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x
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ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
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¨
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TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
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Delaware
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20-3237489
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(State or other jurisdiction of
incorporation or organization)
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(I.R.S. employer
identification no.)
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Title of each class
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Name of each exchange on which registered
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Common Stock, $0.001 par value per share
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The New York Stock Exchange
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|
•
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Indicate by check mark if the registrant is a well-known seasoned issuer, as defined in Rule 405 of the Securities Act. Yes
¨
No
x
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•
|
Indicate by check mark if the registrant is not required to file reports pursuant to Section 13 or Section 15(d) of the Act. Yes
¨
No
x
|
•
|
Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 (Exchange Act) during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes
x
No
¨
|
•
|
Indicate by check mark whether the registrant has submitted electronically and posted on its corporate Website, if any, every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T (§ 232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files). Yes
x
No
¨
|
•
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Indicate by check mark if disclosure of delinquent filers pursuant to Item 405 of Regulation S-K (§ 229.405 of this chapter) is not contained herein, and will not be contained, to the best of registrant’s knowledge, in definitive proxy or information statements incorporated by reference in Part III of this Form 10-K or any amendment to this Form 10-K.
¨
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•
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Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, or a smaller reporting company. See definitions of “large accelerated filer,” “accelerated filer,” and “smaller reporting company” in Rule 12b-2 of the Exchange Act. (Check one)
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Large accelerated filer
¨
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Accelerated filer
x
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Non-accelerated filer
¨
(Do not check if a smaller reporting company)
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Smaller reporting company
¨
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•
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Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes
¨
No
x
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•
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The aggregate market value of the voting stock held by non-affiliates of the registrant as of
June 30, 2016
, the last business day of the registrant’s most recently completed second fiscal quarter, based upon the closing price of such stock on such date as reported by the New York Stock Exchange on such date, was approximately
$402,351,715
. Shares of Common Stock held by each executive officer and director have been excluded in that such persons may be deemed to be affiliates. This determination of affiliate status is not necessarily a conclusive determination for other purposes.
|
•
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As of
January 31, 2017
, the Registrant had
91,830,713
outstanding shares of Common Stock.
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Regulations related to the Program Participation Agreement of the U.S. Department of Education and other similar laws and regulate the recruitment of students to colleges and other institutions of higher learning.
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•
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execute on our relatively new and evolving business model;
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•
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develop new products and services, both independently and with developers or other third parties;
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•
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attract and retain students and increase their engagement with our connected learning platform and our mobile applications;
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•
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attract and retain colleges, universities and other academic institutions and brands to our marketing services;
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•
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manage the growth of our business, including increasing or unforeseen expenses;
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•
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develop and scale a high performance technology infrastructure to efficiently handle increased usage by students, especially during peak periods prior to each academic term;
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•
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maintain and manage relationships with strategic partners, including Ingram, NRCCUA, and other distributors, publishers, wholesalers, colleges and brands;
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•
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develop a profitable business model and pricing strategy;
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•
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compete with companies that offer similar services or products;
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•
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expand into adjacent markets;
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•
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navigate the ongoing evolution and uncertain application of regulatory requirements, such as privacy laws, to our business, including our new products and services;
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•
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integrate and realize synergies from businesses that we acquire; and
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•
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expand into foreign markets.
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•
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our ability to attract and retain students and increase their engagement with our connected learning platform and mobile applications, particularly related to our Chegg Services subscribers;
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•
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the rate of adoption of our offerings;
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•
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our ability to successfully utilize the information gathered from our connected learning platform to enhance our Student Graph and target sales of complementary products and services to our students;
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•
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changes in demand and pricing for print textbooks and eTextbooks; Ingram's ability to manage fulfillment processes to handle significant volumes during peak periods and as a result of the potential growth in volume of transactions over time; changes by our competitors to their product and service offerings;
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•
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price competition and our ability to react appropriately to such competition;
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•
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our ability and Ingram's ability to manage their textbook library;
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•
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our ability to execute on our strategic partnership with Ingram;
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•
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disruptions to our internal computer systems and our fulfillment information technology infrastructure, particularly during peak periods; the amount and timing of operating costs and capital expenditures relating to expansion of our business, operations and infrastructure;
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•
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our ability to successfully manage the integration of operations, technology and personnel resulting from our acquisitions;
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•
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governmental regulation in particular regarding privacy and advertising and taxation policies; and
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•
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general macroeconomic conditions and economic conditions specific to higher education.
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•
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our ability and Ingram's ability to consistently provide students with a convenient, high quality experience for selecting, receiving and returning print textbooks;
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•
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our ability and Ingram's ability to accurately forecast and respond to student demand for print textbooks;
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•
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the pricing of our physical textbooks and eTextbooks for rental or sale in relation to other alternatives, including the prices offered by publishers or by other competing textbook rental providers;
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•
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the quality and prices of our offerings compared to those of our competitors;
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•
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the rate of adoption of eTextbooks and our ability to capture a significant share of that market;
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•
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our ability to engage high school students with our College Admissions and Scholarship Services, Chegg Tutors, Chegg Test Prep and Chegg Writing Tools;
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•
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changes in student spending levels;
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•
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changes in the number of students attending college;
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•
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the effectiveness of our sales and marketing efforts; and
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•
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our ability to introduce new products and services that are favorably received by students.
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•
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maintain our reputation as a trusted source of textbooks, content and services for students;
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•
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maintain the quality of and improve our existing products and services;
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•
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maintain and control the quality of our brand while Ingram handles our textbook fulfillment logistics;
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•
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introduce products and services that are favorably received;
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•
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adapt to changing technologies;
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•
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adapt to students’ rapidly changing tastes, preferences, behavior and brand loyalties;
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•
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protect our students’ data, such as passwords and personally identifiable information;
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•
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protect our trademark and other intellectual property rights;
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•
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continue to expand our reach to students in high school, graduate school and internationally;
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•
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ensure that the content posted to our website by students is reliable and does not infringe on third-party copyrights or violate other applicable laws, our terms of use or the ethical codes of those students’ colleges;
|
•
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adequately address students’ concerns with our products and services; and
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•
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convert and fully integrate the brands and students that we acquire, including Imagine Easy Solutions and Internships.com, each into the Chegg brand and Chegg.com.
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•
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changes in student sentiment about the quality or usefulness of our connected learning platform and our products and services;
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•
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problems that prevent Ingram, from delivering textbooks reliably or timely;
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•
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technical or other problems that prevent us from providing our products and services reliably or otherwise negatively affect the student experience on our website or our mobile application;
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•
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concern from colleges about the ways students use our content offerings, such as our Expert Answers service;
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•
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brand conflict between acquired brands and the Chegg brand;
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•
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student concerns related to privacy and the way in which we use student data as part of our products and services;
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•
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the reputation or products and services of competitive companies; and
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•
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students’ misuse of our products and services in ways that violate our terms of services, applicable laws or the code of conduct at their colleges.
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•
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require us to incur charges and substantial debt or liabilities;
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•
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cause adverse tax consequences, substantial depreciation or deferred compensation charges;
|
•
|
result in acquired in-process research and development expenses or in the future may require the amortization, write-down or impairment of amounts related to deferred compensation, goodwill and other intangible assets; and
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•
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give rise to various litigation risks, including the increased likelihood of litigation.
|
•
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we may not generate sufficient financial return to offset acquisition costs;
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•
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we may encounter difficulties or unforeseen expenditures in integrating the business, technologies, products, services, operations and personnel of any company that we acquire, particularly if key personnel of the acquired company decide not to work for us;
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•
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an acquisition may disrupt our ongoing business, divert resources, increase our expenses and distract our management;
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•
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an acquisition may delay adoption rates or reduce engagement rates for our products and services and those of the company acquired by us due to student uncertainty about continuity and effectiveness of service from either company;
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•
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we may encounter difficulties in, or may be unable to, successfully sell or otherwise monetize any acquired products and services; and
|
•
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an acquisition may involve the entry into geographic or business markets in which we have little or no prior experience.
|
•
|
Products and Services for Students.
Our Chegg Services face competition from different businesses depending on the offering. For Chegg Study, our competitors primarily include publishers that provide study materials and online instructional systems. Additionally, we face competition from free services such as Yahoo! Answers and Brain.ly for our Expert Answers service. For our Chegg Tutors services, we face competition from other online tutoring services such as Tutors.com and Varsity Tutors. For our writing tools, we primarily face competition
|
•
|
Enrollment Marketing Services
.
With respect to our enrollment marketing services, we compete against traditional methods of student recruitment, including student data providers such as standardized test providers, radio, television and Internet advertising and print mail marketing programs. In this area, we compete primarily on the basis of the number of high-quality connections between prospective students and colleges we are able to provide as well as on price. We are able to create these connections by providing prospective students with an easy-to-use platform to input their academic information and aspirations, learn about colleges, locate scholarships and financial aid and facilitate and streamline the application process.
|
•
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Brand Advertising
.
With respect to brands, we compete with online and offline outlets that generate revenues from advertisers and marketers, especially those that target high school and college students. In this area, we seek to partner with brands that have offerings that will interest or delight students and have received very positive comments and feedback from students on these offerings. We provide these brands with preferential access to our audience, which we believe represents a highly engaged portion of the target demographic of our brand partners.
|
•
|
compete for advertising and marketing dollars from colleges, brands, online marketing and media companies and advertisers;
|
•
|
penetrate the market for student-focused advertising;
|
•
|
develop a platform that can deliver advertising and marketing services across multiple channels, including print, email, Internet, mobile applications and other connected devices;
|
•
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improve our analytics and measurement solutions to demonstrate the value of our advertising and marketing services;
|
•
|
maintain the retention, growth and engagement of our student user base;
|
•
|
strengthen our brand and increase our presence in media reports and with publicity companies that utilize online platforms for advertising and marketing purposes;
|
•
|
create new products that sustain or increase the value of our advertising and marketing services and other commercial content;
|
•
|
manage changes in the way online advertising and marketing services are priced;
|
•
|
weather the impact of macroeconomic conditions and conditions in the advertising industry and higher education in general; and
|
•
|
manage legal developments relating to data privacy, advertising or marketing services, legislation and regulation and litigation.
|
•
|
the CAN-SPAM Act of 2003 and similar laws adopted by a number of states regulate unsolicited commercial emails, create criminal penalties for emails containing fraudulent headers and control other abusive online marketing practices;
|
•
|
the U.S. Federal Trade Commission (FTC) has guidelines that impose responsibilities on companies with respect to communications with consumers and impose fines and liability for failure to comply with rules with respect to advertising or marketing practices they may deem misleading or deceptive; and
|
•
|
the TCPA restricts telemarketing and the use of automated telephone equipment. The TCPA limits the use of automatic dialing systems, artificial or prerecorded voice messages and SMS text messages. It also applies to unsolicited text messages advertising the commercial availability of goods or services. Additionally, a number of states have enacted statutes that address telemarketing. For example, some states, such as California, Illinois and New York, have created do-not-call lists. Other states, such as Oregon and Washington, have enacted “no rebuttal statutes” that require the telemarketer to end the call when the consumer indicates that he or she is not interested in the product being sold. Restrictions on telephone marketing, including calls and text messages, are enforced by the FTC, the Federal Communications Commission, states and through the availability of statutory damages and class action lawsuits for violations of the TCPA.
|
•
|
our intellectual property and proprietary rights will provide competitive advantages to us;
|
•
|
our competitors or others will not design around our intellectual property or proprietary rights;
|
•
|
our ability to assert our intellectual property or proprietary rights against potential competitors or to settle current or future disputes will not be limited by our agreements with third parties;
|
•
|
our intellectual property and proprietary rights will be enforced in jurisdictions where competition may be intense or where legal protection may be weak;
|
•
|
any of the patents, trademarks, copyrights, trade secrets or other intellectual property or proprietary rights that we presently employ in our business will not lapse or be invalidated, circumvented, challenged or abandoned; or
|
•
|
we will not lose the ability to assert our intellectual property or proprietary rights against or to license our intellectual property or proprietary rights to others and collect royalties or other payments.
|
•
|
recruiting and retaining talented and capable employees in foreign countries and maintaining our company culture across all of our offices;
|
•
|
compliance with applicable foreign laws and regulations;
|
•
|
compliance with anti-bribery laws including, without limitation, compliance with the Foreign Corrupt Practices Act;
|
•
|
currency exchange rate fluctuations;
|
•
|
political and economic instability; and
|
•
|
higher costs of doing business internationally.
|
•
|
borrow money and guarantee or provide other support for indebtedness of third-parties;
|
•
|
pay dividends on, redeem or repurchase our capital stock;
|
•
|
acquire entities or assets;
|
•
|
make investments in entities that we do not control, including joint ventures;
|
•
|
consummate a merger, consolidation or sale of all or substantially all of our assets;
|
•
|
enter into certain asset sale transactions; and
|
•
|
enter into secured financing arrangements;
|
•
|
actual or anticipated fluctuations in our financial condition and operating results, including as a result of the seasonality in our business that results from the academic calendar;
|
•
|
our announcement of actual results for a fiscal period that are higher or lower than projected results or our announcement of revenues or earnings guidance that is higher or lower than expected, including as a result of difficulty forecasting seasonal variations in our financial condition and operating results or the revenues generated by our offerings;
|
•
|
issuance of new or updated research or reports by securities analysts, including the publication of unfavorable reports or change in recommendation or downgrading of our common stock;
|
•
|
announcements by us or our competitors of significant products or features, technical innovations, acquisitions, strategic relationships and partnerships, joint ventures or capital commitments;
|
•
|
actual or anticipated changes in our growth rate relative to our competitors;
|
•
|
changes in the economic performance or market valuations of companies perceived by investors to be comparable to us;
|
•
|
additional shares of our common stock being sold into the market by us or our existing stockholders or the anticipation of such sales;
|
•
|
issuances of additional shares of our common stock in connection with acquisitions;
|
•
|
share price and volume fluctuations attributable to inconsistent trading volume levels of our shares;
|
•
|
lawsuits threatened or filed against us;
|
•
|
regulatory developments in our target markets affecting us, students, colleges or brands, publishers or our competitors;
|
•
|
political climate in the United States, with a focus on cutting or limiting budgets, higher education and taxation;
|
•
|
terrorist attacks or natural disasters or other such events impacting countries where we have operations;
|
•
|
international stock market conditions; and
|
•
|
general economic and market conditions, such as recessions, unemployment rates, the limited availability of consumer credit, interest rate changes and currency fluctuations.
|
•
|
our board of directors is classified into three classes of directors with staggered three-year terms and directors can only be removed from office for cause and by the approval of the holders of at least two-thirds of our outstanding common stock;
|
•
|
subject to certain limitations, our board of directors has the sole right to set the number of directors and to fill a vacancy resulting from any cause or created by the expansion of our board of directors, which prevents stockholders from being able to fill vacancies on our board of directors;
|
•
|
only our board of directors is authorized to call a special meeting of stockholders;
|
•
|
certain litigation against us can only be brought in Delaware;
|
•
|
our restated certificate of incorporation authorizes undesignated preferred stock, the terms of which may be established and shares of which may be issued, without the approval of the holders of common stock;
|
•
|
advance notice procedures apply for stockholders to nominate candidates for election as directors or to bring matters before an annual meeting of stockholders;
|
•
|
our stockholders cannot act by written consent;
|
•
|
our restated bylaws can only be amended by our board of directors or by the approval of the holders of at least two-thirds of our outstanding common stock; and
|
•
|
certain provisions of our restated certificate of incorporation can only be amended by the approval of the holders of at least two-thirds of our outstanding common stock.
|
|
High
|
Low
|
||||
Year Ended December 31, 2016
|
|
|
||||
Fourth quarter
|
$
|
8.48
|
|
$
|
6.54
|
|
Third quarter
|
$
|
7.21
|
|
$
|
4.90
|
|
Second quarter
|
$
|
5.08
|
|
$
|
4.27
|
|
First quarter
|
$
|
6.56
|
|
$
|
3.47
|
|
Year Ended December 31, 2015
|
|
|
||||
Fourth quarter
|
$
|
7.83
|
|
$
|
6.73
|
|
Third quarter
|
$
|
8.74
|
|
$
|
7.07
|
|
Second quarter
|
$
|
8.68
|
|
$
|
7.27
|
|
First quarter
|
$
|
8.75
|
|
$
|
6.44
|
|
|
Year Ended December 31,
|
||||||||||||||||||
|
2016
|
|
2015
|
|
2014
|
|
2013
|
|
2012
|
||||||||||
|
(in thousands, except per share amounts)
|
||||||||||||||||||
Consolidated Statements of Operations Data:
|
|
|
|
|
|
|
|
|
|
||||||||||
Net revenues
|
$
|
254,090
|
|
|
$
|
301,373
|
|
|
$
|
304,834
|
|
|
$
|
255,575
|
|
|
$
|
213,334
|
|
Gross profit
|
134,489
|
|
|
111,524
|
|
|
93,849
|
|
|
80,515
|
|
|
67,665
|
|
|||||
Net loss
|
(42,245
|
)
|
|
(59,210
|
)
|
|
(64,758
|
)
|
|
(55,850
|
)
|
|
(49,043
|
)
|
|||||
Deemed dividend to preferred stockholders
(1)
|
—
|
|
|
—
|
|
|
—
|
|
|
(102,557
|
)
|
|
—
|
|
|||||
Net loss attributable to common stockholders
|
$
|
(42,245
|
)
|
|
$
|
(59,210
|
)
|
|
$
|
(64,758
|
)
|
|
$
|
(158,407
|
)
|
|
$
|
(49,043
|
)
|
Net loss per share attributable to common stockholders, basic and diluted
|
$
|
(0.47
|
)
|
|
$
|
(0.68
|
)
|
|
$
|
(0.78
|
)
|
|
$
|
(7.58
|
)
|
|
$
|
(4.39
|
)
|
Weighted-average shares used to compute net loss per share attributable to common stockholders, basic and diluted
|
90,534
|
|
|
86,818
|
|
|
83,205
|
|
|
20,902
|
|
|
11,183
|
|
|
December 31,
|
||||||||||||||||||
|
2016
|
|
2015
|
|
2014
|
|
2013
|
|
2012
|
||||||||||
|
(in thousands)
|
||||||||||||||||||
Consolidated Balance Sheet Data:
|
|
|
|
|
|
|
|
|
|
||||||||||
Total assets
|
$
|
290,652
|
|
|
$
|
291,356
|
|
|
$
|
318,127
|
|
|
$
|
327,371
|
|
|
$
|
196,367
|
|
Deferred revenue
|
14,836
|
|
|
14,971
|
|
|
24,591
|
|
|
22,804
|
|
|
20,032
|
|
|||||
Debt obligations, current and non-current
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
19,386
|
|
|||||
Convertible preferred stock
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
207,201
|
|
|||||
Common stock and additional paid-in capital
|
593,443
|
|
|
560,330
|
|
|
516,929
|
|
|
479,361
|
|
|
63,088
|
|
|||||
Total stockholders' equity (deficit)
|
221,939
|
|
|
231,075
|
|
|
247,043
|
|
|
274,240
|
|
|
(86,127
|
)
|
|
Year Ended December 31,
|
|||||||||||||||||||
|
2016
|
|
2015
|
|
2014
|
|||||||||||||||
Net revenues:
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||
Rental
|
$
|
39,837
|
|
|
16
|
%
|
|
$
|
120,365
|
|
|
40
|
%
|
|
$
|
181,570
|
|
|
60
|
%
|
Services
|
181,264
|
|
|
71
|
|
|
131,996
|
|
|
44
|
|
|
87,460
|
|
|
29
|
|
|||
Sales
|
32,989
|
|
|
13
|
|
|
49,012
|
|
|
16
|
|
|
35,804
|
|
|
11
|
|
|||
Total net revenues
|
254,090
|
|
|
100
|
|
|
301,373
|
|
|
100
|
|
|
304,834
|
|
|
100
|
|
|||
Cost of revenues
(1)
:
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||
Rental
|
28,637
|
|
|
11
|
|
|
98,162
|
|
|
32
|
|
|
145,760
|
|
|
48
|
|
|||
Services
|
54,767
|
|
|
22
|
|
|
43,794
|
|
|
15
|
|
|
31,158
|
|
|
10
|
|
|||
Sales
|
36,197
|
|
|
14
|
|
|
47,893
|
|
|
16
|
|
|
34,067
|
|
|
11
|
|
|||
Total cost of revenues
|
119,601
|
|
|
47
|
|
|
189,849
|
|
|
63
|
|
|
210,985
|
|
|
69
|
|
|||
Gross profit
|
134,489
|
|
|
53
|
|
|
111,524
|
|
|
37
|
|
|
93,849
|
|
|
31
|
|
|||
Operating expenses
(1)
:
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||
Technology and development
|
66,331
|
|
|
26
|
|
|
59,391
|
|
|
20
|
|
|
49,386
|
|
|
16
|
|
|||
Sales and marketing
|
53,949
|
|
|
21
|
|
|
64,082
|
|
|
21
|
|
|
72,315
|
|
|
24
|
|
|||
General and administrative
|
55,372
|
|
|
22
|
|
|
45,209
|
|
|
15
|
|
|
41,837
|
|
|
14
|
|
|||
Restructuring (credits) charges
|
(423
|
)
|
|
—
|
|
|
4,868
|
|
|
2
|
|
|
—
|
|
|
—
|
|
|||
Gain on liquidation of textbooks
|
(670
|
)
|
|
—
|
|
|
(4,326
|
)
|
|
(2
|
)
|
|
(4,555
|
)
|
|
(2
|
)
|
|||
Total operating expenses
|
174,559
|
|
|
69
|
|
|
169,224
|
|
|
56
|
|
|
158,983
|
|
|
52
|
|
|||
Loss from operations
|
(40,070
|
)
|
|
(16
|
)
|
|
(57,700
|
)
|
|
(19
|
)
|
|
(65,134
|
)
|
|
(21
|
)
|
|||
Total interest expense, net and other (expense) income, net
|
(468
|
)
|
|
—
|
|
|
(31
|
)
|
|
—
|
|
|
562
|
|
|
—
|
|
|||
Loss before provision for income taxes
|
(40,538
|
)
|
|
(16
|
)
|
|
(57,731
|
)
|
|
(19
|
)
|
|
(64,572
|
)
|
|
(21
|
)
|
|||
Provision for income taxes
|
1,707
|
|
|
(1
|
)
|
|
1,479
|
|
|
(1
|
)
|
|
186
|
|
|
—
|
|
|||
Net loss
|
$
|
(42,245
|
)
|
|
(17
|
)%
|
|
$
|
(59,210
|
)
|
|
(20
|
)%
|
|
$
|
(64,758
|
)
|
|
(21
|
)%
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||
(1)
Includes share-based compensation expense as follows:
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||
Cost of revenues
|
$
|
172
|
|
|
|
|
$
|
262
|
|
|
|
|
$
|
617
|
|
|
|
|||
Technology and development
|
14,771
|
|
|
|
|
11,992
|
|
|
|
|
10,451
|
|
|
|
||||||
Sales and marketing
|
6,124
|
|
|
|
|
7,901
|
|
|
|
|
11,300
|
|
|
|
||||||
General and administrative
|
20,718
|
|
|
|
|
18,620
|
|
|
|
|
14,520
|
|
|
|
||||||
Total share-based compensation expense
|
$
|
41,785
|
|
|
|
|
$
|
38,775
|
|
|
|
|
$
|
36,888
|
|
|
|
|
Year Ended
December 31, |
|
Change in 2016
|
|
Change in 2015
|
||||||||||||||||||||
|
2016
|
|
2015
|
|
2014
|
|
$
|
|
%
|
|
$
|
|
%
|
||||||||||||
Chegg Services
|
$
|
129,335
|
|
|
$
|
94,285
|
|
|
$
|
68,117
|
|
|
$
|
35,050
|
|
|
37
|
%
|
|
$
|
26,168
|
|
|
38
|
%
|
Required Materials
|
124,755
|
|
|
207,088
|
|
|
236,717
|
|
|
(82,333
|
)
|
|
(40
|
)%
|
|
(29,629
|
)
|
|
(13
|
)%
|
|||||
Total net revenues
|
$
|
254,090
|
|
|
$
|
301,373
|
|
|
$
|
304,834
|
|
|
$
|
(47,283
|
)
|
|
(16
|
)%
|
|
$
|
(3,461
|
)
|
|
(1
|
)%
|
|
Year Ended
December 31, |
|
Change in 2016
|
|
Change in 2015
|
||||||||||||||||||||
|
2016
|
|
2015
|
|
2014
|
|
$
|
|
%
|
|
$
|
|
%
|
||||||||||||
Cost of revenues
(1)
|
$
|
119,601
|
|
|
$
|
189,849
|
|
|
$
|
210,985
|
|
|
$
|
(70,248
|
)
|
|
(37
|
)%
|
|
$
|
(21,136
|
)
|
|
(10
|
)%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
(1)
Includes share-based compensation expense of:
|
$
|
172
|
|
|
$
|
262
|
|
|
$
|
617
|
|
|
$
|
(90
|
)
|
|
(34
|
)%
|
|
$
|
(355
|
)
|
|
(58
|
)%
|
|
Year Ended
December 31, |
|
Change in 2016
|
|
Change in 2015
|
||||||||||||||||||||
|
2016
|
|
2015
|
|
2014
|
|
$
|
|
%
|
|
$
|
|
%
|
||||||||||||
Technology and development
(1)
|
$
|
66,331
|
|
|
$
|
59,391
|
|
|
$
|
49,386
|
|
|
$
|
6,940
|
|
|
12
|
%
|
|
$
|
10,005
|
|
|
20
|
%
|
Sales and marketing
(1)
|
53,949
|
|
|
64,082
|
|
|
72,315
|
|
|
(10,133
|
)
|
|
(16
|
)
|
|
(8,233
|
)
|
|
(11
|
)
|
|||||
General and administrative
(1)
|
55,372
|
|
|
45,209
|
|
|
41,837
|
|
|
10,163
|
|
|
22
|
|
|
3,372
|
|
|
8
|
|
|||||
Restructuring (credits) charges
|
(423
|
)
|
|
4,868
|
|
|
—
|
|
|
(5,291
|
)
|
|
n/m
|
|
|
4,868
|
|
|
n/m
|
|
|||||
Gain on liquidation of textbooks
|
(670
|
)
|
|
(4,326
|
)
|
|
(4,555
|
)
|
|
3,656
|
|
|
(85
|
)
|
|
229
|
|
|
(5
|
)
|
|||||
Total operating expenses
|
$
|
174,559
|
|
|
$
|
169,224
|
|
|
$
|
158,983
|
|
|
$
|
5,335
|
|
|
3
|
%
|
|
$
|
10,241
|
|
|
6
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
(1)
Includes share-based compensation expense of:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Technology and development
|
$
|
14,771
|
|
|
$
|
11,992
|
|
|
$
|
10,451
|
|
|
$
|
2,779
|
|
|
23
|
%
|
|
$
|
1,541
|
|
|
15
|
%
|
Sales and marketing
|
6,124
|
|
|
7,901
|
|
|
11,300
|
|
|
(1,777
|
)
|
|
(22
|
)
|
|
(3,399
|
)
|
|
(30
|
)
|
|||||
General and administrative
|
20,718
|
|
|
18,620
|
|
|
14,520
|
|
|
2,098
|
|
|
11
|
|
|
4,100
|
|
|
28
|
|
|||||
Share-based compensation expense
|
$
|
41,613
|
|
|
$
|
38,513
|
|
|
$
|
36,271
|
|
|
$
|
3,100
|
|
|
8
|
%
|
|
$
|
2,242
|
|
|
6
|
%
|
|
Year Ended
December 31, |
|
Change in 2016
|
|
Change in 2015
|
||||||||||||||||||||
|
2016
|
|
2015
|
|
2014
|
|
$
|
|
%
|
|
$
|
|
%
|
||||||||||||
Interest expense, net
|
$
|
(171
|
)
|
|
$
|
(247
|
)
|
|
$
|
(317
|
)
|
|
$
|
76
|
|
|
(31
|
)%
|
|
$
|
70
|
|
|
(22
|
)%
|
Other (expense) income, net
|
(297
|
)
|
|
216
|
|
|
879
|
|
|
(513
|
)
|
|
n/m
|
|
|
(663
|
)
|
|
(75
|
)
|
|||||
Total interest expense, net and other (expense) income, net
|
$
|
(468
|
)
|
|
$
|
(31
|
)
|
|
$
|
562
|
|
|
$
|
(437
|
)
|
|
n/m
|
|
|
$
|
(593
|
)
|
|
(106
|
)%
|
|
Year Ended
December 31, |
|
Change in 2016
|
|
Change in 2015
|
|||||||||||||||||||
|
2016
|
|
2015
|
|
2014
|
|
$
|
|
%
|
|
$
|
|
%
|
|||||||||||
Provision for income taxes
|
$
|
1,707
|
|
|
$
|
1,479
|
|
|
$
|
186
|
|
|
$
|
228
|
|
|
15
|
%
|
|
$
|
1,293
|
|
|
n/m
|
|
Year Ended
December 31, |
||||||||||
|
2016
|
|
2015
|
|
2014
|
||||||
Consolidated Statements of Cash Flows Data:
|
|
|
|
|
|
||||||
Net cash provided by (used in) operating activities
|
$
|
24,938
|
|
|
$
|
(82
|
)
|
|
$
|
68,475
|
|
Net cash (used in) provided by investing activities
|
$
|
(5,963
|
)
|
|
$
|
8,271
|
|
|
$
|
(87,350
|
)
|
Net cash (used in) provided by financing activities
|
$
|
(8,675
|
)
|
|
$
|
2,723
|
|
|
$
|
(1,872
|
)
|
|
|
Less than
|
|
More than
|
||||||||||||||||
|
|
Total
|
|
1 Year
|
|
1-3 Years
|
|
3-5 Years
|
|
5 Years
|
||||||||||
Purchase obligations
|
|
$
|
15,600
|
|
|
$
|
5,000
|
|
|
$
|
10,600
|
|
|
$
|
—
|
|
|
$
|
—
|
|
Operating lease obligations
(1)
|
|
6,231
|
|
|
2,001
|
|
|
3,026
|
|
|
1,066
|
|
|
138
|
|
|||||
Total contractual obligations
|
|
$
|
21,831
|
|
|
$
|
7,001
|
|
|
$
|
13,626
|
|
|
$
|
1,066
|
|
|
$
|
138
|
|
|
Page
|
|
|
|
December 31, 2016
|
|
December 31, 2015
|
||||
Assets
|
|
|
|
||||
Current assets
|
|
|
|
||||
Cash and cash equivalents
|
$
|
77,329
|
|
|
$
|
67,029
|
|
Short-term investments
|
—
|
|
|
17,800
|
|
||
Accounts receivable, net of allowance for doubtful accounts of $436 and $378 at December 31, 2016 and December 31, 2015, respectively
|
9,206
|
|
|
13,157
|
|
||
Prepaid expenses
|
2,579
|
|
|
3,117
|
|
||
Other current assets
|
22,259
|
|
|
31,732
|
|
||
Total current assets
|
111,373
|
|
|
132,835
|
|
||
Long-term investments
|
—
|
|
|
4,229
|
|
||
Textbook library, net
|
2,575
|
|
|
29,728
|
|
||
Property and equipment, net
|
35,305
|
|
|
19,971
|
|
||
Goodwill
|
116,239
|
|
|
91,301
|
|
||
Intangible assets, net
|
20,748
|
|
|
8,865
|
|
||
Other assets
|
4,412
|
|
|
4,427
|
|
||
Total assets
|
$
|
290,652
|
|
|
$
|
291,356
|
|
Liabilities and stockholders' equity
|
|
|
|
||||
Current liabilities
|
|
|
|
||||
Accounts payable
|
$
|
5,175
|
|
|
$
|
5,860
|
|
Deferred revenue
|
14,836
|
|
|
14,971
|
|
||
Accrued liabilities
|
44,319
|
|
|
35,280
|
|
||
Total current liabilities
|
64,330
|
|
|
56,111
|
|
||
Long-term liabilities
|
|
|
|
||||
Total other long-term liabilities
|
4,383
|
|
|
4,170
|
|
||
Total liabilities
|
68,713
|
|
|
60,281
|
|
||
Commitments and contingencies (Note 10)
|
|
|
|
||||
Stockholders' equity:
|
|
|
|
||||
Preferred stock, $0.001 par value – 10,000,000 shares authorized, no shares issued and outstanding at December 31, 2016 and December 31, 2015
|
—
|
|
|
—
|
|
||
Common stock, $0.001 par value – 400,000,000 shares authorized; 91,708,839 and 88,099,983 shares issued and outstanding at December 31, 2016 and December 31, 2015, respectively
|
92
|
|
|
88
|
|
||
Additional paid-in capital
|
593,351
|
|
|
560,242
|
|
||
Accumulated other comprehensive loss
|
(176
|
)
|
|
(172
|
)
|
||
Accumulated deficit
|
(371,328
|
)
|
|
(329,083
|
)
|
||
Total stockholders' equity
|
221,939
|
|
|
231,075
|
|
||
Total liabilities and stockholders' equity
|
$
|
290,652
|
|
|
$
|
291,356
|
|
|
Year Ended December 31,
|
||||||||||
|
2016
|
|
2015
|
|
2014
|
||||||
Net revenues:
|
|
|
|
|
|
||||||
Rental
|
$
|
39,837
|
|
|
$
|
120,365
|
|
|
$
|
181,570
|
|
Services
|
181,264
|
|
|
131,996
|
|
|
87,460
|
|
|||
Sales
|
32,989
|
|
|
49,012
|
|
|
35,804
|
|
|||
Total net revenues
|
254,090
|
|
|
301,373
|
|
|
304,834
|
|
|||
Cost of revenues:
|
|
|
|
|
|
||||||
Rental
|
28,637
|
|
|
98,162
|
|
|
145,760
|
|
|||
Services
|
54,767
|
|
|
43,794
|
|
|
31,158
|
|
|||
Sales
|
36,197
|
|
|
47,893
|
|
|
34,067
|
|
|||
Total cost of revenues
|
119,601
|
|
|
189,849
|
|
|
210,985
|
|
|||
Gross profit
|
134,489
|
|
|
111,524
|
|
|
93,849
|
|
|||
Operating expenses:
|
|
|
|
|
|
||||||
Technology and development
|
66,331
|
|
|
59,391
|
|
|
49,386
|
|
|||
Sales and marketing
|
53,949
|
|
|
64,082
|
|
|
72,315
|
|
|||
General and administrative
|
55,372
|
|
|
45,209
|
|
|
41,837
|
|
|||
Restructuring (credits) charges
|
(423
|
)
|
|
4,868
|
|
|
—
|
|
|||
Gain on liquidation of textbooks
|
(670
|
)
|
|
(4,326
|
)
|
|
(4,555
|
)
|
|||
Total operating expenses
|
174,559
|
|
|
169,224
|
|
|
158,983
|
|
|||
Loss from operations
|
(40,070
|
)
|
|
(57,700
|
)
|
|
(65,134
|
)
|
|||
Interest expense, net and other (expense) income, net:
|
|
|
|
|
|
||||||
Interest expense, net
|
(171
|
)
|
|
(247
|
)
|
|
(317
|
)
|
|||
Other (expense) income, net
|
(297
|
)
|
|
216
|
|
|
879
|
|
|||
Total interest expense, net and other (expense) income, net
|
(468
|
)
|
|
(31
|
)
|
|
562
|
|
|||
Loss before provision for income taxes
|
(40,538
|
)
|
|
(57,731
|
)
|
|
(64,572
|
)
|
|||
Provision for income taxes
|
1,707
|
|
|
1,479
|
|
|
186
|
|
|||
Net loss
|
$
|
(42,245
|
)
|
|
$
|
(59,210
|
)
|
|
$
|
(64,758
|
)
|
Net loss per share, basic and diluted
|
$
|
(0.47
|
)
|
|
$
|
(0.68
|
)
|
|
$
|
(0.78
|
)
|
Weighted average shares used to compute net loss per share, basic and diluted
|
90,534
|
|
|
86,818
|
|
|
83,205
|
|
|
Year Ended December 31,
|
||||||||||
|
2016
|
|
2015
|
|
2014
|
||||||
Net loss
|
$
|
(42,245
|
)
|
|
$
|
(59,210
|
)
|
|
$
|
(64,758
|
)
|
Other comprehensive loss:
|
|
|
|
|
|
||||||
Change in unrealized gain (loss) on available for sale investments
|
25
|
|
|
(8
|
)
|
|
2
|
|
|||
Change in foreign currency translation adjustments, net of tax
|
(29
|
)
|
|
(151
|
)
|
|
(9
|
)
|
|||
Other comprehensive loss
|
(4
|
)
|
|
(159
|
)
|
|
(7
|
)
|
|||
Total comprehensive loss
|
$
|
(42,249
|
)
|
|
$
|
(59,369
|
)
|
|
$
|
(64,765
|
)
|
|
Common Stock
|
|
Additional Paid-In
Capital |
|
Accumulated Other Comprehensive Loss
|
|
Accumulated
Deficit |
|
Total Stockholders’ Equity
|
|||||||||||||
|
Shares
|
|
Par
Value |
|
|
|
|
|
|
|
|
|||||||||||
Balances at December 31, 2013
|
81,708
|
|
|
$
|
82
|
|
|
$
|
479,279
|
|
|
$
|
(6
|
)
|
|
$
|
(205,115
|
)
|
|
$
|
274,240
|
|
Issuance of common stock upon exercise of stock options and ESPP
|
1,004
|
|
|
1
|
|
|
2,712
|
|
|
—
|
|
|
—
|
|
|
2,713
|
|
|||||
Net issuance of common stock for settlement of restricted stock units (RSUs)
|
873
|
|
|
1
|
|
|
(3,980
|
)
|
|
—
|
|
|
—
|
|
|
(3,979
|
)
|
|||||
Warrant exercises
|
104
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|||||
Issuance of common stock in connection with acquisition
|
408
|
|
|
—
|
|
|
2,585
|
|
|
—
|
|
|
—
|
|
|
2,585
|
|
|||||
Repurchase of common stock
|
(89
|
)
|
|
—
|
|
|
(604
|
)
|
|
—
|
|
|
—
|
|
|
(604
|
)
|
|||||
Share-based compensation expense
|
—
|
|
|
—
|
|
|
36,853
|
|
|
—
|
|
|
—
|
|
|
36,853
|
|
|||||
Other comprehensive loss
|
—
|
|
|
—
|
|
|
—
|
|
|
(7
|
)
|
|
—
|
|
|
(7
|
)
|
|||||
Net loss
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(64,758
|
)
|
|
(64,758
|
)
|
|||||
Balances at December 31, 2014
|
84,008
|
|
|
84
|
|
|
516,845
|
|
|
(13
|
)
|
|
(269,873
|
)
|
|
247,043
|
|
|||||
Issuance of common stock upon exercise of stock options and ESPP
|
2,165
|
|
|
2
|
|
|
13,694
|
|
|
—
|
|
|
—
|
|
|
13,696
|
|
|||||
Net issuance of common stock for settlement of RSUs
|
1,624
|
|
|
2
|
|
|
(8,712
|
)
|
|
—
|
|
|
—
|
|
|
(8,710
|
)
|
|||||
Warrant exercises
|
368
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|||||
Issuance of common stock in connection with acquisition
|
125
|
|
|
—
|
|
|
825
|
|
|
—
|
|
|
—
|
|
|
825
|
|
|||||
Repurchase of common stock
|
(190
|
)
|
|
—
|
|
|
(1,185
|
)
|
|
—
|
|
|
—
|
|
|
(1,185
|
)
|
|||||
Share-based compensation expense
|
—
|
|
|
—
|
|
|
38,775
|
|
|
—
|
|
|
—
|
|
|
38,775
|
|
|||||
Other comprehensive loss
|
—
|
|
|
—
|
|
|
—
|
|
|
(159
|
)
|
|
—
|
|
|
(159
|
)
|
|||||
Net loss
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(59,210
|
)
|
|
(59,210
|
)
|
|||||
Balances at December 31, 2015
|
88,100
|
|
|
88
|
|
|
560,242
|
|
|
(172
|
)
|
|
(329,083
|
)
|
|
231,075
|
|
|||||
Issuance of common stock upon exercise of stock options and ESPP
|
590
|
|
|
1
|
|
|
2,103
|
|
|
—
|
|
|
—
|
|
|
2,104
|
|
|||||
Net issuance of common stock for settlement of RSUs
|
3,019
|
|
|
3
|
|
|
(10,779
|
)
|
|
—
|
|
|
—
|
|
|
(10,776
|
)
|
|||||
Share-based compensation expense
|
—
|
|
|
—
|
|
|
41,785
|
|
|
—
|
|
|
—
|
|
|
41,785
|
|
|||||
Other comprehensive loss
|
—
|
|
|
—
|
|
|
—
|
|
|
(4
|
)
|
|
—
|
|
|
(4
|
)
|
|||||
Net loss
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(42,245
|
)
|
|
(42,245
|
)
|
|||||
Balances at December 31, 2016
|
91,709
|
|
|
$
|
92
|
|
|
$
|
593,351
|
|
|
$
|
(176
|
)
|
|
$
|
(371,328
|
)
|
|
$
|
221,939
|
|
|
Year Ended December 31,
|
||||||||||
|
2016
|
|
2015
|
|
2014
|
||||||
Cash flows from operating activities
|
|
|
|
|
|
||||||
Net loss
|
$
|
(42,245
|
)
|
|
$
|
(59,210
|
)
|
|
$
|
(64,758
|
)
|
Adjustments to reconcile net loss to net cash provided by (used in) operating activities:
|
|
|
|
|
|
||||||
Textbook library depreciation expense
|
9,267
|
|
|
43,553
|
|
|
70,147
|
|
|||
Amortization of warrants and deferred loan costs
|
105
|
|
|
151
|
|
|
187
|
|
|||
Other depreciation and amortization expense
|
14,520
|
|
|
11,511
|
|
|
11,159
|
|
|||
Share-based compensation expense
|
41,785
|
|
|
38,775
|
|
|
36,888
|
|
|||
Provision (release) for bad debts
|
58
|
|
|
(77
|
)
|
|
234
|
|
|||
Gain on liquidation of textbooks
|
(670
|
)
|
|
(4,326
|
)
|
|
(4,555
|
)
|
|||
Loss from write-offs of textbooks
|
1,090
|
|
|
5,297
|
|
|
10,534
|
|
|||
Deferred income taxes
|
—
|
|
|
—
|
|
|
(1,291
|
)
|
|||
Realized gain on sale of securities
|
(11
|
)
|
|
—
|
|
|
(21
|
)
|
|||
Loss from disposal of property and equipment
|
—
|
|
|
967
|
|
|
—
|
|
|||
Impairment of intangible assets
|
—
|
|
|
—
|
|
|
1,552
|
|
|||
Change in assets and liabilities net of effect of acquisition of businesses:
|
|
|
|
|
|
||||||
Accounts receivable
|
(127
|
)
|
|
712
|
|
|
(1,709
|
)
|
|||
Prepaid expenses and other current assets
|
10,039
|
|
|
(27,878
|
)
|
|
(2,981
|
)
|
|||
Other assets
|
1,437
|
|
|
(592
|
)
|
|
(155
|
)
|
|||
Accounts payable
|
(728
|
)
|
|
(4,236
|
)
|
|
5,037
|
|
|||
Deferred revenue
|
(272
|
)
|
|
(9,620
|
)
|
|
1,657
|
|
|||
Accrued liabilities
|
(9,499
|
)
|
|
5,237
|
|
|
7,448
|
|
|||
Other liabilities
|
189
|
|
|
(346
|
)
|
|
(898
|
)
|
|||
Net cash provided by (used in) operating activities
|
24,938
|
|
|
(82
|
)
|
|
68,475
|
|
|||
Cash flows from investing activities
|
|
|
|
|
|
||||||
Purchases of textbooks
|
(886
|
)
|
|
(32,297
|
)
|
|
(112,814
|
)
|
|||
Proceeds from liquidations of textbooks
|
25,646
|
|
|
38,260
|
|
|
58,119
|
|
|||
Purchases of marketable securities
|
(7,633
|
)
|
|
(35,610
|
)
|
|
(70,706
|
)
|
|||
Proceeds from sale of marketable securities
|
22,830
|
|
|
350
|
|
|
46,358
|
|
|||
Maturities of marketable securities
|
6,844
|
|
|
47,840
|
|
|
50,700
|
|
|||
Purchases of property and equipment
|
(24,689
|
)
|
|
(8,253
|
)
|
|
(5,083
|
)
|
|||
Acquisition of businesses, net of cash acquired
|
(27,055
|
)
|
|
—
|
|
|
(53,872
|
)
|
|||
Release of cash from escrow
|
—
|
|
|
—
|
|
|
(52
|
)
|
|||
Purchase of strategic equity investment
|
(1,020
|
)
|
|
(2,019
|
)
|
|
—
|
|
|||
Net cash (used in) provided by investing activities
|
(5,963
|
)
|
|
8,271
|
|
|
(87,350
|
)
|
|||
Cash flows from financing activities
|
|
|
|
|
|
||||||
Common stock issued under stock plans, net
|
2,104
|
|
|
13,696
|
|
|
2,712
|
|
|||
Payment of taxes related to the net share settlement of RSUs
|
(10,779
|
)
|
|
(8,710
|
)
|
|
(3,980
|
)
|
|||
Repurchase of common stock
|
—
|
|
|
(2,263
|
)
|
|
(604
|
)
|
|||
Net cash (used in) provided by financing activities
|
(8,675
|
)
|
|
2,723
|
|
|
(1,872
|
)
|
|||
Net increase (decrease) in cash and cash equivalents
|
10,300
|
|
|
10,912
|
|
|
(20,747
|
)
|
|||
Cash and cash equivalents, beginning of period
|
67,029
|
|
|
56,117
|
|
|
76,864
|
|
|||
Cash and cash equivalents, end of period
|
$
|
77,329
|
|
|
$
|
67,029
|
|
|
$
|
56,117
|
|
|
|
|
|
|
|
||||||
Supplemental cash flow data:
|
|
|
|
|
|
||||||
Cash paid during the period for:
|
|
|
|
|
|
||||||
Interest
|
$
|
50
|
|
|
$
|
95
|
|
|
$
|
114
|
|
Income taxes
|
$
|
1,094
|
|
|
$
|
827
|
|
|
$
|
625
|
|
Non-cash investing and financing activities:
|
|
|
|
|
|
||||||
Accrued purchases of long-lived assets
|
$
|
2,333
|
|
|
$
|
1,771
|
|
|
$
|
5,132
|
|
Issuance of common stock related to prior acquisition
|
$
|
—
|
|
|
$
|
825
|
|
|
$
|
2,585
|
|
Accrued deferred cash consideration related to acquisition
|
$
|
17,378
|
|
|
$
|
—
|
|
|
$
|
—
|
|
Classification
|
|
Useful Life
|
Computers and equipment
|
|
3 years
|
Software
|
|
3 years
|
Furniture and fixtures
|
|
5 years
|
Leasehold improvements
|
|
Shorter of the remaining lease term or the estimated useful life of 5 years
|
Content
|
|
5 years
|
|
Year Ended
December 31, |
||||||||||
|
2016
|
|
2015
|
|
2014
|
||||||
Numerator:
|
|
|
|
|
|
||||||
Net loss
|
$
|
(42,245
|
)
|
|
$
|
(59,210
|
)
|
|
$
|
(64,758
|
)
|
Denominator:
|
|
|
|
|
|
||||||
Weighted-average common shares outstanding
|
90,534
|
|
|
86,818
|
|
|
83,241
|
|
|||
Less: Weighted-average unvested common shares subject to repurchase or forfeiture
|
—
|
|
|
—
|
|
|
(36
|
)
|
|||
Weighted average shares used to compute net loss per share, basic and diluted
|
90,534
|
|
|
86,818
|
|
|
83,205
|
|
|||
|
|
|
|
|
|
||||||
Net loss per share, basic and diluted
|
$
|
(0.47
|
)
|
|
$
|
(0.68
|
)
|
|
$
|
(0.78
|
)
|
|
Year Ended December 31,
|
|||||||
|
2016
|
|
2015
|
|
2014
|
|||
Options to purchase common stock
|
10,799
|
|
|
11,446
|
|
|
14,253
|
|
RSUs and PSUs
|
1,239
|
|
|
200
|
|
|
289
|
|
Employee stock purchase plan
|
15
|
|
|
—
|
|
|
—
|
|
Warrants to purchase common stock
|
200
|
|
|
299
|
|
|
996
|
|
Total common stock equivalents
|
12,253
|
|
|
11,945
|
|
|
15,538
|
|
|
December 31, 2016
|
|
December 31, 2015
|
||||||||||||||||||||
|
Cost
|
|
Net Unrealized Loss
|
|
Fair Value
|
|
Cost
|
|
Net Unrealized Loss
|
|
Fair Value
|
||||||||||||
Cash and cash equivalents:
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Cash
|
$
|
77,329
|
|
|
$
|
—
|
|
|
$
|
77,329
|
|
|
$
|
52,905
|
|
|
$
|
—
|
|
|
$
|
52,905
|
|
Money market funds
|
—
|
|
|
—
|
|
|
—
|
|
|
6,672
|
|
|
—
|
|
|
6,672
|
|
||||||
Commercial paper
|
—
|
|
|
—
|
|
|
—
|
|
|
5,453
|
|
|
—
|
|
|
5,453
|
|
||||||
Corporate securities
|
—
|
|
|
—
|
|
|
—
|
|
|
600
|
|
|
(1
|
)
|
|
599
|
|
||||||
Agency bond
|
—
|
|
|
—
|
|
|
—
|
|
|
1,400
|
|
|
—
|
|
|
1,400
|
|
||||||
Total cash and cash equivalents
|
$
|
77,329
|
|
|
$
|
—
|
|
|
$
|
77,329
|
|
|
$
|
67,030
|
|
|
$
|
(1
|
)
|
|
$
|
67,029
|
|
Short-term investments:
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Commercial paper
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
3,746
|
|
|
$
|
—
|
|
|
$
|
3,746
|
|
Corporate securities
|
—
|
|
|
—
|
|
|
—
|
|
|
10,572
|
|
|
(12
|
)
|
|
10,560
|
|
||||||
Agency bonds
|
—
|
|
|
—
|
|
|
—
|
|
|
3,494
|
|
|
—
|
|
|
3,494
|
|
||||||
Total short-term investments
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
17,812
|
|
|
$
|
(12
|
)
|
|
$
|
17,800
|
|
Long-term investments:
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Corporate securities
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
3,241
|
|
|
$
|
(10
|
)
|
|
$
|
3,231
|
|
Agency bond
|
—
|
|
|
—
|
|
|
—
|
|
|
1,001
|
|
|
(3
|
)
|
|
998
|
|
||||||
Long-term corporate securities
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
4,242
|
|
|
$
|
(13
|
)
|
|
$
|
4,229
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Short-term restricted cash
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
300
|
|
|
$
|
—
|
|
|
$
|
300
|
|
Long-term restricted cash
|
104
|
|
|
—
|
|
|
104
|
|
|
478
|
|
|
—
|
|
|
478
|
|
||||||
Total restricted cash
|
$
|
104
|
|
|
$
|
—
|
|
|
$
|
104
|
|
|
$
|
778
|
|
|
$
|
—
|
|
|
$
|
778
|
|
|
December 31, 2015
|
||||||||||
|
Total
|
|
Quoted Prices
in Active Markets for Identical Assets (Level 1) |
|
Significant
Other Observable Inputs (Level 2) |
||||||
Assets:
|
|
|
|
|
|
||||||
Cash equivalents:
|
|
|
|
|
|
||||||
Money market funds
|
$
|
6,672
|
|
|
$
|
6,672
|
|
|
$
|
—
|
|
Commercial paper
|
5,453
|
|
|
—
|
|
|
5,453
|
|
|||
Corporate securities
|
599
|
|
|
—
|
|
|
599
|
|
|||
Agency bond
|
1,400
|
|
|
—
|
|
|
1,400
|
|
|||
Short-term investments:
|
|
|
|
|
|
||||||
Commercial paper
|
3,746
|
|
|
—
|
|
|
3,746
|
|
|||
Corporate securities
|
10,560
|
|
|
—
|
|
|
10,560
|
|
|||
Agency bonds
|
3,494
|
|
|
—
|
|
|
3,494
|
|
|||
Long-term investments:
|
|
|
|
|
|
||||||
Corporate securities
|
3,231
|
|
|
—
|
|
|
3,231
|
|
|||
Agency bond
|
998
|
|
|
—
|
|
|
998
|
|
|||
Total assets measured and recorded at fair value
|
$
|
36,153
|
|
|
$
|
6,672
|
|
|
$
|
29,481
|
|
|
December 31,
|
||||||
|
2016
|
|
2015
|
||||
Textbook library
|
$
|
33,980
|
|
|
$
|
100,783
|
|
Less accumulated depreciation
|
(31,405
|
)
|
|
(71,055
|
)
|
||
Textbook library, net
|
$
|
2,575
|
|
|
$
|
29,728
|
|
|
December 31,
|
||||||
|
2016
|
|
2015
|
||||
Computer and equipment
|
$
|
1,597
|
|
|
$
|
1,313
|
|
Software
|
4,324
|
|
|
2,591
|
|
||
Furniture and fixtures
|
2,148
|
|
|
1,652
|
|
||
Leasehold improvements
|
5,342
|
|
|
4,983
|
|
||
Content
|
49,725
|
|
|
27,359
|
|
||
Property and equipment
|
63,136
|
|
|
37,898
|
|
||
Less accumulated depreciation and amortization
|
(27,831
|
)
|
|
(17,927
|
)
|
||
Property and equipment, net
|
$
|
35,305
|
|
|
$
|
19,971
|
|
Initial cash consideration
|
$
|
22,007
|
|
Net working capital adjustment
|
200
|
|
|
Fair value of deferred cash consideration
|
17,127
|
|
|
Escrow
|
4,200
|
|
|
Hold-back
|
500
|
|
|
Fair value of purchase consideration
|
$
|
44,034
|
|
Cash
|
$
|
59
|
|
Accounts receivable
|
2,610
|
|
|
Favorable lease acquired
|
300
|
|
|
Other acquired assets
|
212
|
|
|
Acquired intangible assets:
|
|
||
Trade names
|
1,840
|
|
|
Domain names
|
1,330
|
|
|
Advertiser relationships
|
6,600
|
|
|
User base
|
550
|
|
|
Non-compete agreements
|
508
|
|
|
Developed technology
|
5,660
|
|
|
Total acquired intangible assets
|
16,488
|
|
|
Total identifiable assets acquired
|
19,669
|
|
|
Liabilities assumed
|
(573
|
)
|
|
Net identifiable assets acquired
|
19,096
|
|
|
Goodwill
|
24,938
|
|
|
Total fair value of purchase consideration
|
$
|
44,034
|
|
Cash consideration
|
$
|
55,537
|
|
Fair value of stock escrow consideration
|
2,585
|
|
|
Fair value of stock contingent consideration
|
193
|
|
|
Fair value of purchase consideration
|
$
|
58,315
|
|
Cash
|
$
|
1,665
|
|
Other acquired assets
|
595
|
|
|
Acquired intangible assets:
|
|
||
Developed technology
|
4,174
|
|
|
Customer lists
|
3,770
|
|
|
Trade names
|
5,990
|
|
|
Non-compete agreements
|
1,630
|
|
|
Corporate partnerships
|
243
|
|
|
Master services agreements
|
1,030
|
|
|
Total acquired intangible assets
|
16,837
|
|
|
Total identifiable assets acquired
|
19,097
|
|
|
Liabilities assumed
|
(2,538
|
)
|
|
Net identifiable assets acquired
|
16,559
|
|
|
Goodwill
|
41,756
|
|
|
Net assets acquired
|
$
|
58,315
|
|
|
December 31, 2016
|
|
December 31, 2015
|
||||
Beginning balance
|
$
|
91,301
|
|
|
$
|
91,301
|
|
Additions due to acquisitions
|
24,938
|
|
|
—
|
|
||
Ending balance
|
$
|
116,239
|
|
|
$
|
91,301
|
|
|
December 31, 2016
|
|||||||||||||
|
Weighted-Average Amortization
Period
(in months)
|
|
Gross
Carrying
Amount
|
|
Accumulated
Amortization
|
|
Net
Carrying
Amount
|
|||||||
Developed technologies
|
60
|
|
|
$
|
15,077
|
|
|
$
|
(8,245
|
)
|
|
$
|
6,832
|
|
Customer lists
|
47
|
|
|
9,970
|
|
|
(3,673
|
)
|
|
6,297
|
|
|||
Trade names
|
47
|
|
|
5,513
|
|
|
(1,998
|
)
|
|
3,515
|
|
|||
Non-compete agreements
|
30
|
|
|
1,728
|
|
|
(1,249
|
)
|
|
479
|
|
|||
Master service agreements
|
21
|
|
|
1,030
|
|
|
(1,005
|
)
|
|
25
|
|
|||
Indefinite-lived trade name
|
—
|
|
|
3,600
|
|
|
—
|
|
|
3,600
|
|
|||
Total intangible assets
|
|
|
$
|
36,918
|
|
|
$
|
(16,170
|
)
|
|
$
|
20,748
|
|
|
December 31, 2015
|
|||||||||||||
|
Weighted-Average Amortization
Period
(in months)
|
|
Gross
Carrying
Amount
|
|
Accumulated
Amortization
|
|
Net
Carrying
Amount
|
|||||||
Developed technologies
|
52
|
|
|
$
|
9,417
|
|
|
$
|
(6,702
|
)
|
|
$
|
2,715
|
|
Customer lists
|
20
|
|
|
2,820
|
|
|
(2,239
|
)
|
|
581
|
|
|||
Trade names
|
48
|
|
|
2,343
|
|
|
(920
|
)
|
|
1,423
|
|
|||
Non-compete agreements
|
28
|
|
|
1,220
|
|
|
(832
|
)
|
|
388
|
|
|||
Master service agreements
|
21
|
|
|
1,030
|
|
|
(872
|
)
|
|
158
|
|
|||
Indefinite-lived trade name
|
—
|
|
|
3,600
|
|
|
—
|
|
|
3,600
|
|
|||
Total intangible assets
|
|
|
$
|
20,430
|
|
|
$
|
(11,565
|
)
|
|
$
|
8,865
|
|
2017
|
$
|
5,350
|
|
2018
|
4,446
|
|
|
2019
|
3,510
|
|
|
2020
|
2,153
|
|
|
2021
|
815
|
|
|
Thereafter
|
874
|
|
|
Total
|
$
|
17,148
|
|
|
December 31,
|
||||||
|
2016
|
|
2015
|
||||
Reimbursement from Ingram
|
$
|
18,759
|
|
|
$
|
28,875
|
|
Other
|
3,500
|
|
|
2,857
|
|
||
Other Current Assets
|
$
|
22,259
|
|
|
$
|
31,732
|
|
|
December 31,
|
||||||
|
2016
|
|
2015
|
||||
Accrued shipping for cycle returns
|
$
|
1,334
|
|
|
$
|
3,355
|
|
Refund reserve
|
487
|
|
|
4,538
|
|
||
Taxes payable
|
2,927
|
|
|
3,913
|
|
||
Accrued deferred cash consideration related to acquisition
|
17,378
|
|
|
—
|
|
||
Payable to Ingram
|
8,237
|
|
|
9,965
|
|
||
Other
|
13,956
|
|
|
13,509
|
|
||
Accrued Liabilities
|
$
|
44,319
|
|
|
$
|
35,280
|
|
2017
|
$
|
2,001
|
|
2018
|
1,927
|
|
|
2019
|
1,099
|
|
|
2020
|
749
|
|
|
2021
|
317
|
|
|
Thereafter
|
138
|
|
|
Total
|
$
|
6,231
|
|
|
December 31, 2016
|
|
Warrants to purchase common stock
|
200,000
|
|
Outstanding stock options
|
11,333,624
|
|
Outstanding RSUs
|
14,142,109
|
|
Shares available for grant under the stock plans
|
9,574,896
|
|
Shares available for issuance under employee stock purchase plan
|
5,310,428
|
|
Total common shares reserved for future issuance
|
40,561,057
|
|
|
Year Ended December 31,
|
||||||||||
|
2016
|
|
2015
|
|
2014
|
||||||
Cost of revenues
|
$
|
172
|
|
|
$
|
262
|
|
|
$
|
617
|
|
Technology and development
|
14,771
|
|
|
11,992
|
|
|
10,451
|
|
|||
Sales and marketing
|
6,124
|
|
|
7,901
|
|
|
11,300
|
|
|||
General and administrative
|
20,718
|
|
|
18,620
|
|
|
14,520
|
|
|||
Total share-based compensation expense
|
$
|
41,785
|
|
|
$
|
38,775
|
|
|
$
|
36,888
|
|
|
Year Ended December 31,
|
||||||||||
|
2016
|
|
2015
|
|
2014
|
||||||
Expected term (years)
|
5.50
|
|
|
5.50-6.00
|
|
|
6.07
|
|
|||
Expected volatility
|
56.94
|
%
|
|
50.68%-51.69%
|
|
|
55.91%-56.83%
|
|
|||
Dividend yield
|
—
|
%
|
|
—
|
%
|
|
—
|
%
|
|||
Risk-free interest rate
|
1.43
|
%
|
|
1.75%-1.86%
|
|
|
1.88%-2.02%
|
|
|||
Weighted-average grant-date fair value per share
|
$
|
2.58
|
|
|
$
|
3.54
|
|
|
$
|
3.82
|
|
|
Year Ended December 31,
|
||||||||||
|
2016
|
|
2015
|
|
2014
|
||||||
Expected term (years)
|
0.50
|
|
|
0.50
|
|
|
0.50
|
|
|||
Expected volatility
|
35.10%-75.74%
|
|
|
36.20%-49.59%
|
|
|
40.54%-46.42%
|
|
|||
Dividend yield
|
—
|
%
|
|
—
|
%
|
|
—
|
%
|
|||
Risk-free interest rate
|
0.38%-0.62%
|
|
|
0.09%-0.31%
|
|
|
0.05%-0.07%
|
|
|||
Weighted-average grant-date fair value per share
|
$
|
1.79
|
|
|
$
|
1.98
|
|
|
$
|
1.68
|
|
|
Options Outstanding
|
|||||||||||
|
Number of
Options
Outstanding
|
|
Weighted-
Average
Exercise
Price per
Share
|
|
Weighted-Average Remaining Contractual Term in Years
|
|
Aggregate
Intrinsic
Value
|
|||||
Balance at December 31, 2015
|
12,415,492
|
|
|
$
|
8.68
|
|
|
6.24
|
|
$
|
5,082,489
|
|
Granted
|
232,700
|
|
|
5.00
|
|
|
|
|
|
|||
Exercised
|
(121,538
|
)
|
|
2.81
|
|
|
|
|
|
|||
Canceled
|
(1,193,030
|
)
|
|
9.31
|
|
|
|
|
|
|||
Balance at December 31, 2016
|
11,333,624
|
|
|
$
|
8.60
|
|
|
5.22
|
|
$
|
6,608,611
|
|
|
|
|
|
|
|
|
|
|||||
As of December 31, 2016
|
|
|
|
|
|
|
|
|||||
Options exercisable
|
10,818,738
|
|
|
$
|
8.64
|
|
|
5.07
|
|
$
|
6,004,970
|
|
Options vested and expected to vest
|
11,299,893
|
|
|
$
|
8.60
|
|
|
5.21
|
|
$
|
6,569,584
|
|
|
RSUs and PSUs Outstanding
|
|||||
|
Number of RSUs and PSUs
Outstanding
|
|
Weighted
Average Grant Date
Fair Value
|
|||
Balance at December 31, 2015
|
13,270,650
|
|
|
$
|
6.38
|
|
Granted
|
10,307,836
|
|
|
4.62
|
|
|
Released
|
(5,104,641
|
)
|
|
6.37
|
|
|
Canceled
|
(4,331,736
|
)
|
|
6.06
|
|
|
Balance at December 31, 2016
|
14,142,109
|
|
|
$
|
5.20
|
|
|
Year Ended December 31,
|
||||||||||
|
2016
|
|
2015
|
|
2014
|
||||||
Current income taxes:
|
|
|
|
|
|
||||||
Federal
|
$
|
(18
|
)
|
|
$
|
—
|
|
|
$
|
—
|
|
State
|
321
|
|
|
263
|
|
|
304
|
|
|||
Foreign
|
959
|
|
|
778
|
|
|
871
|
|
|||
Total current income taxes
|
1,262
|
|
|
1,041
|
|
|
1,175
|
|
|||
|
|
|
|
|
|
||||||
Deferred income taxes:
|
|
|
|
|
|
||||||
Federal
|
503
|
|
|
484
|
|
|
(1,003
|
)
|
|||
State
|
48
|
|
|
56
|
|
|
33
|
|
|||
Foreign
|
(106
|
)
|
|
(102
|
)
|
|
(19
|
)
|
|||
Total deferred income taxes
|
445
|
|
|
438
|
|
|
(989
|
)
|
|||
Total income tax provision
|
$
|
1,707
|
|
|
$
|
1,479
|
|
|
$
|
186
|
|
|
Year Ended December 31,
|
||||||
|
2016
|
|
2015
|
||||
Deferred tax assets:
|
|
|
|
||||
Accrued expenses and reserves
|
$
|
5,069
|
|
|
$
|
7,351
|
|
Share-based compensation
|
23,864
|
|
|
21,676
|
|
||
Deferred revenue
|
1,085
|
|
|
1,488
|
|
||
Net operating loss carryforwards
|
73,708
|
|
|
58,664
|
|
||
Property and equipment, textbooks and intangibles assets
|
5,168
|
|
|
7,577
|
|
||
Other items
|
1,407
|
|
|
1,612
|
|
||
Gross deferred tax assets
|
110,301
|
|
|
98,368
|
|
||
Valuation allowance
|
(110,045
|
)
|
|
(98,209
|
)
|
||
Total deferred tax assets
|
256
|
|
|
159
|
|
||
|
|
|
|
||||
Deferred tax liabilities:
|
|
|
|
||||
Intangible asset
|
(1,413
|
)
|
|
(862
|
)
|
||
Total deferred tax liabilities
|
(1,413
|
)
|
|
(862
|
)
|
||
|
|
|
|
||||
Net deferred tax liability
|
$
|
(1,157
|
)
|
|
$
|
(703
|
)
|
|
Year Ended December 31,
|
||||||||||
|
2016
|
|
2015
|
|
2014
|
||||||
Beginning balance
|
$
|
4,849
|
|
|
$
|
4,272
|
|
|
$
|
2,994
|
|
Increase in tax positions for prior years
|
478
|
|
|
82
|
|
|
406
|
|
|||
Decrease in tax positions for prior years
|
(855
|
)
|
|
(416
|
)
|
|
(284
|
)
|
|||
Decrease in tax positions for prior year settlement
|
(32
|
)
|
|
(61
|
)
|
|
—
|
|
|||
Decrease in tax positions for prior years due to statutes lapsing
|
(76
|
)
|
|
—
|
|
|
—
|
|
|||
Increase in tax positions for current year
|
595
|
|
|
948
|
|
|
1,172
|
|
|||
Change due to translation of foreign currencies
|
(77
|
)
|
|
24
|
|
|
(16
|
)
|
|||
Ending balance
|
$
|
4,882
|
|
|
$
|
4,849
|
|
|
$
|
4,272
|
|
|
Workforce Reduction Costs
|
|
Lease Termination and Other Costs
|
|
Total
|
||||||
Balance at January 1, 2015
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
Restructuring charges
|
1,885
|
|
|
2,983
|
|
|
4,868
|
|
|||
Cash payments
|
(1,830
|
)
|
|
(675
|
)
|
|
(2,505
|
)
|
|||
Write-offs
|
—
|
|
|
(317
|
)
|
|
(317
|
)
|
|||
Other
|
—
|
|
|
472
|
|
|
472
|
|
|||
Balance at December 31, 2015
|
$
|
55
|
|
|
$
|
2,463
|
|
|
$
|
2,518
|
|
Restructuring credits
|
—
|
|
|
(423
|
)
|
|
(423
|
)
|
|||
Cash payments
|
(55
|
)
|
|
(1,734
|
)
|
|
(1,789
|
)
|
|||
Balance at December 31, 2016
|
$
|
—
|
|
|
$
|
306
|
|
|
$
|
306
|
|
|
December 31,
|
||||||||||
|
2016
|
|
2015
|
|
2014
|
||||||
Chegg Services
|
$
|
129,335
|
|
|
$
|
94,285
|
|
|
$
|
68,117
|
|
Required Materials
|
124,755
|
|
|
207,088
|
|
|
236,717
|
|
|||
Total net revenues
|
$
|
254,090
|
|
|
$
|
301,373
|
|
|
$
|
304,834
|
|
|
Three Months Ended
|
||||||||||||||
|
March 31, 2016
|
|
June 30, 2016
|
|
September 30, 2016
|
|
December 31, 2016
|
||||||||
Total net revenues
|
$
|
66,654
|
|
|
$
|
53,036
|
|
|
$
|
71,343
|
|
|
$
|
63,057
|
|
Gross profit
|
$
|
27,731
|
|
|
$
|
31,629
|
|
|
$
|
32,644
|
|
|
$
|
42,485
|
|
Net loss
|
$
|
(15,685
|
)
|
|
$
|
(9,008
|
)
|
|
$
|
(16,063
|
)
|
|
$
|
(1,489
|
)
|
Weighted average shares used to compute net loss per share, basic and diluted
|
89,118
|
|
|
90,416
|
|
|
91,059
|
|
|
91,526
|
|
||||
Net loss per share, basic and diluted
|
$
|
(0.18
|
)
|
|
$
|
(0.10
|
)
|
|
$
|
(0.17
|
)
|
|
$
|
(0.02
|
)
|
|
Three Months Ended
|
||||||||||||||
|
March 31, 2015
|
|
June 30, 2015
|
|
September 30, 2015
|
|
December 31, 2015
|
||||||||
Total net revenues
|
$
|
84,872
|
|
|
$
|
67,061
|
|
|
$
|
81,286
|
|
|
$
|
68,154
|
|
Gross profit
|
$
|
19,379
|
|
|
$
|
30,805
|
|
|
$
|
19,566
|
|
|
$
|
41,774
|
|
Net (loss) income
|
$
|
(28,542
|
)
|
|
$
|
(10,131
|
)
|
|
$
|
(24,167
|
)
|
|
$
|
3,630
|
|
Weighted average shares used to compute net (loss) income per share:
|
|
|
|
|
|
|
|
||||||||
Basic
|
84,794
|
|
|
86,741
|
|
|
87,706
|
|
|
87,993
|
|
||||
Diluted
|
84,794
|
|
|
86,741
|
|
|
87,706
|
|
|
93,225
|
|
||||
Net (loss) income per share:
|
|
|
|
|
|
|
|
||||||||
Basic
|
$
|
(0.34
|
)
|
|
$
|
(0.12
|
)
|
|
$
|
(0.28
|
)
|
|
$
|
0.04
|
|
Diluted
|
$
|
(0.34
|
)
|
|
$
|
(0.12
|
)
|
|
$
|
(0.28
|
)
|
|
$
|
0.04
|
|
(a)
|
Evaluation of Disclosure Controls and Procedures
|
(b)
|
Management's Annual Report on Internal Control Over Financial Reporting
|
(c)
|
Changes in Internal Control over Financial Reporting
|
|
Years Ended December 31, 2016, 2015 and 2014
|
||||||||||||||
|
Balance at
Beginning of Year |
|
Provision (Release) for Bad Debts
|
|
Net
(Write-offs) Recoveries |
|
Balance at
End of Year |
||||||||
Allowance for doubtful accounts
|
|
|
|
|
|
|
|
||||||||
2016
|
$
|
378
|
|
|
$
|
58
|
|
|
$
|
—
|
|
|
$
|
436
|
|
2015
|
$
|
559
|
|
|
$
|
(77
|
)
|
|
$
|
(104
|
)
|
|
$
|
378
|
|
2014
|
$
|
317
|
|
|
$
|
234
|
|
|
$
|
8
|
|
|
$
|
559
|
|
|
Years Ended December 31, 2016, 2015 and 2014
|
||||||||||||||
|
Balance at
Beginning of Year |
|
Provision for Refunds
|
|
Refunds Issued
|
|
Balance at
End of Year |
||||||||
Refund Reserve
|
|
|
|
|
|
|
|
||||||||
2016
|
$
|
4,538
|
|
|
$
|
26,373
|
|
|
$
|
(30,424
|
)
|
|
$
|
487
|
|
2015
|
$
|
6,174
|
|
|
$
|
39,919
|
|
|
$
|
(41,555
|
)
|
|
$
|
4,538
|
|
2014
|
$
|
330
|
|
|
$
|
54,434
|
|
|
$
|
(48,590
|
)
|
|
$
|
6,174
|
|
|
CHEGG, INC.
|
||
February 22, 2017
|
By:
|
|
/S/ DAN ROSENSWEIG
|
|
|
|
Dan Rosensweig
|
|
|
|
President, Chief Executive Officer and Chairman
|
Name
|
Title
|
Date
|
|
|
|
/S/ DAN ROSENSWEIG
|
President, Chief Executive Officer and Chairman
|
February 22, 2017
|
Dan Rosensweig
|
(Principal Executive Officer)
|
|
|
|
|
/S/ ANDREW BROWN
|
Chief Financial Officer
|
February 22, 2017
|
Andrew Brown
|
(Principal Financial Officer)
|
|
|
|
|
/S/ ROBIN TOMASELLO
|
Vice President, Corporate Controller
|
February 22, 2017
|
Robin Tomasello
|
(Principal Accounting Officer)
|
|
|
|
|
/S/ JEFFREY HOUSENBOLD
|
Director
|
February 22, 2017
|
Jeffrey Housenbold
|
|
|
|
|
|
/S/ RENEE BUDIG
|
Director
|
February 22, 2017
|
Renee Budig
|
|
|
|
|
|
|
Director
|
February 22, 2017
|
Marne Levine
|
|
|
|
|
|
/S/ RICHARD SARNOFF
|
Director
|
February 22, 2017
|
Richard Sarnoff
|
|
|
|
|
|
|
Director
|
February 22, 2017
|
Ted Schlein
|
|
|
|
|
|
/S/ JOHN YORK
|
Director
|
February 22, 2017
|
John York
|
|
|
|
|
|
|
Incorporated by Reference
|
||||||||
Exhibit
No.
|
|
Exhibit
|
|
Form
|
|
File No
|
|
Filing Date
|
|
Exhibit No.
|
|
Filed
Herewith
|
3.01
|
|
Restated Certificate of Incorporation of the Registrant effective November 18, 2013
|
|
10-K
|
|
001-36180
|
|
3/4/16
|
|
3.01
|
|
|
3.02
|
|
Restated Bylaws of the Registrant effective November 13, 2013
|
|
10-K
|
|
001-36180
|
|
3/4/16
|
|
3.02
|
|
|
4.01
|
|
Form of Registrant’s Common Stock Certificate
|
|
S-1/A
|
|
333-190616
|
|
10/01/13
|
|
4.01
|
|
|
4.02
|
|
Amended and Restated Investors’ Rights Agreement, dated as of March 7, 2012, by and among the Registrant and certain investors of the Registrant
|
|
S-1
|
|
333-190616
|
|
08/14/13
|
|
4.02
|
|
|
10.01*
|
|
Form of Indemnification Agreement entered into between the Registrant and each of its directors and executive officers
|
|
S-1/A
|
|
333-190616
|
|
10/01/13
|
|
10.01
|
|
|
10.02*
|
|
2005 Stock Incentive Plan, as amended, and forms of agreement thereunder
|
|
S-1
|
|
333-190616
|
|
08/14/13
|
|
10.02
|
|
|
10.03*
|
|
2013 Equity Incentive Plan, and forms of agreement thereunder
|
|
S-1/A
|
|
333-190616
|
|
10/25/13
|
|
10.04
|
|
|
10.04*
|
|
2013 Employee Stock Purchase Plan
|
|
S-1
|
|
333-190616
|
|
08/14/13
|
|
10.05
|
|
|
10.05*
|
|
Offer Letter between Dan Rosensweig and the Registrant, dated December 3, 2009
|
|
S-1
|
|
333-190616
|
|
08/14/13
|
|
10.06
|
|
|
10.06*
|
|
Amendment to Offer Letter between Dan Rosensweig and the Registrant, dated November 29, 2012
|
|
S-1
|
|
333-190616
|
|
08/14/13
|
|
10.07
|
|
|
10.07*
|
|
Offer Letter between Andy Brown and the Registrant, dated September 2, 2011
|
|
10-K
|
|
001-36180
|
|
3/6/14
|
|
10.07
|
|
|
10.08*
|
|
Amendment to Offer Letter between Andy Brown and the Registrant, dated November 29, 2012
|
|
10-K
|
|
001-36180
|
|
3/6/14
|
|
10.08
|
|
|
10.10*
|
|
Offer Letter between Jenny Brandemuehl and the Registrant, dated January 9, 2013
|
|
|
|
|
|
|
|
|
|
X
|
10.13
|
|
Lease between Silicon Valley CA-I, LLC and the Registrant, dated as of May 14, 2012
|
|
S-1
|
|
333-190616
|
|
08/14/13
|
|
10.14
|
|
|
10.14
|
|
Commencement Date Memorandum between Silicon Valley CA-I, LLC and the Registrant, dated as of October 12, 2012
|
|
S-1
|
|
333-190616
|
|
08/14/13
|
|
10.15
|
|
|
10.15
|
|
Standard Industrial Lease Agreement between Pattillo Industrial Partners, LLC and the Registrant, dated as of October 17, 2009
|
|
S-1
|
|
333-190616
|
|
08/14/13
|
|
10.16
|
|
|
10.16
|
|
Amendment to Lease, dated as of May 13, 2011, amended the Standard Industrial Lease Agreement between Pattillo Industrial Partners, LLC and the Registrant, dated as of October 17, 2009
|
|
S-1
|
|
333-190616
|
|
08/14/13
|
|
10.17
|
|
|
10.17†
|
|
2015 Inventory Purchase and Consignment Agreement dated April 3, 2015, by and among Ingram Hosting Holdings Inc., the Company and Ingram Book Group Inc.
|
|
10-Q
|
|
001-36180
|
|
08/06/15
|
|
10.01
|
|
|
10.19
|
|
Interest Purchase Agreement by and among Chegg Inc., and Imagine Easy Solutions, LLC and the Sellers, dated as of April 28, 2016.
|
|
8-K
|
|
001-36180
|
|
5/2/16
|
|
99.03
|
|
|
10.20
|
|
Credit Agreement dated September 21, 2016 by and between Chegg, Inc. and Wells Fargo Bank, National Association.
|
|
8-K
|
|
001-36180
|
|
9/22/16
|
|
99.1
|
|
|
21.01
|
|
List of subsidiaries
|
|
|
|
|
|
|
|
|
|
X
|
23.01
|
|
Consent of Independent Registered Public Accounting Firm
|
|
|
|
|
|
|
|
|
|
X
|
24.01
|
|
Power of Attorney (included on signature page hereto)
|
|
|
|
|
|
|
|
|
|
X
|
31.01
|
|
Certification of Dan Rosensweig, Chief Executive Officer, pursuant to Rule 13a-14(a)/15d-14(a), as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002
|
|
|
|
|
|
|
|
|
|
X
|
31.02
|
|
Certification of Andrew Brown, Chief Financial Officer, pursuant to Rule 13a-14(a)/15d-14(a), as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002
|
|
|
|
|
|
|
|
|
|
X
|
32.01**
|
|
Certification pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002
|
|
|
|
|
|
|
|
|
|
X
|
101.INS
|
|
XBRL Instance
|
|
|
|
|
|
|
|
|
|
X
|
101.SCH
|
|
XBRL Taxonomy Extension Schema
|
|
|
|
|
|
|
|
|
|
X
|
101.CAL
|
|
XBRL Taxonomy Extension Calculation
|
|
|
|
|
|
|
|
|
|
X
|
101.LAB
|
|
XBRL Taxonomy Extension Labels
|
|
|
|
|
|
|
|
|
|
X
|
101.PRE
|
|
XBRL Taxonomy Extension Presentation
|
|
|
|
|
|
|
|
|
|
X
|
101.DEF
|
|
XBRL Taxonomy Extension Definition
|
|
|
|
|
|
|
|
|
|
X
|
†
|
Confidential treatment has been granted for portions of this exhibit by the SEC.
|
*
|
Indicates a management contract or compensatory plan.
|
**
|
This certification is deemed not filed for purposes of section 18 of the Securities Exchange Act of 1934, as amended (Exchange Act), or otherwise subject to the liability of that section, nor shall it be deemed incorporated by reference into any filing under the Securities Act of 1933, as amended or the Exchange Act.
|
1.
|
Position
.
|
2.
|
Compensation
.
|
3.
|
Stock Options.
|
4.
|
Benefits
.
|
5.
|
At-Will Employment
.
|
Chegg®, Inc.
www.chegg.com
|
3990 Freedom Circle Santa Clara, CA 95054
CONFIDENTIAL INFORMATION
|
408.855.5700
|
6.
|
Confidential Information and Invention Assignment Agreement
.
|
7.
|
Section 409A
.
|
8.
|
No Inconsistent Obligations
.
|
Chegg®, Inc.
www.chegg.com
|
3990 Freedom Circle Santa Clara, CA 95054
CONFIDENTIAL INFORMATION
|
408.855.5700
|
Name of Subsidiary
|
Jurisdiction of Incorporation or Organization
|
Cramster Inc.
|
California
|
Cramster Holding Corp.
|
California
|
InstaEDU Inc.
|
Delaware
|
Internships.com, LLC
|
Delaware
|
Chegg India Private Limited
|
India
|
Good Ascent Corporation Limited
|
Hong Kong
|
Beijing Zichi Information Technology Co., Ltd.
|
China WOFE
|
Beijing Kairen Information Technology Co., Ltd.
|
China ICP
|
Chegg M.E. Ltd.
|
Israel
|
Imagine Easy Solutions, LLC
|
Delaware
|
Imagine Easy Technology Solutions GmbH
|
Germany
|
1.
|
I have reviewed this
Annual
Report on Form
10-K
of Chegg, Inc.;
|
2.
|
Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;
|
3.
|
Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;
|
4.
|
The registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)), for the registrant and have:
|
a)
|
Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;
|
b)
|
Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;
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c)
|
Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and
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d)
|
Disclosed in this report any change in the registrant's internal control over financial reporting that occurred during the registrant's fourth fiscal quarter that has materially affected, or is reasonably likely to materially affect, the registrant's internal control over financial reporting; and
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5.
|
The registrant’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):
|
a)
|
All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and
|
b)
|
Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.
|
/
S
/ D
AN
R
OSENSWEIG
|
Dan Rosensweig
|
President, Chief Executive Officer and Chairman
|
(Principal Executive Officer)
|
1.
|
I have reviewed this
Annual
Report on Form
10-K
of Chegg, Inc.;
|
2.
|
Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;
|
3.
|
Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;
|
4.
|
The registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)), for the registrant and have:
|
a)
|
Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;
|
b)
|
Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;
|
c)
|
Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and
|
d)
|
Disclosed in this report any change in the registrant's internal control over financial reporting that occurred during the registrant's fourth fiscal quarter that has materially affected, or is reasonably likely to materially affect, the registrant's internal control over financial reporting; and
|
5.
|
The registrant’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):
|
a)
|
All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and
|
b)
|
Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.
|
/
S
/ A
NDREW
B
ROWN
|
Andrew Brown
|
Chief Financial Officer
|
(Principal Financial Officer)
|
(1)
|
The Report, to which this certification is attached as Exhibit 32.01, fully complies with the requirements of Section 13(a) of the Securities Exchange Act of 1934; and
|
(2)
|
The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Registrant.
|
/S/
D
AN
R
OSENSWEIG
|
|
/S/
A
NDREW
B
ROWN
|
Dan Rosensweig
|
|
Andrew Brown
|
President, Chief Executive Officer and Chairman
|
|
Chief Financial Officer
|