Chegg to cut almost 250 jobs, terminate lease at South Bay headquarters

(KRON) — Education software maker Chegg announced plans on Monday to cut nearly 250 jobs as part of a restructuring plan. In a filing with the Securities and Exchange Commission, Chegg, which is based in Santa Clara, said it will cut about 22% of its global workforce.

Those jobs will impact 248 people, according to the filing. The job cuts are one component of the restructuring, which is intended to help Chegg align its “cost structure with ongoing industry challenges that are negatively impacting our business, including a decline in traffic,” the company said.

Chegg said it expects to incur charges of around $34 million to $38 million in connection with the job cuts. Around $1 to $35 million of those costs will be incurred as expenditures for employee transition and severance payments, the filing said.

Additionally, Chegg said it had negotiated a lease termination agreement with the landlord at its corporate headquarters in Santa Clara. The agreement provides for an early termination on Dec. 31, 2025. As a result of the agreement, Chegg said it will not be obligated to pay monthly rent during the period of time from July 2025 to December 2025.

Chegg expects a $5.3 million reduction in its contractual operating lease obligations as a result of that agreement.

An education technology company, Chegg saw its business surge during the remote-learning phase of the pandemic. However, recently the company has faced challenges from artificial intelligence and an ongoing dispute with Google that has resulted in it filing a lawsuit against the tech giant.