Greetings and welcome to Chegg, Inc's Third Quarter 2020 Earnings Conference Call. [Operator Instructions] As a reminder, this conference is being recorded. It is now my pleasure to introduce your host, Tracey Ford, Vice President of Investor Relations for Chegg. Thank you. You may begin.

Good afternoon. Thank you for joining Chegg's third quarter 2020 conference call. On today's call are Dan Rosensweig; Co-Chairperson and CEO; and Andy Brown, Chief Financial Officer. A copy of our earnings press release along with our investor presentation is available at our Investor Relations website investor.chegg.com. A replay of this call will also be available on our website. We routinely post information on our website and intend to make important announcements on our media center website at chegg.com/mediacenter. We encourage you to make use of these resources. Before we begin, I would like to point out that during the course of this call, we will make forward-looking statements regarding future events, including the future financial and operating performance of the company. These forward-looking statements are subject to material risks and uncertainties that could cause actual results to differ materially from those in the forward-looking statements. We caution you to consider the important factors that could cause actual results to differ materially from those in the forward-looking statement. In particular, we refer you to the cautionary language included in today's earnings release and the risk factors described in Chegg's quarterly report on Form 10-Q filed with the Securities and Exchange Commission on August 3, 2020 as well as our other filings with the SEC. Any forward-looking statements that we make today are based on assumptions that we believe to be reasonable as of this date. We undertake no obligation to update these statements as a result of new information or future events. During this call, we will present both GAAP and non-GAAP financial measure. Our GAAP results and GAAP to non-GAAP reconciliation can be found in our earnings press release and the investor slide deck on our IR website investor.chegg.com. We also recommend you review the investor data sheet, which is also posted on our IR website. Now, I will turn the call over to Dan.

Thank you, Tracey, and welcome everyone to Chegg's third quarter earnings call. First and foremost, we hope you and your families continue to be healthy and well, as we all navigate these unprecedented times. It has become apparent to us that this terrible pandemic has only further highlighted the need for higher education to transition to a model that is more on-demand, student-centric, affordable and does a much better job of leveraging technology to the advantage of the learner. As evident in our Q3 results, students more than ever before are relying on Chegg as they navigate their semesters, whether they are back on campus or not. And while our business continues to have an extraordinary year, more importantly we are helping millions of students get through these uncertain time. In Q3, we saw subscriber growth of 69% year-over-year, reaching 3.7 million students in the quarter. This yielded total net revenue growth of 64% year-over-year. The inevitable trend towards online learning, the clear need for high-quality online support and the momentum we are experiencing globally, gives us the confidence to raise our guidance again for 2020 and provide our initial outlook for 2021. Andy will walk you through all of these numbers shortly, but I would like to take a moment to share with you, why we believe our results will continue to perform at such a high level. Millions of students around the world are now asking for a better return for their education and demanding a shift to the model we always knew it would become, increasingly online, on-demand, adaptive, affordable, personalized and tailored to the modern learner. Chegg has been focused on these things for years. So we believe we are in the best position to not only expand academic support to students, but also expand support…

Thanks, Dan, and good afternoon, everyone. First and foremost, I hope you and your families are staying safe during these difficult times. As you can see from the results, Chegg had another great quarter with our business metrics and financials once again, ahead of our expectations. During the quarter, we also executed a very well received convertible debt offering. The success we are experiencing, both domestically and internationally, give us the confidence to raise our guidance again for 2020 and as we have been for the past four years, provide an early initial outlook for next year, despite ongoing economic uncertainties. Looking specifically at the third quarter, total revenue was $154 million, a 64% increase over Q3, 2019, driven primarily by 69% subscriber growth to 3.7 million, as we continue to see significant growth opportunities in both domestic and increasingly in international markets. Adjusted EBITDA for the quarter was well ahead of what we expected at $32 million, as we continue to see strong leverage in the model, all while making incremental investments to build for the future. We ended the quarter with approximately $1.8 billion of cash and investments. In the quarter, we completed a very issuer friendly convertible debt offering, along with a concurrent exchange of approximately 50% of the outstanding principal on our 2023 notes that were deep in the money. We expect to use the cash on our balance sheet and future operating cash flows to fund our current business, including potential acquisitions and to call or repurchase outstanding notes at opportunistic times to minimize shareholder dilution from these instruments. We continue to believe the combination of our scale, balance sheet, operating model and cash flows are the strongest in the education industry, which we believe provide a significant advantage to both our customers and our…

[Operator Instructions] Our first question comes from the line of Jeff Silber with BMO Capital Markets. Please proceed with your question.

In your prepared remarks, you talked a little bit about the Chegg Study Pack. I am just wondering, we can get a little bit more color in terms of how that's been going, you talked about higher than expected take rate, but I'm just curious how the momentum there has been as you rolled it out? Thanks.

Yes, this is Dan. The momentum has been great. And what do I mean by that. So it started earlier than we expected. And we are seeing a better take rate than we expected. On top of that, we are seeing a take rate outside the U.S. similar to that in the U.S. which surprised us, because we weren't really sure how writing would do. But it's very clear that the more we can package an overwhelming value that we can create for students that they are taking it. So we couldn't be happier to be honest with you.

And the impact on ARPU, I think people thought might have been a little bit higher. Can you talk a little bit about that?

Yes, it's hard to really breakout ARPU the way we report, because we report a full Chegg Services number and that includes things like advertising and now it includes things like Thinkful. So - but we do know that if you just look at the subscriber number and the revenue per subscriber, that ARPU is up, yield is up. So it's extraordinarily positive. You have to remember, we do have an advertising business that's much smaller compared to the rest of our businesses, but advertising has just been slightly weaker, which is why that may make up the balance. But if you were to just look at it apples-to-apples, you would be very pleased.

Yes.

Yes, Jeff, when we look at it internally for subscribers, we're seeing ARPU increase like Dan said. Unfortunately, you've got the other businesses involved.

Our next question comes from the line of Stephen Sheldon with William Blair. Please proceed with your question.

Thanks and congrats on another strong quarter.

Thank you.

Can you talk some about topline trends you've been seeing at Banko recently including funnel trends looking ahead. And additionally continue - maybe frame what you've included for Thinkful in terms of revenue and adjusted EBITDA within your '21 guidance?

I'll start and turn it over to Andy. But what Andy is going to tell you is, we don't break it out. But what we - look the - all parts of our business are performing better than our expectations and clearly better than a year ago when we gave out guidance for this year. I mean, we're looking us doing $100 million more this year than we originally anticipated last November. So we're seeing sort of really just great take rates on all of our businesses. In the case of Thinkful, we are seeing a real growth rate from, say, the trough for the year which was February to just take this month or last month, it's significantly higher. I just want to remind people though that we've had Thinkful little bit less than the year, it's really early in Thinkful's growth and because our other businesses are growing so quickly, it's not a significant contributor yet, but it clearly will be to - that the raise of growth we're seeing.

Yes. And with respect to 2021 to Dan's point, Thinkful still relatively small, and it's not at scale yet. We clearly - we've clearly accelerated investments in Thinkful with respect to the course development and some other things. And so as we look at 2021, once again, it's relatively small, continuing to grow at rates that we've anticipated when we made the acquisition. And we think it will - it will contribute to EBITDA next year, but we do believe at scale it will definitely contribute to the EBITDA.

Our next question comes from the line of Ryan MacDonald with Needham & Company. Please proceed with your question.

Congrats on an excellent quarter. As we look into the fourth quarter guidance and what the visibility you have in terms of usage and adoption, can you talk about any trends that may have been a bit different as students are more online? And Andy, as we look at the 4Q guidance, do you have any risk to the numbers built in for universities that are ending the semester early say Thanksgiving or maybe there might be risk to December revenues at all? Thanks.

I'll take - this is Dan. I'll take the first part, let Andy take care of the second part of your question. So, in terms of surprises, look, there has been a lot of variables that we like other companies have had to navigate. So start date, end dates, total number of students that are attending whether they were attending their original school or they are attending online. And then there was one thing we didn't anticipate which is scary, which is how many students would actually get COVID while they were on campus. And so we've actually - we actually are the parameters to tell you what's going on at those schools as it relates to COVID because we can see it in their behavior when they subscribe or when they're using it. So that was just - that was something we didn't anticipate, probably should have. But I don't know how we would have done that if school is doing it differently. So, we haven't seen any surprises except to the upside, which is that the things that we - rarely when you work on a bunch of initiatives like penetration into community colleges, penetration into more online schools, account sharing, global, I mean, for the first time, we mentioned just how many countries we're now in, which is 190 countries which means we're well beyond just the English-speaking countries. So all of the surprises are things that we believe should be happening and would happen, it's just between the timing of them is very difficult to know, but all of have been to the upside, which is why the numbers are as big as they are. And it's - COVID has really just revealed how many people are dependent on what we do to help them navigate their curriculum, think about learning to earning. So, in our case, the surprises have been good for the business side, it's just disappointing us, gives me not having to go through this as a country, whereas the business has been great.

Okay.

And then - and Ryan with respect to Q4 guidance, we're well into the semester the fall semester right now, we have a pretty good handle on what schools are doing, what schools aren't doing. And so, we incorporate all of that thinking into our guidance and we feel comfortable with where we're at.

Great. Thank you.

I think by the way, just one last point on that. What's been interesting is we hear a lot about schools ending early, but the evidence of what we see is that, that's not the case. They may not come back after Thanksgiving. But that doesn't mean the semester is ending early. And the second thing is, given the outbreak of COVID, we're not sure people are going homes for Thanksgiving. So in all circumstances, we are ready for those circumstances, and Chegg is benefiting.

Our next question comes from the line of Douglas Anmuth with JPMorgan. Please proceed with your question.

I was hoping you could just help us understand what kind of assumptions are included in your initial '21 outlook? Just kind of how you think about the international sub mix and Study Pack adoption and ARPU and anything on account sharing efforts? I know it may be tough quantitatively, but if there's anything qualitatively you can add there. And I'm sure there is initial conservatism in the '21 outlook. Just trying to understand the revenue growth that you're seeing this year, the 50% plus and then into the mid 20s that you're initially guided to for next year. Thanks.

Go ahead, Dan.

Yes. And I'll start it, which is I think the guiding is a little bit higher than that. And actually when we look at it, we're actually guiding back to where we were when we started this year in terms of percentage of growth on top of a substantially higher number. But what - as you mentioned, it's early. I'm sure a lot of companies aren't giving guidance for Q4, let alone for '21, let alone this early. So I think it just shows how positive we are about the business and how big the opportunity is for Chegg going forward, and because we debated that question, should we give it at all, but we think given the momentum, we felt comfortable giving this guidance right now, which is three months before most companies would give it. So let me start with that. The second thing is, we - the reality is we'll continue to see substantial growth through the first part of the year and then the question is what happens after sort of the March 15 from the lapping of when students left to campus. As a reminder, it's our belief that domestically, the majority of the growth that we saw domestically was the result not of COVID per se, but in the fact that we've done a really good job of our investment in account sharing. So we expect to be able to continue to reap the benefits of that. What surprises to the real positive was outside of the U.S., which is the international business, really just jumped out of nowhere, because it's students needed to leave campus, they became familiar with Chegg. As you may or may not know, they are back on campus. And we are still seeing substantial, I mean, really substantial growth outside of the U.S. So it's a mixture of us doing the best we can this early to estimate a number we can feel very comfortable with plus recognizing that there might be two halves of the year, next year domestically and then continued substantial growth outside of the U.S. and with continued improvements on not just the take rate but renewals and other things on Chegg Study Pack. So it's - as mentioned, is the combination of what we could visualize minimally now in November of 2020 in a year where we're dealing with a pandemic and all these changes. So we feel really good about the guidance as you can imagine.

And just following up on that, any more commentary you can just give around Study Pack adoption and uptake. I mean, clearly, above all of your expectations, and you mentioned that you rolled it out earlier, but just as we think about modeling going forward and ARPU, I mean, are there any numbers that you can put to about?

I'll let Andy talk to the specific, at the numbers, but just for those that haven't spent as much time, Doug, has you have the opportunity to do, Study Pack is $19.95 versus Chegg Study at $14.95. So it's $5 more a month, but we'd be seeing 90-plus percent gross margins. So it's both the real positive on the topline and a real positive on the bottom line, which is why we're not only expecting the growth substantially next year, but actually improving our EBITDA margins. So it all shows up there. But the other thing I want to remind people is because we're doing so well, and because we think there is such a massive opportunity ahead of us, Andy mentioned on the last call, and call before that we've pulled forward some investments to continue to invest in future growth. So it's all those balances. But what I would say is over the next several years, we imagine and we expect that Chegg Study will make a significant impact on both top and bottom lines for us.

Yes.

Our next question comes from the line of Brent Thill with Jefferies. Please proceed with your question.

On the investment side, it's rare to see this type of growth and share margin improve at the same time. Can you just walk through what makes you comfortable in this ongoing kind of dual engine model? What - despite all these new things that you're unveiling, how you can make that happen at the same time?

Well, Dan mentioned it earlier. Right? Every incremental new subscriber at $14.95 or $19.95, pretty much $0.90 that could drop to the bottom line. And what we're - what we have decided to do is invest in our future growth opportunities. Right? Whether it be you've been with us a long time grant, whether it be with the initial investments that we made in like Q&A and then we made investments in Chegg Study Pack and we're making investments in skills based learning, we're making investments in international, but they're not insignificant investments they are significant investments. But what they do is, they benefit our future growth. And so we've got a model that scales like that where we can make that - have that, what I call balance between driving incremental, profits to the bottom line and benefit our shareholders immediately while us increasingly investing in the future, which benefit shareholders, both in the long-term. So we've got this great model that we have that opportunity to do both things.

Yes, look, I think the way I would sum up what Andy said, which is exactly right, is we're blessed with a model that not only produces very high growth 60% - 64% revenue growth, 69% subscriber growth, increase in EBITDA total plus percentage and then increase of the ratio of the free cash flow. And that does liberate us to make very smart investments, and what we believe is the right time to do it. So international is one we started to make a few years ago and it's really paying dividends now. We made technological investments in the platform that allow us to grow internationally, but also to lock account sharing, you're seeing the benefit of that now. And then of course Thinkful itself, which is we lowered prices, we've increased the curriculum and all of that is an investment to make that business very large and sort of as we've done with Chegg which is redefine the space and become the very obvious large leader and that we think they will have a massive pay-off down the road. So those are the areas that we're focused on. And the good news is the model just allows for it in ways where it's hard for you to even notice it because we're so profitable on the core business.

Our next question comes from the line of Josh Baer with Morgan Stanley. Please proceed with your question.

Thanks, and congrats on a great quarter. I wanted to focus on international go-to-market, as it relates to profitability and competition. So obviously domestically, a very efficient customer acquisition. Just wondering how this might differ internationally levels of marketing or other investments needed? And then any insights into any differences in the competitive landscape in different geographies?

Yes, that's obviously your question that we are focusing on a lot our sales, given the significance of how quickly it grew. The things that are really good news for Chegg shareholders and of course of those of us operating the business. Currently, the international business is actually even more efficient than the U.S. business. Beyond that, we have a very low cost way to develop content, which is the Q&A network itself, which is similar to the U.S., every question that gets asked that gets new. We pay to answer it, but then it stays in our database in it tracks other customers and becomes profitable right away. It's a very unique model and one that Chegg invested and we're benefiting here because in our prepared remarks we said at least 25% of all new questions. And this is the most number of new questions we've ever got in any year in total. And even if you were to subtract the international, the international questions that are being asked now are about the size of the total questions that we're being asked in terms of new questions shipped three years ago. So it is quite significant. So we have a very low cost way to do it and we have a very low cost way to acquire customers. So, similarly U.S. where 84% of the people come directly to Chegg either through SCO or to chegg.com. We're actually seeing that same behavior outside the U.S. at this point. So our marketing expenses collectively for Chegg Services app has been Thinkful not only haven't they grown, they just been shifted from markets that are getting bigger faster. So the efficiency rate that we experience with Chegg in the U.S., we're seeing the exact same efficiency outside the U.S., and that's…

Our next question comes from the line of Aaron Kessler with Raymond James. Please proceed with your question.

I think curious to get your update on maybe what you're seeing with the password sharing that you've talked about maybe in Q3 and what type of impact we should expect for Q4? And then just, when we think about my pre-college offerings has the pandemic and kind of the shift more on learning, things you're thinking at all about maybe going more high school middle school students additionally? Thank you.

Yes, great questions, as always, I'll take the second question, first, let Andy talk about accounts sharing, how we account for that. We have always said that our model is primarily going to be direct to this. And so we go direct to the students, we actually go older, not young because students in high school remember they have through the school through the school system or through the parent and there is a real need for those things using but there are much more difficult, they are much more expensive, they don't have the margins that our business has. They require sales forces that we can - we would not necessarily be that attrition and each school district makes a strong decision. And sometimes these future make firm decisions. So for us, we use high school through Mathway - to Mathway and through Chegg Writing to actually acquire customers brand them to us and then sell them into our college. We're actually going older. The thing I want to remind people out here is the average age of a college student, in this country is now 25. It's not 18 to 22. Online students exclusively are even older, we have 30. Community college students are much older as well. They come in and out of the system. So we are going older. We are going down with ClearPass, with Thinkful and that has been paying off for us. So we don't really expect to go younger necessarily.

Yes. And with respect to password sharing or is - we started to see the benefits of that starting in really Q2. As Dan had mentioned, particularly in the U.S., the U.S. is where it's particularly an issue and as students went off-campus that proximity sharing ability went away. And what we've subsequently done kind of getting back into the prior question around investments, we accelerated our investment in device management, that got implemented in what, the second week of August, if I recall correctly, - August 17. And that is - and that's all - the continued benefit of that is incorporated into our Q4 guidance.

Our next question comes from the line of Jason Celino with KeyBanc Capital Markets. Please proceed with your question.

On the device management question from the previous question, what are the some of the other details. Another rollout happen in the middle of August, but was that to your entire installed base? And then with the multi-factor authentication and what are the details on that?

I would get instead of like instead of like Dan said. So we - it was a strange sort of coincidences which is we've been working on this. And as you know last year we focused, all of our efforts in getting rid of really bad actors. And what do we mean by that. There were people stealing our accounts and reselling that. There were people sort of hacking and when we prove that, we saw our growth rate to the first part of the first quarter had already moved up to 32% and then when COVID came, it moved up to 35% and then you see we're at 64% now. A lot of that in the U.S. has to do with the fact that when students moved off-campus, it was more difficult for them to share. What we've done is make sure that when they get back on campus, they not still can't share. So we get done - we've done a lot of things leading up to it that were more halves than they were full technology investments that we've pulled forward the full technology investment. And so, now you need to register your devices. So you can use two devices and you can swap to a third, which makes it very difficult. And we did the swaps with that because when you do go on campus, some people don't have the money, don't - computers - they use computer labs or when they do, they don't want to carry their computer. And so we want to be very available to those students. The two factor needs that we now can identify to make sure that it's your fault. And so these two things, they don't eliminate 100% but they have really made a substantial impact on the…

Our next question comes from the line of Alex Fuhrman from Craig-Hallum Capital Group. Please proceed with your question.

Thanks very much for taking my question. I'd like to follow up on what you've been talking about with the international students, and it seems like you've had quite a bit of success there the last couple of semesters. Can you comment a little bit on how those students are behaving as customers compared to the American students? I guess, it might be too early to know how long they're going to stick around. But in terms of when they've been signing up and perhaps how they interact with free trial before converting to paid membership? Has that been similar to your U.S. customers? Just curious how that plays out over the next few semesters.

Yes, let me - it's an set of phenomenal questions, let me go back and just start with what you said, which is in some cases institution to know, particularly where it's sort of LTV of a customer. But here's what we have seen since January 1, and what has sustained. So the behavior in the first quarter and the behavior in second quarter has been very similar. There's a lot more people came in after the second quarter than were coming in the first quarter. So that was the acceleration of the growth rate. But the behavior that we've seen, which has been good is the conversion follow up was very similar to the U.S. The second thing is the Q&A is, it looks very similar to the U.S. Actually it's more so, because we have left well with the local content. This is the way we're building it. And so that's been a really positive thing which means international growth should be a big grower for many years to come. So it's not only white space but is our database, it's filled with more content from each individual country, more and more and more people will find it. So that's good news. What did surprise us was the percentage of them taking Chegg Study Pack are actually was not just equal to the U.S., but actually a little bit better, which is a really good sign. Usage in terms of how often do they use it, very similar. The difficulty for us has been in the forecasting because we didn't expect to be in 190 countries this quickly. And second, so we have to figure out when the start takes are, when mid-terms are, when finals in, when they take their breaks, do they behave similarly on those breaks. And so these are all things we are learning as we go. But the core things that we care about which is conversion, cost to convert, usage, Study Pack takers and early retention are all extraordinarily positive is something that we are all very familiar with the Midwest. The rest are things that we'll learn as we get scale in any unique country. It's a big - no doubt about it. I mean it's a lot bigger than people think, I mean outside the U.S., not including China, we expect that market to be just as big as the U.S. And we don't see any business obstacles over the next several years pick up.

Our next question comes from the line of Mike Grondahl with Northland Securities. Please proceed with your question.

Yes, thanks guys. Anything to call out in the textbook rental business?

The call out? No. Honestly, it's gone as planned, we don't expect it to grow next year for those of you who may not recall when we switched from Ingram to FedEx. We took a one-time sort of step-up in the revenue that we recognized, because we own the books versus not own the books. But in terms of, it's pretty much what we expected on volumes and prices and margins. It is a decreasing percentage of our business for all the reasons that you know that we've been articulating that you've been very constructively covering for the last several years. We use it to attract customers. We use it to provide overwhelming value. We use it to be able to update customers to the other Chegg Services. We run it, it's pretty much flat growth and breakeven and that's exactly what we expect in our guidance as Andy put out for '21.

Our next question comes from the line of Eric Martinuzzi with Lake Street. Please proceed with your question.

Yes. A backward looking question on the Q3 outperformance. If I look at the Chegg Services, as you - as we stated in August 3, you were talking about 112.5, that is the midpoint of the Chegg Services expectation for September. And of course, that was pretty account sharing project. And then we wind up for the quarter where you do, let's say, 119. So just in broad strokes, about $6 million of that performance in Chegg Services in Q3, can you break that apart? Is this kind of 80:20 account share versus Study Pack or account share versus international particularly deeper than the outperformance in Q3?

Well, first thing is, yes for us, we outperformed. So we're certainly happy about that. So thanks for pointing that out to us. But yes, the net-net is really has to do with what Dan talked about earlier. There is - we're seeing significant growth internationally. And just - that's just come out as faster than we had anticipated. And then the second part is what you just talked about and that is we are starting to see a bigger capture of those kids that may have in the U.S., that may have shared an account and we're having more of those kids pay. And just in general, it's those two things that gave us a slight the outperformance that you just mentioned.

One of things that makes it hard to break out is that it's really early for all these things. I mean there's a lot of future growth left in these businesses, which is again why we - I think we'll be those layer of company that gave guidance for '21 and higher than people expected. So there is a lot of things that are moving in the direction of where Chegg believe the industry was going to go and we are growing faster now and we think that's good for students and we think it's great for Chegg shareholders and we'll just keep executing.

Our next question comes from the line of Brett Knoblauch from Berenberg. Please proceed with your question.

Can you maybe just update us on a go-to-market strategy with Thinkful? And maybe what is - I guess what is driving customer acquisition there? And have you seen any inflection point in demand due to maybe the remote learning tailwinds that you're seeing in your core business?

Yes, again, really good questions. We've had - we only closed the company a little less than a year or so or about a year ago. So we - it's hard for us to go - they did not build all the historic, starts on reporting that Chegg like to have that we've now built into the business, the analytics. So what we know is that growth is staffs there. What we know is that when we offer more curriculum, we get more students. What we know is we've been able to bring down the cost of customer acquisition. And what we know of the big differentiators that we built is we've employed chat-based tutoring inside of Thinkful. So there is no other competitor that where student they get stuck in the middle of it, can ask a question anytime day or night and get unstuck. So the go-to-market strategy is really what you would imagine, it would be, which is we're utilizing the Chegg West and focusing on seniors, because those are the ones who are beginning to realize that a lot of their tutoring isn't going to help them get a job. The question about what's the impact to the pandemic on Thinkful is difficult to know, which is to some degree you would say that a lot of people have more time to take it now. And so they are taking it, but what we're seeing is we are seeing growth from people who are still currently employed, and we are looking to upgrade the quality of the opportunity they have with their company or go find a job in another company, because these are all technological skills. So the go-to-market has been - they had a very good go-to-market strategy. We've just grown it faster under the way we do things and the ability for us to invest in the company. But it's going to continue to be lower prices, greater curriculum, support that no one else can offer, which is the cafe support as well as career placements, ISAs. I mean I can't point to one thing and say that is working and the others are not. Everything that we're doing right now is designed to make Thinkful a very large business in the future. And so far the signs are that it can be.

Our last question comes from the line of Arvind Ramnani with Piper Sandler. Please proceed with your question.

Thanks for squeezing me in. Yes, just a little bit of a longer-term question. When students go back online, are they expect to change demand? Have you seen a permanent reset in how students and educators look at digital learning? And will that kind of sustains when we kind of go back to a more normal environment?

Yes, look, it is - I think if you just look at the perspective and say, students note, the bigger the student base gets, the older that it gets and more diverse than it is, the different income backgrounds that people come from, the different support levels that people will come from, when more support they need. And Chegg is in a position to capture that and we've been capturing it. I mean we went public seven years ago and look how far we've come as a business. And I think that's an indication of just how much the world has already shifted in the direction that Chegg is going. What we can feel comfortable in saying from this semester is that usage is agnostic to geography. If you're at the school or if you're not at the school, you subscribe and use Chegg very similar way. Those they were at school and not at school are taking the same take rates, are Chegg Study, whether they're in school physically or not in school. So, for us, we see this as a permanent situation, but we've always believe that that was going to be the case. What COVID did was sort of reveal how much need students have and allowed us to accelerate our account sharing efforts and accelerate our growth internationally. I mean, now other companies that grow 69%, we're a seventh year as a public company in terms of subscriber growth. So we don't see any evidence that things will go backward. If anything, we are going to see as schools go more hybrid, we're going to see more students in the system last year, which means you're going to need more support of the things that Chegg does. As students start to speak in a much more aggressive way, better ROI, shorter times to enroll and acceleration of learning to earning what we do at Thinkful, we'll have a much more meaningful impact, because it's very clear. Again, one of the things that COVID has revealed is that those who don't have the skill to be working in technology enabled environment, it doesn't mean you're a coder. While you need to understand and utilize technology those are the ones that were most susceptible to furloughs, and to layoffs. And so you're seeing a rush of people who now get it without any qualification, but they need these skills and that's going to boom to Thinkful others in that space. And by the way you're seeing Universities trying to do that now because they've recognized that students don't have four or six years to take off, they don't have $80,000 to spend, they'll have jobs when they're trying to learn, they have families when they're trying to learn. So we think we're positioned exactly where the person who helps defining when the category should be. And this confidence is built by the fact that we're seeing, not buying anything else.

That concludes our Q&A session. I'd like to hand it back to management for closing remarks.

Okay, well thank you everybody for joining. Look almost seven years ago, Chegg went public with initially put students first, strong base to support the future of learning and a small team of committed employees who believe that students needed and deserve help. While the journey has not been easy and it's certainly not been straight line, we believe given the millions of students that we have helped and the strength of our business, it is no worth it. What is truly remarkable is that the more success we have, the more opportunities we see ahead of us. What Chegg provides has never been more critical and given there are more students than ever before, with more diverse backgrounds, ages and needs, Chegg sees a bigger future than even we first imagine. Higher Ed institutions were already struggling to provide services and support to their students prior to the pandemic. Now, as many colleges and universities face an uncertain financial future, their ability to provide needed academic support has even further strengthened. This is why students are turning to Chegg in record numbers. And as online learning is being embraced around the globe, with more and more students expecting a hybrid model in the future as we've talked about, Chegg will only play a more critical role in student's academic success and now in their professional journey. We are proud to be here to serve that. No matter their needs, no matter how they prefer to learn, no matter of the pathway they choose, no matter where they are in the world, we will continue to always put the student first. And we want to thank you all for joining us. We want you all to stay safe and we look forward to talking to you next time and we'll see how this tie.

Ladies and gentlemen, this does conclude today's teleconference. Thank you for your participation. You may disconnect your lines at this time. And have a wonderful day.