Although we’re in the thick of the summer, school was definitely in session for online education company Chegg (NYSE: CHGG) on the last trading day of the week. On the back of very encouraging quarterly results, investors eagerly raised their hand for the stock, sending it 9% higher on the day.
According to the figures published after market hours by Chegg on Thursday, the company’s total net revenue for its second quarter was just under $195 million, representing a slight (2%) year-over-year decline. Non-GAAP (adjusted) net income saw a steeper fall, lowering to nearly $55 million ($0.37 per share) from the year-ago result of almost $72 million.
Despite the drops, both headline figures were high enough to top analyst estimates. Collectively, prognosticators following Chegg were modeling revenue of slightly below $190 million, and adjusted net income of $0.33.
In the earnings release, CEO Dan Rosensweig praised his team for its performance, saying that “with the impact of constant upgrades to our user experience we are seeing continued strong conversion rates, as well as a year-over-year increase of over 100 basis points in our Chegg Study and Study Pack retention rate.”
Chegg also proffered guidance for its current (third) quarter, and for the entirety of 2022. For the latter period, it’s modeling total net revenue of $745 million to $770 million, nearly all of which ($715 million to $740 million) should consist of services revenue. On average, analysts are expecting just under $762 million for the period.
As for profitability, adjusted earnings before interest, taxes, depreciation, and amortization (EBITDA) are forecast to hit $225 million to $235 million. The company did not proffer any net income guidance.