As business continues to surge amid the coronavirus pandemic, Chegg CEO Dan Rosensweig told CNBC Tuesday that the education platform is focused on international expansion this year.
Last year, the Santa Clara, California-based company began investing abroad to augment the number of students subscribing to the service and management projects international subscribers to reach six figures by the end of 2021.
“Over the course of the year, we’re going to crest over 1 million subscribers outside the United States across 190 different countries,” Rosensweig said in a “Mad Money” interview with Jim Cramer.
Among those countries, Chegg, which started out as a textbook provider in 2005, currently has a large presence in Canada, Australia and the United Kingdom. The company reports seeing strong growth in the Middle East and Asia, though it has no plans to expand to China, the world’s second-largest economy.
Chegg has not disclosed the number of non-U.S. users it serves, but Rosensweig said its online program is needed around the globe as colleges, many of which closed or reduced campus access in the face of a global health crisis last year, seek out ways to serve students remotely.
The company began mulling international expansion in 2019 and forecasts that the international market presents a bigger opportunity than what’s available in the U.S. Some of its investments in its international services include language translation technology.
While Chegg does not currently disclose international revenue, the company reported 67% subscriber growth in 2020, reaching 6.6 million users. Total revenues, which are broken down into the company’s Chegg Services and Required Materials divisions, were up 57% year-over-year to $644.3 million. Revenue growth is up from the less than 30% growth rate the company posted in the two years prior.
“What we do is something that every student around the world clearly needs, and we’re proud of what we’re doing,” Rosensweig said. “It’s exciting to see this level of growth.”
Based on the momentum Chegg has seen in the last quarter of 2020 and the opening quarter of 2021, the company raised its guidance for the current year, powered by both the domestic and international businesses.
Chegg expects total revenues this year to come in between $780 million and $790 million, which would represent nearly 23% year-over-year growth on the high end.
“This is the wave of the future,” Rosensweig said. “Either institutions understand it, invest in it and reevaluate what they teach, how they teach it, how they monitor students and how they assess them, or they’re going to lose completely.”
Shares of Chegg gained 0.34% in Tuesday’s session, claiming an all-time closing high of $102.35. The stock is up 13% year to date.
Chegg more than doubled its market cap in 2020 and is currently valued by the market at $13.18 billion.