AI May Be Tailwind -- Not a Headwind -- for Chegg
Education company Chegg (NYSE: CHGG), which provides products and services to support learners, spooked investors earlier this year when management warned that artificial intelligence (AI) chatbot ChatGPT was beginning to hurt the company's new customer growth rate. However, the reality is proving to be far less ominous than the stock's huge drop following Chegg's last earnings report implied things might become. While the company did take a hit from buzz surrounding ChatGPT during the quarter, it wasn't as bad as management had anticipated. Further, management emphasized in its second-quarter update this week that AI could become a tailwind for the company.
Here's what investors should know about the quarter and what management is saying about AI.
The company's second-quarter revenue fell 6% year over year to $182.9 million. But that was a slower year-over-year decrease than the company's 7% decrease in revenue during Q1. Further, this top-line figure was well beyond analysts' consensus forecast for second-quarter revenue of $176.5 million. The company was also notably able to generate a profit of $24.6 million -- more than twice its profit in the year-ago quarter.
Source Fool.com
