The stock of the Santa Clara, Calif., company at last check surged 28% to $56.21 after the provider of online tutoring services and textbook rentals, among other student services, reported first-quarter adjusted earnings of 22 cents a share.
That came in higher than the 17 cents a share estimated by analysts surveyed by Zacks Investment Research. And it beat by more than 40% the 15 cents a share of adjusted profit Chegg reported for the year-earlier quarter.
On a GAAP basis, Chegg reported that its net loss widened to 5 cents a share from 4 cents. Shares outstanding rose 4.9% to 122.4 million.
Chegg reported quarterly revenue of $131.6 million, 6.5% higher than the estimate of analysts polled by Zacks, and 35% above the $97.4 million the company reported for the first quarter of 2019.
The number of subscribers at Chegg rose to 2.9 million at the end of the first quarter, a 35% increase over the first three months of 2019.
"We saw a substantial increase in new subscribers, both domestically and globally," Chief Executive Dan Rosensweig said in a statement.
Chegg also recorded 235 million content views during the first quarter of 2020.
For the second quarter Chegg is estimating revenue at $135 million to $137 million.
"While we are comfortable providing guidance for Q2, there are many unknowns, such as school start dates, enrollment trends, and whether schools will be taught on-campus, online or both," Chief Financial Officer Andy Brown said in a statement.
"As such, it is difficult to predict how much, if any of Chegg's first-half momentum will continue; therefore we believe it is premature to update our guidance for the second half of the year."
Shares of Chegg on Tuesday also got a boost from an upgrade by Raymond James, with analysts at the firm raising their rating on the educational tech firm to outperform from market perform.