Chegg is Cutting 45% of Its Workforce: A New Era Begins

Chegg, a company operating in the field of educational technologies, announced that it will reduce its workforce by 45% and close 388 positions. This decision was made to reduce costs and streamline operations and is considered a step to align with the increasing demand for AI-supported tools.

The company offers textbook rentals, homework assistance, and private tutoring services and stated that it has experienced significant traffic and revenue losses due to a decrease in visits from content publishers via Google.

Chegg also announced that former CEO Dan Rosensweig will return to the role effective immediately. Rosensweig previously led the company from February 2010 until June 2024. The departing Nathan Schultz will continue to contribute to the company as a board advisor.

Located in Santa Clara, California, Chegg expects to incur costs between $15 million and $19 million related to restructuring by the first quarter of 2026; it anticipates that this amount will be between $12 million and $16 million in the fourth quarter of 2026. As of December 31, 2024, the company had 1,271 employees.

Chegg had previously filed a lawsuit against Google, alleging that AI summaries led to traffic loss. During this process, the company initiated a strategic review and explored options for sale or privatization. However, the company stated that it has completed the review process and decided to continue operating as an independent entity.

This year, Chegg shares have fallen by more than 10%, and in 2024, the company experienced a significant loss of 85.6% in value.