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Q2 Earnings Highlights: Chegg (NYSE:CHGG) Vs The Rest Of The Consumer Subscription Stocks

StockStory - Mon Oct 16, 2023

CHGG Cover Image

As the craze of earnings season draws to a close, here's a look back at some of the most exciting (and some less so) results from Q2. Today we are looking at the consumer subscription stocks, starting with Chegg (NYSE:CHGG).

Consumers today expect goods and services to be hyper-personalized and on demand. Whether it be what music they listen to, what movie they watch, or even finding a date, online consumer businesses are expected to delight their customers with simple user interfaces that magically fulfill demand. Subscription models have further increased usage and stickiness of many online consumer services.

The 7 consumer subscription stocks we track reported a mixed Q2; on average, revenues beat analyst consensus estimates by 3.32%, while next quarter's revenue guidance was 0.32% above consensus. There has been a stampede out of high valuation technology stocks as higher interest rates encourage investors to value profits over growth, and while some of the consumer subscription stocks have fared somewhat better than others, they have not been spared, with share prices declining 8% on average since the previous earnings results.

Chegg (NYSE:CHGG)

Started as a physical textbook rental service, Chegg (NYSE:CHGG) is now a digital platform addressing student pain points by providing study and academic assistance.

Chegg reported revenues of $182.9 million, up 11% year on year, beating analyst expectations by 3.59%. It was a weaker quarter for the company, with a decline in its user base and slow revenue growth.

Chegg Total Revenue

The stock is down 15.3% since the results and currently trades at $8.49.

Read our full report on Chegg here, it's free.

Best Q2: Coursera (NYSE:COUR)

Founded by two Stanford University computer science professors, Coursera (NYSE:COUR) is an online learning platform that offers courses, specializations, and degrees from top universities and organizations around the world.

Coursera reported revenues of $153.7 million, up 23.2% year on year, beating analyst expectations by 5.13%. It was a strong quarter for the company, with a solid beat of analysts' revenue estimates and strong growth in its user base.

Coursera Total Revenue

Coursera delivered the fastest revenue growth and highest full year guidance raise among its peers. The company reported 129 million users, up 20.6% year on year. The stock is up 39.8% since the results and currently trades at $18.17.

Is now the time to buy Coursera? Access our full analysis of the earnings results here, it's free.

Weakest Q2: Netflix (NASDAQ:NFLX)

Launched by Reed Hastings as a DVD mail rental company until its famous pivot to streaming in 2007, Netflix (NASDAQ: NFLX) is a pioneering streaming content platform.

Netflix reported revenues of $8.19 billion, up 2.72% year on year, missing analyst expectations by 1.24%. It was a weak quarter for the company, with underwhelming revenue guidance for the next quarter and a miss of analysts' revenue estimates.

Netflix had the weakest performance against analyst estimates and slowest revenue growth in the group. The company reported 238.4 million users, up 8.03% year on year. The stock is down 24.3% since the results and currently trades at $360.99.

Read our full analysis of Netflix's results here.

Udemy (NASDAQ:UDMY)

With courses ranging from investing to cooking and computer programming, Udemy (NASDAQ:UDMY) is an online learning platform connecting learners with expert instructors who specialize in a wide range of topics.

Udemy reported revenues of $178.2 million, up 16.4% year on year, beating analyst expectations by 2.93%. It was a weaker quarter for the company, with underwhelming revenue guidance for the next quarter and full-year revenue guidance missing analysts' expectations.

Udemy had the weakest full year guidance update among its peers. The company reported 1.34 million active buyers, up 3.88% year on year. The stock is down 12.4% since the results and currently trades at $9.89.

Read our full, actionable report on Udemy here, it's free.

Match (NASDAQ:MTCH)

Originally launched as a dial-up service before widespread internet adoption, Match (NASDAQ:MTCH) was an early innovator in online dating and today has a portfolio of apps including Tinder, OkCupid, Match.com, and Hinge.

Match reported revenues of $829.6 million, up 4.41% year on year, beating analyst expectations by 2.23%. It was a weaker quarter for the company, with a decline in its user base and slow revenue growth.

The company reported 15.6 million users, down 4.88% year on year. The stock is down 21.2% since the results and currently trades at $36.35.

Read our full, actionable report on Match here, it's free.

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The author has no position in any of the stocks mentioned