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Chegg Grapples with ChatGPT’s Rising Popularity: Stock Prices Tumble as Education Companies Embrace AI Solutions

Chegg, a widely-used platform for academic assistance, is concerned that students are increasingly turning to ChatGPT as their preferred study companion, a revelation that sent its stock price tumbling yesterday.

Following CEO Dan Rosensweig’s comments during an earnings call on Monday about the chatbot’s impact on new subscriber acquisition, Chegg’s stock experienced a near 50% decline. This marks the first known case of a company cautioning that ChatGPT is encroaching on its market share.

The apprehension surrounding AI also affected other educational companies, with Pearson’s shares falling around 15% and Duolingo’s dropping approximately 10%.

To counter ChatGPT’s disruption, these companies are employing ChatGPT itself.

Chegg is collaborating with ChatGPT-developer OpenAI to create its own AI-based conversational tool, Cheggmate, which is set to undergo testing this month.

Duolingo, on the other hand, introduced a subscription level that allows users to practice languages with an AI bot and features an AI-driven instrument to clarify errors. 

Duolingo Max, an advanced subscription level surpassing Super Duolingo, offering subscribers two innovative features and activities: Clarify My Response and Interactive Scenarios. These cutting-edge tools are driven by the latest and most advanced generative AI technology available. 

The collaboration with OpenAI has spanned months, as they have diligently fine-tuned the technology to ensure it meets the needs of eager learners!

ChatGPT is so popular that other companies such as Meta, Alphabet, Microsoft, and Amazon used their recent earnings calls to emphasize AI’s potential, mentioning “AI” a total of 168 times, as reported by Insider.

In contrast, Khan Academy has been proactive in adopting ChatGPT into their educational platform. Last month, Khan Academy introduced Khanmigo: A Revolutionary AI Chatbot Transforming Education for Students, Teachers, and Parents.

About Khanmigo – an AI-powered chatbot designed to enhance the educational experience for students, teachers, and parents alike. By leveraging cutting-edge artificial intelligence, Khanmigo aims to bring personalized learning experiences, foster creativity, and revolutionize computer science education. Let’s explore the various benefits that Khanmigo offers.

  1. Tutoring for All: Khanmigo harnesses the power of AI to provide one-on-one tutoring experiences, ensuring that all students receive the individual attention they need. By fostering deep understanding, confidence, and empowerment, Khanmigo levels the playing field for students regardless of their socioeconomic backgrounds.
  2. Empowering Educators: Khanmigo not only benefits students but also serves as an invaluable tool for educators. The AI-driven chatbot assists teachers in lesson planning and offers insightful feedback on student performance. By saving time and reducing workload, Khanmigo enables educators to focus more on personalized instruction and build stronger connections with their students.
  3. Unlocking Creativity: As a virtual writing coach, Khanmigo encourages students to explore their creative potential by providing prompts, suggestions, and guidance throughout the writing process. The chatbot promotes collaboration, debate, and innovation, pushing students to think critically and express themselves in new and exciting ways.
  4. Reimagining Computer Science: With the increasing demand for programming skills in today’s job market, Khanmigo makes learning to code more accessible than ever before. Through interactive experiences and real-time feedback, the AI chatbot helps learners of all ages refine their computer science abilities, setting them up for success in an increasingly tech-driven world.

Khanmigo represents a significant milestone in the evolution of educational technology. By utilizing the power of AI, Khan Academy’s chatbot is poised to transform the learning experience for students, teachers, and parents. As we witness the rise of Khanmigo, we can look forward to a more inclusive, engaging, and empowering educational landscape.

About Khan Academy: a nonprofit that wants to make education free and accessible for all. By joining Khan Labs, you can help us develop new features that will empower hundreds of millions of learners around the world! You’ll test and provide feedback on new learning tools to help shape the future of learning.

Alex Oliveira

I’m Alex. I’m a dad, husband, an entrepreneur and an information junkie. I am a passionate guy — I love business and I really love helping business owners turn their passions into profits. I’ve spent the last 10+ years helping clients advance their businesses and brands through dynamic interactive marketing campaigns. I always welcome a challenge and am relentless in the pursuit of innovative marketing strategies that actually work.