Jefferies analyst, Brian Fitzgerald, thinks the focus should be on Chegg (NYSE: CHGG) is growing subs and delivering timely service. Chegg Tutors and Chegg Study grew 37% Y/Y and reached 750K subs . Chegg Tutors is the Co's fastest growing service; in Q1 it achieved mgmt's goal of replying to 85% of requests within 5 mins. Chegg Study answered over 745K questions within 4 hours during the Q and students saw over 4MM solutions across 21K+ ISBNs. The service saw 79% renewal rate in Q1. Test Prep and Careers remain large opportunities longer-term and are expected to contribute to profitability in '17; 258K new students registered on Internships.com in Q1.

CHGG delivered a beat quarter and announced the acquisition of Imagine Easy, a suite of writing tools with over 7MM monthly active users. The acquisition will help extend CHGG's reach into middle and high school students.

In the quarter, GAAP Revenue declined 21% Y/Y to $66.7MM (Street $62.9MM). Pro-Forma Revenue was up 2% Y/Y to $46.8MM. Adj. EBITDA (w/o Book Dep'n) of ($0.5MM) came in ahead of Street's ($1.1MM). Non-GAAP net loss per share of ($0.03) was in line with Street's ($0.03).

Revenue guidance (GAAP / PF / Chegg Services) of $50MM / $38MM / $29MM and Adj. EBITDA of $6.0MM. FY16 Guidance at the mid-point: Rev (GAAP / PF / Chegg Services) of $248MM / $186MM / $128MM and Adj. EBITDA of $18MM.

The firm maintained a Buy rating and $12 price target on the stock.

For an analyst ratings summary and ratings history on Chegg click here. For more ratings news on Chegg click here.

Shares of Chegg closed at $4.64 yesterday.