Could Chegg's Busuu Expansion in LATAM Spark Its Next Growth Run?

Chegg, Inc. CHGG has pivoted to formally split the business into two distinct units – a growth-focused Chegg Skilling segment and a cash-generating legacy academic services business. This renewed focus has positioned this ed tech company to realize benefits from its language-learning platform, Busuu.

During the third quarter of 2025 earnings call, CHGG highlighted Latin America (LATAM) as a key geographic expansion opportunity for Busuu, given its pivot toward B2B skilling and away from its structurally challenged academic services business. Busuu already has a strong foundation in Europe, where it has spent more than a decade refining a differentiated approach to language learning. Unlike many consumer-focused apps that emphasize translation or gamification, Busuu is built around conversational fluency and speaking proficiency. This positioning aligns well with enterprise demand, where employers value practical communication skills rather than casual language exposure.

Chegg believes this distinction gives Busuu an edge as it expands into LATAM, a region with growing cross-border trade, outsourcing and multinational workforce needs. As the corporate demand for reskilling is accelerating globally, particularly in areas tied to AI adoption, global collaboration and workforce mobility, this expansion is expected to bode well for CHGG. Busuu’s increased traction on the B2B side, especially through enterprise partnerships, suggests that LATAM could become a natural extension of this momentum rather than a speculative bet.

Financially, Chegg Skilling is still relatively small and is expected to exit 2025 with about $70 million in revenues and mid-teens growth year over year. However, the company’s aggressive cost restructuring has freed up capital to invest selectively in expansion without pressuring cash flow. This disciplined approach reduces execution risk as Busuu enters new regions. If Chegg successfully replicates its European B2B playbook in LATAM, Busuu may become a meaningful contributor to its next phase of sustainable, skilling-led growth.

Chegg Stock’s Price Performance vs. Other Market Players

Shares of this California-based education technology company have gained 13.5% in the past month, outperforming the Zacks Internet - Software industry, the Zacks Computer and Technology sector and the S&P 500 Index.

Chegg operates in a highly competitive landscape, with renowned names like Duolingo, Inc. DUOL and Coursera, Inc. COUR operating beside it in the ed tech market. In the past month, shares of Duolingo and Coursera have tumbled 2% and 8.2%, respectively.

CHGG’s Valuation Trend

CHGG stock is currently trading at a discount compared with the industry peers, with a forward 12-month price-to-earnings (P/E) ratio of 5.57, as evidenced by the chart below.

Notably, Duolingo and Coursera are currently trading at a forward 12-month P/E ratio of 43.67 and 15.88, respectively.

Earnings Estimate Trend of CHGG

The Zacks Consensus Estimate for 2025 loss has widened in the past 60 days to 14 cents, while earnings estimates for 2026 have moved up to 18 cents during the same time frame.

While the estimated figure for 2025 indicates a decline of 118.7% year over year, estimates for 2026 indicate 228.6% growth.

Chegg stock currently sports a Zacks Rank #1 (Strong Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.

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This article originally published on Zacks Investment Research (zacks.com).

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