Earnings release
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Chegg Reports Third Quarter 2026 Earnings November 3, 2026 SAN FRANCISCO, Nov. 03, 2026 (GLOBE NEWSWIRE) -- Chegg, Inc. (NYSE:CHGG), a learning and employability company, today reported financial results for the quarter ended September 30, 2026. “Over the last year our focus was rearchitecting our cost structure, accumulating cash, eliminating our debt, and positioning Chegg to return to growth,” said Dan Rosensweig, Executive Chairman and CEO of Chegg. “We are evolving Chegg from a homework help company into an employability company, focused on helping people find internships, assess and develop relevant job skills, and secure full-time employment. Our mission is simple; to help people get the jobs they want and build the careers they deserve.” Third Quarter 2026 Highlights Total Net Revenues of $46.5 million, a decrease of 40% year-over-year Gross Margin of 52% Non-GAAP Gross Margin of 54% Net Loss was $4.7 million Non-GAAP Net Loss was $5.7 million Adjusted EBITDA was $5.4 million For more information about non-GAAP gross margin, non-GAAP net (loss) income, and adjusted EBITDA, as well as a reconciliation of gross margin to non- GAAP gross margin, net loss to non-GAAP net (loss) income, and net loss to adjusted EBITDA, see the sections of this press release titled, “Use of Non- GAAP Measures,” “Reconciliation of Net Loss to EBITDA and Adjusted EBITDA,” and “Reconciliation of GAAP to Non-GAAP Financial Measures.” Business Outlook Fourth Quarter 2026 Total Net Revenues between $38 million and $40 million Gross Margin in the range of 46% to 48% Adjusted EBITDA of approximately $1 million For more information about the use of forward-looking non-GAAP measures, a reconciliation of forward-looking net loss to EBITDA and adjusted EBITDA for the third quarter 2026, see the below sections of the press release titled “Use of Non-GAAP Measures,” and “Reconciliation of Forward-Looking Net Loss to EBITDA and Adjusted EBITDA.” An updated investor presentation and an investor data sheet can be found on Cheggʼs Investor Relations website https://investor.chegg.com (such items are not incorporated into any filings Chegg may make with the Securities and Exchange Commission, unless otherwise noted). Prepared Remarks - Dan Rosensweig, CEO & Executive Chairman Chegg, Inc. Thank you, Tracey, and thanks everyone for joining Cheggʼs third quarter 2026 earnings call. Over the last year our focus was rearchitecting our cost structure, accumulating cash, eliminating our debt, and positioning Chegg to return to growth. I am happy to report that the balance sheet reset is complete. In Q3, we had revenue of $46.5 million, adjusted EBITDA of $5.4 million, and ended the quarter with $43.6 million in cash and no debt. Core to our reinvention, we have repositioned Chegg from being a homework help company to an employability company, focused on helping students find internships, assess and learn relevant job skills and find full-time employment. Our mission is simple; to help people get the jobs they want and build the careers they deserve. David will take you through the financials in more detail, but I want to walk you through what we are building. Higher education is going through a dramatic transformation, but one thing that will never change is that students go to college to get a job. Economic uncertainty and anxiety around AI have made the path to a first job even more daunting for students, and the need for what we are building even more urgent. In September, we launched our new employability platform on Internships.com - a comprehensive experience that gives students personalized job matching, resume tailoring, one-click apply, interview prep, skills assessment, and curated network connections, all in one place. We are rapidly expanding the platformʼs capabilities and will soon be adding 70,000 early career listings as we move beyond internships into entry-level roles. Since launch, we have had over 100,000 visitors to the site, a clear signal that employability is top of mind for students and their families. We recently rolled out our first marketing campaign for Internships.com, both as a standalone product and bundled with Chegg, and the early results are encouraging. At the same time, we are seeing our first institutional momentum. Since September, we have signed pilot programs with College of Charleston, Salem College, and Radford University, and we have several more schools set to sign in the coming weeks. The reason is straightforward, as institutions, colleges, and universities increasingly know that their own success is measured by whether their graduates get jobs. We are in active conversations with a meaningful number of schools, and we believe this B2I channel is just getting started. Every time Chegg has evolved to serve studentsʼ most critical needs, it has entered a new growth chapter. This is that moment. We will continue to expand our offering through 2027 and beyond, but the foundation is live and the momentum is real. As we expand how we serve students on the path from learning to earning, we continue to invest in our skills platform which, thanks to AI, we are able to develop and launch more programs and more capabilities, rapidly, for more partners at a much lower cost. Our multi-channel approach continues to build, and we believe we are on a path to consistent growth in that business. We have signed 11 new distribution partners since the start of the year, including our recent announcement of Power Train. In Q3, we made significant product enhancements to how we build and deliver skills programs for our B2B clients. We can now scale tailored learning programs directly from a companyʼs own systems, documents, and objectives, grounded in our proven instructional design methodology. And critically, we measure actual demonstrated proficiency. That is what enterprise buyers need, and what sets us apart. And I am genuinely excited that our language learning product, in both our B2B and B2C channels, is returning to growth. The new capabilities we have added create a better, more powerful experience for learners that combines language courses with workplace skills content, delivered through adaptive AI, expert human coaching and real-world practice. Learners build both the language and the communication skills they need to perform in the moments that matter most. In Q3, our workplace skills content went live for English-speaking premium subscribers and is now expanding to Spanish, French, German and Italian. The goal is a performance platform designed around real-life outcomes, not lesson completions. The last year has been both complicated and exhilarating. Complicated because AI hit our business hard, and we had to reinvent the company, financially, structurally, and across our product offerings. And exhilarating because we see all of the opportunities ahead of us. 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our traditional academic services business would wind down over time, and while it did, we would generate significant cash. That continues to play out as we anticipated, and that cash has allowed us to pay down our debt and invest in the future of the company. As I said at the top of the call, we are on our way to being a very different company, focused on employability, and as we look ahead, we will be strategic and targeted in how we think about growth across the company, with both organic and inorganic opportunities. We are reviewing companies with strong IP and customer bases that could benefit from our new employability platform to help them grow faster at much lower costs. We will be judicious, but the pipeline is real. With a clean balance sheet, a market opportunity that is only getting bigger, and the positive signals we are seeing in our most recent product launch on Internships.com, we are excited about what is ahead and I look forward to updating you on our progress next quarter. With that, Iʼll turn it over to David. Prepared Remarks - David Longo, CFO Chegg, Inc. Thank you, Dan and good morning. Today, I will review our financial performance for the third quarter of 2026, along with the companyʼs outlook for the fourth quarter. We delivered a strong third quarter, exceeding our expectations while making meaningful progress in reshaping our business and balance sheet, executing our strategic priorities, and delivering free cash flow. Over the past year, we have significantly reduced our cost structure, repaid our remaining convertible debt, and established a stronger financial foundation that expands our ability to invest in future growth. We are now focused on building our employability business, helping learners develop workforce-ready skills while enabling employers to build and maintain a more skilled workforce. We believe this represents an attractive opportunity to create long-term value. As we execute our strategy, we remain focused on identifying additional cost savings, improving operational performance, and leveraging AI across the business. In the quarter, Total Revenue was $46.5 million, exceeding our expectations. Our legacy homework-help business continued to decline as expected, while we focused investment on the areas we believe offer the greatest long-term opportunity. We entered into new skilling distribution partnerships, enhanced our language offering, and continued to build our employability platform, which we expect to contribute more meaningfully in 2027. Turning to expenses, Q3 non-GAAP operating expenses were $31.2 million, down 36% year-over-year. This reduction reflects the impact of our cost management initiatives and the use of AI to streamline operations and improve productivity across the organization. Adjusted EBITDA for the quarter was $5.4 million, representing a margin of 12%. Third quarter CapEx was $1.7 million, down 71% year-over-year. For full year 2026, we are targeting a greater than 60% reduction in CapEx. Free cash flow in the quarter was $5.5 million, reflecting our continued focus on cash generation and disciplined financial management. Looking at the balance sheet, we ended the quarter with $43.6 million in cash and investments and fully repaid our remaining convertible debt. Eliminating our debt was a key objective for 2026 and marks an important milestone in strengthening our balance sheet. Moving to guidance. Looking ahead to the fourth quarter, we expect: Total revenue between $38 and $40 million; Gross margin in the range of 46% to 48%; And adjusted EBITDA of approximately $1 million With our debt eliminated, our capital allocation strategy remains focused on generating free cash flow, maintaining a strong balance sheet, and thoughtfully deploying capital to create long-term shareholder value. In closing, we have made significant progress repositioning Chegg for its next phase. We have strengthened both the business and the balance sheet, creating a more focused, efficient, and financially flexible organization as we continue to build our employability platform. We believe we are well positioned to create long-term value through disciplined execution and thoughtful investment in future growth opportunities. With that, I will turn the call over to the operator for your questions. Conference Call and Webcast Information To access the call, please dial 1-877-407-4018 or outside the U.S. +1-201-689-8471. A live webcast of the call will also be available at https://investor.chegg.com under the Events & Presentations menu. Participants can also access the call using the Call me™ link for instant telephone access to the event, which will be active 15 minutes before the scheduled start time. An audio replay will be available from 11:59 p.m. Eastern Time on November 17, 2026 by calling 1-844-512-2921 or outside the U.S. +1-412-317-6671 with Access ID 13763323. An audio archive of the call will also be available at https://investor.chegg.com. Use of Investor Relations Website for Regulation FD Purposes Chegg also uses its Investor Relations website, https://www.chegg.com/press, as a means of disclosing material non-public information and for complying with its disclosure obligations under Regulation FD. Accordingly, investors should monitor https://www.chegg.com/press, in addition to following press releases, Securities and Exchange Commission filings and public conference calls and webcasts. AboutChegg Chegg is a learning and employability platform that helps students and lifelong learners build the skills, confidence, and career readiness to succeed from learning to earning, while helping businesses develop and upskill their workforce. Through AI-powered, personalized experiences, Chegg supports learners across academics, workplace readiness, professional upskilling, and language learning. By combining proprietary data, AI, and deep insight into how students learn and build their careers, Chegg remains committed to improving employability and creating better outcomes for learners and employers. Chegg is a publicly held company and trades on the NYSE under the symbol CHGG. For more information, visit www.chegg.com. Media Contact: press@chegg.com Investor Contact: Tracey Ford, IR@chegg.com Use of Non-GAAP Measures 2/9
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To supplement Cheggʼs financial results presented in accordance with generally accepted accounting principles in the United States (GAAP), this press release and the accompanying tables and the related earnings conference call contain non-GAAP financial measures, including EBITDA, adjusted EBITDA, non-GAAP cost of revenues, non-GAAP gross profit, non-GAAP gross margin, non-GAAP operating expenses, non-GAAP loss from operations, non-GAAP net (loss) income, non-GAAP weighted average shares, non-GAAP net (loss) income per share, and free cash flow. For reconciliations of these non-GAAP financial measures to the most directly comparable GAAP financial measures, please see the section of the accompanying tables titled, “Reconciliation of Net Loss to EBITDA and Adjusted EBITDA,” “Reconciliation of GAAP to Non-GAAP Financial Measures,” “Reconciliation of Net Cash Provided by Operating Activities to Free Cash Flow,” and “Reconciliation of Forward-Looking Net Loss to EBITDA and Adjusted EBITDA.” The presentation of these non-GAAP financial measures is not intended to be considered in isolation from, as a substitute for, or superior to, the financial information prepared and presented in accordance with GAAP, and may be different from non-GAAP financial measures used by other companies. Chegg defines (1) EBITDA as earnings before interest, taxes, depreciation and amortization; (2) Adjusted EBITDA as EBITDA adjusted for share-based compensation expense, gain on lease termination, litigation settlement (credits) charges, other income, net, restructuring (credits) charges, impairment of equity investment, impairment of lease related assets, and impairment expense; (3) non-GAAP cost of revenues as cost of revenues excluding amortization of intangible assets, share-based compensation expense, and restructuring (charges) credits; (4) non-GAAP gross profit as gross profit excluding amortization of intangible assets, share-based compensation expense, and restructuring charges (credits); (5) non-GAAP gross margin is defined as non- GAAP gross profit divided by net revenues, (6) non-GAAP operating expenses as operating expenses excluding share-based compensation expense, gain on lease termination, litigation settlement credits (charges), restructuring credits (charges), impairment of equity investment, impairment of lease related assets, and impairment expense; (7) non-GAAP loss from operations as loss from operations excluding share-based compensation expense, amortization of intangible assets, gain on lease termination, litigation settlement (credits) charges, restructuring (credits) charges, impairment of equity investment, impairment of lease related assets, and impairment expense; (8) non-GAAP net (loss) income as net loss excluding share-based compensation expense, amortization of intangible assets, income tax effect of non-GAAP adjustments, amortization of debt issuance costs, gain on lease termination, litigation settlement (credits) charges, restructuring (credits) charges, gain on early extinguishment of debt, impairment of equity investment, impairment of lease related assets, and impairment expense; (9) non-GAAP weighted average shares outstanding as weighted average shares outstanding adjusted for the effect of shares for stock plan activity and shares related to our convertible senior notes, to the extent such shares are not already included in our weighted average shares outstanding; (10) non-GAAP net (loss) income per share is defined as non-GAAP net (loss) income divided by non-GAAP weighted average shares outstanding; and (11) free cash flow as net cash provided by operating activities adjusted for purchases of property and equipment. To the extent additional significant non-recurring items arise in the future, Chegg may consider whether to exclude such items in calculating the non-GAAP financial measures it uses. Chegg believes that these non-GAAP financial measures, when taken together with the corresponding GAAP financial measures, provide meaningful supplemental information regarding Cheggʼs performance by excluding items that may not be indicative of Cheggʼs core business, operating results or future outlook. Chegg management uses these non-GAAP financial measures in assessing Cheggʼs operating results, as well as when planning, forecasting and analyzing future periods and believes that such measures enhance investorsʼ overall understanding of our current financial performance. These non- GAAP financial measures also facilitate comparisons of Cheggʼs performance to prior periods. As presented in the “Reconciliation of Net Loss to EBITDA and Adjusted EBITDA,” “Reconciliation of GAAP to Non-GAAP Financial Measures,” “Reconciliation of Forward-Looking Net Loss to EBITDA and Adjusted EBITDA,” and “Reconciliation of Net Cash Provided by Operating Activities to Free Cash Flow,” tables below, each of the non-GAAP financial measures excludes or includes one or more of the following items: Share-based compensation expense. Share-based compensation expense is a non-cash expense that varies in amount from period to period and is dependent on market forces that are often beyond Chegg's control. As a result, management excludes this item from Chegg's internal operating forecasts and models. Management believes that non- GAAP measures adjusted for share-based compensation expense provide investors with a basis to measure Chegg's core performance against the performance of other companies without the variability created by share-based compensation as a result of the variety of equity awards used by other companies and the varying methodologies and assumptions used. Amortization of intangible assets. Chegg amortizes intangible assets, including those that contribute to generating revenues, that it acquires in conjunction with acquisitions, which results in non-cash expenses that may not otherwise have been incurred. Chegg believes excluding the expense associated with intangible assets from non-GAAP measures allows for a more accurate assessment of its ongoing operations and provides investors with a better comparison of period-over-period operating results. No corresponding adjustments have been made related to revenues generated from acquired intangible assets. Amortization of debt issuance costs. The difference between the effective interest expense and the contractual interest expense are excluded from management's assessment of our operating performance because management believes that these non-cash expenses are not indicative of ongoing operating performance. Chegg believes that the exclusion of the non-cash interest expense provides investors with a better comparison of period-over-period operating results. Income tax effect of non-GAAP adjustments. We utilize a non-GAAP effective tax rate for evaluating our operating results, which is based on our current mid-term projections. This non-GAAP tax rate could change for various reasons including, but not limited to, significant changes resulting from tax legislation, changes to our corporate structure and other significant events. Chegg believes that the inclusion of the income tax effect of non-GAAP adjustments provides investors with a better comparison of period-over-period operating results. Restructuring (credits) charges. Restructuring (credits) charges represent expenses incurred in conjunction with a reduction in workforce. Chegg believes that it is appropriate to exclude them from non-GAAP financial measures because they are nonrecurring and the result of an event that is not considered a core-operating activity. Chegg believes that it is appropriate to exclude the restructuring charges from non-GAAP financial measures because it provides investors with a better comparison of period-over-period operating results. Impairment expense. Impairment expense represents the impairment of property and equipment. Chegg believes that it is appropriate to exclude it from non-GAAP financial measures because it is the result of discrete events that are not considered core-operating activities and are not indicative of our ongoing operating 3/9
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performance. Chegg believes that it is appropriate to exclude the impairment expense from non-GAAP financial measures because it provides investors with a better comparison of period-over-period operating results. Impairment of lease related assets. The impairment of lease related assets represents an impairment charge recorded on the ROU asset and leasehold improvements associated with the closure of our offices. The impairment of lease related assets is the result of an event that is not considered a core-operating activity and we believe its exclusion provides investors with a better comparison of period-over-period operating results. Litigation settlement (credits) charges. Litigation settlement (credits) charges represent discrete events that are not considered core-operating activities, and as such, are excluded from non- GAAP financial measures because it provides investors with a better comparison of period-over-period operating results. Impairment of equity investment. The impairment of equity investment represents a one-time event to record an impairment charge on our equity investment. The impairment of equity investment is a non-cash expense and we believe the exclusion from non-GAAP financial measures provides investors with a better comparison of period- over-period results. Gain on early extinguishment of debt. The difference between the carrying amount of early extinguished debt and the reacquisition price is excluded from management's assessment of our operating performance because management believes that these non-cash gains are not indicative of ongoing operating performance. Chegg believes that the exclusion of the gain on early extinguishment of debt provides investors with a better comparison of period-over-period operating results. Gain on lease termination. The gain on lease termination represents a gain from fully terminating an office lease agreement that relieved us from all future obligations. We excluded from management's assessment of our operating performance because management believes that these non-cash gains are not indicative of ongoing operating performance and its exclusion provides investors with a better comparison of period-over-period operating results. Effect of shares for stock plan activity. The effect of shares for stock plan activity represents the dilutive impact of outstanding stock options, RSUs, and PSUs, to the extent such shares are not already included in our weighted average shares outstanding. Effect of shares related to convertible senior notes. The effect of shares related to convertible senior notes represents the dilutive impact of our convertible senior notes, to the extent such shares are not already included in our weighted average shares outstanding. Free cash flow. Free cash flow represents net cash provided by operating activities adjusted for purchases of property and equipment. Chegg considers free cash flow to be a liquidity measure that provides useful information to management and investors about the amount of cash generated by the business after the purchases of property and equipment, which can then be used to, among other things, invest in Chegg's business and make strategic acquisitions. A limitation of the utility of free cash flow as a measure of financial performance is that it does not represent the total increase or decrease in Chegg's cash balance for the period. Forward-Looking Statements This press release contains forward-looking statements made pursuant to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995, which include, without limitation, statements regarding customer retention, the growth of the skilling market and our Skilling business, investments in future growth and creation of long-term value, transformation of our business and development and customer adoption of our products, development of new partnerships and distribution channels, our ability to grow, control expenses, and generate cash flow, expectations regarding our balance sheet, including future repurchases of securities under our existing securities repurchase program, acquisition opportunities, all statements about Cheggʼs outlook under “Business Outlook”, including our fourth quarter 2026 guidance, including total revenue, gross margin, and adjusted EBITDA, as well as those included in the investor presentation referenced above and those included in the “Prepared Remarks” sections above. The words “anticipate,” “believe,” “estimate,” “expect,” “intend,” “project,” “endeavor,” “will,” “should,” “future,” “transition,” “outlook” and similar expressions, as they relate to Chegg, are intended to identify forward-looking statements. These statements are not guarantees of future performance, and are based on managementʼs expectations as of the date of this press release and assumptions that are inherently subject to uncertainties, risks and changes in circumstances that are difficult to predict. Forward-looking statements involve known and unknown risks, uncertainties and other factors that may cause actual results, performance or achievements to differ materially from any future results, performance or achievements. Important factors that could cause actual results to differ materially from those expressed or implied by these forward-looking statements include the following: the effects of AI technology on Cheggʼs business and the economy generally; Cheggʼs ability to attract new learners and retain existing learners in light of declining revenue and user traffic; Chegg's ability to innovate and offer new products and services in response to competitive technology and market developments, including AI; Cheggʼs ability to diversify its revenue streams with business-to-institution programs and other enterprise offerings; the uncertainty surrounding the evolving educational landscape; Cheggʼs ability to build and maintain strong brands and reputation; Cheggʼs ability to develop new product and service offerings and their adoption by customers; competition in all aspects of Cheggʼs business, including with respect to AI and Chegg's expectation that such competition will increase; challenges related to Cheggʼs international operations; Cheggʼs ability to maintain its services and systems without interruption, including as a result of technical issues, cybersecurity threats, or cyber-attacks; disruptions of services provided to us by third parties, including web hosting and payment processing services; changes in regulation, in particular those concerning privacy, marketing, and education; risks related to our ability to comply with regulations, obligations and policies related to data privacy; the outcome of any current litigation and investigations, including our litigation against Google and litigation against us; misuse of Cheggʼs platform and content; the effectiveness of Cheggʼs restructuring activities and disruptions related to them; changes in the education market, including as a result of AI technology; the possibility that the NYSE may delist our common stock; and general economic, political and industry conditions, including inflation, recession and war. All information provided in this release and in the conference call is as of the date hereof, and Chegg undertakes no duty to update this information except as required by law. These and other important risk factors are described more fully in documents filed 4/9
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with the Securities and Exchange Commission, including Chegg's most recent annual report on Form 10-K, subsequent quarterly reports on Form 10-Q and other filings with the Securities and Exchange Commission, which could cause actual results to differ materially from expectations. CHEGG, INC. CONDENSED CONSOLIDATED BALANCE SHEETS (in thousands, except for number of shares and par value) (unaudited) September 30, December 31, 2026 2025 Assets Current assets Cash and cash equivalents $ 28,847 $ 31,146 Short-term investments 14,757 41,674 Accounts receivable, net of allowance of $102 and $156 at September 30, 2026 and December 31, 2025, respectively 9,550 15,604 Prepaid expenses 13,891 16,331 Other current assets 13,909 16,857 Total current assets 80,954 121,612 Long-term investments — 12,392 Property and equipment, net 85,390 115,168 Intangible assets, net 3,019 6,041 Right of use assets 10,846 13,188 Other assets 7,824 9,613 Total assets $ 188,033 $ 278,014 Liabilities and stockholders' equity Current liabilities Accounts payable $ 8,216 $ 3,258 Deferred revenue 25,685 29,675 Accrued liabilities 26,006 54,249 Current portion of convertible senior notes, net — 53,765 Total current liabilities 59,907 140,947 Long-term liabilities Long-term operating lease liabilities 9,863 15,205 Other long-term liabilities 2,672 2,239 Total long-term liabilities 12,535 17,444 Total liabilities 72,442 158,391 Commitments and contingencies Stockholders' equity: Preferred stock, $0.001 par value per share, 10,000,000 shares authorized, no shares issued and outstanding — — Common stock, $0.001 par value per share: 400,000,000 shares authorized; 111,058,059 and 110,985,562 shares issued and outstanding at September 30, 2026 and December 31, 2025, respectively 111 111 Additional paid-in capital 1,150,240 1,145,371 Accumulated other comprehensive loss (34,485) (32,997) Accumulated deficit (1,000,275) (992,862) Total stockholders' equity 115,591 119,623 Total liabilities and stockholders' equity $ 188,033 $ 278,014 5/9
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CHEGG, INC. CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS (in thousands, except per share amounts) (unaudited) Three Months Ended Nine Months Ended September 30, September 30, 2026 2025 2026 2025 Net revenues $ 46,468 $ 77,742 $ 161,579 $ 304,249 Cost of revenues(1) 22,229 31,701 71,170 121,152 Gross profit 24,239 46,041 90,409 183,097 Operating expenses: Research and development(1) 7,972 18,350 24,509 76,495 Sales and marketing(1) 9,249 11,583 29,323 54,614 General and administrative(1) 12,120 33,232 45,891 132,572 Impairment expense — — — 2,000 Total operating expenses 29,341 63,165 99,723 265,681 Loss from operations (5,102) (17,124) (9,314) (82,584) Interest expense, net and other income, net: Interest expense, net (15) (41) (68) (549) Other income, net 704 1,377 2,498 16,433 Total interest expense, net and other income, net 689 1,336 2,430 15,884 Loss before provision for income taxes (4,413) (15,788) (6,884) (66,700) Provision for income taxes (277) (1,683) (529) (3,918) Net loss $ (4,690) $ (17,471) $ (7,413) $ (70,618) Net loss per share, basic and diluted $ (0.04) $ (0.16) $ (0.07) $ (0.66) Weighted average shares used to compute net loss per share, basic and diluted 111,025 108,450 111,388 106,851 (1) Includes share-based compensation expense as follows: Cost of revenues $ 14 $ 102 $ 49 $ 471 Research and development 138 1,141 819 5,937 Sales and marketing 80 352 335 1,826 General and administrative 1,823 4,330 5,887 16,860 Total share-based compensation expense $ 2,055 $ 5,925 $ 7,090 $ 25,094 6/9
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CHEGG, INC. CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (in thousands) (unaudited) Nine Months Ended September 30, 2026 2025 Cash flows from operating activities Net loss $ (7,413) $ (70,618) Adjustments to reconcile net loss to net cash provided by operating activities: Share-based compensation expense 7,090 25,094 Depreciation and amortization expense 39,377 63,641 Deferred tax assets 41 319 Operating lease expense, net of accretion 1,609 2,883 Amortization of debt issuance costs 68 459 Loss from write-offs of property and equipment 103 793 Gain on early extinguishment of debt (523) (7,360) Realized gain on sale of investments (5) (752) Impairment expense — 2,000 Impairment of lease related assets — 3,004 Impairment of equity investment — 6,000 Gain on lease termination (3,675) — Litigation settlement credits (3,000) — Other non-cash items (340) 1,049 Change in assets and liabilities: Accounts receivable 5,992 8,592 Prepaid expenses and other current assets 5,506 7,822 Other assets 779 1,323 Accounts payable 4,856 (4,977) Deferred revenue (3,783) (8,195) Accrued liabilities (24,709) (3,301) Other liabilities (597) (3,277) Net cash provided by operating activities 21,376 24,499 Cash flows from investing activities Purchases of property and equipment (6,411) (21,651) Purchases of investments — (793) Maturities of investments 32,810 111,124 Proceeds from sale of investments 5,679 181,158 Net cash provided by investing activities 32,078 269,838 Cash flows from financing activities Repayment of convertible senior notes (53,309) (416,492) Repurchase of common stock (1,721) — Payment of taxes related to the net share settlement of equity awards (868) (1,642) Proceeds from common stock issued under stock plans 68 392 Net cash used in financing activities (55,830) (417,742) Effect of exchange rate changes (569) (160) Net decrease in cash, cash equivalents and restricted cash (2,945) (123,565) Cash, cash equivalents and restricted cash, beginning of period 33,411 164,359 Cash, cash equivalents and restricted cash, end of period $ 30,466 $ 40,794 7/9
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CHEGG, INC. RECONCILIATION OF NET LOSS TO EBITDA AND ADJUSTED EBITDA (in thousands) (unaudited) Three Months Ended Nine Months Ended September 30, September 30, 2026 2025 2026 2025 Net loss $ (4,690) $ (17,471) $ (7,413) $ (70,618) Depreciation and amortization expense 12,385 15,321 39,377 63,641 Provision for income taxes 277 1,683 529 3,918 Interest expense, net 15 41 68 549 EBITDA 7,987 (426) 32,561 (2,510) Share-based compensation expense 2,055 5,925 7,090 25,094 Gain on lease termination (3,675) — (3,675) — Litigation settlement (credits) charges — — (3,000) 7,500 Other income, net (704) (1,377) (2,498) (16,433) Restructuring (credits) charges (228) 9,132 (536) 30,974 Impairment of equity investment — — — 6,000 Impairment of lease related assets — — — 3,004 Impairment expense — — — 2,000 Adjusted EBITDA $ 5,435 $ 13,254 $ 29,942 $ 55,629 CHEGG, INC. RECONCILIATION OF GAAP TO NON-GAAP FINANCIAL MEASURES (in thousands, except percentages and per share amounts) (unaudited) Three Months Ended Nine Months Ended September 30, September 30, 2026 2025 2026 2025 Cost of revenues $ 22,229 $ 31,701 $ 71,170 $ 121,152 Amortization of intangible assets (937) (1,077) (3,021) (3,230) Share-based compensation expense (14) (102) (49) (471) Restructuring (charges) credits — (915) 26 (1,656) Non-GAAP cost of revenues $ 21,278 $ 29,607 $ 68,126 $ 115,795 Gross profit $ 24,239 $ 46,041 $ 90,409 $ 183,097 Amortization of intangible assets 937 1,077 3,021 3,230 Share-based compensation expense 14 102 49 471 Restructuring charges (credits) — 915 (26) 1,656 Non-GAAP gross profit $ 25,190 $ 48,135 $ 93,453 $ 188,454 Gross margin % 52% 59% 56% 60% Non-GAAP gross margin % 54% 62% 58% 62% Operating expenses $ 29,341 $ 63,165 $ 99,723 $ 265,681 Share-based compensation expense (2,041) (5,823) (7,041) (24,623) Gain on lease termination 3,675 — 3,675 — Litigation settlements credits (charges) — — 3,000 (7,500) Restructuring credits (charges) 228 (8,217) 510 (29,318) Impairment of equity investment — — — (6,000) Impairment of lease related assets — — — (3,004) Impairment expense — — — (2,000) Non-GAAP operating expenses $ 31,203 $ 49,125 $ 99,867 $ 193,236 Loss from operations $ (5,102) $ (17,124) $ (9,314) $ (82,584) Share-based compensation expense 2,055 5,925 7,090 25,094 Amortization of intangible assets 937 1,077 3,021 3,230 Gain on lease termination (3,675) — (3,675) — Litigation settlement (credits) charges — — (3,000) 7,500 Restructuring (credits) charges (228) 9,132 (536) 30,974 Impairment of equity investment — — — 6,000 Impairment of lease related assets — — — 3,004 Impairment expense — — — 2,000 Non-GAAP loss from operations $ (6,013) $ (990) $ (6,414) $ (4,782) 8/9
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Three Months Ended Nine Months Ended September 30, September 30, 2026 2025 2026 2025 Net loss $ (4,690) $ (17,471) $ (7,413) $ (70,618) Share-based compensation expense 2,055 5,925 7,090 25,094 Amortization of intangible assets 937 1,077 3,021 3,230 Income tax effect of non-GAAP adjustments (148) 1,717 174 4,254 Amortization of debt issuance costs 15 41 68 459 Gain on lease termination (3,675) — (3,675) — Litigation settlement (credits) charges — — (3,000) 7,500 Restructuring (credits) charges (228) 9,132 (536) 30,974 Gain on early extinguishment of debt — — (523) (7,360) Impairment of equity investment — — — 6,000 Impairment of lease related assets — — — 3,004 Impairment expense — — — 2,000 Non-GAAP net (loss) income $ (5,734) $ 421 $ (4,794) $ 4,537 Weighted average shares used to compute net loss per share 111,025 108,450 111,388 106,851 Effect of shares for stock plan activity — 1,699 — 728 Effect of shares related to convertible senior notes — 583 — 2,573 Non-GAAP weighted average shares used to compute non-GAAP net (loss) income per share 111,025 110,732 111,388 110,152 Net loss per share $ (0.04) $ (0.16) $ (0.07) $ (0.66) Non-GAAP net (loss) income per share $ (0.05) $ — $ (0.04) $ 0.04 CHEGG, INC. RECONCILIATION OF NET CASH PROVIDED BY OPERATING ACTIVITIES TO FREE CASH FLOW (in thousands) (unaudited) Nine Months Ended September 30, 2026 2025 Net cash provided by operating activities $ 21,376 $ 24,499 Purchases of property and equipment (6,411) (21,651) Free cash flow $ 14,965 $ 2,848 CHEGG, INC. RECONCILIATION OF FORWARD-LOOKING NET LOSS TO EBITDA AND ADJUSTED EBITDA (in thousands) (unaudited) Three Months Ending December 31, 2026 Net loss $ (12,550) Depreciation and amortization expense 11,700 Provision for income taxes 600 EBITDA (250) Share-based compensation expense 1,500 Other income, net (250) Adjusted EBITDA $ 1,000 Source: Chegg, Inc. 9/9