While Chegg beat analyst expectations for the first quarter of the year, it also raised a warning that didn’t fall on deaf ears: It warned that ChatGPT was hindering its ability to add new subscribers.
The Exchange explores startups, markets and money.
“[S]ince March, we saw a significant spike in student interest in ChatGPT. We now believe it’s having an impact on our new customer growth rate,” Chegg CEO Dan Rosensweig said during the company’s Q1 earnings call.
Chegg is particularly vulnerable to competition from generative AI; although you may know it as a place to rent college textbooks, “it has also proven an incredibly popular tool for cheating,” TechCrunch+ reported.