The educational technology company Chegg, facing the impact of AI, has announced a major restructuring plan. The company will cut 388 jobs globally, which represents approximately 45% of its workforce, in an effort to reduce costs and streamline operations. This decision comes as Chegg adapts to the growing shift towards AI-powered tools, which has led to a significant decline in traffic and revenue. The company's CEO, Nathan Schultz, has stepped down, and Dan Rosensweig will return to the role, replacing him. Rosensweig previously led Chegg from 2010 to 2024. The restructuring is expected to incur charges of around $15 million to $19 million by the first quarter of 2026 and $12 million to $16 million by the fourth quarter of 2026. Chegg had 1,271 employees as of December 31, 2024. The company has also sued Google over its AI summaries, claiming they are hurting traffic. Despite the challenges, Chegg will continue to operate as a standalone company, as it has concluded its strategic review and is exploring potential sales or take-private transactions. The company's shares have seen a decline of over 10% so far this year, following an 85.6% slump in 2024.
