Chegg Inc., which specializes in developing learning services and helping with homework, plunged sharply on May 2 due to competition with ChatGPT. Shares of the company fell 50% to $8.8. informs Forbes.
The reason for the drop in shares was Chegg CEO Dan Rozensweig’s statement that the company’s business is under threat because of the artificial intelligence-based ChatGPT chatbot. He said that in March 2023, the chatbot began to be in high demand among students, which had a negative impact on attracting new customers to Chegg.
In addition, the company’s first quarter revenue of 2023 decreased by 7% compared to the same period of 2022 to $187.6 million, while the number of paid subscribers decreased by 5% to 5.1 million.
For $15 per month, Chegg provides access to a database of canned answers to 46 million questions and exam tasks. Bloomberg noted that this source of income could be undermined if students continue to turn to free chatbots.
Formerly socialbites.ca saidThat the “godfather of artificial intelligence” left Google to warn humanity of the danger.