Shares of Chegg (NYSE:CHGG) lost over 32% in after-hours trading after the company reported earnings for its first quarter of Fiscal Year 2023. Earnings per share came in at $0.27, which beat analysts’ consensus estimate of $0.26 per share. Sales decreased by 7.2% year-over-year, with revenue hitting $187.6 million. This beat analysts’ expectations of $185.17 million.
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Chegg lost ground in both subscription revenue and total subscribers as well. Subscription Service revenues lost 3% against this time last year, slipping to $168.4 million. Subscription Services subscriber count, meanwhile, stood at 5.1 million, which is down 5% year-over-year.
Chegg’s management also offered projections for the second quarter, which proved disappointing. Chegg looked for total net revenues to come in between $175 million and $178 million, which was a clear miss compared to analyst expectations of $193.65 million. Subscription Services revenue, meanwhile, is projected between $159 million and $162 million, which is a decline on a quarter-over-quarter basis.
Overall, Wall Street has a consensus price target of $20.80 per share on Chegg stock, implying 18.18% upside potential, as indicated by the graphic above.
