So the opportunity is to start to sell more new accounts. We are selling significantly more new accounts in 2023 than we did in 2019 before COVID. I mean it’s millions more a year. So we still generate millions of new accounts a year. What we want – what we have to do is overcome the incredible rise that we took in COVID and then hit the trough, as you point out, which we think we’re approaching that trough on new account growth. We’re – and with the new product and the new marketing messages and the new capabilities that we’re going to have in it, we think that we’re somewhere around the trough. I can’t pick the particular day or a moment. On a given day, we’re at the trough. Some days, we’re above the trough. Some days, we’re a little bit below the trough.
But we’re where we wanted to get to first, and then from there, we start to grow again. And so that is the entire effort of the company is to invigorate growth again. We have a lot of variables in which we need to execute on. But as we’re executing on it, we expect that’s exactly what’s going to happen.
Ryan MacDonald: Helpful color. Thanks. And maybe on international, last quarter, you talked about rolling out a new payment infrastructure in India as part of the international growth. And I think that was supposed to come online in August. And it seems like in some of our survey work that you’re starting to see more of an uptick there. But can you just talk about India and how big that opportunity is and if you’re starting to see some of that stronger momentum from the new payment infrastructure. Thanks.
Dan Rosensweig: Yes, I’ll start with the second part first. Yes, we are seeing – it’s not just the payment infrastructure that we had to do. But you’re right, we did that, but it’s also getting the appropriate pricing in India, which we’ve been able to do. So what’s interesting and really positive is when we lower prices internationally, we obviously see an increase in conversion, which is exactly what you want. But we’re also seeing an uptick in people that take the more expensive version of what we have. So when you take the increase in conversion and the higher take rate or the more expensive product, the margins on the product are remaining very similar right now to what they were before, which is a really positive step.
Now in terms of the size of what we think India can be, we actually think it could be millions. That’s our objective is in India. It’s got the largest English-speaking community outside of America. There is a huge focus on learning, a huge focus on STEM and an increasing awareness of Chegg. And as we roll out the AI capabilities, we think that’s even going to expand well beyond that. Also, as we mentioned that we’re starting – our expectation is over time to build community, and we think sharing of Chegg will also be a great viral way to accelerate growth. So I would say India is a real highlight of what we’re seeing right now. And again, your survey work, I think, backs that up.
Ryan MacDonald: Appreciate it. Thanks again.
Dan Rosensweig: Yes.
Operator: Next question, Doug Anmuth with JPMorgan. Please go ahead.
Bryan Smilek: Hi. It’s Bryan Smilek on for Doug. Thanks for taking my questions. And congrats on the retirement, Andy. Just to start, can you just walk us through the results from the back-to-school season and how it shaped up versus your expectations? And then I guess, secondly, just shifting a bit, can you elaborate more on the Skill strategy? And what are the drivers of success that you’re seeing there so far? Thank you.
Dan Rosensweig: Yes. So back-to-school has gone well. I mean, look, it’s the third quarter in a row now where we’ve beaten our own expectations both on the top line and on the bottom line and quite substantially. So all of those are reflections of excellent execution that our team has been doing, and you see them in the results. So we would say that it’s going very well versus our original expectations, we’re ahead of where we thought we would be in the number of subscribers we have, in our retention numbers. And so all of this is good news. The opportunity for Chegg, as I said, is to expand the aperture, open it up because we can use AI now. We have more ways to add more content and a lower cost per content and make it relevant to a much larger group of people.
And that is really exciting and really one of the biggest growth opportunities that we’ve seen in years. So we’re fired up about that. On the Skills side, we’ve made an investment over the last couple of years to really change the way we do Skills to make them lower cost, higher quality, greater completion rates and work through our B2B partners, particularly Guild, and we’re seeing excellent growth. So year-over-year growth of Skills is quite high. And if it continues this way, we expect it to be a very meaningful part of our business in the years to come because we’re expanding not just through Guild, but we’re expanding direct to corporations where we signed our first customer, indeed. rather than lay people up that they are going to use us to retrain their employees.
So this is exactly the kind of investments that we wanted to make in businesses that have higher ARPU. I mean the average ARPU of our Chegg Study Pack customers, $17, these are as much as $5,000. So we are really bullish on where we’re going with Skills. Now the next big opportunity is, as we talked about in the prepared remarks, and as you can see in the video, if you take a look at it, is we’re building Skills taxonomy. So what we want to do is help college kids assess where they really are with the kind of skills that they need to be employable on top of their academic learnings and then help them master those skills so that they can, in fact, be employable. These are all things that are now possible that we’ve always wanted to do that are made much more possible because of the combination of Chegg and AI.
And so this is the direction that we intend to go, which is B2B through Guild, B2B direct to corporations and direct to student through Chegg. So these are all future growth opportunities that we’re building now.
