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Chegg shares drop more than 40% after company says ChatGPT is killing its business


James Tahaney loads textbooks on to a pallet in preparation for shipping at the Chegg warehouse in Shepherdsville, Kentucky, April 29, 2010.John Sommers II | Bloomberg | Getty ImagesChegg shares tumbled after the online education company said ChatGPT is hurting its growth.”In the first part of the year, we saw no noticeable impact from ChatGPT on our new account growth and we were meeting expectations on new sign-ups,” CEO Dan Rosensweig said during the earnings call Monday evening. “However, since 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.”related investing newsThe company, which provides homework assistance and online tutoring, said revenue would be between $175 million and $178 million this quarter, far below FactSet’s analyst consensus estimate of $193.6 million.Chegg shares were last down 48% to $9.01 during Tuesday trading.Stock Chart IconStock chart icon Chegg shares 1-dayOtherwise, Chegg beat first-quarter expectations on the top and bottom lines, with earnings per share ex-items of 27 cents above analysts’ 26 cent estimate, and revenue of $188 …

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