It’s early, but the recent headlines around Chegg Inc. are scary.
Chegg Inc. Inc’s stock has dropped ~40% this month as the company warns that Chat GPT threatens the growth of its homework-help services.
Chegg’s revenue and profit forecasts for the current quarter have also fallen short of analysts’ estimates.
The company makes a considerable amount of money from subscriptions, which are at risk if students choose to use AI instead.
The news highlights the growing impact of AI on subscription-based companies.
As generative AI continues to evolve, we are suggesting that our clients treat AI as a formidable competitor in all strategic plans.
We are also advocating for AI to be treated as a real risk to shareholder value, and one that needs to be taken seriously at this point.
Good CEO’s will hedge, and create stronger more sustainable subscription models. 💡
Bad ones won’t, and see shareholder value erode.
The Chegg Inc. use case is a warning.