CHEGG, INC, 10-Q filed on 10/30/2023
Quarterly Report
v3.23.3
Cover Page - shares
 9 Months Ended
Sep. 30, 2023
Oct. 23, 2023
Cover [Abstract]    
Document Type 10-Q  
Document Quarterly Report true  
Document Period End Date Sep. 30, 2023  
Document Transition Report false  
Entity File Number 001-36180  
Entity Registrant Name CHEGG, INC  
Entity Incorporation, State or Country Code DE  
Entity Tax Identification Number 20-3237489  
Entity Address, Address Line One 3990 Freedom Circle  
Entity Address, City or Town Santa Clara  
Entity Address, State or Province CA  
Entity Address, Postal Zip Code 95054  
City Area Code 408  
Local Phone Number 855-5700  
Title of 12(b) Security Common stock, $0.001 par value per share  
Trading Symbol CHGG  
Security Exchange Name NYSE  
Entity Current Reporting Status Yes  
Entity Interactive Data Current Yes  
Entity Filer Category Large Accelerated Filer  
Entity Small Business false  
Entity Emerging Growth Company false  
Entity Shell Company false  
Entity Common Stock, Shares Outstanding   115,814,932
Entity Central Index Key 0001364954  
Current Fiscal Year End Date --12-31  
Document Fiscal Year End 2023  
Document Fiscal Period Focus Q3  
Amendment Flag false  
v3.23.3
CONDENSED CONSOLIDATED BALANCE SHEETS - USD ($)
$ in Thousands
Sep. 30, 2023
Dec. 31, 2022
Current assets    
Cash and cash equivalents $ 94,419 $ 473,677
Short-term investments 166,841 583,973
Accounts receivable, net of allowance of $245 and $394 at September 30, 2023 and December 31, 2022, respectively 30,480 23,515
Prepaid expenses 30,761 28,481
Other current assets 25,195 34,754
Total current assets 347,696 1,144,400
Long-term investments 412,541 216,233
Property and equipment, net 168,735 204,383
Goodwill 617,690 615,093
Intangible assets, net 56,638 78,333
Right of use assets 26,568 18,838
Deferred tax assets 145,807 167,524
Other assets 28,964 20,612
Total assets 1,804,639 2,465,416
Current liabilities    
Accounts payable 18,187 12,367
Deferred revenue 58,906 56,273
Accrued liabilities 73,133 70,234
Total current liabilities 150,226 138,874
Long-term liabilities    
Convertible senior notes, net 599,291 1,188,593
Long-term operating lease liabilities 19,537 13,375
Other long-term liabilities 2,236 7,985
Total long-term liabilities 621,064 1,209,953
Total liabilities 771,290 1,348,827
Commitments and contingencies
Stockholders' equity:    
Preferred stock, $0.001 par value per share, 10,000,000 shares authorized, no shares issued and outstanding 0 0
Common stock, $0.001 par value per share: 400,000,000 shares authorized; 115,671,820 and 126,473,827 shares issued and outstanding at September 30, 2023 and December 31, 2022, respectively 116 126
Additional paid-in capital 1,151,697 1,244,504
Accumulated other comprehensive loss (56,426) (57,488)
Accumulated deficit (62,038) (70,553)
Total stockholders' equity 1,033,349 1,116,589
Total liabilities and stockholders' equity $ 1,804,639 $ 2,465,416
v3.23.3
CONDENSED CONSOLIDATED BALANCE SHEETS (Parenthetical) - USD ($)
$ in Thousands
Sep. 30, 2023
Dec. 31, 2022
Statement of Financial Position [Abstract]    
Accounts receivable, net of allowance $ 245 $ 394
Preferred stock, par value (in dollars per share) $ 0.001 $ 0.001
Preferred stock, shares authorized (in shares) 10,000,000 10,000,000
Preferred stock, shares issued (in shares) 0 0
Preferred stock, shares outstanding (in shares) 0 0
Common stock, par value (in dollars per share) $ 0.001 $ 0.001
Common stock, shares authorized (in shares) 400,000,000 400,000,000
Common stock, shares issued (in shares) 115,671,820 126,473,827
Common stock, shares outstanding (in shares) 115,671,820 126,473,827
v3.23.3
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS - USD ($)
shares in Thousands, $ in Thousands
 3 Months Ended 9 Months Ended
Sep. 30, 2023
Sep. 30, 2022
Sep. 30, 2023
Sep. 30, 2022
Income Statement [Abstract]        
Net revenues $ 157,854 $ 164,739 $ 528,308 $ 561,704
Cost of revenues 83,575 45,203 180,137 145,972
Gross profit 74,279 119,536 348,171 415,732
Operating expenses:        
Research and development 46,202 45,426 145,981 150,321
Sales and marketing 28,872 31,803 96,845 109,580
General and administrative 57,075 53,742 186,357 154,547
Total operating expenses 132,149 130,971 429,183 414,448
(Loss) income from operations (57,870) (11,435) (81,012) 1,284
Interest expense, net and other income, net:        
Interest expense, net (733) (1,525) (3,115) (4,738)
Other income, net 40,492 97,258 116,671 105,247
Total interest expense, net and other income, net 39,759 95,733 113,556 100,509
(Loss) income before (provision for) benefit from income taxes (18,111) 84,298 32,544 101,793
(Provision for) benefit from income taxes (172) 167,264 (24,029) 162,987
Net (loss) income $ (18,283) $ 251,562 $ 8,515 $ 264,780
Net (loss) income per share        
Basic (in dollars per share) $ (0.16) $ 1.99 $ 0.07 $ 2.07
Diluted (in dollars per share) $ (0.16) $ 1.23 $ (0.24) $ 1.31
Weighted average shares used to compute net (loss) income per share        
Basic (in shares) 115,407 126,132 119,001 128,166
Diluted (in shares) 115,407 148,045 121,876 151,221
v3.23.3
CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE (LOSS) INCOME - USD ($)
$ in Thousands
 3 Months Ended 9 Months Ended
Sep. 30, 2023
Sep. 30, 2022
Sep. 30, 2023
Sep. 30, 2022
Statement of Comprehensive Income [Abstract]        
Net (loss) income $ (18,283) $ 251,562 $ 8,515 $ 264,780
Other comprehensive (loss) income        
Change in net unrealized loss on investments, net of tax (322) (1,946) (930) (17,196)
Change in foreign currency translation adjustments, net of tax (12,925) (31,056) 1,992 (79,340)
Other comprehensive (loss) income (13,247) (33,002) 1,062 (96,536)
Total comprehensive (loss) income $ (31,530) $ 218,560 $ 9,577 $ 168,244
v3.23.3
CONDENSED CONSOLIDATED STATEMENTS OF STOCKHOLDERS' EQUITY - USD ($)
$ in Thousands
Total
Common Stock
Additional Paid-In Capital
Accumulated Other Comprehensive Loss
Accumulated Deficit
Beginning balance (in shares) at Dec. 31, 2021   136,952,000      
Beginning balance at Dec. 31, 2021 $ 1,106,917 $ 137 $ 1,449,305 $ (5,334) $ (337,191)
Increase (Decrease) in Stockholders' Equity [Roll Forward]          
Repurchases of common stock (in shares)   (12,709,000)      
Repurchases of common stock (323,528) $ (13) (323,515)    
Issuance of common stock upon exercise of stock options and ESPP (in shares)   319,000      
Issuance of common stock upon exercise of stock options and ESPP 4,557   4,557    
Net share settlement of equity awards (in shares)   862,000      
Net share settlement of equity awards (12,775) $ 1 (12,776)    
Share-based compensation expense 103,117   103,117    
Other comprehensive income (loss) (96,536)     (96,536)  
Net (loss) income 264,780       264,780
Ending balance (in shares) at Sep. 30, 2022   125,424,000      
Ending balance at Sep. 30, 2022 1,046,532 $ 125 1,220,688 (101,870) (72,411)
Beginning balance (in shares) at Dec. 31, 2021   136,952,000      
Beginning balance at Dec. 31, 2021 $ 1,106,917 $ 137 1,449,305 (5,334) (337,191)
Ending balance (in shares) at Dec. 31, 2022 126,473,827 126,474,000      
Ending balance at Dec. 31, 2022 $ 1,116,589 $ 126 1,244,504 (57,488) (70,553)
Beginning balance (in shares) at Jun. 30, 2022   126,344,000      
Beginning balance at Jun. 30, 2022 818,791 $ 126 1,211,506 (68,868) (323,973)
Increase (Decrease) in Stockholders' Equity [Roll Forward]          
Repurchases of common stock (in shares)   (1,147,000)      
Repurchases of common stock (23,078) $ (1) (23,077)    
Net share settlement of equity awards (in shares)   227,000      
Net share settlement of equity awards (2,555)   (2,555)    
Share-based compensation expense 34,814   34,814    
Other comprehensive income (loss) (33,002)     (33,002)  
Net (loss) income 251,562       251,562
Ending balance (in shares) at Sep. 30, 2022   125,424,000      
Ending balance at Sep. 30, 2022 $ 1,046,532 $ 125 1,220,688 (101,870) (72,411)
Beginning balance (in shares) at Dec. 31, 2022 126,473,827 126,474,000      
Beginning balance at Dec. 31, 2022 $ 1,116,589 $ 126 1,244,504 (57,488) (70,553)
Increase (Decrease) in Stockholders' Equity [Roll Forward]          
Repurchases of common stock (in shares)   (13,008,000)      
Repurchases of common stock (186,368) $ (13) (186,355)    
Issuance of common stock upon exercise of stock options and ESPP (in shares)   379,000      
Issuance of common stock upon exercise of stock options and ESPP 3,105   3,105    
Net share settlement of equity awards (in shares)   1,827,000      
Net share settlement of equity awards (13,854) $ 3 (13,857)    
Share-based compensation expense 104,003   104,003    
Proceeds from capped call related to extinguishment of 2025 notes 297   297    
Other comprehensive income (loss) 1,062     1,062  
Net (loss) income $ 8,515       8,515
Ending balance (in shares) at Sep. 30, 2023 115,671,820 115,672,000      
Ending balance at Sep. 30, 2023 $ 1,033,349 $ 116 1,151,697 (56,426) (62,038)
Beginning balance (in shares) at Jun. 30, 2023   115,178,000      
Beginning balance at Jun. 30, 2023 1,035,001 $ 115 1,121,820 (43,179) (43,755)
Increase (Decrease) in Stockholders' Equity [Roll Forward]          
Issuance of common stock upon exercise of stock options and ESPP (in shares)   3,000      
Issuance of common stock upon exercise of stock options and ESPP 26   26    
Net share settlement of equity awards (in shares)   491,000      
Net share settlement of equity awards (2,788) $ 1 (2,789)    
Share-based compensation expense 32,640   32,640    
Other comprehensive income (loss) (13,247)     (13,247)  
Net (loss) income $ (18,283)       (18,283)
Ending balance (in shares) at Sep. 30, 2023 115,671,820 115,672,000      
Ending balance at Sep. 30, 2023 $ 1,033,349 $ 116 $ 1,151,697 $ (56,426) $ (62,038)
v3.23.3
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS - USD ($)
$ in Thousands
 9 Months Ended
Sep. 30, 2023
Sep. 30, 2022
Cash flows from operating activities    
Net income $ 8,515 $ 264,780
Adjustments to reconcile net income to net cash provided by operating activities:    
Share-based compensation expense 101,596 98,341
Other depreciation and amortization expense 108,945 64,295
Deferred income taxes 20,929 6,376
Gain on early extinguishment of debt (85,926) (93,519)
Loss contingency 7,000 0
Operating lease expense, net 4,535 4,746
Impairment of intangible asset 3,600 0
Loss from write-off of property and equipment 3,578 3,117
Amortization of debt issuance costs 2,610 4,084
Gain on foreign currency remeasurement of purchase consideration 0 (4,628)
Tax benefit related to release of valuation allowance 0 (174,601)
Print textbook depreciation expense 0 1,610
Impairment on lease related assets 0 3,411
Gain on textbook library, net 0 (4,976)
Other non-cash items (389) 619
Change in assets and liabilities, net of effect of acquisition of business:    
Accounts receivable (6,908) (2,259)
Prepaid expenses and other current assets 558 13,251
Other assets 8,671 15,926
Accounts payable 4,820 (1,728)
Deferred revenue 2,539 11,434
Accrued liabilities (6,149) (23,323)
Other liabilities (9,810) (5,240)
Net cash provided by operating activities 168,714 181,716
Cash flows from investing activities    
Purchases of property and equipment (57,298) (79,242)
Purchases of textbooks 0 (3,815)
Proceeds from disposition of textbooks 9,787 2,503
Purchases of investments (585,275) (534,008)
Maturities of investments 561,197 783,912
Proceeds from sale of investments 238,681 0
Purchase of strategic equity investment (11,853) (6,000)
Acquisition of business, net of cash acquired 0 (401,125)
Net cash provided by (used in) investing activities 155,239 (237,775)
Cash flows from financing activities    
Proceeds from common stock issued under stock plans, net 3,108 4,558
Payment of taxes related to the net share settlement of equity awards (13,857) (12,776)
Repurchases of common stock (186,368) (323,528)
Repayment of convertible senior notes (505,986) (401,203)
Proceeds from exercise of convertible senior notes capped call 297 0
Net cash used in financing activities (702,806) (732,949)
Effect of exchange rate changes (379) 4,628
Net decrease in cash, cash equivalents and restricted cash (379,232) (784,380)
Cash, cash equivalents and restricted cash, beginning of period 475,854 855,893
Cash, cash equivalents and restricted cash, end of period 96,622 71,513
Supplemental cash flow data:    
Interest 741 875
Income taxes, net of refunds 8,368 5,530
Cash paid for amounts included in the measurement of lease liabilities:    
Operating cash flows from operating leases 7,037 6,908
Right of use assets obtained in exchange for lease obligations:    
Operating leases 12,407 7,603
Non-cash investing and financing activities:    
Accrued purchases of long-lived assets 5,879 4,101
Reconciliation of cash, cash equivalents and restricted cash:    
Cash and cash equivalents 94,419 69,349
Restricted cash included in other current assets 60 63
Restricted cash included in other assets 2,143 2,101
Total cash, cash equivalents and restricted cash $ 96,622 $ 71,513
v3.23.3
Background and Basis of Presentation
 9 Months Ended
Sep. 30, 2023
Organization, Consolidation and Presentation of Financial Statements [Abstract]  
Background and Basis of Presentation Background and Basis of Presentation
Company and Background

Chegg, Inc. (“we,” “us,” “our,” “Company” or “Chegg”), headquartered in Santa Clara, California, was incorporated as a Delaware corporation in July 2005. Millions of people all around the world Learn with Chegg. Our mission is to improve learning and learning outcomes by putting students first. We support life-long learners starting with their academic journey and extending into their careers. The Chegg platform provides products and services to support learners to help them better understand their academic course materials, and also provides personal and professional development skills training, to help them achieve their learning goals.

Basis of Presentation

The accompanying unaudited condensed consolidated financial statements have been prepared in accordance with generally accepted accounting principles in the United States (“GAAP”) and applicable rules and regulations of the U.S. Securities and Exchange Commission (“SEC”) regarding interim financial reporting. The condensed consolidated financial statements include the results of Chegg, Inc. and its wholly-owned subsidiaries. Significant intercompany balances and transactions have been eliminated. In the opinion of management, the accompanying unaudited condensed consolidated financial statements contain all adjustments, including normal recurring adjustments, necessary to present fairly our financial position as of September 30, 2023, our results of operations, results of comprehensive (loss) income, and stockholders' equity for the three and nine months ended September 30, 2023 and 2022 and cash flows for the nine months ended September 30, 2023 and 2022. Our results of operations, results of comprehensive (loss) income, stockholders' equity, and cash flows for the nine months ended September 30, 2023 are not necessarily indicative of the results to be expected for the full year.

We have a single operating and reportable segment and operating unit structure. The condensed consolidated financial statements and related financial information should be read in conjunction with the audited consolidated financial statements and the related notes thereto that are included in our Annual Report on Form 10-K for the year ended December 31, 2022 (the Annual Report on Form 10-K) filed with the SEC.

Except for our policies on strategic investments, there have been no material changes to our significant accounting policies as compared to the significant accounting policies described in our Annual Report on Form 10-K.

Strategic Investments

Investments in partnerships where we have the ability to exercise significant influence, but not control, over the investee are accounted for under the equity method of accounting. Equity method investments are initially recorded at cost and adjusted for our share of the investees' earnings or losses, based on our percentage ownership, recognized on a one-quarter lag basis within other income, net on our condensed consolidated statements of operations.

Investments in entities where we do not have the ability to exercise significant influence and which do not have readily determinable fair values are accounted for at cost, plus or minus changes resulting from observable price changes in orderly transactions for the identical or a similar investment of the same issuer, if any.

Strategic investments are included in other assets on our condensed consolidated balance sheets. We assess our strategic investments for impairment whenever events or changes in circumstances indicate that they may be impaired. The factors we consider in our evaluation include, but are not limited to, a significant deterioration in the earnings performance or business prospects of the investee or factors that raise significant concerns about the investee’s ability to continue as a going concern, such as negative cash flows from operations or working capital deficiencies.

Use of Estimates

The preparation of financial statements in conformity with GAAP requires management to make estimates, judgments, and assumptions that affect the reported amounts of assets and liabilities; the disclosure of contingent liabilities at the date of the financial statements; and the reported amounts of revenues and expenses during the reporting periods. We base our estimates on historical experience, knowledge of current business conditions, and various other factors we believe to be reasonable under the circumstances. These estimates are based on management’s knowledge about current events and
expectations about actions we may undertake in the future. Actual results could differ from these estimates, and such differences could be material to our financial position and results of operations. There have been no material changes in our use of estimates during the nine months ended September 30, 2023 as compared to the use of estimates disclosed in Part II, Item 8 “Consolidated Financial Statements and Supplementary Data” contained in our Annual Report on Form 10-K for the year ended December 31, 2022.

Leases

During the nine months ended September 30, 2023, we extended our existing lease agreement related to our corporate headquarters in Santa Clara and reassessed lease terms related to office spaces internationally in India, resulting in the recording of $12.4 million of right of use assets in exchange for lease liabilities.

The aggregate future minimum lease payments and reconciliation to operating lease liabilities as of September 30, 2023, are as follows (in thousands):
September 30, 2023
Remaining three months of 2023$2,201 
20247,818 
20256,578 
20265,903 
20275,493 
Thereafter1,898 
Total future minimum lease payments29,891 
Less imputed interest(3,485)
Total lease liabilities$26,406 

Condensed Consolidated Statements of Operations Details

Other income, net consists of the following (in thousands):
Three Months Ended
September 30,		Nine Months Ended
September 30,
2023202220232022
Gain on early extinguishment of debt$32,149 $93,519 $85,926 $93,519 
Interest income8,430 3,737 30,351 7,246 
Gain on foreign currency remeasurement of purchase consideration— — — 4,628 
Other(87)2 394 (146)
Total other income, net
$40,492 $97,258 $116,671 $105,247 

Recent Accounting Pronouncements

Recently Issued Accounting Pronouncements Not Yet Adopted

There were no accounting pronouncements issued during the nine months ended September 30, 2023 that would have a material impact on our financial statements.

Recently Adopted Accounting Pronouncements

We did not adopt any accounting pronouncements during the nine months ended September 30, 2023 that had a material impact on our financial statements.
v3.23.3
Revenues
 9 Months Ended
Sep. 30, 2023
Revenue from Contract with Customer [Abstract]  
Revenues Revenues
Revenue Recognition

Revenues are recognized when control of the goods or services is transferred to our customers, in an amount that reflects the consideration we expect to be entitled to in exchange for those goods or services. The majority of our revenues are recognized over time, with certain revenues being recognized at a point in time.

We have changed our revenue disaggregation to Subscription Services and Skills and Other to better reflect the nature and timing of revenue and cash flows. Subscription Services includes revenues from our Chegg Study Pack, Chegg Study, Chegg Writing, Chegg Math, and Busuu offerings. Skills and Other includes revenues from our Skills, advertising services, print textbooks and eTextbooks offerings. We no longer present our Required Materials product line separately as we no longer recognize significant revenue from our print textbook and eTextbooks offerings.

The following tables set forth our total net revenues for the periods shown disaggregated for our Subscription Services and Skills and Other product lines (in thousands, except percentages):
 Three Months Ended
September 30,		Change
 20232022$%
Subscription Services$139,912 $146,001 $(6,089)(4)%
Skills and Other17,942 18,738 (796)(4)
Total net revenues$157,854 $164,739 $(6,885)(4)
 Nine Months Ended
September 30,		Change
 20232022$%
Subscription Services$474,207 $494,462 $(20,255)(4)%
Skills and Other54,101 67,242 (13,141)(20)
Total net revenues$528,308 $561,704 $(33,396)(6)

During the three and nine months ended September 30, 2023, we recognized revenues of $36.6 million and $53.0 million, respectively, that were included in our deferred revenue balance at the beginning of each respective reporting period. During the three and nine months ended September 30, 2022, we recognized revenues of $35.2 million and $33.8 million, respectively, that were included in our deferred revenue balance at the beginning of each respective reporting period.

Contract Balances

The following table presents our accounts receivable, net, contract assets and deferred revenue balances (in thousands, except percentages):
 Change
 September 30,
2023		December 31, 2022$%
Accounts receivable, net$30,480 $23,515 $6,965 30 %
Contract assets9,148 11,946 (2,798)(23)
Deferred revenue58,906 56,273 2,633 5 

During the nine months ended September 30, 2023 our accounts receivable, net balance increased by $7.0 million, or 30%, primarily due to timing of billings and seasonality of our business. During the nine months ended September 30, 2023, our contract assets balance decreased by $2.8 million, or 23%, primarily due to our Thinkful service. During the nine months ended September 30, 2023, our deferred revenue balance increased by $2.6 million, or 5%, primarily due to timing of bookings and seasonality of our business.
v3.23.3
Net (Loss) Income Per Share
 9 Months Ended
Sep. 30, 2023
Earnings Per Share [Abstract]  
Net (Loss) Income Per Share Net (Loss) Income Per Share
The following tables set forth the computation of basic and diluted net (loss) income per share (in thousands, except per share amounts):
Three Months Ended
September 30,		Nine Months Ended
September 30,
2023202220232022
Basic
Numerator:
Net (loss) income
$(18,283)$251,562 $8,515 $264,780 
Denominator:
Weighted average shares used to compute net (loss) income per share, basic
115,407 126,132 119,001 128,166 
Net (loss) income per share, basic
$(0.16)$1.99 $0.07 $2.07 
Diluted
Numerator:
Net (loss) income$(18,283)$251,562 $8,515 $264,780 
Convertible senior notes activity, net of tax(1)
— (69,042)(38,079)(66,630)
Net (loss) income, diluted
$(18,283)$182,520 $(29,564)$198,150 
Denominator:
Weighted average shares used to compute net (loss) income per share, basic
115,407 126,132 119,001 128,166 
Shares related to stock plan activity— 504 — 674 
Shares related to convertible senior notes— 21,409 2,875 22,381 
Weighted average shares used to compute net (loss) income per share, diluted
115,407 148,045 121,876 151,221 
Net (loss) income per share, diluted
$(0.16)$1.23 $(0.24)$1.31 
(1) Includes the gain on early extinguishment and interest expense on our notes, net of tax, when dilutive. For further information, see Note 5, “Convertible Senior Notes.”

The following potential weighted-average shares of common stock outstanding were excluded from the computation of diluted net (loss) income per share because including them would have been anti-dilutive (in thousands):
Three Months Ended
September 30,		Nine Months Ended
September 30,
2023202220232022
Shares related to stock plan activity8,732 7,534 8,349 4,148 
Shares related to convertible senior notes10,280 — 10,378 — 
Total common stock equivalents19,012 7,534 18,727 4,148 
v3.23.3
Cash and Cash Equivalents, Investments and Fair Value Measurements
 9 Months Ended
Sep. 30, 2023
Cash and Cash Equivalents [Abstract]  
Cash and Cash Equivalents, Investments and Fair Value Measurements Cash and Cash Equivalents, Investments and Fair Value Measurements
The following tables show our cash and cash equivalents, and investments’ fair value level classification, adjusted cost, unrealized gain, unrealized loss and fair value as of September 30, 2023 and December 31, 2022 (in thousands except for fair value levels):
 September 30, 2023
 Fair Value LevelAdjusted CostUnrealized GainUnrealized LossFair Value
Cash and cash equivalents:   
Cash$42,015 $— $— $42,015 
Money market fundsLevel 152,404 — — 52,404 
Total cash and cash equivalents$94,419 $— $— $94,419 
Short-term investments:   
Corporate debt securitiesLevel 2$58,911 $— $(258)$58,653 
Agency bondsLevel 2108,919 — (731)108,188 
Total short-term investments$167,830 $— $(989)$166,841 
Long-term investments:   
Corporate debt securitiesLevel 2$220,649 $8 $(2,598)$218,059 
U.S. treasury securitiesLevel 198,462 — (1,248)97,214 
Agency bondsLevel 298,642 — (1,374)97,268 
Total long-term investments$417,753 $8 $(5,220)$412,541 

 December 31, 2022
 Fair Value LevelAdjusted CostUnrealized GainUnrealized LossFair Value
Cash and cash equivalents:   
Cash$33,532 $— $— $33,532 
Money market fundsLevel 1440,145 — — 440,145 
Total cash and cash equivalents$473,677 $— $— $473,677 
Short-term investments:   
Commercial paperLevel 2$11,744 $— $(29)$11,715 
Corporate debt securitiesLevel 2491,459 — (4,130)487,329 
U.S. treasury securitiesLevel 185,271 — (342)84,929 
Total short-term investments$588,474 $— $(4,501)$583,973 
Long-term investments:   
Corporate debt securitiesLevel 2$125,735 $158 $(909)$124,984 
U.S. treasury securitiesLevel 130,633 122 — 30,755 
Agency bondsLevel 260,635 — (141)60,494 
Total long-term investments$217,003 $280 $(1,050)$216,233 

As of September 30, 2023, we determined that the unrealized losses on our investments were not driven by credit related factors. During the three and nine months ended September 30, 2023 and 2022, we did not recognize any losses on our investments due to credit related factors. During the three and nine months ended September 30, 2023 and 2022, our realized gains and losses on investments were not significant.
The following table shows our cash equivalents and investments' adjusted cost and fair value by contractual maturity as of September 30, 2023 (in thousands):
 Adjusted CostFair Value
Due within one year$167,830 $166,841 
Due after one year through three years417,753 412,541 
Investments not due at a single maturity date52,404 52,404 
Total$637,987 $631,786 

Investments not due at a single maturity date in the preceding table consisted of money market funds.

Strategic Investments

In May 2023, we entered into a $15.0 million commitment to invest in Sound Ventures AI Fund, L.P. (Sound Ventures), a limited partnership that invests in artificial intelligence companies, for an approximate 6% ownership. We accounted for our investment under the equity method of accounting. During the nine months ended September 30, 2023, we funded $11.8 million of our investment commitment. As part of the conditions for entering into the investment, we are contractually required to provide additional investment commitments. As of September 30, 2023, we have unfunded investment commitments of $3.2 million, which can be issued at any time within five years of the commencement of the partnership, which occurred in February 2023.

In July 2022, we completed an investment of $6.0 million in Knack Technologies, Inc. (Knack), a privately held U.S. based peer-to-peer tutoring platform for higher education institutions. We do not have the ability to exercise significant influence over Knack's operating and financial policies and have elected to account for our investment at cost as it does not have a readily determinable fair value. We did not record any impairment charges during the three and nine months ended September 30, 2023, as there were no significant identified events or changes in circumstances that would be considered an indicator for impairment. There were no observable price changes in orderly transactions for the identical or similar investments of the same issuer during the three and nine months ended September 30, 2023.

Financial Instruments Not Recorded at Fair Value on a Recurring Basis

We report our financial instruments at fair value with the exception of the notes (defined below). The estimated fair value of the notes was determined based on the trading price of the notes as of the last day of trading for the period. We consider the fair value of the notes to be a Level 2 measurement due to the limited trading activity. The estimated fair value of the 2026 notes as of September 30, 2023 and December 31, 2022 was $191.3 million and $385.0 million, respectively. The estimated fair value of the 2025 notes as of September 30, 2023 and December 31, 2022 was $324.1 million and $640.5 million, respectively. For further information on the notes, refer to Note 5, “Convertible Senior Notes.”
v3.23.3
Convertible Senior Notes
 9 Months Ended
Sep. 30, 2023
Debt Disclosure [Abstract]  
Convertible Senior Notes Convertible Senior NotesIn August 2020, we issued $1.0 billion in aggregate principal amount of 0% convertible senior notes due in 2026 (2026 notes). The aggregate principal amount of the 2026 notes includes $100 million from the initial purchasers fully exercising their option to purchase additional notes. In March 2019, we issued $700 million in aggregate principal amount of 0.125% convertible senior notes due in 2025 (2025 notes, together with the 2026 notes, the notes) and in April 2019, the initial purchasers fully exercised their option to purchase $100 million of additional 2025 notes for aggregate total principal amount of $800 million. The notes were issued in private placements to qualified institutional buyers pursuant to Rule 144A of the Securities Act of 1933, as amended.
The total net proceeds from the notes are as follows (in thousands):
2026 Notes2025 Notes
Principal amount$1,000,000 $800,000 
Less initial purchasers’ discount(15,000)(18,998)
Less other issuance costs(904)(822)
Net proceeds$984,096 $780,180 

The notes are our senior, unsecured obligations and are governed by indenture agreements by and between us and Computershare Trust Company, National Association (as successor to Wells Fargo Bank, National Association), as Trustee (the indentures). The 2026 notes bear no interest and will mature on September 1, 2026, unless repurchased, redeemed or converted in accordance with their terms prior to such date. The 2025 notes bear interest of 0.125% per year which is payable semi-annually in arrears on March 15 and September 15 of each year, beginning on September 15, 2019. The 2025 notes will mature on March 15, 2025, unless repurchased, redeemed or converted in accordance with their terms prior to such date.

Each $1,000 principal amount of the 2026 notes will initially be convertible into 9.2978 shares of our common stock. This is equivalent to an initial conversion price of approximately $107.55 per share, which is subject to adjustment in certain circumstances. Each $1,000 principal amount of the 2025 notes will initially be convertible into 19.3956 shares of our common stock. This is equivalent to an initial conversion price of approximately $51.56 per share, which is subject to adjustment in certain circumstances.

Prior to the close of business on the business day immediately preceding June 1, 2026 for the 2026 notes and December 15, 2024 for the 2025 notes, the notes are convertible at the option of holders only upon satisfaction of the following circumstances:

•during any calendar quarter commencing after the calendar quarter ending on December 31, 2020 for the 2026 notes and June 30, 2019 for the 2025 notes, if the last reported sale price of our common stock for at least 20 trading days (whether or not consecutive) during a period of 30 consecutive trading days ending on, and including, the last trading day of the immediately preceding calendar quarter is greater than or equal to 130% of the respective conversion price for the notes on each applicable trading day;
•during the five-business day period after any 10 consecutive trading day period (the measurement period) in which the trading price per $1,000 principal amount of notes for each trading day of the measurement period was less than 98% of the product of the last reported sale price of our common stock and the conversion rate on each such trading day;
•if we call any or all of the notes for redemption, at any time prior to the close of business on the second scheduled trading day immediately preceding the redemption date; or
•upon the occurrence of certain specified corporate events described in the indentures.

On or after June 1, 2026 for the 2026 notes and December 15, 2024 for the 2025 notes until the close of business on the second scheduled trading day immediately preceding the respective maturity dates, holders may convert their notes at any time, regardless of the foregoing circumstances. Upon conversion, the notes may be settled in shares of our common stock, cash or a combination of cash and shares of our common stock, at our election.

If we undergo a fundamental change, as defined in the indentures, prior to the respective maturity dates, subject to certain conditions, holders of the notes may require us to repurchase for cash all or any portion of their notes at a repurchase price equal to 100% of the principal amount of the notes to be repurchased, plus accrued and unpaid interest to, but excluding, the fundamental change repurchase date. In addition, if specific corporate events, described in the indentures, occur prior to the respective maturity dates, we will also increase the conversion rate for a holder who elects to convert their notes in connection with such specified corporate events.

In August 2023, in connection with our securities repurchase program, we extinguished $169.7 million aggregate principal amount of the 2026 notes in privately-negotiated transactions for a total consideration of $135.8 million, which was paid to the holders in cash. We also incurred approximately $0.4 million in fees resulting in a total reacquisition price of $136.2 million. The carrying amount of the extinguished notes was $168.3 million resulting in a $32.1 million gain on early extinguishment of debt. We elected to reacquire and not cancel the extinguished 2026 notes.

In May 2023, in connection with our securities repurchase program, we extinguished $85.8 million and $341.1 million aggregate principal amount of the 2026 notes and 2025 notes, respectively, in privately-negotiated transactions for a total consideration of $368.6 million, which was paid to the holders in cash. We also incurred approximately $1.2 million in fees
resulting in a total reacquisition price of $369.8 million. The carrying amount of the extinguished notes was $423.5 million resulting in a $53.8 million gain on early extinguishment of debt. We elected to reacquire and not cancel the extinguished 2026 notes and the 2025 notes were canceled with the trustee. Additionally, we terminated 2025 notes capped call transactions underlying 6,615,161 shares of our common stock and received aggregate cash proceeds of $0.3 million.

As of September 30, 2023, we had 9,297,800 and 6,961,352 shares remaining underlying the 2026 notes and 2025 notes, respectively. During the three months ended September 30, 2023, the conditions allowing holders of the 2026 notes and 2025 notes to convert were not met and therefore the 2026 notes and 2025 notes are not convertible the following quarter.

The net carrying amount of the notes is as follows (in thousands):
September 30, 2023December 31, 2022
2026 Notes2025 Notes2026 Notes2025 Notes
Principal$244,479 $358,914 $500,000 $699,979 
Unamortized issuance costs(1,883)(2,219)(4,837)(6,549)
Net carrying amount$242,596 $356,695 $495,163 $693,430 

The following table sets forth the total interest expense recognized related to the notes (in thousands):

Three Months Ended September 30,Nine Months Ended September 30,
2023202220232022
2026 notes:
Contractual interest expense$— $— $— $— 
Amortization of issuance costs238 556 873 1,863 
Total 2026 notes interest expense$238 $556 $873 $1,863 
2025 notes:
Contractual interest expense$112 $220 $510 $654 
Amortization of issuance costs384 749 1,737 2,221 
Total 2025 notes interest expense$496 $969 $2,247 $2,875 

Capped Call Transactions

Concurrently with the offering of the 2026 notes and 2025 notes, we used $103.4 million and $97.2 million, respectively, of the net proceeds to enter into privately negotiated capped call transactions which are expected to reduce or offset potential dilution to holders of our common stock upon conversion of the notes or offset the potential cash payments we would be required to make in excess of the principal amount of any converted notes. The capped call transactions automatically exercise upon conversion of the notes and as of September 30, 2023, cover 9,297,800 and 6,961,352 shares of our common stock for the 2026 notes and 2025 notes, respectively. These are intended to effectively increase the overall conversion price from $107.55 to $156.44 per share for the 2026 notes and $51.56 to $79.32 per share for the 2025 notes. The effective increase in conversion price as a result of the capped call transactions serves to reduce potential dilution to holders of our common stock and/or offset the cash payments we are required to make in excess of the principal amount of any converted notes. As these transactions meet certain accounting criteria, they are recorded in stockholders’ equity as a reduction of additional paid-in capital on our condensed consolidated balance sheets and are not accounted for as derivatives. The fair value of the capped call instrument is not remeasured each reporting period. The cost of the capped call is not expected to be deductible for tax purposes.
v3.23.3
Commitments and Contingencies
 9 Months Ended
Sep. 30, 2023
Commitments and Contingencies Disclosure [Abstract]  
Commitments and Contingencies Commitments and ContingenciesWe may from time to time be subject to certain legal proceedings and claims in the ordinary course of business, including claims of alleged infringement of trademarks, patents, copyrights, and other intellectual property rights; employment claims; and general contract or other claims. We may also, from time to time, be subject to various legal or government claims, demands, disputes, investigations, or requests for information. Such matters may include, but not be limited to, claims, disputes, or investigations related to warranty, refund, breach of contract, employment, intellectual property, government regulation, or compliance or other matters.
On March 1, 2023, Plaintiff Shiva Stein, derivatively on behalf of Chegg, filed a stockholder derivative complaint in the Court of Chancery of the State of Delaware (Case No. 2023-0244-NAC) asserting breach of fiduciary duty, unjust enrichment, and waste of corporate asset claims against members of Chegg’s Board and certain Chegg officers. The matter is stayed. The Company disputes these claims and intends to vigorously defend itself in this matter.

On February 14, 2023, Plaintiff Brian Stansell, individually and on behalf of other similarly situated stockholders of Chegg, filed a putative class action complaint in the Court of Chancery of the State of Delaware (Case No. 2023-0180) on behalf of all Chegg stockholders who were eligible to vote at Chegg's 2022 Annual Stockholders' Meeting, asserting breach of fiduciary duty claims against the members of Chegg's Board. The Company disputes these claims and intends to vigorously defend itself in this matter.

On December 27, 2022, Plaintiff Sheri Moyer, individually and on behalf of all others similarly situated, filed a putative consumer class action in the United States District Court for the Northern District of California (Case No. 22-cv-09123) on behalf of all purchasers of a Chegg product or service as part of an automatic renewal plan or continuous service offer within the past four years. On July 25, 2023, the Company received an order granting its motion to compel arbitration, and the case will be stayed pending arbitration. The Company and Plaintiff have resolved this matter by agreement and dismissal is in process.

On December 22, 2022, JPMorgan Chase Bank, N.A. (JPMC) asserted a demand for repayment by the Company of certain investment proceeds received by the Company in its capacity as an investor in TAPD, Inc. (more commonly known as “Frank”). JPMC seeks such repayment pursuant to certain provisions in the existing Support Agreement between JPMC and the Company that was entered into in connection with JPMC's acquisition of Frank. JPMC has alleged fraud on the part of certain former Frank executives regarding the quantity and quality of its customer accounts. The Company is not at fault however is pursuing a settlement agreement with JPMC. As of September 30, 2023, we believe a loss is probable and reasonably estimable, and we have previously recognized an estimated loss contingency accrual of $7.0 million within general and administrative expense on our condensed consolidated statements of operations during the three months ended June 30, 2023.

On November 9, 2022, Plaintiff Joshua Keller, individually and on behalf of all others similarly situated, filed a putative class action in the United States District Court for the Northern District of California (Case No. 22-cv-06986) on behalf of individuals whose data was allegedly impacted by past data breaches. On August 15, 2023, the Company received an order granting its motion to compel arbitration, and the case will be stayed and administratively closed pending the conclusion of arbitration, if Plaintiff decides to pursue arbitration. The Company disputes Plaintiff's claims and intends to vigorously defend itself in this matter should it continue.

On March 30, 2022, Joseph Robinson, derivatively on behalf of Chegg, filed a shareholder derivative complaint against Chegg and certain of its current and former directors and officers in the United States District Court for the Northern District of California, alleging violations of securities laws and breaches of fiduciary duties. On February 22, 2023, Plaintiff filed an Amended Shareholder Derivative Complaint. This matter has been consolidated with Choi, below, and both matters are stayed. The Company disputes these claims and intends to vigorously defend itself in this matter.

On January 12, 2022, Rak Joon Choi, derivatively on behalf of Chegg, filed a shareholder derivative complaint against Chegg and certain of its current and former directors and officers in the United States District Court for the Northern District of California, alleging violations of securities laws, breaches of fiduciary duties, unjust enrichment, abuse of control, gross mismanagement, and waste of corporate assets. On February 22, 2023, Plaintiff filed an Amended Shareholder Derivative Complaint. This matter has been consolidated with Robinson, above, and both matters are stayed. The Company disputes these claims and intends to vigorously defend itself in this matter.

On December 22, 2021, Steven Leventhal, individually and on behalf of all others similarly situated, filed a purported securities fraud class action on behalf of all purchasers of Chegg common stock between May 5, 2020 and November 1, 2021, inclusive, against Chegg and certain of its current and former officers in the United States District Court for the Northern District of California (Case No. 5:21-cv-09953), alleging that Chegg and several of its officers made materially false and misleading statements in violation of Sections 10(b) and 20(a) of the Securities Exchange Act of 1934. On September 7, 2022, KBC Asset Management and The Pompano Beach Police & Firefighters Retirement System were appointed as lead plaintiff in the case. On December 8, 2022, Plaintiff filed his Amended Complaint and seeks unspecified compensatory damages, costs, and expenses, including counsel and expert fees. The Company disputes these claims and intends to vigorously defend itself in this matter.

On September 13, 2021, Pearson Education, Inc. (Pearson) filed a complaint captioned Pearson Education, Inc. v. Chegg, Inc. (Pearson Complaint) in the United States District Court for the District of New Jersey against the Company (Case 2:21-
cv-16866), alleging infringement of Pearson’s registered copyrights and exclusive rights under copyright in violation of the United States Copyright Act. Pearson is seeking injunctive relief, monetary damages, costs, and attorneys’ fees. The Company filed its answer to the Pearson Complaint on November 19, 2021. Pearson’s June 29, 2022 Motion for Leave to File Amended Complaint seeking to add Bedford, Freeman & Worth Publishing Group, LLC d/b/a Macmillan Learning as a plaintiff was denied. Pearson filed an Amended Complaint on May 10, 2023, and the Company filed an amended answer on June 7, 2023. The Company disputes these claims and intends to vigorously defend itself in this matter.

On June 18, 2020, we received a Civil Investigative Demand (CID) from the Federal Trade Commission (FTC) regarding certain alleged deceptive or unfair acts or practices related to consumer privacy and/or data security. On October 31, 2022, the FTC published the parties’ agreed-upon consent order regarding Chegg’s privacy and data security practices. On January 27, 2023, the FTC finalized its order ("Final Order") requiring Chegg to implement a comprehensive information security program, limit the data the Company can collect and retain, offer users multi factor authentication to secure their accounts, and allow users to request access to and delete their data. No monetary penalties or fines were included in the Final Order.

Aside from the loss contingency accrual recorded related to the Frank matter, we have not recorded any additional loss contingency accruals related to the above matters as we do not believe that a loss is probable in these matters. We are not aware of any other pending legal matters or claims, individually or in the aggregate, that are expected to have a material adverse impact on our consolidated financial position, results of operations, or cash flows. However, our analysis of whether a claim will proceed to litigation cannot be predicted with certainty, nor can the results of litigation be predicted with certainty. Nevertheless, defending any of these actions, regardless of the outcome, may be costly, time consuming, distract management personnel and have a negative effect on our business. An adverse outcome in any of these actions, including a judgment or settlement, may cause a material adverse effect on our future business, operating results and/or financial condition.
v3.23.3
Guarantees and Indemnifications
 9 Months Ended
Sep. 30, 2023
Guarantees And Indemnifications [Abstract]  
Guarantees and Indemnifications Guarantees and Indemnifications
We have agreed to indemnify our directors and officers for certain events or occurrences, subject to certain limits, while such persons are or were serving at our request in such capacity. We may terminate the indemnification agreements with these persons upon termination of employment, but termination will not affect claims for indemnification related to events occurring prior to the effective date of termination. We have a directors’ and officers’ insurance policy that limits our potential exposure up to the limits of our insurance coverage. In addition, we also have other indemnification agreements with various vendors against certain claims, liabilities, losses, and damages. The maximum amount of potential future indemnification is unlimited.

We believe the fair value of these indemnification agreements is immaterial. We have not recorded any liabilities for these agreements as of September 30, 2023.
v3.23.3
Common Stock
 9 Months Ended
Sep. 30, 2023
Equity [Abstract]  
Common Stock Common Stock
We are authorized to issue 400 million shares of our common stock, with a par value per share of $0.001. As of September 30, 2023, we have reserved the following shares of our common stock for future issuance:
September 30, 2023
Outstanding stock options254,209 
Outstanding RSUs and PSUs10,295,610 
Shares available for grant under the 2023 Equity Incentive Plan12,166,070 
Shares available for issuance under the Amended and Restated 2013 Employee Stock Purchase Plan4,000,000 
Total common shares reserved for future issuance26,715,889 
Stock Plans

2023 Equity Incentive Plan

On April 7, 2023, our Board of Directors adopted our 2023 Equity Incentive Plan (the “2023 EIP”), which was subsequently approved by our stockholders and became effective on June 7, 2023, replacing our 2013 Equity Incentive Plan (the “2013 Plan”). On the effective date of the 2023 EIP, 12,000,000 shares of our common stock were reserved for issuance under the 2023 EIP. On June 6, 2023, the date on which the 2013 Plan expired, all remaining shares available for grant under the 2013 Plan were cancelled, and we will not make any additional grants under the 2013 Plan. In addition, any shares subject to awards, including shares subject to awards granted under the 2013 Plan that were outstanding on June 7, 2023, that are cancelled, forfeited, repurchased, expire by their terms without shares being issued, are used to pay the exercise price of an option or stock appreciation right or withheld to satisfy the tax withholding obligations related to any award, will be returned to the pool of shares available for grant and issuance under the 2023 EIP. As of September 30, 2023, there were 12,166,070 shares available for grant under the 2023 EIP. The 2023 EIP permits the granting of incentive stock options, non-qualified stock options, RSUs, restricted stock awards, stock bonus awards, stock appreciation rights and performance awards. The 2023 EIP terminates on April 7, 2033.

Amended and Restated 2013 Employee Stock Purchase Plan

On April 7, 2023, our Board of Directors adopted our Amended and Restated 2013 Employee Stock Purchase Plan (the “A&R ESPP”), which was subsequently approved by our stockholders and became effective on June 7, 2023. The A&R ESPP permits eligible employees to purchase shares of our common stock by accumulating funds through periodic payroll deductions. The A&R ESPP is intended to qualify as an "employee stock purchase plan" under Section 423 of the Code. Under the A&R ESPP, eligible employees will be granted an option to purchase shares of our common stock at a 15% discount to the lesser of the fair market value of our common stock on (i) the first trading day of the applicable offering period or (ii) the last day of each purchase period in the applicable offering period. The Compensation Committee of our Board of Directors shall determine the duration and commencement date of each offering period, provided that an offering period shall in no event be longer than twenty-seven (27) months, except as otherwise provided by an applicable sub-plan. Upon approval of the A&R ESPP, the available share pool under our existing 2013 Employee Stock Purchase Plan was reduced, and we have reserved 4,000,000 shares of our common stock under the A&R ESPP. As of September 30, 2023, there were 4,000,000 shares of common stock available for future issuance under the A&R ESPP.

2023 Equity Inducement Plan

On October 11, 2023, our Board of Directors approved and adopted our 2023 Equity Inducement Plan (the “2023 EINP”). On the effective date of the 2023 EINP, 2,000,000 shares of our common stock were reserved for issuance under the 2023 EINP. The 2023 EINP permits the granting of non-qualified stock options and restricted stock unit awards. The 2023 EINP terminates on the later of (i) October 11, 2033 or (ii) ten years from the last date that additional shares are added to the EINP by the Compensation Committee of our Board of Directors.
v3.23.3
Stockholders' Equity
 9 Months Ended
Sep. 30, 2023
Share-Based Payment Arrangement [Abstract]  
Stockholders' Equity Stockholders' Equity
Share Repurchases

In June 2023, we repurchased 3,433,157 shares of our common stock in open market transactions for $34.5 million.

In February 2023, we entered into an accelerated share repurchase (ASR) agreement with a financial institution (2023 ASR). We accounted for the 2023 ASR as two separate transactions, a repurchase of our common stock and an equity-linked contract indexed to our common stock that met certain accounting criteria for classification in stockholders' equity. Upon execution, we paid a fixed amount of $150.0 million and received an initial delivery of 7,599,747 shares of our common stock, which were retired immediately. The initial delivery of shares of our common stock represented approximately 80 percent of the fixed amount paid of $150.0 million, which was based on the share price of our common stock on the date of execution. The 2023 ASR, along with $1.9 million in associated costs, primarily consisting of an estimated 1% excise tax, were recorded as a reduction to additional paid in capital on our condensed consolidated statements of stockholders’ equity. The 2023 ASR settled during the three months ended June 30, 2023 and we received an additional delivery of 1,974,762 shares of our common stock, which were retired immediately. The 2023 ASR resulted in a total repurchase of 9,574,509 shares of our common stock at a
volume-weighted-average price, less an agreed upon discount, of $15.67 per share. We were not required to make any additional cash payments or delivery of common stock to the financial institution upon settlement.

In February 2022 and December 2021, we entered into ASR agreements with financial institutions. During the year ended December 31, 2022, we received a total of 11,562,475 shares of our common stock from these ASR agreements, which were retired immediately. Additionally, during the year ended December 31, 2022, we repurchased 1,146,803 shares of our common stock in open market transactions.

Securities Repurchase Program

In August 2023, our board of directors approved a $200.0 million increase to our existing securities repurchase program authorizing the repurchase of up to $2.2 billion of our common stock and/or convertible notes, through open market purchases, block trades, and/or privately negotiated transactions or pursuant to Rule 10b5-1 plans, in compliance with applicable securities laws and other legal requirements. The timing, volume, and nature of the repurchases will be determined by management based on the capital needs of the business, market conditions, applicable legal requirements, and other factors.

As of December 31, 2022, we had $642.6 million remaining under the securities repurchase program. During the nine months ended September 30, 2023, we increased our existing securities repurchase program by $200.0 million, repurchased shares of our common stock for $184.5 million and a portion of our notes for $504.4 million. As of September 30, 2023, we had $153.7 million remaining under the securities repurchase program, which has no expiration date and will continue until otherwise suspended, terminated or modified at any time for any reason by our board of directors.

Share-based Compensation Expense

Total share-based compensation expense recorded for employees and non-employees is as follows (in thousands):
 Three Months Ended
September 30,		Nine Months Ended
September 30,
 2023202220232022
Cost of revenues$598 $653 $1,685 $1,945 
Research and development11,027 9,172 33,909 30,954 
Sales and marketing2,435 2,771 7,116 11,176 
General and administrative17,870 21,574 58,886 54,266 
Total share-based compensation expense$31,930 $34,170 $101,596 $98,341 

During the three and nine months ended September 30, 2023, we capitalized share-based compensation expense of $0.7 million and $2.4 million, respectively. During the three and nine months ended September 30, 2022, we capitalized share-based compensation expense of $0.7 million and $4.8 million, respectively. As of September 30, 2023, total unrecognized share-based compensation expense was approximately $170.7 million, which is expected to be recognized over the remaining weighted-average vesting period of approximately 1.9 years.

Activity for RSUs and PSUs is as follows:
 RSUs and PSUs Outstanding
 Shares OutstandingWeighted Average Grant Date Fair Value
Balance at December 31, 20229,155,680 $36.03 
Granted5,546,566 15.39 
Released(2,852,092)35.71 
Forfeited(1,554,544)32.67 
Balance at September 30, 202310,295,610 25.51 
v3.23.3
Restructuring
 9 Months Ended
Sep. 30, 2023
Restructuring and Related Activities [Abstract]  
Restructuring RestructuringIn June 2023, we announced a reduction in workforce to better position the Company to execute against its AI strategy and to create long-term, sustainable value for its students and investors. This resulted in a management approved restructuring plan that impacted approximately 90 employees primarily in the United States. During the nine months ended September 30, 2023, we recorded restructuring charges of $5.7 million related to one-time employee termination benefits classified on our condensed consolidated statements of operations based on the employees' job function. As of September 30, 2023, $4.7 million in payments have been made and the $1.0 million liability is included within accrued liabilities on our condensed consolidated balance sheets. The total cost of the restructuring plan of $5.7 million has been recorded and we expect it to be substantially completed by the end of fiscal 2023. We expect cost savings from the restructuring plan to be reinvested in future growth opportunities.
v3.23.3
Property and Equipment, Net
 9 Months Ended
Sep. 30, 2023
Property, Plant and Equipment [Abstract]  
Property and Equipment, Net Property and Equipment, Net
Property and equipment, net consisted of the following (in thousands):
September 30, 2023December 31, 2022
Content$325,811 $339,879 
Software
43,595 45,422 
Leasehold improvements10,784 10,860 
Furniture and fixtures5,147 4,952 
Computer and equipment3,514 3,321 
Property and equipment388,851 404,434 
Less accumulated depreciation and amortization(220,116)(200,051)
Property and equipment, net$168,735 $204,383 

Depreciation and content amortization expense during the three and nine months ended September 30, 2023 was $56.9 million and $108.9 million, respectively, which included the $34.2 million accelerated depreciation discussed below. Depreciation and content amortization expense during the three and nine months ended September 30, 2022 was $22.4 million and $64.3 million, respectively.

As part of the design and build of our new generative AI experience, in August 2023, we streamlined our product experiences. As a result, we elected to abandon certain content and software assets and accelerated depreciation over shortened useful lives for completed assets as well as impaired in-progress software assets prior to their completion. We also recognized other costs associated with abandoning these content and software assets. Additionally, we impaired our internships.com trade name and adjusted the carrying value to zero. The total content and related assets charge has been recorded during the three months ended September 30, 2023.

Condensed consolidated statements of operations classification and total charge recorded is as follows (in thousands):
Classification
Total charge
Accelerated depreciation of content and software
Cost of revenues$34,195 
Impairment of in-progress software
Cost of revenues2,616 
Other costs
Cost of revenues1,431 
Total costs of revenues
38,242 
Impairment of indefinite-lived trade name
General and administrative3,600 
Total general and administrative expense
3,600 
Total content and related assets charge
$41,842 
v3.23.3
Pay vs Performance Disclosure - USD ($)
$ in Thousands
 3 Months Ended 9 Months Ended
Sep. 30, 2023
Sep. 30, 2022
Sep. 30, 2023
Sep. 30, 2022
Pay vs Performance Disclosure        
Net (loss) income $ (18,283) $ 251,562 $ 8,515 $ 264,780
v3.23.3
Insider Trading Arrangements
 3 Months Ended
Sep. 30, 2023
Trading Arrangements, by Individual  
Rule 10b5-1 Arrangement Adopted false
Non-Rule 10b5-1 Arrangement Adopted false
Rule 10b5-1 Arrangement Terminated false
Non-Rule 10b5-1 Arrangement Terminated false
v3.23.3
Background and Basis of Presentation (Policies)
 9 Months Ended
Sep. 30, 2023
Organization, Consolidation and Presentation of Financial Statements [Abstract]  
Basis of Presentation
Basis of Presentation

The accompanying unaudited condensed consolidated financial statements have been prepared in accordance with generally accepted accounting principles in the United States (“GAAP”) and applicable rules and regulations of the U.S. Securities and Exchange Commission (“SEC”) regarding interim financial reporting. The condensed consolidated financial statements include the results of Chegg, Inc. and its wholly-owned subsidiaries. Significant intercompany balances and transactions have been eliminated. In the opinion of management, the accompanying unaudited condensed consolidated financial statements contain all adjustments, including normal recurring adjustments, necessary to present fairly our financial position as of September 30, 2023, our results of operations, results of comprehensive (loss) income, and stockholders' equity for the three and nine months ended September 30, 2023 and 2022 and cash flows for the nine months ended September 30, 2023 and 2022. Our results of operations, results of comprehensive (loss) income, stockholders' equity, and cash flows for the nine months ended September 30, 2023 are not necessarily indicative of the results to be expected for the full year.

We have a single operating and reportable segment and operating unit structure. The condensed consolidated financial statements and related financial information should be read in conjunction with the audited consolidated financial statements and the related notes thereto that are included in our Annual Report on Form 10-K for the year ended December 31, 2022 (the Annual Report on Form 10-K) filed with the SEC.
Except for our policies on strategic investments, there have been no material changes to our significant accounting policies as compared to the significant accounting policies described in our Annual Report on Form 10-K.
Strategic Investments
Strategic Investments

Investments in partnerships where we have the ability to exercise significant influence, but not control, over the investee are accounted for under the equity method of accounting. Equity method investments are initially recorded at cost and adjusted for our share of the investees' earnings or losses, based on our percentage ownership, recognized on a one-quarter lag basis within other income, net on our condensed consolidated statements of operations.

Investments in entities where we do not have the ability to exercise significant influence and which do not have readily determinable fair values are accounted for at cost, plus or minus changes resulting from observable price changes in orderly transactions for the identical or a similar investment of the same issuer, if any.
Strategic investments are included in other assets on our condensed consolidated balance sheets. We assess our strategic investments for impairment whenever events or changes in circumstances indicate that they may be impaired. The factors we consider in our evaluation include, but are not limited to, a significant deterioration in the earnings performance or business prospects of the investee or factors that raise significant concerns about the investee’s ability to continue as a going concern, such as negative cash flows from operations or working capital deficiencies.
Use of Estimates
Use of Estimates

The preparation of financial statements in conformity with GAAP requires management to make estimates, judgments, and assumptions that affect the reported amounts of assets and liabilities; the disclosure of contingent liabilities at the date of the financial statements; and the reported amounts of revenues and expenses during the reporting periods. We base our estimates on historical experience, knowledge of current business conditions, and various other factors we believe to be reasonable under the circumstances. These estimates are based on management’s knowledge about current events and
expectations about actions we may undertake in the future. Actual results could differ from these estimates, and such differences could be material to our financial position and results of operations.
Recent Accounting Pronouncements
Recent Accounting Pronouncements

Recently Issued Accounting Pronouncements Not Yet Adopted

There were no accounting pronouncements issued during the nine months ended September 30, 2023 that would have a material impact on our financial statements.

Recently Adopted Accounting Pronouncements

We did not adopt any accounting pronouncements during the nine months ended September 30, 2023 that had a material impact on our financial statements.
v3.23.3
Background and Basis of Presentation (Tables)
 9 Months Ended
Sep. 30, 2023
Organization, Consolidation and Presentation of Financial Statements [Abstract]  
Schedule of Maturities of Operating Lease Liabilities
The aggregate future minimum lease payments and reconciliation to operating lease liabilities as of September 30, 2023, are as follows (in thousands):
September 30, 2023
Remaining three months of 2023$2,201 
20247,818 
20256,578 
20265,903 
20275,493 
Thereafter1,898 
Total future minimum lease payments29,891 
Less imputed interest(3,485)
Total lease liabilities$26,406 
Schedule of Other Income Net
Other income, net consists of the following (in thousands):
Three Months Ended
September 30,		Nine Months Ended
September 30,
2023202220232022
Gain on early extinguishment of debt$32,149 $93,519 $85,926 $93,519 
Interest income8,430 3,737 30,351 7,246 
Gain on foreign currency remeasurement of purchase consideration— — — 4,628 
Other(87)2 394 (146)
Total other income, net
$40,492 $97,258 $116,671 $105,247 
v3.23.3
Revenues (Tables)
 9 Months Ended
Sep. 30, 2023
Revenue from Contract with Customer [Abstract]  
Schedule of Disaggregation of Revenue
The following tables set forth our total net revenues for the periods shown disaggregated for our Subscription Services and Skills and Other product lines (in thousands, except percentages):
 Three Months Ended
September 30,		Change
 20232022$%
Subscription Services$139,912 $146,001 $(6,089)(4)%
Skills and Other17,942 18,738 (796)(4)
Total net revenues$157,854 $164,739 $(6,885)(4)
 Nine Months Ended
September 30,		Change
 20232022$%
Subscription Services$474,207 $494,462 $(20,255)(4)%
Skills and Other54,101 67,242 (13,141)(20)
Total net revenues$528,308 $561,704 $(33,396)(6)
Schedule of Accounts Receivable
The following table presents our accounts receivable, net, contract assets and deferred revenue balances (in thousands, except percentages):
 Change
 September 30,
2023		December 31, 2022$%
Accounts receivable, net$30,480 $23,515 $6,965 30 %
Contract assets9,148 11,946 (2,798)(23)
Deferred revenue58,906 56,273 2,633 5 
v3.23.3
Net (Loss) Income Per Share (Tables)
 9 Months Ended
Sep. 30, 2023
Earnings Per Share [Abstract]  
Schedule of Net (Loss) Income Per Share, Basic and Diluted
The following tables set forth the computation of basic and diluted net (loss) income per share (in thousands, except per share amounts):
Three Months Ended
September 30,		Nine Months Ended
September 30,
2023202220232022
Basic
Numerator:
Net (loss) income
$(18,283)$251,562 $8,515 $264,780 
Denominator:
Weighted average shares used to compute net (loss) income per share, basic
115,407 126,132 119,001 128,166 
Net (loss) income per share, basic
$(0.16)$1.99 $0.07 $2.07 
Diluted
Numerator:
Net (loss) income$(18,283)$251,562 $8,515 $264,780 
Convertible senior notes activity, net of tax(1)
— (69,042)(38,079)(66,630)
Net (loss) income, diluted
$(18,283)$182,520 $(29,564)$198,150 
Denominator:
Weighted average shares used to compute net (loss) income per share, basic
115,407 126,132 119,001 128,166 
Shares related to stock plan activity— 504 — 674 
Shares related to convertible senior notes— 21,409 2,875 22,381 
Weighted average shares used to compute net (loss) income per share, diluted
115,407 148,045 121,876 151,221 
Net (loss) income per share, diluted
$(0.16)$1.23 $(0.24)$1.31 
(1) Includes the gain on early extinguishment and interest expense on our notes, net of tax, when dilutive. For further information, see Note 5, “Convertible Senior Notes.”
Schedule of Antidilutive Securities Excluded from Computation of Net (Loss) Income Per Share
The following potential weighted-average shares of common stock outstanding were excluded from the computation of diluted net (loss) income per share because including them would have been anti-dilutive (in thousands):
Three Months Ended
September 30,		Nine Months Ended
September 30,
2023202220232022
Shares related to stock plan activity8,732 7,534 8,349 4,148 
Shares related to convertible senior notes10,280 — 10,378 — 
Total common stock equivalents19,012 7,534 18,727 4,148 
v3.23.3
Cash and Cash Equivalents, Investments and Fair Value Measurements (Tables)
 9 Months Ended
Sep. 30, 2023
Cash and Cash Equivalents [Abstract]  
Schedule of Cash, Cash Equivalents and Investments
The following tables show our cash and cash equivalents, and investments’ fair value level classification, adjusted cost, unrealized gain, unrealized loss and fair value as of September 30, 2023 and December 31, 2022 (in thousands except for fair value levels):
 September 30, 2023
 Fair Value LevelAdjusted CostUnrealized GainUnrealized LossFair Value
Cash and cash equivalents:   
Cash$42,015 $— $— $42,015 
Money market fundsLevel 152,404 — — 52,404 
Total cash and cash equivalents$94,419 $— $— $94,419 
Short-term investments:   
Corporate debt securitiesLevel 2$58,911 $— $(258)$58,653 
Agency bondsLevel 2108,919 — (731)108,188 
Total short-term investments$167,830 $— $(989)$166,841 
Long-term investments:   
Corporate debt securitiesLevel 2$220,649 $8 $(2,598)$218,059 
U.S. treasury securitiesLevel 198,462 — (1,248)97,214 
Agency bondsLevel 298,642 — (1,374)97,268 
Total long-term investments$417,753 $8 $(5,220)$412,541 

 December 31, 2022
 Fair Value LevelAdjusted CostUnrealized GainUnrealized LossFair Value
Cash and cash equivalents:   
Cash$33,532 $— $— $33,532 
Money market fundsLevel 1440,145 — — 440,145 
Total cash and cash equivalents$473,677 $— $— $473,677 
Short-term investments:   
Commercial paperLevel 2$11,744 $— $(29)$11,715 
Corporate debt securitiesLevel 2491,459 — (4,130)487,329 
U.S. treasury securitiesLevel 185,271 — (342)84,929 
Total short-term investments$588,474 $— $(4,501)$583,973 
Long-term investments:   
Corporate debt securitiesLevel 2$125,735 $158 $(909)$124,984 
U.S. treasury securitiesLevel 130,633 122 — 30,755 
Agency bondsLevel 260,635 — (141)60,494 
Total long-term investments$217,003 $280 $(1,050)$216,233 
Schedule of Available-for-sale Securities Reconciliation
The following table shows our cash equivalents and investments' adjusted cost and fair value by contractual maturity as of September 30, 2023 (in thousands):
 Adjusted CostFair Value
Due within one year$167,830 $166,841 
Due after one year through three years417,753 412,541 
Investments not due at a single maturity date52,404 52,404 
Total$637,987 $631,786 
v3.23.3
Convertible Senior Notes (Tables)
 9 Months Ended
Sep. 30, 2023
Debt Disclosure [Abstract]  
Schedule of Long-term Debt Instruments
The total net proceeds from the notes are as follows (in thousands):
2026 Notes2025 Notes
Principal amount$1,000,000 $800,000 
Less initial purchasers’ discount(15,000)(18,998)
Less other issuance costs(904)(822)
Net proceeds$984,096 $780,180 
Schedule of Debt
The net carrying amount of the notes is as follows (in thousands):
September 30, 2023December 31, 2022
2026 Notes2025 Notes2026 Notes2025 Notes
Principal$244,479 $358,914 $500,000 $699,979 
Unamortized issuance costs(1,883)(2,219)(4,837)(6,549)
Net carrying amount$242,596 $356,695 $495,163 $693,430 
Schedule Of Interest Expense Recognized
The following table sets forth the total interest expense recognized related to the notes (in thousands):

Three Months Ended September 30,Nine Months Ended September 30,
2023202220232022
2026 notes:
Contractual interest expense$— $— $— $— 
Amortization of issuance costs238 556 873 1,863 
Total 2026 notes interest expense$238 $556 $873 $1,863 
2025 notes:
Contractual interest expense$112 $220 $510 $654 
Amortization of issuance costs384 749 1,737 2,221 
Total 2025 notes interest expense$496 $969 $2,247 $2,875 
v3.23.3
Common Stock (Tables)
 9 Months Ended
Sep. 30, 2023
Equity [Abstract]  
Schedule Of Common Stock Reserved For Future Issuance As of September 30, 2023, we have reserved the following shares of our common stock for future issuance:
September 30, 2023
Outstanding stock options254,209 
Outstanding RSUs and PSUs10,295,610 
Shares available for grant under the 2023 Equity Incentive Plan12,166,070 
Shares available for issuance under the Amended and Restated 2013 Employee Stock Purchase Plan4,000,000 
Total common shares reserved for future issuance26,715,889 
v3.23.3
Stockholders' Equity (Tables)
 9 Months Ended
Sep. 30, 2023
Share-Based Payment Arrangement [Abstract]  
Schedule of Stock-Based Compensation Expense for Employees and Non-Employees
Total share-based compensation expense recorded for employees and non-employees is as follows (in thousands):
 Three Months Ended
September 30,		Nine Months Ended
September 30,
 2023202220232022
Cost of revenues$598 $653 $1,685 $1,945 
Research and development11,027 9,172 33,909 30,954 
Sales and marketing2,435 2,771 7,116 11,176 
General and administrative17,870 21,574 58,886 54,266 
Total share-based compensation expense$31,930 $34,170 $101,596 $98,341 
Schedule of Restricted Stock Unit Activity
Activity for RSUs and PSUs is as follows:
 RSUs and PSUs Outstanding
 Shares OutstandingWeighted Average Grant Date Fair Value
Balance at December 31, 20229,155,680 $36.03 
Granted5,546,566 15.39 
Released(2,852,092)35.71 
Forfeited(1,554,544)32.67 
Balance at September 30, 202310,295,610 25.51 
v3.23.3
Property and Equipment, Net (Tables)
 9 Months Ended
Sep. 30, 2023
Property, Plant and Equipment [Abstract]  
Schedule of Property and Equipment, Net
Property and equipment, net consisted of the following (in thousands):
September 30, 2023December 31, 2022
Content$325,811 $339,879 
Software
43,595 45,422 
Leasehold improvements10,784 10,860 
Furniture and fixtures5,147 4,952 
Computer and equipment3,514 3,321 
Property and equipment388,851 404,434 
Less accumulated depreciation and amortization(220,116)(200,051)
Property and equipment, net$168,735 $204,383 
Schedule of Total Expense Related to Site Experience Realignment
Condensed consolidated statements of operations classification and total charge recorded is as follows (in thousands):
Classification
Total charge
Accelerated depreciation of content and software
Cost of revenues$34,195 
Impairment of in-progress software
Cost of revenues2,616 
Other costs
Cost of revenues1,431 
Total costs of revenues
38,242 
Impairment of indefinite-lived trade name
General and administrative3,600 
Total general and administrative expense
3,600 
Total content and related assets charge
$41,842 
v3.23.3
Background and Basis of Presentation - Narrative (Details)
$ in Thousands
 9 Months Ended
Sep. 30, 2023
USD ($)
segment
Sep. 30, 2022
USD ($)
Organization, Consolidation and Presentation of Financial Statements [Abstract]    
Number of operating segments 1  
Number of reportable segments 1  
Operating leases | $ $ 12,407 $ 7,603
v3.23.3
Background and Basis of Presentation - Maturities of Operating Lease Liabilities (Details)
$ in Thousands
Sep. 30, 2023
USD ($)
Organization, Consolidation and Presentation of Financial Statements [Abstract]  
Remaining three months of 2023 $ 2,201
2024 7,818
2025 6,578
2026 5,903
2027 5,493
Thereafter 1,898
Total future minimum lease payments 29,891
Less imputed interest (3,485)
Total lease liabilities $ 26,406
v3.23.3
Background and Basis of Presentation - Other Income Net (Details) - USD ($)
$ in Thousands
 3 Months Ended 9 Months Ended
Sep. 30, 2023
Sep. 30, 2022
Sep. 30, 2023
Sep. 30, 2022
Organization, Consolidation and Presentation of Financial Statements [Abstract]        
Gain on early extinguishment of debt $ 32,149 $ 93,519 $ 85,926 $ 93,519
Interest income 8,430 3,737 30,351 7,246
Gain on foreign currency remeasurement of purchase consideration 0 0 0 4,628
Other (87) 2 394 (146)
Total other income, net $ 40,492 $ 97,258 $ 116,671 $ 105,247
v3.23.3
Revenues - Disaggregation of Revenue (Details) - USD ($)
$ in Thousands
 3 Months Ended 9 Months Ended
Sep. 30, 2023
Sep. 30, 2022
Sep. 30, 2023
Sep. 30, 2022
Disaggregation of Revenue [Line Items]        
Total net revenues $ 157,854 $ 164,739 $ 528,308 $ 561,704
Change, Total net revenues $ (6,885)   $ (33,396)  
Change, Total net revenues, percent (4.00%)   (6.00%)  
Subscription Services        
Disaggregation of Revenue [Line Items]        
Total net revenues $ 139,912 146,001 $ 474,207 494,462
Change, Total net revenues $ (6,089)   $ (20,255)  
Change, Total net revenues, percent (4.00%)   (4.00%)  
Skills and Other        
Disaggregation of Revenue [Line Items]        
Total net revenues $ 17,942 $ 18,738 $ 54,101 $ 67,242
Change, Total net revenues $ (796)   $ (13,141)  
Change, Total net revenues, percent (4.00%)   (20.00%)  
v3.23.3
Revenues - Narrative (Details) - USD ($)
$ in Thousands
 3 Months Ended 9 Months Ended
Sep. 30, 2023
Sep. 30, 2022
Sep. 30, 2023
Sep. 30, 2022
Revenue from Contract with Customer [Abstract]        
Contract with customer, liability, revenue recognized $ 36,600 $ 35,200 $ 53,000 $ 33,800
Increase in accounts receivable, net     $ 6,965  
Increase in accounts receivable, net, percent     30.00%  
Decrease in contract assets     $ 2,798  
Decrease in contract assets, percent     23.00%  
Increase in deferred revenue     $ 2,633  
Increase in deferred revenue, percent     5.00%  
v3.23.3
Revenues - Contract Balances (Details) - USD ($)
$ in Thousands
 9 Months Ended
Sep. 30, 2023
Dec. 31, 2022
Revenue from Contract with Customer [Abstract]    
Accounts receivable, net $ 30,480 $ 23,515
Change, Accounts receivable, net $ 6,965  
Change, Accounts receivable, net, percent 30.00%  
Contract assets $ 9,148 11,946
Change, Contract assets $ (2,798)  
Change, Contract assets, percent (23.00%)  
Deferred revenue $ 58,906 $ 56,273
Change, Deferred revenue $ 2,633  
Change, Deferred revenue, percent 5.00%  
v3.23.3
Net (Loss) Income Per Share - Computation of Basic and Diluted Net (Loss) Income Per Share (Details) - USD ($)
$ / shares in Units, shares in Thousands, $ in Thousands
 3 Months Ended 9 Months Ended
Sep. 30, 2023
Sep. 30, 2022
Sep. 30, 2023
Sep. 30, 2022
Numerator:        
Net (loss) income $ (18,283) $ 251,562 $ 8,515 $ 264,780
Convertible senior notes activity, net of tax 0 (69,042) (38,079) (66,630)
Net (loss) income, diluted $ (18,283) $ 182,520 $ (29,564) $ 198,150
Denominator:        
Weighted average shares used to compute net (loss) income per share, basic (in shares) 115,407 126,132 119,001 128,166
Net (loss) income per share, basic (in dollars per share) $ (0.16) $ 1.99 $ 0.07 $ 2.07
Weighted average shares used to compute net (loss) income per share, diluted (in shares) 115,407 148,045 121,876 151,221
Net (loss) income per share, diluted (in dollars per share) $ (0.16) $ 1.23 $ (0.24) $ 1.31
Shares related to stock plan activity        
Denominator:        
Incremental common shares attributable to dilutive effect (in shares) 0 504 0 674
Shares related to convertible senior notes        
Denominator:        
Incremental common shares attributable to dilutive effect (in shares) 0 21,409 2,875 22,381
v3.23.3
Net (Loss) Income Per Share - Shares Excluded From Computation Of Diluted Net (Loss) Income Per Share (Details) - shares
shares in Thousands
 3 Months Ended 9 Months Ended
Sep. 30, 2023
Sep. 30, 2022
Sep. 30, 2023
Sep. 30, 2022
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items]        
Total common stock equivalents (in shares) 19,012 7,534 18,727 4,148
Shares related to stock plan activity        
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items]        
Total common stock equivalents (in shares) 8,732 7,534 8,349 4,148
Shares related to convertible senior notes        
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items]        
Total common stock equivalents (in shares) 10,280 0 10,378 0
v3.23.3
Cash and Cash Equivalents, Investments and Fair Value Measurements - Schedule of Available For Sale Securities (Details) - USD ($)
$ in Thousands
Sep. 30, 2023
Dec. 31, 2022
Debt Securities, Available-for-sale [Line Items]    
Adjusted Cost $ 637,987  
Fair Value 631,786  
Cash and cash equivalents:    
Debt Securities, Available-for-sale [Line Items]    
Adjusted Cost 94,419 $ 473,677
Unrealized Gain 0 0
Unrealized Loss 0 0
Fair Value 94,419 473,677
Cash and cash equivalents: | Cash    
Debt Securities, Available-for-sale [Line Items]    
Adjusted Cost 42,015 33,532
Unrealized Gain 0 0
Unrealized Loss 0 0
Fair Value 42,015 33,532
Cash and cash equivalents: | Money market funds | Level 1    
Debt Securities, Available-for-sale [Line Items]    
Adjusted Cost 52,404 440,145
Unrealized Gain 0 0
Unrealized Loss 0 0
Fair Value 52,404 440,145
Short-term investments:    
Debt Securities, Available-for-sale [Line Items]    
Adjusted Cost 167,830 588,474
Unrealized Gain 0 0
Unrealized Loss (989) (4,501)
Fair Value 166,841 583,973
Short-term investments: | Commercial paper | Level 2    
Debt Securities, Available-for-sale [Line Items]    
Adjusted Cost   11,744
Unrealized Gain   0
Unrealized Loss   (29)
Fair Value   11,715
Short-term investments: | Corporate debt securities | Level 2    
Debt Securities, Available-for-sale [Line Items]    
Adjusted Cost 58,911 491,459
Unrealized Gain 0 0
Unrealized Loss (258) (4,130)
Fair Value 58,653 487,329
Short-term investments: | U.S. treasury securities | Level 1    
Debt Securities, Available-for-sale [Line Items]    
Adjusted Cost   85,271
Unrealized Gain   0
Unrealized Loss   (342)
Fair Value   84,929
Short-term investments: | Agency bonds | Level 2    
Debt Securities, Available-for-sale [Line Items]    
Adjusted Cost 108,919  
Unrealized Gain 0  
Unrealized Loss (731)  
Fair Value 108,188  
Long-term investments:    
Debt Securities, Available-for-sale [Line Items]    
Adjusted Cost 417,753 217,003
Unrealized Gain 8 280
Unrealized Loss (5,220) (1,050)
Fair Value 412,541 216,233
Long-term investments: | Corporate debt securities | Level 2    
Debt Securities, Available-for-sale [Line Items]    
Adjusted Cost 220,649 125,735
Unrealized Gain 8 158
Unrealized Loss (2,598) (909)
Fair Value 218,059 124,984
Long-term investments: | U.S. treasury securities | Level 1    
Debt Securities, Available-for-sale [Line Items]    
Adjusted Cost 98,462 30,633
Unrealized Gain 0 122
Unrealized Loss (1,248) 0
Fair Value 97,214 30,755
Long-term investments: | Agency bonds | Level 2    
Debt Securities, Available-for-sale [Line Items]    
Adjusted Cost 98,642 60,635
Unrealized Gain 0 0
Unrealized Loss (1,374) (141)
Fair Value $ 97,268 $ 60,494
v3.23.3
Cash and Cash Equivalents, Investments and Fair Value Measurements - Contractual Maturity (Details)
$ in Thousands
Sep. 30, 2023
USD ($)
Adjusted Cost  
Due within one year $ 167,830
Due after one year through three years 417,753
Investments not due at a single maturity date 52,404
Adjusted Cost 637,987
Fair Value  
Due within one year 166,841
Due after one year through three years 412,541
Investments not due at a single maturity date 52,404
Fair Value $ 631,786
v3.23.3
Cash and Cash Equivalents, Investments and Fair Value Measurements - Strategic Investments (Details) - USD ($)
$ in Thousands
 1 Months Ended 9 Months Ended
May 31, 2023
Sep. 30, 2023
Sep. 30, 2022
Jul. 31, 2022
Schedule of Investments [Line Items]        
Funded capital calls   $ 11,853 $ 6,000  
Sound Ventures AI Fund, LP        
Schedule of Investments [Line Items]        
Commitment to invest $ 15,000      
Invests in artificial intelligence companies, ownership percentage 6.00%      
Funded capital calls   11,800    
Unfunded investment   $ 3,200    
Unfunded commitment, length of period to issue   5 years    
Knack Technologies, Inc        
Schedule of Investments [Line Items]        
Investment without readily determinable fair value       $ 6,000
v3.23.3
Cash and Cash Equivalents, Investments and Fair Value Measurements - Debt (Details) - Estimate of Fair Value Measurement - Senior Notes - Fair Value, Measurements, Nonrecurring - USD ($)
$ in Millions
Sep. 30, 2023
Dec. 31, 2022
Senior Notes due 2026    
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]    
Convertible senior notes $ 191.3 $ 385.0
Senior Notes due 2025    
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]    
Convertible senior notes $ 324.1 $ 640.5
v3.23.3
Convertible Senior Notes - Narrative (Details)
$ / shares in Units, $ in Thousands
 1 Months Ended 3 Months Ended 9 Months Ended
Aug. 31, 2023
USD ($)
May 31, 2023
USD ($)
Aug. 31, 2020
USD ($)
$ / shares
Apr. 30, 2019
USD ($)
$ / shares
Sep. 30, 2023
USD ($)
$ / shares
shares
Sep. 30, 2022
USD ($)
Sep. 30, 2023
USD ($)
day
$ / shares
shares
Sep. 30, 2022
USD ($)
Dec. 31, 2022
USD ($)
Mar. 31, 2019
USD ($)
Debt Instrument [Line Items]                    
Repayments of convertible senior notes             $ 505,986 $ 401,203    
Gain on early extinguishment of debt         $ 32,149 $ 93,519 85,926 93,519    
Proceeds from exercise and termination of convertible senior notes capped call             $ 297 $ 0    
Senior Notes | Sale Price Is Greater Or Equal 130%                    
Debt Instrument [Line Items]                    
Threshold trading days | day             20      
Threshold consecutive trading days | day             30      
Threshold percentage of stock price trigger             130.00%      
Senior Notes | Trading Price Per $1,000 Principal Amount Less Than 98%                    
Debt Instrument [Line Items]                    
Threshold trading days | day             5      
Threshold consecutive trading days | day             10      
Senior Notes | Trading Price Per $1,000 Principal Amount Less Than 98% | Maximum                    
Debt Instrument [Line Items]                    
Threshold percentage of stock price trigger             98.00%      
Senior Notes | Fundamental Change Scenario                    
Debt Instrument [Line Items]                    
Threshold percentage of stock price trigger             100.00%      
Senior Notes due 2026 | Senior Notes                    
Debt Instrument [Line Items]                    
Face value     $ 1,000,000   $ 244,479   $ 244,479   $ 500,000  
Interest rate, stated percentage     0.00%              
Proceeds from issuance of debt     $ 1,000,000              
Conversion ratio     0.0092978              
Conversion price (in dollars per share) | $ / shares     $ 107.55              
Repurchased face amount $ 169,700 $ 85,800                
Repayments of convertible senior notes 135,800                  
Extinguishment incurred 400                  
Debt instrument, reacquisition price of debt 136,200                  
Debt extinguished 168,300                  
Gain on early extinguishment of debt $ 32,100                  
Net proceeds     $ 984,096              
Senior Notes due 2026 | Senior Notes | Capped Call                    
Debt Instrument [Line Items]                    
Conversion price (in dollars per share) | $ / shares         $ 156.44   $ 156.44      
Debt instrument, convertible (in shares) | shares         9,297,800   9,297,800      
Net proceeds     103,400              
0% Convertible Senior Notes Due 2026, Additional Notes | Senior Notes                    
Debt Instrument [Line Items]                    
Face value     $ 100,000              
Senior Notes due 2025 | Senior Notes                    
Debt Instrument [Line Items]                    
Face value       $ 100,000 $ 358,914   $ 358,914   $ 699,979 $ 700,000
Interest rate, stated percentage                   0.125%
Proceeds from issuance of debt       $ 800,000            
Conversion ratio       0.0193956            
Conversion price (in dollars per share) | $ / shares       $ 51.56            
Repurchased face amount   341,100                
Net proceeds       $ 780,180            
Senior Notes due 2025 | Senior Notes | Terminated Capped Call                    
Debt Instrument [Line Items]                    
Debt instrument, convertible (in shares) | shares         6,615,161   6,615,161      
Senior Notes due 2025 | Senior Notes | Capped Call                    
Debt Instrument [Line Items]                    
Conversion price (in dollars per share) | $ / shares         $ 79.32   $ 79.32      
Debt instrument, convertible (in shares) | shares         6,961,352   6,961,352      
Net proceeds       $ 97,200            
0% Convertible Senior Notes Due 2026 And 0.125% Convertible Senior Notes Due 2025 | Senior Notes                    
Debt Instrument [Line Items]                    
Repayments of convertible senior notes   368,600                
Extinguishment incurred   1,200                
Debt instrument, reacquisition price of debt   369,800                
Debt extinguished   423,500                
Gain on early extinguishment of debt   $ 53,800                
v3.23.3
Convertible Senior Notes - Long-term Debt Instruments (Details) - Senior Notes - USD ($)
$ in Thousands
 1 Months Ended
Aug. 31, 2020
Apr. 30, 2019
2026 Notes    
Debt Instrument [Line Items]    
Principal amount $ 1,000,000  
Less initial purchasers’ discount (15,000)  
Less other issuance costs (904)  
Net proceeds $ 984,096  
2025 Notes    
Debt Instrument [Line Items]    
Principal amount   $ 800,000
Less initial purchasers’ discount   (18,998)
Less other issuance costs   (822)
Net proceeds   $ 780,180
v3.23.3
Convertible Senior Notes - Net Carrying Amount (Details) - Senior Notes - USD ($)
$ in Thousands
Sep. 30, 2023
Dec. 31, 2022
Aug. 31, 2020
Apr. 30, 2019
Mar. 31, 2019
2026 Notes          
Debt Instrument [Line Items]          
Principal $ 244,479 $ 500,000 $ 1,000,000    
Unamortized issuance costs (1,883) (4,837)      
2026 Notes | Carrying Amount | Fair Value, Measurements, Nonrecurring          
Debt Instrument [Line Items]          
Net carrying amount 242,596 495,163      
2025 Notes          
Debt Instrument [Line Items]          
Principal 358,914 699,979   $ 100,000 $ 700,000
Unamortized issuance costs (2,219) (6,549)      
2025 Notes | Carrying Amount | Fair Value, Measurements, Nonrecurring          
Debt Instrument [Line Items]          
Net carrying amount $ 356,695 $ 693,430      
v3.23.3
Convertible Senior Notes - Interest Expense Recognized (Details) - Senior Notes - USD ($)
$ in Thousands
 3 Months Ended 9 Months Ended
Sep. 30, 2023
Sep. 30, 2022
Sep. 30, 2023
Sep. 30, 2022
2026 Notes        
Debt Instrument [Line Items]        
Contractual interest expense $ 0 $ 0 $ 0 $ 0
Amortization of issuance costs 238 556 873 1,863
Total interest expense 238 556 873 1,863
2025 Notes        
Debt Instrument [Line Items]        
Contractual interest expense 112 220 510 654
Amortization of issuance costs 384 749 1,737 2,221
Total interest expense $ 496 $ 969 $ 2,247 $ 2,875
v3.23.3
Convertible Senior Notes - Capped Call Transactions (Details) - Senior Notes - USD ($)
$ / shares in Units, $ in Thousands
 1 Months Ended
Aug. 31, 2020
Apr. 30, 2019
Sep. 30, 2023
Senior Notes due 2026      
Debt Instrument [Line Items]      
Net proceeds $ 984,096    
Conversion price (in dollars per share) $ 107.55    
Senior Notes due 2025      
Debt Instrument [Line Items]      
Net proceeds   $ 780,180  
Conversion price (in dollars per share)   $ 51.56  
Capped Call | Senior Notes due 2026      
Debt Instrument [Line Items]      
Net proceeds $ 103,400    
Debt instrument, convertible (in shares)     9,297,800
Conversion price (in dollars per share)     $ 156.44
Capped Call | Senior Notes due 2025      
Debt Instrument [Line Items]      
Net proceeds   $ 97,200  
Debt instrument, convertible (in shares)     6,961,352
Conversion price (in dollars per share)     $ 79.32
v3.23.3
Commitments and Contingencies (Details)
$ in Millions
Sep. 30, 2023
USD ($)
Commitments and Contingencies Disclosure [Abstract]  
Loss contingency accrual $ 7.0
v3.23.3
Common Stock - Narrative (Details) - $ / shares
Oct. 11, 2023
Jun. 07, 2023
Sep. 30, 2023
Dec. 31, 2022
Class of Stock [Line Items]        
Common stock, shares authorized (in shares)     400,000,000 400,000,000
Common stock, par value (in dollars per share)     $ 0.001 $ 0.001
Total common shares reserved for future issuance (in shares)     26,715,889  
2023 Equity Incentive Plan        
Class of Stock [Line Items]        
Total common shares reserved for future issuance (in shares)   12,000,000    
Shares available for grant under the 2023 EIP (in shares)     12,166,070  
2013 Employee Stock Purchase Plan        
Class of Stock [Line Items]        
Total common shares reserved for future issuance (in shares)     4,000,000  
Employee discount on applicable offering period   15.00%    
Maximum offering period   27 months    
Shares reserved (in shares)   4,000,000    
2023 Equity Inducement Plan | Subsequent Event        
Class of Stock [Line Items]        
Total common shares reserved for future issuance (in shares) 2,000,000      
Common shares reserved for future issuance, length of termination period 10 years      
v3.23.3
Common Stock - Schedule of Common Stock Reserved for Future Issuance (Details) - shares
Sep. 30, 2023
Jun. 07, 2023
Dec. 31, 2022
Class of Stock [Line Items]      
Outstanding stock options (in shares) 254,209    
Total common shares reserved for future issuance (in shares) 26,715,889    
2023 Equity Incentive Plan      
Class of Stock [Line Items]      
Shares available for grant under the 2023 EIP (in shares) 12,166,070    
Total common shares reserved for future issuance (in shares)   12,000,000  
2013 Employee Stock Purchase Plan      
Class of Stock [Line Items]      
Total common shares reserved for future issuance (in shares) 4,000,000    
RSUs and PSUs      
Class of Stock [Line Items]      
Outstanding RSUs and PSUs (in shares) 10,295,610   9,155,680
v3.23.3
Stockholders' Equity - Share Repurchase (Details)
$ / shares in Units, $ in Thousands
 1 Months Ended 3 Months Ended 9 Months Ended 12 Months Ended
Jun. 30, 2023
USD ($)
shares
Feb. 28, 2023
USD ($)
transaction
shares
Jun. 30, 2023
shares
Sep. 30, 2022
USD ($)
Sep. 30, 2023
USD ($)
$ / shares
shares
Sep. 30, 2022
USD ($)
Dec. 31, 2022
shares
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]              
Repurchases of common stock       $ 23,078 $ 186,368 $ 323,528  
Purchase price         $ 186,368 $ 323,528  
Open Market Transactions              
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]              
Repurchases of common stock (in shares) | shares 3,433,157           1,146,803
Repurchases of common stock $ 34,500            
2023 ASR              
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]              
Repurchases of common stock (in shares) | shares         9,574,509    
Number of transactions | transaction   2          
Purchase price   $ 150,000          
Stock repurchased and retired during period, shares (in shares) | shares   7,599,747 1,974,762        
Stock repurchased and retired during period, percentage   80.00%          
Associated costs   $ 1,900          
Stock repurchased of excise tax percentage   1.00%          
Stock repurchased and retired during the period, weighted-average price (in dollars per share) | $ / shares         $ 15.67    
Accelerated Share Repurchase Program              
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]              
Stock repurchased and retired during period, shares (in shares) | shares             11,562,475
v3.23.3
Stockholders' Equity - Securities Repurchase Program (Details) - USD ($)
$ in Thousands
 1 Months Ended 3 Months Ended 9 Months Ended
Aug. 31, 2023
May 31, 2023
Sep. 30, 2022
Sep. 30, 2023
Sep. 30, 2022
Dec. 31, 2022
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]            
Repurchases of common stock     $ 23,078 $ 186,368 $ 323,528  
Repayments of convertible senior notes       505,986 $ 401,203  
Securities Repurchase Program            
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]            
Stock repurchase program, increase of authorized amount $ 200,000     200,000    
Stock repurchase program, authorized amount $ 2,200,000          
Remaining under repurchase program       153,700   $ 642,600
Repurchases of common stock       184,500    
0% Convertible Senior Notes Due 2026 And 0.125% Convertible Senior Notes Due 2025 | Senior Notes            
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]            
Repayments of convertible senior notes   $ 368,600        
0% Convertible Senior Notes Due 2026 And 0.125% Convertible Senior Notes Due 2025 | Senior Notes | Securities Repurchase Program            
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]            
Repayments of convertible senior notes       $ 504,400    
v3.23.3
Stockholders' Equity - Schedule of Share-based Compensation Expense (Details) - USD ($)
$ in Thousands
 3 Months Ended 9 Months Ended
Sep. 30, 2023
Sep. 30, 2022
Sep. 30, 2023
Sep. 30, 2022
Employee Service Share Based Compensation Allocation Of Recognized Period Costs [Line Items]        
Total share-based compensation expense $ 31,930 $ 34,170 $ 101,596 $ 98,341
Cost of revenues        
Employee Service Share Based Compensation Allocation Of Recognized Period Costs [Line Items]        
Total share-based compensation expense 598 653 1,685 1,945
Research and development        
Employee Service Share Based Compensation Allocation Of Recognized Period Costs [Line Items]        
Total share-based compensation expense 11,027 9,172 33,909 30,954
Sales and marketing        
Employee Service Share Based Compensation Allocation Of Recognized Period Costs [Line Items]        
Total share-based compensation expense 2,435 2,771 7,116 11,176
General and administrative        
Employee Service Share Based Compensation Allocation Of Recognized Period Costs [Line Items]        
Total share-based compensation expense $ 17,870 $ 21,574 $ 58,886 $ 54,266
v3.23.3
Stockholders' Equity - Narrative of Share-based Compensation Expense (Details) - USD ($)
$ in Millions
 3 Months Ended 9 Months Ended
Sep. 30, 2023
Sep. 30, 2022
Sep. 30, 2023
Sep. 30, 2022
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]        
Share-based compensation expense capitalized $ 0.7 $ 0.7 $ 2.4 $ 4.8
RSUs and PSUs        
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]        
Unrecognized compensation costs related to restricted stock units $ 170.7   $ 170.7  
Weighted-average vesting period     1 year 10 months 24 days  
v3.23.3
Stockholders' Equity - Schedule of RSU and PSU Activity (Details) - RSUs and PSUs
 9 Months Ended
Sep. 30, 2023
$ / shares
shares
Shares Outstanding  
Beginning balance (in shares) | shares 9,155,680
Granted (in shares) | shares 5,546,566
Released (in shares) | shares (2,852,092)
Forfeited (in shares) | shares (1,554,544)
Ending balance (in shares) | shares 10,295,610
Weighted Average Grant Date Fair Value  
Beginning balance (in dollars per share) | $ / shares $ 36.03
Granted (in dollars per share) | $ / shares 15.39
Released (in dollars per share) | $ / shares 35.71
Forfeited (in dollars per share) | $ / shares 32.67
Ending balance (in dollars per share) | $ / shares $ 25.51
v3.23.3
Restructuring (Details)
$ in Millions
 1 Months Ended 9 Months Ended
Jun. 30, 2023
full_time_employee
Sep. 30, 2023
USD ($)
Restructuring and Related Activities [Abstract]    
Number of positions impacted | full_time_employee 90  
Restructuring charges   $ 5.7
Payments for restructuring   4.7
Restructuring liability   $ 1.0
v3.23.3
Property and Equipment, Net - Schedule of Property and Equipment, Net (Details) - USD ($)
$ in Thousands
 9 Months Ended
Sep. 30, 2023
Dec. 31, 2022
Property, Plant and Equipment [Line Items]    
Property and equipment $ 388,851 $ 404,434
Less accumulated depreciation and amortization (220,116) (200,051)
Property and equipment, net 168,735 204,383
Disposal Group, Disposed of by Means Other than Sale, Not Discontinued Operations, Abandonment | Total Content And Related Assets Charge    
Property, Plant and Equipment [Line Items]    
Accelerated depreciation of content and software 34,195  
Impairment of in-progress software 2,616  
Other costs 1,431  
Total costs of revenues 38,242  
Impairment of indefinite-lived trade name 3,600  
Total general and administrative expense 3,600  
Total content and related assets charge 41,842  
Content    
Property, Plant and Equipment [Line Items]    
Property and equipment 325,811 339,879
Software    
Property, Plant and Equipment [Line Items]    
Property and equipment 43,595 45,422
Leasehold improvements    
Property, Plant and Equipment [Line Items]    
Property and equipment 10,784 10,860
Furniture and fixtures    
Property, Plant and Equipment [Line Items]    
Property and equipment 5,147 4,952
Computer and equipment    
Property, Plant and Equipment [Line Items]    
Property and equipment $ 3,514 $ 3,321
v3.23.3
Property and Equipment, Net - Additional Information (Details) - USD ($)
$ in Millions
 3 Months Ended 9 Months Ended
Sep. 30, 2023
Sep. 30, 2022
Sep. 30, 2023
Sep. 30, 2022
Property, Plant and Equipment [Abstract]        
Depreciation and content amortization expense $ 56.9 $ 22.4 $ 108.9 $ 64.3
Accelerated depreciation     $ 34.2  
v3.23.3
Property and Equipment, Net - Schedule of Total Expense Related to Site Experience Realignment (Details) - Disposal Group, Disposed of by Means Other than Sale, Not Discontinued Operations, Abandonment - Total Content And Related Assets Charge
$ in Thousands
 9 Months Ended
Sep. 30, 2023
USD ($)
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items]  
Accelerated depreciation of content and software $ 34,195
Impairment of in-progress software 2,616
Other costs 1,431
Total costs of revenues 38,242
Impairment of indefinite-lived trade name 3,600
Total general and administrative expense 3,600
Total content and related assets charge $ 41,842