If our business plans and product developments are unsuccessful or if we do not attract new students to our platform, we may not generate sufficient revenue, operating margin, or other value to justify our investments, and our business may be materially adversely affected.
Beginning in September 2023, we started to roll out the first phase of our new AI-powered user experience, and we are continuing to make significant investments in AI initiatives.
In April 2023, we announced our pivot to AI with a partnership with OpenAI to utilize GPT-4 in our offerings. Beginning in September 2023, we started to roll out the first phase of our new AI-powered user experience, and we are continuing to make significant investments in AI initiatives.
We may be subject to short-selling strategies that may drive down the market price of our common stock. Short selling occurs when an investor borrows a security and sells it on the open market, with the intention of buying identical securities at a later date to return to the lender.
Short selling occurs when an investor borrows a security and sells it on the open market, with the intention of buying identical securities at a later date to return to the lender.
We make critical estimates and assumptions involving accounting matters including revenue recognition and deferred revenue, impairment of acquired intangible assets and other long-lived assets, goodwill and indefinite lived intangible assets, share-based compensation expense, and (provision for) benefit from income taxes. These estimates and assumptions involve matters that are inherently uncertain and require us to make subjective and complex judgments.
We make critical estimates and assumptions involving accounting matters including revenue recognition and deferred revenue, impairment of acquired intangible assets and other long-lived assets, goodwill and indefinite lived intangible assets, share-based compensation 26 Table of Contents expense, and (provision for) benefit from income taxes.
If our competitors’ efforts to increase user traffic are more successful than ours, overall growth could slow, including the number of Subscription Services subscribers, student engagement could decrease, and fewer students may use our platform. Any reduction in the number of students directed to our learning platform could harm our business and results of operations.
If our competitors’ efforts to increase user traffic are more successful than ours, our decline could accelerate, including the number of Subscription Services subscribers, student engagement could decrease, and fewer students may use our platform.
Given the volume of our repurchases of the notes to date, our future repurchases may be restrained by the quantity available for sale on the capital markets.
Our ability to refinance the notes will depend on the capital markets and our financial condition at such time. Given the volume of our repurchases of the notes to date, our future repurchases may be restrained by the quantity available for sale on the capital markets.
If we are not able to manage the growth of our business, we may not 21 Table of Contents be able to maintain or increase our revenues as anticipated or recover any associated acquisition or development costs, and our business could be adversely affected.
If we are not able to manage the growth of our business, we may not be able to maintain or increase our revenues as anticipated or recover any associated acquisition or development costs, and our business could be adversely affected. 23 Table of Contents Our business is seasonal, and disruptions during peak periods can make, and have made, our operating results difficult to predict.
Noncompliance with certain privacy and data security laws we may be subject to could subject us to particularly significant penalties. For example, TCPA violations can result in penalties or criminal fines imposed by the Federal Communications Commission or statutory damages awards of up to $1,500 per violation imposed through private litigation or fines by state authorities.
For example, TCPA violations can result in penalties or criminal fines imposed by the Federal Communications Commission or statutory damages awards of up to $1,500 per violation imposed through private litigation or fines by state authorities.
Risks Related to Our Convertible Senior Notes Servicing our convertible senior notes requires a significant amount of cash, and we may not have sufficient cash flow or cash on hand to repay them, settle conversions in cash or to repurchase them upon a fundamental change, and any future debt may contain limitations on our ability to pay cash upon conversion or repurchase.
Although our securities repurchase program is intended to enhance long-term stockholder value, short-term price fluctuations could reduce the program’s effectiveness. 36 Table of Contents Risks Related to Our Convertible Senior Notes Servicing our convertible senior notes requires a significant amount of cash, and we may not have sufficient cash flow or cash on hand to repay them, settle conversions in cash or to repurchase them upon a fundamental change, and any future debt may contain limitations on our ability to pay cash upon conversion or repurchase.
We cannot predict the effect of technological changes on our business. Failure to keep pace with these technological developments or otherwise bring to market products that reflect these technologies could have a material adverse impact on our overall business and results of operations.
Failure to keep pace with these 14 Table of Contents technological developments or otherwise bring to market products that reflect these technologies and are accepted by students would have a material adverse impact on our overall business and results of operations.
To be successful, we must timely and efficiently integrate acquired companies, including their technologies, products, services, operations, and personnel. Acquired companies can be complex and time consuming to integrate and we may incur significant integration costs and we may not be able to offset our acquisition costs.
Acquired companies can be complex and time consuming to integrate and we may incur significant integration costs and we may not be able to offset our acquisition costs.
Our business is seasonal, and disruptions during peak periods can make, and have made, our operating results difficult to predict. Revenues from Subscription Services are primarily recognized ratably over the subscription term, which has generally resulted in our highest revenues and profitability in the fourth quarter as it reflects more days of the academic year.
Revenues from Subscription Services are primarily recognized ratably over the subscription term, which has generally resulted in our highest revenues and profitability in the fourth quarter as it reflects more days of the academic year.
Our growth strategy includes acquisitions, and we may not be able to execute on our acquisition strategy or integrate acquisitions successfully. As part of our business strategy, we have made and intend to continue to make acquisitions to add specialized employees, complementary businesses, products, services, operations, or technologies. Our recent prior acquisitions include Busuu, Mathway, and Thinkful.
As part of our business strategy, we have made and intend to continue to make acquisitions to add specialized employees, complementary businesses, products, services, operations, or technologies. Our recent prior acquisitions include Busuu, Mathway, and Thinkful. To be successful, we must timely and efficiently integrate acquired companies, including their technologies, products, services, operations, and personnel.
Although we will continue to work with academic institutions to enforce our honor code and otherwise discourage students from misusing our services, other jurisdictions (including international jurisdictions) may adopt similar or broader versions of these types of laws 22 Table of Contents and regulations, or the interpretation of the existing or future laws and regulations may impact whether they are cited against us or where we can offer our services.
Although we will continue to work with academic institutions to enforce our honor code and otherwise discourage students from misusing our services, other jurisdictions (including international jurisdictions) may adopt similar or broader versions of these types of laws and regulations, or the interpretation of the existing or future laws and regulations may impact whether they are cited against us or where we can offer our services. 24 Table of Contents The adoption of any laws or regulations that adversely affect the popularity or growth in the use of the Internet particularly for educational services, including laws limiting the content and learning programs that we can offer, and the audiences that we can offer that content to, may decrease demand for our service offerings and increase our cost of doing business.
For example, the California Consumer Privacy Act of 2018 (“CCPA”) requires businesses to provide specific disclosures in privacy notices and honor requests of California residents 29 Table of Contents to exercise certain privacy rights.
For example, the California Consumer Privacy Act of 2018 (“CCPA”) applies to personal data of consumers, business representatives, and employees who are California residents, and requires businesses to provide specific disclosures in privacy notices and honor requests of such individuals to exercise certain privacy rights.
Furthermore, remote work has become more common and has increased risks to our information technology systems and data, as more of our employees, as well as employees of our service providers and other third parties on which we rely, utilize network connections, computers and devices outside our premises or network, including while working at home, while in transit and in public locations.
Furthermore, remote work has become more common and has increased risks to our information technology systems and data, as more of our employees, as well as employees of our service providers and other third parties on which we rely, utilize network connections, computers and devices outside our premises or network, including while working at home, while in transit and in public locations. 29 Table of Contents Future or past business transactions (such as acquisitions or integrations) could also expose us to additional cybersecurity risks and vulnerabilities, as our systems could be negatively affected by vulnerabilities present in acquired or integrated entities’ systems and technologies.
Our competitors that are not specifically focused on education and learning services but whose AI offerings may impact education 14 Table of Contents and learning include companies such as Google, OpenAI, Microsoft, Meta, and Anthropic. Certain educational institutions, such as the University of Michigan, are also developing AI tools which may compete with our offerings.
Our competitors that are not specifically focused on education and learning services but whose AI offerings may impact education and learning include companies such as Google, OpenAI, Microsoft, Meta, and Anthropic.
If our efforts to build and maintain strong brands are not successful, we may not be able to grow our student user base, which could adversely affect our results of operations. We believe our brands are a key asset of our business.
Any reduction in the number of students directed to our learning platform could harm our business and results of operations. 18 Table of Contents If our efforts to build and maintain strong brands are not successful, we may not be able to grow our student user base, which could adversely affect our results of operations.
We have been in the past, and may be in the future, subject to claims under such laws or regulations. As the regulatory framework for machine learning, artificial intelligence, and automated decision making evolves, our business, financial condition, and results of operations may be adversely affected by related laws or regulations.
As the regulatory framework for machine learning, artificial intelligence, and automated decision making evolves, our business, financial condition, and results of operations may be adversely affected by related laws or regulations. It is possible that new laws and regulations will be adopted in the U.S.
We have been and may continue to be the target of this type of litigation in the future. Securities litigation against us could result in substantial costs and divert our management’s attention from other business concerns, which could seriously harm our business and results of operations.
Securities litigation against us could result in substantial costs and divert our management’s attention from other business concerns, which could seriously harm our business and results of operations. We may be subject to short-selling strategies that may drive down the market price of our common stock.
Similarly, the adoption of any laws or regulations affecting the ability of service providers to periodically charge consumers for, among other things, recurring subscription payments may materially adversely affect our business, financial condition and results of operations. Legislation or regulation regarding the foregoing, or changes to existing legislation or regulation governing subscription payments, are being considered in many U.S. States.
Similarly, the adoption of any laws or regulations affecting the ability of service providers to periodically charge consumers for, among other things, recurring subscription payments, such as the Restore Online Shoppers’ Confidence Act, may materially adversely affect our business, financial condition and results of operations.
We depend on mobile app stores and operating systems to grow our student user base and their engagement with our learning platform. There is no guarantee that students will use our mobile apps, such as the mobile version of our website, m.chegg.com, and Chegg Study, rather than competing products.
There is no guarantee that students will use our mobile apps, such as the mobile version of our website, m.chegg.com, and Chegg Study, rather than competing products.
Any failure to repurchase securities after we have announced our intention to do so may negatively impact our reputation and investor confidence in us and may negatively impact our stock price. Although our securities repurchase program is intended to enhance long-term stockholder value, short-term price fluctuations could reduce the program’s effectiveness.
Any failure to repurchase securities after we have announced our intention to do so may negatively impact our reputation and investor confidence in us and may negatively impact our stock price.

… 102 more changes not shown on this page.

Item 1C. Cybersecurity

Cybersecurity — threats and controls disclosure

5 edited+1 added−2 removed5 unchanged
Biggest changeT&S also partners with a dedicated engineering team, Security and Fraud Engineering, which reports to our CTO and is responsible for building libraries, services, and integrations that interface with both backend and vendor systems to support the objectives of T&S. Mr.
Biggest changeT&S also partners with other dedicated teams which report to our CTO: • Operations and Analytics , which is responsible for identifying and measuring consumer fraud and abuse of our customer-facing services, implementing manual and automated operations to ensure these are within acceptable bounds, and working with our product and engineering teams to design and implement longer term solutions. • Security and Fraud Engineering , which is responsible for building libraries, services, and integrations that interface with both backend and vendor systems to support the objectives of T&S.
T&S is made up of three sub-teams, each led by a director who reports to the CISO: • Information Security , which is responsible for implementing all aspects of the ISP and is structured around the following pillars: (i) Application Security, (ii) Infrastructure (Cloud) Security, (iii) Corporate IT Security, (iv) Security Operations, and (v) Governance and Risk Management. • Compliance and Privacy , which is responsible for assessing and preparing internal teams for regulatory compliance pertaining to information security, secured financial reporting, and privacy and is structured around the following pillars: (i) Privacy, (ii) Compliance, (iii) Vendor Risk Management, and (iv) Security Awareness. • Operations and Analytics , which is responsible for identifying and measuring consumer fraud and abuse of our customer-facing services, implementing manual and automated operations to ensure these are within acceptable bounds, and working with our product and engineering teams to design and implement longer term solutions.
T&S is made up of two sub-teams, each led by a director who reports to the CISO: • Information Security , which is responsible for implementing all aspects of the ISP and is structured around the following pillars: (i) Application Security, (ii) Infrastructure (Cloud) Security, (iii) Corporate IT Security, (iv) Security Operations, and (v) Governance and Risk Management. • Compliance and Privacy , which is responsible for assessing and preparing internal teams for regulatory compliance pertaining to information security, secured financial reporting, and privacy and is structured around the following pillars: (i) Privacy, (ii) Compliance, (iii) Vendor Risk Management, and (iv) Security Awareness.
The Audit Committee provides guidance and oversight to help ensure the ISP meets the needs of all interested parties and fulfills its core functions. 35 Table of Contents Our Trust and Security organization (“T&S”) is responsible for implementing the ISP.
The Audit Committee provides guidance and oversight to help ensure the ISP meets the needs of all interested parties and fulfills its core functions. Our Trust and Security organization (“T&S”) is responsible for implementing the ISP. T&S is led by our Chief Information Security Officer (“CISO”), Lonnie Benavides, who reports to our Chief Technology Officer (“CTO”), Chuck Geiger.
For discussion of our risk factors relating to cybersecurity and data privacy, see the “Risks Related to Data Privacy” section included in Part I, Item 1A, “Risk factors” of this Annual Report on Form 10-K.
Our CEO, CFO and General Counsel each hold degrees in their respective fields, and each have over 20 years of experience managing risks at Chegg and other companies, including risks arising from cybersecurity threats. 38 Table of Contents For discussion of our risk factors relating to cybersecurity and data privacy, see the “Risks Related to Data Privacy” section included in Part I, Item 1A, “Risk factors” of this Annual Report on Form 10-K.
Heasman has served as our CISO for over four years and has served in various roles in information technology and information security for over 20 years, including serving as the Deputy CISO of a large public company prior to joining Chegg. Mr. Heasman holds undergraduate and graduate degrees in engineering and computer science. Mr.
Mr. Benavides joined Chegg in 2024 and has served various roles in information technology and security for over 25 years, including serving as CISO of a mortgage servicing company prior to joining Chegg. Mr.
Removed
T&S is led by our Chief Information Security Officer (“CISO”), John Heasman, who reports to our Chief Technology Officer (“CTO”), Chuck Geiger.
Added
Benavides holds an undergraduate degree in Information Technology with a specialization in Information Assurance and Security and was a distinguished graduate of the US Air Force Secure Communications school. Mr.
Removed
Our CEO, CFO and General Counsel each hold degrees in their respective fields, and each have over 20 years of experience managing risks at Chegg and other companies, including risks arising from cybersecurity threats.

Item 2. Properties

Properties — owned and leased real estate

2 edited+0 added−0 removed0 unchanged
Biggest changeITEM 2. PROPERTIES Our corporate headquarters are located in Santa Clara, California and consist of approximately 45,000 square feet of space under a lease that expires in November 2028. We have additional offices in Oregon and New York in the United States and internationally in the United Kingdom, India, and Israel.
Biggest changeITEM 2. PROPERTIES Our corporate headquarters are located in Santa Clara, California and consist of approximately 45,000 square feet of space under a lease that expires in November 2028. We have additional offices in Oregon in the United States and internationally in the United Kingdom, India, and Spain. Our corporate office leases expire at varying times between 2025 and 2033.
Our corporate office leases expire at varying times between 2024 and 2028. We believe our facilities are adequate for our current needs and for the foreseeable future.
We believe our facilities are adequate for our current needs and for the foreseeable future.

Item 3. Legal Proceedings

Legal Proceedings — active lawsuits and investigations

1 edited+2 added−0 removed2 unchanged
Biggest changeFor further information on our legal proceedings, see Note 10, “Commitments and Contingencies,” of our accompanying Notes to Consolidated Financial Statements included in Part II, Item 8, “Consolidated Financial Statements and Supplementary Data” of this Annual Report on Form 10-K. ITEM 4. MINE SAFETY DISCLOSURES Not Applicable. 36 Table of Contents PART II
Biggest changeFor further information on our legal proceedings, see Note 10, “Commitments and Contingencies,” of our accompanying Notes to Consolidated Financial Statements included in Part II, Item 8, “Consolidated Financial Statements and Supplementary Data” of this Annual Report on Form 10-K. In addition, on February 24, 2025, we filed a complaint in the U.S.
Added
District Court for the District of Columbia against Google LLC and Alphabet Inc. ("Google"), asserting federal antitrust claims and common-law unjust enrichment claims, in connection with Google's expansion of its AIO search experience, and seeking damages, restitution, disgorgement, and injunctive relief.
Added
Given the nature of the case, including that the proceedings are in their early stages, we are unable to predict the ultimate outcome of the case or whether Google will seek to counter claim, or the likelihood of success should Google do so. ITEM 4. MINE SAFETY DISCLOSURES Not Applicable. 39 Table of Contents PART II

Item 5. Market for Registrant's Common Equity

Market for Common Equity — stock, dividends, buybacks

7 edited+1 added−3 removed1 unchanged
Biggest changeAs of December 31, 2023, we had $3.7 million remaining under the securities repurchase program, which has no expiration date and will continue until otherwise suspended, terminated or modified at any time for any reason by our board of directors.
Biggest changeAs of December 31, 2024, we had $207.5 million remaining under the securities repurchase program, which has no expiration date and will continue until otherwise suspended, terminated or modified at any time for any reason by our board of directors. 40 Table of Contents Stock Performance Graph This performance graph shall not be deemed “soliciting material” or to be “filed” with the SEC for purposes of Section 18 of the Exchange Act, or otherwise subject to the liabilities under that Section, and shall not be deemed to be incorporated by reference into any filing of Chegg under the Securities Act or the Exchange Act.
The graph assumes that $100 was invested at the market close on December 31, 2018, in the common stock of Chegg, Inc., the S&P 500 and the NASDAQ Composite and data for the S&P 500 and the NASDAQ Composite assumes reinvestment of dividends. The stock price performance of the following graph is not necessarily indicative of future stock price performance.
The graph assumes that $100 was invested at the market close on December 31, 2019, in the common stock of Chegg, Inc., the S&P 500 and the NASDAQ Composite and data for the S&P 500 and the NASDAQ Composite assumes reinvestment of dividends. The stock price performance of the following graph is not necessarily indicative of future stock price performance.
ITEM 5. MARKET FOR REGISTRANT’S COMMON EQUITY, RELATED STOCKHOLDER MATTERS AND ISSUER PURCHASES OF EQUITY SECURITIES Market Information Our common stock is listed on the New York Stock Exchange under the symbol “CHGG.” Stockholders of Record As of January 31, 2024 , there were 26 stockholders of record of our common stock.
ITEM 5. MARKET FOR REGISTRANT’S COMMON EQUITY, RELATED STOCKHOLDER MATTERS AND ISSUER PURCHASES OF EQUITY SECURITIES Market Information Our common stock is listed on the New York Stock Exchange under the symbol “CHGG.” Stockholders of Record As of January 31, 2025 , there were 25 stockholders of record of our common stock.
The timing, volume, and nature of the repurchases will be determined by management based on the capital needs of the business, market conditions, applicable legal requirements, and other factors.
The timing, volume, and nature of the repurchases will be determined by management based on the capital needs of the business, market conditions, applicable legal requirements, alternative investment opportunities, and other factors.
The following graph presents a comparison from December 31, 2018, through December 31, 2023, of the cumulative total return for our common stock, the Standard & Poor’s 500 Stock Index (S&P 500) and the NASDAQ Composite Index (NASDAQ Composite).
The following graph presents a comparison from December 31, 2019, through December 31, 2024, of the cumulative total return for our common stock, the Standard & Poor’s 500 Stock Index (S&P 500) and the NASDAQ Composite Index (NASDAQ Composite).
Securities Repurchase Program In August 2023, our Board of Directors approved a $200.0 million increase to our existing securities repurchase program authorizing the repurchase of up to $2.2 billion of our common stock and/or convertible notes, through open market purchases, block trades, and/or privately negotiated transactions or pursuant to Rule 10b5-1 plans, in compliance with applicable securities laws and other legal requirements.
Securities Repurchase Program In November 2024, our board of directors approved a $300.0 million increase to our existing securities repurchase program authorizing the repurchase of our common stock and/or convertible notes, through open market purchases, block trades, and/or privately negotiated transactions or pursuant to Rule 10b5-1 plans, in compliance with applicable securities laws and other legal requirements.
Securities Authorized for Issuance under Equity Compensation Plans See Part III, Item 12, “Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters” of this Annual Report on Form 10-K for more information regarding securities authorized for issuance. Unregistered Sales of Securities We had no unregistered sales of our securities during the three months ended December 31, 2023.
Securities Authorized for Issuance under Equity Compensation Plans See Part III, Item 12, “Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters” of this Annual Report on Form 10-K for more information regarding securities authorized for issuance.
Removed
Purchases of Securities by the Registrant and Affiliated Purchasers The following table presents the securities repurchase activity during the three months ended December 31, 2023 (in thousands, except average price paid per security and total number of securities repurchased): Period Total Number of Securities Repurchased Average Price Paid Per Security Total Number of Securities Purchased Pursuant to Publicly Announced Plan Total Dollar Amount Purchased Pursuant to Publicly Announced Plan Maximum Dollar Amount Remaining Available for Repurchase Pursuant to Publicly Announced Plan October 1 - October 31 — $ — — $ — $ 153,665 November 1 - November 30 (1) 13,498,313 — 13,498,313 150,000 3,665 December 1 - December 31 — — — — 3,665 (1) On November 14, 2023, in connection with our securities repurchase program, we entered into an accelerated share repurchase (ASR) agreement with a financial institution to repurchase $150.0 million of our outstanding common stock.
Added
Recent Sales of Unregistered Securities We had no unregistered sales of our securities during the three months ended December 31, 2024. Purchases of Equity Securities by the Registrant and Affiliated Purchasers We did not purchase any of our common stock during the three months ended December 31, 2024.
Removed
In exchange for an upfront payment of $150.0 million, we received an initial delivery of 13,498,313 shares of our common stock.
Removed
The average price paid per security is not applicable as final settlement did not occur during the three months ended December 31, 2023. 37 Table of Contents Stock Performance Graph This performance graph shall not be deemed “soliciting material” or to be “filed” with the SEC for purposes of Section 18 of the Exchange Act, or otherwise subject to the liabilities under that Section, and shall not be deemed to be incorporated by reference into any filing of Chegg under the Securities Act or the Exchange Act.

Item 7. Management's Discussion & Analysis

Management's Discussion & Analysis (MD&A) — revenue / margin commentary

63 edited+28 added−25 removed45 unchanged
Biggest change(Provision For) Benefit From Income Taxes (Provision for) benefit from income taxes consists primarily of federal and state income taxes in the United States. 41 Table of Contents Results of Operations The following table presents our historical consolidated statements of operations (in thousands, except percentage of total net revenues): Years Ended December 31, 2023 2022 Net revenues $ 716,295 100 % $ 766,897 100 % Cost of revenues (1) 225,941 32 197,396 26 Gross profit 490,354 68 569,501 74 Operating expenses: Research and development (1) 191,705 27 196,637 26 Sales and marketing (1) 126,591 18 147,660 19 General and administrative (1) 239,783 33 216,247 28 Total operating expenses 558,079 78 560,544 73 (Loss) income from operations (67,725) (10) 8,957 1 Total interest expense, net and other income (expense), net 118,037 17 94,989 13 Income before (provision for) benefit from income taxes 50,312 7 103,946 14 (Provision for) benefit from income taxes (32,132) (4) 162,692 21 Net income $ 18,180 3 % $ 266,638 35 % (1) Includes share-based compensation expense as follows: Cost of revenues $ 2,256 $ 2,484 Research and development 44,103 41,335 Sales and marketing 9,524 13,857 General and administrative 77,619 75,780 Total share-based compensation expense $ 133,502 $ 133,456 42 Table of Contents Years Ended December 31, 2023 and 2022 Net Revenues The following table presents our total net revenues for the periods shown for our Subscription Services and Skills and Other product lines (in thousands, except percentages): Years Ended December 31, Change in 2023 2023 2022 $ % Subscription Services $ 640,520 $ 671,968 $ (31,448) (5) % Skills and Other 75,775 94,929 (19,154) (20) Total net revenues $ 716,295 $ 766,897 $ (50,602) (7) Subscription Services revenues decreased by $31.4 million, or 5%, during the year ended December 31, 2023, compared to the same period in 2022.
Biggest changeResults of Operations The following table presents our historical consolidated statements of operations (in thousands, except percentage of total net revenues): Years Ended December 31, 2024 2023 Net revenues $ 617,574 100 % $ 716,295 100 % Cost of revenues (1) 180,927 29 225,941 32 Gross profit 436,647 71 490,354 68 Operating expenses: Research and development (1) 170,431 28 191,705 27 Sales and marketing (1) 108,329 18 126,591 18 General and administrative (1) 217,756 35 236,183 33 Impairment expense 677,239 n/m 3,600 — Total operating expenses 1,173,755 n/m 558,079 78 Loss from operations (737,108) n/m (67,725) (10) Total interest expense, net and other income, net 48,742 9 118,037 17 (Loss) income before provision for income taxes (688,366) n/m 50,312 7 Provision for income taxes (148,702) n/m (32,132) (4) Net (loss) income $ (837,068) n/m $ 18,180 3 % (1) Includes share-based compensation expense and restructuring charges as follows: Share-based compensation expense: Cost of revenues $ 1,786 $ 2,256 Research and development 28,044 44,103 Sales and marketing 7,466 9,524 General and administrative 47,318 77,619 Total share-based compensation expense $ 84,614 $ 133,502 Restructuring charges: Cost of revenues $ 762 $ 12 Research and development 11,387 1,692 Sales and marketing 2,630 1,228 General and administrative 9,824 2,772 Total restructuring charges $ 24,603 $ 5,704 _______________________________________ *n/m - not meaningful 45 Table of Contents Years Ended December 31, 2024 and 2023 Net Revenues The following table presents our total net revenues for the periods shown for our Subscription Services and Skills and Other product lines (in thousands, except percentages): Years Ended December 31, Change in 2024 2024 2023 $ % Subscription Services $ 549,211 $ 640,520 $ (91,309) (14) % Skills and Other 68,363 75,775 (7,412) (10) Total net revenues $ 617,574 $ 716,295 $ (98,721) (14) Subscription Services revenues decreased by $91.3 million, or 14%, during the year ended December 31, 2024, compared to the same period in 2023.
Research and Development Our research and development expenses consist of employee-related expenses, which includes salaries, benefits, and share-based compensation expense for employees on our product, engineering, and technical teams who are responsible for maintaining our website, developing new products, and improving existing products. Research and development costs also include technology costs to support our research and development, and outside services.
Research and Development Research and development expenses consist of employee-related expenses, which includes salaries, benefits, and share-based compensation expense for employees on our product, engineering, and technical teams who are responsible for maintaining our website, developing new products, and improving existing products. Research and development expenses also include technology costs to support our research and development, and outside services.
We incur employee-related expenses, which includes salaries, benefits and share-based compensation expenses for our employees engaged in marketing, business development and sales and sales support functions, and amortization of acquired intangible assets.
We incur employee-related expenses, which includes salaries, benefits and share-based compensation expenses for our employees engaged in marketing, business development and sales, sales support functions, and amortization of acquired intangible assets.
We intend to continue making significant investments in developing new products and services and enhancing the functionality of existing products and services. Sales and Marketing Our sales and marketing expenses consist of user and advertiser-facing marketing and promotional expenditures through a number of targeted online marketing channels, sponsored search, display advertising, social media campaigns, and other initiatives.
We intend to continue making significant investments in developing new products and services and enhancing the functionality of existing products and services. Sales and Marketing Sales and marketing expenses consist of user and advertiser-facing marketing and promotional expenditures through a number of targeted online marketing channels, sponsored search, display advertising, social media campaigns, and other initiatives.
We have omitted discussion of the earliest of the three years of financial condition and results of operations and this information can be found in Part I, Item 7, “Management's Discussion and Analysis of Financial Condition and Results of Operations” of our Annual Report on Form 10-K for the fiscal year ended December 31, 2022, filed with the SEC on February 21, 2023, which is available free of charge on the SEC's website at sec.gov and on our website at investor.chegg.com.
We have omitted discussion of the earliest of the three years of financial condition and results of operations and this information can be found in Part I, Item 7, “Management's Discussion and Analysis of Financial Condition and Results of Operations” of our Annual Report on Form 10-K for the fiscal year ended December 31, 2023, filed with the SEC on February 20, 2024, which is available free of charge on the SEC's website at sec.gov and on our website at investor.chegg.com.
Our Chegg Math subscription service, including Mathway, helps students understand math by providing a step-by-step math solver and calculator. We also offer our Chegg Study Pack as a premium subscription bundle of our Chegg Study, Chegg Writing, and Chegg Math services.
Our Chegg Math subscription service helps students understand math by providing a step-by-step math solver and calculator. We also offer our Chegg Study Pack as a premium subscription bundle of our Chegg Study, Chegg Writing, and Chegg Math services.
There are significant judgments involved in determining whether we control the specified goods or services prior to transferring them to the customer including whether we have the ability to direct the use of the good or service and obtain substantially all of the remaining benefits from the good or service.
There are significant judgments involved in determining whether we control the specified goods or 50 Table of Contents services prior to transferring them to the customer including whether we have the ability to direct the use of the good or service and obtain substantially all of the remaining benefits from the good or service.
We expense substantially all of our research and development expenses as they are incurred. Our research and development expenses continue to support new products and services as well as expand our infrastructure capabilities to support back-end processes associated with our 40 Table of Contents revenue transactions and internal systems.
We expense substantially all of our research and development expenses as they are incurred. Our research and development expenses continue to support new products and services as well as expand our infrastructure capabilities to support back-end processes associated with our revenue transactions and internal systems.
Quarterly changes in the estimated forfeiture rate can have a significant impact on our share-based compensation expense as the cumulative effect of adjusting the rate is 48 Table of Contents recognized in the period the forfeiture estimate is changed.
Quarterly changes in the estimated forfeiture rate can have a significant impact on our share-based compensation expense as the cumulative effect of adjusting the rate is recognized in the period the forfeiture estimate is changed.
Our future capital requirements will depend on many factors, including our rate of revenue growth, our investments in research and development activities, our 45 Table of Contents acquisition of new products and services and our sales and marketing activities.
Our future capital requirements will depend on many factors, including our rate of revenue growth, our investments in research and development activities, our acquisition of new products and services and our sales and marketing activities.
Subsequent changes to these considerations may have a material impact on the amount of share-based compensation expense recognized in the period related to PSU awards, which may lead to volatility of share-based compensation expense period-to-period.
Subsequent changes to these considerations may have a material impact on the amount of share-based compensation expense recognized in the period, which may lead to volatility of share-based compensation expense period-to-period.
The substantial majority of our net revenues are from e-commerce transactions with students, which are settled immediately through payment processors, as opposed to our accounts payable, which are settled based on contractual payment terms with our suppliers.
The substantial majority of our net revenues are from e-commerce transactions with students, which are settled within a few days through payment processors, as opposed to our accounts payable, which are settled based on contractual payment terms with our suppliers.
Students typically pay to access Subscription Services on a monthly basis. Our Chegg Study subscription service provides access to personalized, step-by-step learning support powered by AI, computational engines, and subject matter experts. When students need writing help, including plagiarism detection scans and creating citations for their papers, they can use our Chegg Writing subscription service.
Our Chegg Study subscription service provides access to personalized, step-by-step learning support powered by AI, computational engines, and subject matter experts. When students need writing help, including plagiarism detection scans and creating citations for their papers, they can use our Chegg Writing subscription service.
See Note 6, “Property and Equipment, Net” of our accompanying Notes to Consolidated Financial Statements included in Part I, Item 8, “Consolidated Financial Statements and Supplementary Data” of this Annual Report on Form 10-K for additional information.
See Note 10, “Commitments and Contingencies” of our accompanying Notes to Consolidated Financial Statements included in Part I, Item 8, “Consolidated Financial Statements and Supplementary Data” of this Annual Report on Form 10-K for additional information.
General and Administrative Our general and administrative expenses consist of employee-related expenses, which includes salaries, benefits and share-based compensation expense for certain executives as well as our finance, legal, human resources and other administrative employees. In addition, general and administrative expenses include outside services, legal and accounting services, and depreciation expense.
General and Administrative General and administrative expenses consist of employee-related expenses, which includes salaries, benefits and share-based compensation expense for certain executives as well as our finance, legal, human resources and other administrative employees.
We work with leading brands and programmatic partners to deliver advertising across our platforms. We also provide a platform for students to rent or buy print textbooks and eTextbooks, which helps students save money compared to the cost of buying new.
Our Chegg Skills learning platform offers professional courses focused on the latest technology skills. We work with leading brands and programmatic partners to deliver advertising across our platforms. We also provide a platform for students to rent or buy print textbooks and eTextbooks, which helps students save money compared to the cost of buying new.
This estimated amount of variable consideration requires management to make a judgment based on the forecasted amount of consideration that we expect we will earn as well as the time period in which we can reasonably rely on the accuracy of the forecast.
In determining this estimate, we consider the single most likely amount in a range of possible amounts. This estimated amount of variable consideration requires management to make a judgment based on the forecasted amount of consideration that we expect we will earn as well as the time period in which we can reasonably rely on the accuracy of the forecast.
As of December 31, 2023, our principal sources of liquidity were cash, cash equivalents, and investments totaling $579.6 million, which were held for working capital purposes.
As of December 31, 2024, our principal sources of liquidity were cash, cash equivalents, and investments totaling $528.4 million, which were held for working capital purposes.
As of December 31, 2023, we have incurred cumulative losses of $52.4 million from our operations and we may incur additional losses in the future. Most of our cash, cash equivalents, and investments are held in the United States. As of December 31, 2023, our foreign subsidiaries held an insignificant amount of cash in foreign jurisdictions.
As of December 31, 2024, we have incurred cumulative losses of $889.4 million from our operations and we may incur additional losses in the future. Most of our cash, cash equivalents, and investments are held in the United States.
See Note 6, “Property and Equipment, Net” of our accompanying Notes to Consolidated Financial Statements included in Part I, Item 8, “Consolidated Financial Statements and Supplementary Data” of this Annual Report on Form 10-K for additional information.
See Part I, Item 1A, “Risk Factors”, Note 6, “Property and Equipment, Net”, and Note 15, “Restructuring Charges” of our accompanying Notes to Consolidated Financial Statements included in Part II, Item 8, “Financial Statements” of this Annual Report on Form 10-K for additional information.
Interest Expense, Net and Other Income (Expense), Net Interest expense, net consists primarily of interest expense on the amortization of debt issuance costs related to the convertible senior notes.
Interest Expense, Net and Other Income, Net Interest expense, net consists primarily of interest expense on the amortization of debt issuance costs related to the convertible senior notes. Other income, net consists primarily of interest income, gains on early extinguishment of the convertible senior notes, and realized gains/losses on the sale of our investments.
The decrease was primarily due to a 6% decrease in subscribers who have paid to access our services. Subscription Services revenues represented 89% and 88% of net revenues during the years ended December 31, 2023 and 2022, respectively.
The decrease was primarily due to a 14% decrease in subscribers who have paid to access our services. Subscription Services revenues as a percentage of net revenues were 89% during each of the years ended December 31, 2024 and 2023.
For these arrangements that contain multiple performance obligations, we allocate the transaction price based on the relative standalone selling price (SSP) method by comparing the SSP of each distinct 47 Table of Contents performance obligation to the total value of the contract.
For these arrangements that contain multiple performance obligations, we allocate the transaction price based on the relative standalone selling price (SSP) method by comparing the SSP of each distinct performance obligation to the total value of the contract. We determine the SSP based on our historical pricing and discounting practices for the distinct performance obligation when sold separately.
Skills and Other revenues were 11% and 12% of net revenues during the years ended December 31, 2023 and 2022, respectively. Seasonality of Our Business Revenues from Subscription Services are primarily recognized ratably over the subscription term, which has generally resulted in our highest revenues and profitability in the fourth quarter as it reflects more days of the academic year.
Seasonality of Our Business Revenues from Subscription Services are primarily recognized ratably over the subscription term, which has generally resulted in our highest revenues and profitability in the fourth quarter as it reflects more days of the academic year.
Impairment of Acquired Intangible Assets and Other Long-Lived Assets We assess the impairment of acquired intangible assets and other long-lived assets at least annually and whenever events or changes in circumstances indicate that the carrying amount of such assets may not be recoverable.
Impairment of Intangible Assets and Long-Lived Assets Intangible assets and long-lived assets are tested for impairment, at the asset group level, at least annually or whenever events or changes in circumstances indicate that the carrying amount may not be recoverable.
Sales and marketing expenses as a percentage of net revenues were 18% during the year ended December 31, 2023 compared to 19% of net revenues during the same period in 2022. General and Administrative General and administrative expenses in the year ended December 31, 2023 increased by $23.5 million, or 11%, compared to the same period in 2022.
Sales and marketing expenses as a percentage of net revenues were 18% during each of the years ended December 31, 2024 and 2023. General and Administrative General and administrative expenses decreased $18.4 million, or 8%, during the year ended December 31, 2024 compared to the same period in 2023.
Subscribers to Busuu have access to a premium learning language platform that offers comprehensive support through self-paced lessons, live classes with expert tutors and a huge community of members to practice alongside.
Subscribers to Busuu have access to a premium language learning platform that offers comprehensive support through self-paced lessons, live classes with expert tutors and a huge community of members to practice alongside. Skills and Other Our Skills and Other product line includes revenues from Chegg Skills, advertising services, print textbooks and eTextbooks.
Convertible senior notes, net decreased $588.8 million primarily due to early extinguishments. The 2026 notes and 2025 notes mature on September 1, 2026 and March 15, 2025, respectively, unless converted, redeemed, or repurchased in accordance with their terms prior to such dates.
Convertible senior notes, net decreased $113.9 million, or 19%, during the year ended December 31, 2024 primarily due to the early extinguishment of a portion of the 2026 notes. The 2026 notes and 2025 notes mature on September 1, 2026 and March 15, 2025, respectively, unless converted, redeemed, or repurchased in accordance with their terms prior to such dates.
Recent Accounting Pronouncements For relevant recent accounting pronouncements, see Note 2, “Significant Accounting Policies”, of our accompanying Notes to Consolidated Financial Statements included in Part II, Item 8, “Consolidated Financial Statements and Supplementary Data” of this Annual Report on Form 10-K. 49 Table of Contents
As a result, significant changes to these estimates may result in an increase or decrease to our tax provision in a subsequent period. 52 Table of Contents Recent Accounting Pronouncements For relevant recent accounting pronouncements, see Note 2, “Significant Accounting Policies”, of our accompanying Notes to Consolidated Financial Statements included in Part II, Item 8, “Consolidated Financial Statements and Supplementary Data” of this Annual Report on Form 10-K.
Performing a quantitative impairment test includes the determination of fair value and involves significant estimates and assumptions including, among others, forecasted revenue growth rates, operating margins and capital expenditures, and discount rates used to calculate projected future cash flows, as well as the determination of appropriate market comparable companies, metrics and multiples.
Performing a quantitative impairment test includes the determination of fair value and involves significant estimates and assumptions including, among others, forecasted revenue growth rates, operating margins and capital expenditures, and discount rates used to calculate projected future cash flows. If the carrying value exceeds the fair value, an impairment loss is recognized in an amount equal to the excess.
Share-based Compensation Expense We measure and recognize share-based compensation expense for all awards made to employees, directors and consultants, including restricted stock units (RSUs), performance-based RSUs (PSUs) with either a market-based condition or financial and strategic performance target and our employee stock purchase plan (ESPP) based on estimated fair values.
If estimates or related assumptions change, this could have a significant impact on either the fair value of our reporting unit, the amount of any goodwill impairment, or both. 51 Table of Contents Share-based Compensation Expense We measure and recognize share-based compensation expense for all awards made to employees, directors and consultants, including restricted stock units (RSUs), performance-based RSUs (PSUs) with either a market-based condition or financial and strategic performance target and our employee stock purchase plan (ESPP) based on estimated fair values.
Revenues from Chegg Skills are recognized over the delivery period, adjusted for an estimate of non-redemption. Revenues from advertising services are recognized upon fulfillment. Revenues from print textbooks and eTextbooks are recognized immediately. Cost of Revenues Our cost of revenues consists primarily of expenses associated with the delivery and distribution of our products and services.
Revenues from Chegg Study Pack, Chegg Study, Chegg Writing, Chegg Math, and Busuu are primarily recognized ratably over the monthly subscription period. Revenues from Chegg Skills are recognized over the delivery period, adjusted for an estimate of non-redemption. Revenues from advertising services are recognized upon fulfillment. Revenues from print textbooks and eTextbooks are recognized immediately.
Factors that we consider in determining when to perform an impairment review include significant negative industry or economic trends or significant changes or planned changes in the use of the assets. When measuring the recoverability of these assets, we will make assumptions regarding our estimated future cash flows expected to be generated by the assets.
Factors that we consider include the recognition of goodwill impairment charges or planned changes in the use of the asset group. When measuring the recoverability, we make assumptions regarding our estimated future undiscounted cash flows expected to be generated by the asset group.
As a result of these factors, the most concentrated periods for our revenues and expenses do not necessarily coincide, and comparisons of our historical quarterly results of operations on a sequential basis may not provide meaningful insight into our overall financial performance.
As a result of these factors, the most concentrated periods for our revenues and expenses do not necessarily coincide, and comparisons of our historical quarterly results of operations on a sequential basis may not provide meaningful insight into our overall financial performance. 43 Table of Contents Components of Results of Operations Net Revenues We recognize revenues net of allowances for refunds or charge backs from our payment processors who process payments from credit cards, debit cards, and PayPal.
Net cash used in financing activities increased $108.0 million, or 14%, during the year ended December 31, 2023, compared to the same period in 2022 and was primarily related to higher repurchases of our convertible senior notes of $104.8 million.
Net cash used in financing activities decreased $743.6 million, or 87%, during the year ended December 31, 2024, compared to the same period in 2023 and was primarily related to lower repurchases of our convertible senior notes of $409.5 million and lower repurchases of our common stock of $332.2 million.
Skills and Other revenues represented 11% and 12% of net revenues during the years ended December 31, 2023 and 2022, respectively.
Skills and Other revenues as a percentage of net revenues were 11% during each of the years ended December 31, 2024 and 2023.
The decrease was primarily attributable to lower employee-related expenses, including share-based compensation expense, of $2.1 million, and lower contractor spend of $1.5 million, partially offset by restructuring charges of $1.7 million.
The decrease was due to lower employee-related expenses of $38.6 million, which is primarily due to share-based compensation expense, partially offset by higher restructuring charges of $7.1 million, impairment of lease related assets of $5.6 million, and a higher loss contingency of $5.0 million.
Interest Expense, Net and Other Income (Expense), Net The following table presents our interest expense, net, and other income (expense), net, for the periods shown (in thousands, except percentages): Years Ended December 31, Change in 2023 2023 2022 $ % Interest expense, net $ (3,773) $ (6,040) $ 2,267 (38) % Other income (expense), net 121,810 101,029 20,781 21 % Total interest expense, net and other income (expense), net $ 118,037 $ 94,989 $ 23,048 24 % 44 Table of Contents Interest expense, net decreased by $2.3 million, or 38%, during the year ended December 31, 2023, compared to the same period in 2022.
Interest Expense, Net and Other Income, Net The following table presents our interest expense, net, and other income, net, for the periods shown (in thousands, except percentages): Years Ended December 31, Change in 2024 2024 2023 $ % Interest expense, net $ (2,590) $ (3,773) $ 1,183 (31) % Other income, net 51,332 121,810 (70,478) (58) Total interest expense, net and other income, net $ 48,742 $ 118,037 $ (69,295) (59) Interest expense, net decreased by $1.2 million, or 31%, during the year ended December 31, 2024, compared to the same period in 2023.
Cost of Revenues The following table presents our cost of revenues for the periods shown (in thousands, except percentages): Years Ended December 31, Change in 2023 2023 2022 $ % Cost of revenues (1) $ 225,941 $ 197,396 $ 28,545 14 % (1) Includes share-based compensation expense of: $ 2,256 $ 2,484 $ (228) (9) % Cost of revenues increased $28.5 million, or 14%, during the year ended December 31, 2023, compared to the same period in 2022.
Cost of Revenues The following table presents our cost of revenues for the periods shown (in thousands, except percentages): Years Ended December 31, Change in 2024 2024 2023 $ % Cost of revenues (1) $ 180,927 $ 225,941 $ (45,014) (20) % (1) Includes share-based compensation expense of: $ 1,786 $ 2,256 $ (470) (21) % (1) Includes restructuring charges of: $ 762 $ 12 $ 750 n/m _______________________________________ *n/m - not meaningful Cost of revenues decreased $45.0 million, or 20%, during the year ended December 31, 2024, compared to the same period in 2023.
The decrease was primarily attributable to lower paid marketing expenses of $9.8 million, primarily due to Busuu, lower employee-related expenses, including share-based compensation expense, of $5.7 million, and lower other depreciation and amortization expense of $1.2 million, partially offset by restructuring charges of $1.2 million.
The decrease was primarily attributable to lower depreciation and amortization expense of $12.0 million, which is primarily due to previously recognized impairment charges, lower employee-related expenses $4.3 million, which is primarily due to share-based compensation expense, and lower paid marketing expenses of $1.7 million.
Research and development expenses as a percentage of net revenues were 27% during the year ended December 31, 2023 compared to 26% of net revenues during the same period in 2022. Sales and Marketing Sales and marketing expenses during the year ended December 31, 2023 decreased by $21.1 million, or 14%, compared to the same period in 2022.
Sales and Marketing Sales and marketing expenses decreased by $18.3 million, or 14%, during the year ended December 31, 2024, compared to the same period in 2023.
Skills and Other revenues decreased by $19.2 million, or 20%, during the year ended December 31, 2023 compared to the same period in 2022.
Skills and Other revenues decreased by $7.4 million, or 10%, during the year ended December 31, 2024 compared to the same period in 2023. The decrease was primarily due to lower revenues in Chegg Skills related to fewer enrollments.
Factors that could cause or contribute to these differences include those discussed below and elsewhere in this Annual Report on Form 10-K, particularly in Part I, Item 1A, “Risk Factors.” Overview Millions of people all around the world learn with Chegg. No matter the goal, level, or style, Chegg helps learners learn with confidence.
Factors that could cause or contribute to these differences include those discussed below and elsewhere in this Annual Report on Form 10-K, particularly in Part I, Item 1A, “Risk Factors.” Overview Chegg provides individualized learning support to students as they pursue their educational journeys.
As a result of the Tax Cuts and Jobs Act, we anticipate the U.S. federal impact for the remaining foreign jurisdictions to be minimal if these funds are repatriated. In addition, based on our current and future needs, we believe our current funding and capital resources for our international operations are adequate.
As of December 31, 2024, the net cumulative tax expense related to future distributions amounts to $1.7 million. As a result of the Tax Cuts and Jobs Act, we anticipate the U.S. federal impact for the remaining foreign jurisdictions to be minimal if these funds are repatriated.
The timing of such payment is uncertain and we are unable to reliably estimate the timing and therefore have not included in the above table.
As of December 31, 2024, we've recognized an estimated loss contingency accrual of $7.0 million related to one of our legal proceedings. The timing of such payment is uncertain and we are unable to reliably estimate the timing and therefore have not included in the above table.
General and administrative expenses as a percentage of net revenues were 33% during the year ended December 31, 2023 compared to 28% during the same period in 2022.
General and administrative expenses as a percentage of net revenues were 35% during the year ended December 31, 2024 compared to 33% during the same period in 2023. 47 Table of Contents Impairment Expense Impairment expense was $677.2 million during the year ended December 31, 2024, consisting of impairments of goodwill, intangible assets, and other related property and equipment.
We estimate the amount of variable consideration that we will earn at the inception of the contract, adjusted during each period, and include an estimated amount each period. In determining this estimate, we consider the single most likely amount in a range of possible amounts.
This variable consideration can either increase or decrease the total transaction price depending on the nature of the variable consideration. We estimate the amount of variable consideration that we will earn at the inception of the contract, adjusted during each period, and include an estimated amount each period.
See Note 8, “Convertible Senior Notes” and Note 13, “Stockholders' Equity” of our accompanying Notes to Consolidated Financial Statements included in Part I, Item 8, “Consolidated Financial Statements and Supplementary Data” of this Annual Report on Form 10-K for additional information on our repurchases.
See Note 6, “Property and Equipment, Net” and Note 7, “Goodwill and Intangible Assets” of our accompanying Notes to Consolidated Financial Statements included in Part II, Item 1, “Financial Statements” of this Annual Report on Form 10-K for additional information.
Cash, cash equivalents, and investments decreased $694.3 million during the year ended December 31, 2023 primarily due to the early extinguishments of our convertible senior notes of $506.0 million, repurchase of shares of our common stock of $334.8 million and purchases of property and equipment of $83.1 million, partially offset by the net cash provided by operating activities of $246.2 million.
Cash, cash equivalents, and investments decreased $51.2 million, or 9%, during the year ended December 31, 2024 primarily due to the early extinguishment of a portion of the 2026 notes of $96.5 million and purchases of property and equipment of $75.0 million, partially offset by the net cash provided by operating activities of $125.2 million.
In addition, we are also subject to certain legal proceedings and claims in the ordinary course of business and record a liability when we believe that a loss is probable and reasonably estimable and during the year ended December 31, 2023, we recognized an estimated loss contingency accrual of $7.0 million related to one of our legal proceedings.
(3) Our corporate offices are leased under operating leases, which expire at various dates through 2033. In addition, we are also subject to certain legal proceedings and claims in the ordinary course of business and record a liability when we believe that a loss is probable and reasonably estimable.
Our convertible senior notes are recorded on our consolidated balance sheets at the carrying amount. As of December 31, 2023, the carrying amount of the 2026 notes and 2025 notes was $242.8 million and $357.1 million, respectively.
Our convertible senior notes are recorded on our consolidated balance sheets at their carrying amounts. As of December 31, 2024, the carrying amount of the 2026 notes and 2025 notes was $127.3 million and $358.6 million, respectively. 49 Table of Contents (2) Represents contractual obligations primarily related to information technology services.
Net cash provided by investing activities increased $163.8 million, or 156%, during the year ended December 31, 2023, compared to the same period in 2022 and was primarily related to the absence of acquisitions of $401.1 million, which was partially offset by lower cash from investment maturities of $287.7 million.
Net cash provided by investing activities decreased $257.3 million, or 96%, during the year ended December 31, 2024, compared to the same period in 2023 and was primarily driven by lower cash from investment maturities of $425.5 million and lower cash proceeds from the sale of investments of $324.5 million partially offset by an increase in cash used for the purchases of investments of $467.0 million.
Our operating expenses also contain information technology expenses such as technology costs to support our research and development, sales and marketing expenses, depreciation expenses, amortization of acquired intangible assets, and outside services. We allocate certain costs to each expense category, primarily based on the headcount in each group at the end of a period.
We allocate certain costs to each expense category, primarily based on the headcount in each group at the end of a period. As our business grows, our operating expenses may increase over time to expand capacity and sustain our workforce.
We continue to invest in the expansion of our offerings and technology platform to provide a more compelling and personalized solution and deepen engagement with students. As AI technologies continue to advance, we are taking advantage of the increased opportunities by leveraging new tools to better serve our students.
We continue to invest in the expansion of our offerings and technology platform to provide a more compelling and personalized solution and deepen engagement with students. We continue to integrate artificial intelligence into our platform, and it is now conversational, more instructional, and interactive.
The decrease was primarily due to partial early extinguishments of our convertible senior notes. Other income (expense), net increased by $20.8 million, or 21%, during the year ended December 31, 2023, compared to the same period in 2022.
Other income, net decreased $70.5 million, or 58%, during the year ended December 31, 2024 compared to the same period in 2023, primarily due to a decrease in gain on early extinguishment of a portion of convertible senior notes of $66.4 million and a decrease in interest income of $9.4 million partially offset by the gain on the sale of equity investment of $3.8 million.
Goodwill and Indefinite Lived Intangible Asset Goodwill and our indefinite lived intangible asset are tested for impairment at least annually or whenever events or changes in circumstances indicate that their carrying values may not be recoverable. We first assess qualitative factors to determine whether it is necessary to perform a quantitative impairment test.
If our estimates or related assumptions are inaccurate, our conclusion on whether these assets are recoverable or impaired could be incorrect, which could whether we recognize an impairment in a given period. Goodwill Goodwill is tested for impairment at least annually or whenever events or changes in circumstances indicate that their carrying values may not be recoverable.
The following table presents our contractual obligations and other commitments as of December 31, 2023 (in thousands): Total Next 12 Months Beyond 12 Months Convertible senior notes (1) $ 604,066 $ 449 $ 603,617 Purchase obligations (2) 44,812 33,837 10,975 Operating lease obligations (3) 28,006 8,084 19,922 Total contractual obligations $ 676,884 $ 42,370 $ 634,514 _____________________________________________________ (1) Consists of the remaining principal amount due upon maturity and semi-annual cash interest payments.
The following table presents our contractual obligations and other commitments as of December 31, 2024 (in thousands): Total Next 12 Months Beyond 12 Months Convertible senior notes (1) $ 487,044 $ 359,138 $ 127,906 Purchase obligations (2) 172,827 61,170 111,657 Operating lease obligations (3) 29,165 6,822 22,343 Total contractual obligations $ 689,036 $ 427,130 $ 261,906 _____________________________________________________ (1) Consists of the remaining principal amount due upon maturity and cash interest payments.
(Provision for) benefit from income taxes The following table presents our (provision for) benefit from income taxes for the periods shown (in thousands, except percentages): Years Ended December 31, Change in 2023 2023 2022 $ % (Provision for) benefit from income taxes $ (32,132) $ 162,692 $ (194,824) n/m _______________________________________ *n/m - not meaningful The change in (provision for) benefit from income taxes was primarily due to the absence of a valuation allowance benefit as a result of releasing our valuation allowance against a substantial amount of our U.S. deferred tax assets in 2022 and the current year provision for income taxes.
Provision for income taxes The following table presents our provision for income taxes for the periods shown (in thousands, except percentages): Years Ended December 31, Change in 2024 2024 2023 $ % Provision for income taxes $ (148,702) $ (32,132) $ (116,570) n/m _______________________________________ *n/m - not meaningful The $116.6 million change in provision for income taxes during the year ended December 31, 2024 compared to the same period in 2023, was primarily due to the establishment of a valuation allowance against our U.S. federal and state deferred tax assets. 48 Table of Contents Liquidity and Capital Resources The following table presents our cash, cash equivalents and investments and convertible senior notes as of the periods shown (in thousands, except percentages): As of December 31, Change in 2024 2024 2023 $ % Cash, cash equivalents, investments $ 528,374 $ 579,561 $ (51,187) (9) % Convertible senior notes, net (1) 485,949 599,837 (113,888) (19) _____________________________________________________ (1) Consists of the current and long-term portion of convertible senior notes, net.
Some of our customer arrangements may include an amount of variable consideration in addition to a fixed revenue share that we earn. This variable consideration can either increase or decrease the total transaction price depending on the nature of the variable consideration.
If the SSP is not directly observable, we estimate the SSP by considering information such as market conditions, and information about the customer. Some of our customer arrangements may include an amount of variable consideration in addition to a fixed revenue share that we earn.
Our platform also helps learners build essential life and job skills to accelerate their path from learning to earning, and we work with companies to offer learning programs for their employees. Our long-term strategy is centered upon our ability to utilize Subscription Services to increase student engagement with our learning platform.
No matter the goal, level, or style, Chegg helps millions of students around the world learn with confidence by helping them build essential academic, life, and job skills to achieve success. Our long-term strategy is centered upon our ability to utilize our Subscription Services to increase student engagement with our learning platform.
Our ability to achieve these long-term objectives is subject to numerous risks and uncertainties, which are described in greater detail in Part I, Item 1A, “Risk Factors.” During the years ended December 31, 2023, and 2022, we generated net revenues of $716.3 million and $766.9 million, respectively, and in the same periods had net income of $18.2 million and $266.6 million, respectively.
During the years ended December 31, 2024, and 2023, we generated net revenues of $617.6 million and $716.3 million, respectively, and in the same periods had a net loss of $837.1 million and a net income of $18.2 million.
See Note 10, “Commitments and Contingencies” of our accompanying Notes to Consolidated Financial Statements included in Part I, Item 8, “Consolidated Financial Statements and Supplementary Data” of this Annual Report on Form 10-K for additional information on our legal proceedings. 46 Table of Contents The following table presents our consolidated statements of cash flows data (in thousands, except percentages): Years Ended December 31, Change in 2023 2023 2022 $ % Consolidated Statements of Cash Flows Data: Net cash provided by operating activities $ 246,198 $ 255,736 $ (9,538) (4) % Net cash provided by investing activities 268,673 104,891 163,782 156 Net cash used in financing activities (852,770) (744,803) (107,967) 14 Net cash provided by operating activities decreased $9.5 million, or 4%, during the year ended December 31, 2023, compared to the same period in 2022 and was primarily driven by lower billings.
The following table presents our consolidated statements of cash flows data for the periods shown (in thousands, except percentages): Years Ended December 31, Change in 2024 2024 2023 $ % Net cash provided by operating activities $ 125,205 $ 246,198 $ (120,993) (49) % Net cash provided by investing activities 11,345 268,673 (257,328) (96) Net cash used in financing activities (109,142) (852,770) 743,628 (87) Net cash provided by operating activities decreased $121.0 million, or 49%, during the year ended December 31, 2024, compared to the same period in 2023 and was primarily driven by lower bookings as well as timing of bill payments.
Gross margins decreased to 68% during the year ended December 31, 2023, from 74% during the same period in 2022. 43 Table of Contents Operating Expenses The following table presents our total operating expenses for the periods shown (in thousands, except percentages): Years Ended December 31, Change in 2023 2023 2022 $ % Research and development (1) $ 191,705 $ 196,637 $ (4,932) (3) % Sales and marketing (1) 126,591 147,660 (21,069) (14) General and administrative (1) 239,783 216,247 23,536 11 Total operating expenses $ 558,079 $ 560,544 $ (2,465) 0 (1) Includes share-based compensation expense of: Research and development $ 44,103 $ 41,335 $ 2,768 7 % Sales and marketing 9,524 13,857 (4,333) (31) General and administrative 77,619 75,780 1,839 2 Share-based compensation expense $ 131,246 $ 130,972 $ 274 0 Research and Development Research and development expenses during the year ended December 31, 2023 decreased by $4.9 million, or 3%, compared to the same period in 2022.
See Note 6, “Property and Equipment, Net” of our accompanying Notes to Consolidated Financial Statements included in Part II, Item 8, “Financial Statements” of this Annual Report on Form 10-K for additional information on the content and related assets charge. 46 Table of Contents Operating Expenses The following table presents our total operating expenses for the periods shown (in thousands, except percentages): Years Ended December 31, Change in 2024 2024 2023 $ % Research and development (1) $ 170,431 $ 191,705 $ (21,274) (11) % Sales and marketing (1) 108,329 126,591 (18,262) (14) General and administrative (1) 217,756 236,183 (18,427) (8) Impairment expense 677,239 3,600 673,639 n/m Total operating expenses $ 1,173,755 $ 558,079 $ 615,676 n/m (1) Includes share-based compensation expense of: Research and development $ 28,044 $ 44,103 $ (16,059) (36) % Sales and marketing 7,466 9,524 (2,058) (22) General and administrative 47,318 77,619 (30,301) (39) Total share-based compensation expense $ 82,828 $ 131,246 $ (48,418) (37) (1) Includes restructuring charges of: Research and development $ 11,387 $ 1,692 $ 9,695 n/m Sales and marketing 2,630 1,228 1,402 n/m General and administrative 9,824 2,772 7,052 n/m Total restructuring charges $ 23,841 $ 5,692 $ 18,149 n/m _______________________________________ *n/m - not meaningful Research and Development Research and development expenses decreased $21.3 million, or 11%, during the year ended December 31, 2024 compared to the same period in 2023.
Removed
We provide 24/7 on-demand support, and our personalized learning assistant leverages the power of artificial intelligence (“AI”), more than a hundred million pieces of proprietary content, as well as a decade of learning insights.
Added
Available on demand 24/7 and powered by over a decade of learning insights, the Chegg platform offers students artificial intelligence (“AI”)-powered academic support thoughtfully designed for education coupled with access to a vast network of subject matter experts who help ensure quality and accuracy.
Removed
We realigned our investments and resources around AI early in 2023, and have redesigned our user experience, developed our own large language models, launched automated answering and built proprietary algorithms to optimize the quality and accuracy of our content to build our personalized learning assistant.
Added
We remain focused on providing a holistic and differentiated product offering that supports the whole student with 360 degrees of individualized academic and functional support, including the delivery of high-quality and accurate content. We believe the investments we are making will allow us to return to revenue growth over time.
Removed
We remain focused on rolling out the next phase of our personalized learning assistant, including integrating pathways for students with assessments and other tools. We believe the investments we have made will allow us to maintain strong operating margins and cash flows and enable us to return to revenue growth over time.
Added
Our ability to achieve these long-term objectives is subject to numerous risks and uncertainties, which are described in greater detail below and in Part II, Item 1A, “Risk Factors.” Exploration of Strategic Alternatives On February 24, 2025, we announced that we are undertaking a strategic review process and exploring a range of alternatives to maximize shareholder value, including being acquired, undertaking a go-private transaction, or remaining as a standalone public company.
Removed
Subscription Services revenues were 89% and 88% of net revenues during the years ended December 31, 2023 and 2022, respectively. 39 Table of Contents Skills and Other Our Skills and Other product line includes revenues from Skills, advertising services, print textbooks and eTextbooks. Our skills-based learning platform offers learning experiences focused on the latest technology skills.
Added
This review will be ongoing with our continued investment, innovation, and execution. We have not set a timetable for the completion of this process, and there can be no assurance that it will result in any transaction or outcome.
Removed
Components of Results of Operations Net Revenues We recognize revenues net of allowances for refunds or charge backs from our payment processors who process payments from credit cards, debit cards, and PayPal. Revenues from Chegg Study Pack, Chegg Study, Chegg Writing, Chegg Math, and Busuu are primarily recognized ratably over the monthly subscription period.
Added
Business Updates and Developments Recent technological shifts, notably Google's roll out of AI Overviews (AIO) and continued increase in adoption of free and paid generative AI services by students, have created and are expected to continue to create headwinds for our industry and our business, most notably a reduction in traffic to our website and customers subscribing to our services.
Removed
We expect to continue to hire new employees in order to support our business. In any particular period, the timing of additional hires could materially affect our operating expenses, both in absolute dollars and as a percentage of revenues.
Added
In mid-August, Google broadly rolled out its AIO search experience, or AIO, which displays AI-generated content at the top of its search results. This experience, which includes questions and solutions for education, keeps users on Google search results versus leading them onto our site. AIO’s prevalence has grown and will only continue to increase.
Removed
As our business grows, our operating expenses may increase over time to expand capacity and sustain our workforce.
Added
While we continue to study the changes and adjust our SEO strategy, we expect Google to continue its shift from being a search origination point to the destination, which could materially adversely affect our business, operating results and financial condition.
Removed
Other income (expense), net consists primarily of interest income, gains on early extinguishment of the convertible senior notes, realized gains/losses on the sale of our investments, and foreign currency gain on purchase consideration.
Added
In addition, across our industry, there has been a continued increase in the adoption of free and paid generative AI products for academic support, and students are increasingly turning to generative AI for academic support, such as homework and exams, as well as assistance in other areas of daily life.
Removed
The decrease was primarily due to lower revenues of $26.5 million from print textbooks and eTextbooks as a result of recognizing revenue on a net basis from our partnership with GT Marketplace, LLC that began in April 2022, offset by growth in our Chegg Skills offering of $13.0 million.

… 36 more changes not shown on this page.

Item 7A. Quantitative and Qualitative Disclosures About Market Risk

Market Risk — interest-rate, FX, commodity exposure

6 edited+0 added−1 removed5 unchanged
Biggest changeA hypothetical 100 basis point increase or decrease in interest rates would result in a $5.8 million increase or decline in the fair value of our investments as of December 31, 2023. Any realized gains or losses resulting from interest rate changes would only occur if we sold the investments prior to maturity.
Biggest changeChanges in U.S. interest rates, affect the interest earned on our cash and cash equivalents and the market value of our investments. A hypothetical 100 basis point increase or decrease in interest rates would result in a $4.3 million increase or decline in the fair value of our investments as of December 31, 2024.
We have experienced and will continue to experience fluctuations in net income (loss) as a result of transaction gains or losses related to remeasuring certain amounts that are denominated in foreign currencies.
We have experienced and will continue to experience fluctuations in net (loss) income as a result of transaction gains or losses related to remeasuring certain amounts that are denominated in foreign currencies.
For more information, see Note 8, “Convertible Senior Notes,” of our accompanying Notes to Consolidated Financial Statements included in Part II, Item 8, “Consolidated Financial Statements and Supplementary Data” of this Annual Report on Form 10-K. 50 Table of Contents
For more information, see Note 8, “Convertible Senior Notes,” of our accompanying Notes to Consolidated Financial Statements included in Part II, Item 8, “Consolidated Financial Statements and Supplementary Data” of this Annual Report on Form 10-K. 53 Table of Contents
We accept foreign currencies from our international customers and our international revenues were 14%, 15% and 11% of total net revenues during the years ended December 31, 2023, 2022 and 2021, respectively. Additionally, a portion of our operating expenses are incurred outside of the United States and are denominated in foreign currencies.
We accept foreign currencies from our international customers and our international revenues were 13%, 14% and 15% of total net revenues during the years ended December 31, 2024, 2023 and 2022, respectively. Additionally, a portion of our operating expenses are incurred outside of the United States and are denominated in foreign currencies.
We were not exposed to material risks due to changes in market interest rates given the liquidity of the cash, cash equivalents, and investments in which we invested our cash.
Any realized gains or losses resulting from interest rate changes would only occur if we sold the investments prior to maturity. We were not exposed to material risks due to changes in market interest rates given the liquidity of the cash, cash equivalents, and investments in which we invested our cash.
Interest Rate Sensitivity We had cash and cash equivalents totaling $135.8 million and $473.7 million as of December 31, 2023 and 2022, respectively, and investments of $443.8 million and $800.2 million as of December 31, 2023 and 2022, respectively.
Interest Rate Sensitivity As of December 31, 2024 and 2023, we had cash and cash equivalents totaling $161.5 million and $135.8 million, respectively, and investments of $366.9 million and $443.8 million, respectively. Our cash and cash equivalents consist of cash and money market funds and investments consist of corporate debt securities and U.S. treasury securities.
Removed
Our cash and cash equivalents consist of cash and money market funds and investments consist of corporate debt securities, U.S. treasury securities and agency bonds. Changes in U.S. interest rates, such as those that have occurred in 2023, affect the interest earned on our cash and cash equivalents and the market value of our investments.

Other CHGG 10-K year-over-year comparisons