Online education platform Chegg has announced it will lay off approximately 22% of its workforce—around 248 employees—as part of a major restructuring plan aimed at reducing costs and repositioning itself in a rapidly evolving digital learning environment. The move reflects Chegg’s struggle to stay relevant as students increasingly turn to AI-powered tools such as ChatGPT, Google’s Gemini, and Anthropic’s Claude for academic assistance.
Best known for textbook rentals, homework help, and tutoring services, Chegg has seen a consistent drop in website traffic, a trend it expects to continue. One major factor is the rise of AI-generated summaries directly in search engine results, which reduce the need for users to visit external platforms. In response, Chegg will close its US and Canadian offices by the end of 2025 and scale back marketing, product development, and administrative functions. These measures are expected to incur charges of $34–$38 million over the next two quarters but are projected to generate $100–$110 million in annual savings by 2026.
Chegg’s battle with AI is also playing out legally. The company recently filed a lawsuit against Google, alleging that AI-generated content is harming original content creators and diverting traffic away from platforms like Chegg. As the edtech sector grapples with the AI revolution, Chegg’s bold restructuring signals the high stakes of staying competitive in an AI-first world.
