Saturday, June 10, 2023

ChatGPT also sinks companies: an education company admits that students use more artificial intelligence

Artificial intelligence is something of a boon for many companies. It promises to save millions of dollars in personnel that will no longer be needed, and speed up processes that used to take a long time. For other companies, however, it’s more of an existential threat. The American Chegg, from the education sector, can be included in this last group, which among other things rents and sells digital and physical books, provides tutorials and offers exercises. online They help prepare for an exam or do homework. “Since March we have seen a significant increase in student interest in ChatGPT. Now we believe that it has an impact on the new growth rate of our customers”, said its CEO, Dan Rosensweig, during the presentation of the results.

At a time when investors are looking closely at the changes that new technology can cause, rewarding its potential beneficiaries and mercilessly attacking the losers of the paradigm shift, the manager probably underestimated the market’s reaction. The shares of the company based in Santa Clara (California) lost 48.41% of their value in the session on Tuesday. That is, it reduced its value almost in half after evaporating almost 1,000 million dollars.

The phrase comes out very expensive. For this reason, Rosensweig tried to calm things down in a later interview with the financial channel CNBC. He called the stock market reaction “exaggerated” and sought to put his company on the side of artificial intelligence winners by recalling that they plan to launch a platform powered by GPT-4 in May. In addition, he questioned the reliability of ChatGPT. “Students cannot make mistakes when doing homework or learning things. ChatGPT is often wrong, and it won’t be right anytime soon,” he said about the bugs in the tool’s response.

The stock market crash caused a contagion effect on the stock market to other important players in the sector, including British Pearson, the former owner. Financial Times and now focus on education. Its managers also came to deny that they will be hurt, and they explained to the FT that their position as creators and owners of quality content puts them on the side of the lucky ones, because combined with the generative AI they can find. in complexity.

It seems too early to guess which company will disappear under the weight of the competition of ChatGPT and its copies, but anticipate equal to make money. Trend hunters can bet short against companies that could be affected, as they bet on winners, including chipmaker Nvidia, which supplies the market with the most widely used model for artificial intelligence. Meanwhile, the feeling is one of uncertainty. Analysts at U.S. investment bank Jefferies downgraded their recommendation on Chegg from buy to hold, but both its shares and Pearson’s stock rebounded Wednesday on the possibility that the punishment for Rosensweig’s confession — as apparently frank as it is damaging the company’s interests your – there was too much and their security is now underrated.

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World Nation News Desk
World Nation News Desk
World Nation News is a digital news portal website. Which provides important and latest breaking news updates to our audience in an effective and efficient ways, like world’s top stories, entertainment, sports, technology and much more news.
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