Chegg is suing Google over its AI Overviews, accusing them of reducing its web traffic

Chegg, an American educational technology company, has filed a lawsuit against Google, accusing the tech giant of hurting its web traffic and, consequently, its revenues. Specifically, Chegg points to AI Overviews, AI-generated previews that respond to search queries, as the culprits of these detriments.

Chegg Accuses Google of Unfair Competition

Yesterday, February 24, Chegg publicly announced its financial results for 2024, reporting that its total net revenues had decreased by 14% to $679.36 million (almost 589M€), while its net loss reached $920.81 million (798.1M€).

In response, the company announced that they are conducting a «strategic review process and exploring a variety of alternatives to maximize shareholder value, including acquisition, transitioning to a private entity, or remaining a standalone public company».

Besides this, to reverse the situation, they have also decided to file a lawsuit against Google LLC and Alphabet Inc. in the United States District Court for the District of Columbia. «These two actions are related, as we would not need to explore strategic alternatives if Google had not launched AI Overviews, or AIO, which has retained the traffic that historically came to Chegg, thereby materially affecting our acquisitions, revenues, and employees,» explain sources from Chegg.

The lawsuit puts forward three main arguments:

• Reciprocal Treatment: Google forces companies like Chegg to provide their exclusive content to be included in its search feature.
• Maintenance of Monopoly: Google unfairly exercises its monopolistic power in the search business and engages in other anti-competitive conduct to displace companies like Chegg.
• Unjust Enrichment: Google is reaping the financial benefits of Chegg’s content without spending a cent.

Chegg alleges that «Google AIO (AI Overviews) has transformed Google from a “search engine” to an “answer engine,” displaying AI-generated content from third-party sites like Chegg. Google’s expansion of AIO forces traffic to remain on Google, eliminating the need to visit third-party content source sites. The impact on Chegg’s business is clear. Our non-subscriber traffic plummeted to -49% in January 2025, a significant reduction from the modest 8% decline we reported in the second quarter of 2024.

We believe it is not just about Chegg, but that students are losing access to quality step-by-step learning in favor of unverified low-quality AI-generated summaries. It is about the digital publishing industry. It is about the future of Internet search.

In summary, our lawsuit challenges the unfair competition of Google, which is unjust, harmful, and unsustainable. While this proceeding is just beginning, we believe filing this lawsuit is necessary and well-founded».

A Recent Study Says Otherwise

Terakeet, a company focused on brand management for global brands, has presented a study analyzing the impact of appearing or not in Google’s AI Overviews on a page’s web traffic. According to the report, pages that appear in these AI-generated summaries experience an increase in clicks, whereas those left out see their visibility, and therefore their traffic, reduced.

Terakeet segmented the analyzed websites based on their position in the SERPs. The “Top-Ranked” are those located in the top 2 positions, and the “Lower-Ranked” are those positioned between 3 and 10. They also differentiated according to the website’s search intent, dividing them into transactional or informational.

Some of the key conclusions drawn from the study are:

• Informational Queries: AI Overviews diverted traffic from informational web pages in positions 1 and 2 but increased traffic for informational websites appearing in positions 3 to 10.
• Transactional Queries: Transactional websites included in AI Overviews gain more traffic, irrespective of their position on Google’s first page.
• Transactional Queries “Top-Ranked”: Websites included in AI Overviews received 3.2 times more clicks than those not appearing in them.
• Informational Queries “Lower-Ranked”: Websites featured in AI Overviews obtained double the clicks compared to those appearing on SERPs without AI Overviews.
• Transactional Queries “Lower-Ranked”: Websites with presence in AI Overviews garnered 3.6 times more clicks than results without AI Overviews.

In other words, both in informational and transactional queries, presence in AI Overviews provides a clear competitive advantage for websites.

Similarly, the inclusion of AI Overviews is altering user behavior in search engines. Whereas previously higher positions in Google ensured greater traffic, this pattern is no longer as predictable. This indicates that traditional SEO strategies need to adapt to this new landscape.

Adi Srikanth, senior data scientist at Terakeet and author of the study, pointed out, «generally speaking, being excluded from an AI Overview has measurable and significant harm to a webpage. Conversely, being included in an AI Overview has clear benefits for web pages. And, in general, the presence of AI Overviews drastically changes web traffic dynamics on webpages».

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