Last Update: May 03, 2023, 02:32 AM IST
ChatGPT grapples with the mathematical procedures required for tax, financial and managerial valuations (Representational Image)
Notably, the 18-year-old company reported a seven percent drop in sales in a year as well as a five percent drop in customers
Shares of companies that publish school textbooks and offer online classes took a big hit on Tuesday after indications that AI-bots like ChatGPT were eating into their business.
Silicon Valley-based Chegg is an education tech company that provides online homework help and textbooks, and on Monday its CEO acknowledged that the explosion of generative AI chatbots has hurt revenue.
“In the first half of the year, we did not see any notable impact from ChatGPT on our new account growth and we were meeting expectations on new sign-ups,” Chegg CEO Dan Rosensweig told analysts on Monday.
“However, since March we have seen a significant increase in student interest in ChatGPT. We now recognize that this is having an impact on our new customer growth rate,” he said.
Notably, the 18-year-old company reported a seven percent drop in sales in a year as well as a five percent drop in customers.
The admission sent shockwaves through the ed tech sector, sending Chegg’s share price down nearly 50 percent and affecting similar companies such as UK-based Pearson, which lost 15 percent in London.
The chief executive stressed that the student pivot was a blip for ChatGPT and that customers who placed their trust in the company’s products “continue to choose us and retain us at high rates.”
He also said that it launched its own AI-powered tool called CheggMate, which was tailored towards students and based on GPT-4, the latest iteration of the technology created by Microsoft-backed OpenAI and which powers ChatGPT .
Chegg has faced similar allegations in the past addressed to ChatGPT, which provide ready-made methods for students to cheat, especially during the Covid-19 pandemic when exams are largely taking place online outside the supervision of a teacher. Was.
While ChatGPT-style AI has largely been seen as a boon to the economy, the explosion in education tech stocks was the clearest example yet of technology’s abilities to sap a company’s bottom line.
Given the untested nature of the technology, experts now believe the companies most vulnerable to AI are businesses that require little expertise – such as call centers or tutoring services such as those offered by Chegg and others. Is.
“For the time being, you’re only going to see very specific types of tasks that people are drawn to generative AI,” said Vishal Gupta, an associate professor at the USC Marshall School of Business.
He added that these tasks are going to be “low stakes” given the uncertainties about the technology.
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(This story has not been edited by News18 staff and is published from a syndicated news agency feed)