On Monday, Chegg announced that it will lay off approximately 22% of its workforce, equating to 248 employees, in an effort to reduce costs and streamline operations. This decision comes as a response to the growing trend of students turning to AI-powered tools like ChatGPT instead of traditional educational technology platforms. The shift towards AI in education has been significant, with many students finding these technologies to be more accessible and efficient for their learning needs. Tools like ChatGPT can quickly provide answers to homework questions and offer personalized guidance, which appeals to a wide range of learners. This has put considerable pressure on companies like Chegg, which have traditionally offered human-driven tutoring and study resources. Chegg CEO Dan Rosensweig acknowledged the impact of AI on the company's business model in a statement. "The rapid advancement and adoption of AI technologies have changed the landscape of how students seek and receive academic support," he said. "While we continue to innovate and integrate AI into our platform, we must also adapt our cost structure to align with the evolving market dynamics." The layoffs will affect various departments within the company, including marketing, customer service, and product development. Chegg aims to maintain its core services while optimizing its operations to remain competitive. The company has stated that severance packages and career support will be provided to the affected employees. In recent years, Chegg has faced increasing competition from not only AI-driven platforms but also from free online resources and peer-to-peer study groups. To address these challenges, the company has been investing in AI technologies to enhance its offerings. Despite these efforts, the market trends have proven difficult to overcome. Analysts point out that the rise of generative AI models like ChatGPT is reshaping the edtech industry, forcing companies to reassess their value propositions. While some edtech firms are successfully integrating AI into their platforms to offer hybrid solutions, others are struggling to find a foothold in this rapidly changing environment. The move by Chegg reflects a broader trend in the edtech sector, where companies are adapting to technological advancements and shifts in student preferences. This includes reevaluating their business models, reducing overhead, and focusing on innovation to stay relevant. In the meantime, Chegg remains committed to serving its user base with quality educational resources and support. The company plans to use the savings from these layoffs to invest in further AI integration and other initiatives aimed at enhancing its offerings and user experience. Despite the challenges, Chegg's leadership believes that there is still a place for human interaction in the learning process. They are exploring ways to leverage AI while preserving the human touch that has been a cornerstone of the company's services. The edtech industry's future is uncertain, but one thing is clear: companies must continue to evolve and find innovative ways to meet the needs of modern students. For Chegg, this means embracing change and making tough decisions to ensure its long-term sustainability.