Chegg stock dives 20% as forecast calls for another year of shrinking sales
Chegg Inc. (CHGG)shares sank 20% in after-hours trading Monday after executives guided for a second consecutive year of shrinking sales. The online-education company reported fourth-quarter earnings of $1.9 million, or a penny a share, on sales of $205.2 million, down from $207.5 million a year ago. After adjusting for stock-based compensation and other effects, the company reported earnings of 40 cents a share, up from 38 cents a share a year ago. Analysts on average expected adjusted earnings of 38 cents a share on sales of $202.1 million. While Chegg beat expectations in the holiday quarter, its forecast did not. Chegg executives guided for first-quarter revenue of $184 million to $186 million against an average analyst forecast of $200.3 million, and full-year sales of $745 million to $765 million, while analysts on average were projecting $817.5 million, according to FactSet. After ending 2022 with $766.9 million in revenue, down 1.2% from 2021, the forecast suggests a second straight year of sales declines. After closing with a 1.5% decline at $21.03 Monday, shares sank lower than $17 in after-hours trading following the release of the results.
-Jeremy C. Owens
(END) Dow Jones Newswires
February 06, 2023 17:08 ET (22:08 GMT)
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