An airplane takes off from New York’s Laguardia Airport after the FAA ordered flight cuts at 40 major airports amid the ongoing U.S. government shutdown in the Queens borough of New York City, U.S., November 7, 2025.

Ryan Murphy | Reuters

Air traffic controllers and technicians with perfect attendance during the government shutdown will receive $10,000 bonuses, the Department of Transportation and Federal Aviation Administration said this week.

The bonuses will go to 776 controllers and technicians, who will receive notification next week with payments going out by Dec. 9, the FAA and DOT said. There are about 11,000 fully certified air traffic controllers in the U.S., according to their union.

“These patriotic men and women never missed a beat and kept the flying public safe throughout the shutdown,” Transportation Secretary Sean Duffy said in a release late Thursday.

The DOT and FAA didn’t immediately say whether preplanned vacation time or fatigue calls would disqualify controllers and technicians from the bonus.

An increase in absences of air traffic controllers, who were required to work without their regular paychecks during the more than 40-day shutdown, the longest ever, forced airlines to slow or cancel flights. The shutdown ended Nov. 12 with a bill to fund the government through January.

The shutdown’s disruptions and additional strain on air traffic controllers, many of whom are already required to work six-day weeks, sparked an outcry from the aviation industry, which urged lawmakers to ensure critical workers aren’t left without pay if there’s another shutdown.

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The National Air Traffic Controllers Association, which represents the country’s air traffic controllers, said it was informed of the decision on cash bonuses hours before the announcement. It said that 311 employees represented by NATCA qualify for the payments.

“We look forward to working with the Administration to provide the appropriate recognition to those not covered by the Secretary’s announcement,” the union said in a statement.

The Professional Aviation Safety Specialists, the union that represents 11,000 FAA and Defense Department workers including technicians, said it is “reviewing the information that has been provided by the FAA and is evaluating how best to ensure that all employees who worked during the shutdown are recognized.”

Last week, Homeland Security Secretary Kristi Noem said Transportation Security Administration officers who screen passengers at airports would also receive $10,000 bonuses for perfect attendance.

“Despite tremendous personal, operational, and financial challenges, these dedicated officers showed up to work every day for more than a month, without pay, ensuring the American people could travel safely,” DHS said in a press release.

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Planes line up on the tarmac at LaGuardia Airport on November 10, 2025 in New York City.

Spencer Platt | Getty Images News | Getty Images

The U.S. has been scrambling to hire more air traffic controllers for years. The longest-ever federal government shutdown might have made that even harder.

“We need more of them to come into the profession, and this shutdown is going to make that more difficult for us to accomplish that goal,” Transportation Secretary Sean Duffy said at a press conference at Chicago O’Hare International Airport on Tuesday, a day before Congress signed a bill to fund the federal government through January, ending the shutdown.

Air traffic controllers were required to work without receiving regular paychecks during the shutdown. They were paid in part on Friday, according to people familiar with the matter, but during the shutdown some had taken second jobs to make ends meet, while the lack of regular pay added to their stress, union and government officials and lawmakers have said.

The Federal Aviation Administration reported low-staffing thresholds were hit that that slowed aircraft around the country during the final days of the shutdown. President Donald Trump earlier this week threatened to dock air traffic controllers’ pay if they didn’t go to work. On Friday, staffing levels were relatively strong around the U.S. and disruptions eased.

“It can’t make it look like this is a great job because you’re going to have to deal with this all the time,” said Tim Kiefer, who teaches air traffic management at Embry-Riddle Aeronautical University in Prescott, Ariz.

Kiefer was an air traffic controller for more than two decades before he retired. He said shutdowns or the threat of them were common during his career. “You may see people decide to do other things and say, ‘They didn’t get paid; they were stuck in the middle of a partisan dispute,'” he said.

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5 million passengers

The shortage of air traffic controllers delayed or canceled thousands flights during the shutdown, affecting the travel plans of more than 5 million people, according to Airlines for America, an industry group that includes American Airlines, United Airlines, Delta Air Lines, Southwest Airlines and others.

But even with partial pay hitting bank accounts, the staffing crisis that regularly upends travel is set to continue.

A government tally last year showed the U.S. was short 3,903 fully certified air traffic controllers of a goal of 14,633. Shortages have been particularly severe at busy facilities like those where controllers guide planes in and out of airports in the congested New York area, adding to flight disruptions and frustrating airline executives and customers.

Meanwhile, retirements picked up in the shutdown, with 15 to 20 people retiring per day, down from a usual rate of four a day, Duffy said Tuesday. Controllers are required to retire at age 56 but can do so earlier with benefits depending on years on the job.

Staffing was already thin before the shutdown began on Oct. 1, and many controllers were working six-day workweeks. By mid-November, as air traffic controllers missed two full paychecks and the shutdown passed the one-month mark, it approached crisis levels.

More than 10% of U.S. departures were canceled last Sunday as bad weather combined with air traffic controller shortfalls at facilities across the country. That was the highest rate since January, according to aviation-data firm Cirium.

Hours after those cancellations spiked on Sunday, the Senate advanced a preliminary deal that led to the vote ending the shutdown this week.

The Federal Aviation Administration in early November ordered airlines to cut 4% of flights from their domestic schedules at 40 major airports, blaming safety risks they found because of an increased strain on air traffic controllers. Cuts were set to ramp up to 10% on Friday, if the shutdown didn’t end. Cancellations, however, improved dramatically during the week and on Friday morning, just 2% of U.S. departures were canceled, according to Cirium.

The FAA brought its mandated cuts down from 6% to 3% starting on Saturday, saying it will monitor system performance throughout the weekend.

The disruptions were similar to those on days with severe storms, but were more widespread across the U.S.

Millions in lost revenue

The last-minute cuts were a headache for the industry, where airlines from top-moneymaker Delta to struggling carrier Spirt had already lowered their outlooks for the year after an oversupply of flights and weaker-than-expected demand earlier this year. Airlines haven’t yet quantified the damage from the shutdown, but Bank of America estimated a $150 million to $200 million operating income hit for big network airlines and less than $100 million for other carriers.

Travelers walk through the terminal at Ronald Reagan Washington National Airport, more than a month into the ongoing U.S. government shutdown, in Arlington, Virginia, U.S., Nov. 11, 2025.

Annabelle Gordon | Reuters

Airline executives, exasperated by the recent disruptions, are now pushing Congress to make sure controllers are paid in the next shutdown.

“In the past week, we saw a crescendo effect as air traffic control staffing shortages led to massive and unpredictable amounts of delays and cancellations across the industry — and that was on top of a series of FAA-mandated schedule reductions,” American Airlines CEO Robert Isom and the carrier’s chief operating officer, David Seymour, said in a note to employees on Thursday, a day after the House approved a short-term funding bill. “While we both have been in this industry for a long time, only a few other events come to mind when we think about this level of disruption.”

It could have been worse. This part of the fall travel demand is relatively light, but Thanksgiving was fast approaching when Congress ended the shutdown, concerning airline executives.

“This shutdown put tremendous strain on our aviation system and caused severe inconvenience for the millions of Americans who depend on it,” United said in a statement. “It should be obvious to everyone that policy debates, however urgent, should never put air travel at risk, and we urge Congress to ensure that the FAA and [Transportation Security Administration’s] funding is protected in the event of any future lapse in federal appropriations.”

‘Political football’

It wasn’t the first time a government closure has put the aviation industry under strain. The 2018-2019 shutdown, then the longest in U.S. history, ended just hours after controller shortages snarled travel in the New York City area.

Some airline executives told CNBC that they were frustrated by this most recent shutdown and last-minute schedule changes, which ended up being greater than anticipated. One, who spoke on the condition of anonymity because he wasn’t authorized to speak to the press, said “we were the pawns” in the shutdown.

Delta CEO Ed Bastian told CNBC’s “Squawk on the Street” on Wednesday that “the thing we don’t like is being a political football” and said it was unacceptable that air traffic controllers and TSA officers were forced to work without regular paychecks.

The best way to prevent such disruptions is “to ensure those workers, the next time this happens because it will happen, get paid,” Bastian said. “Who could disagree with that?”

The airline industry is urging Congress for legislation that could make use of funds generated by airplane ticket taxes to ensure air traffic controllers and other essential industry workers like airport screeners and Customs agents are paid.

“You don’t hold the American public hostage over a political fight like that,” Airlines for America CEO Chris Sununu, the former governor of New Hampshire, said in a virtual press conference Wednesday, shortly before the House passed the funding bill.

Travelers check their flight status at Dulles International airport as the nation’s air travel system begins to return to normal, as the U.S. government opens back up following the longest shutdown in U.S. history, in Dulles, Virginia, U.S. Nov. 13, 2025.

Evelyn Hockstein | Reuters

Next Wednesday, Sen. Jerry Moran, R-Kan., who chairs the Commerce Subcommittee on Aviation, Space and Innovation, will hold a hearing on the shutdown’s impact on aviation. Moran this year pushed for legislation that would let the FAA use the Airport and Airway Trust Fund, which is funded by taxes on airplane tickets and fuel, to cover expenses if the government shuts down.

“The government shutdown has severely impacted our already fragile aviation industry, and recovering from its effects will take time,” he said in a release this week. “It’s critical that we address the damage done and look at the long-term effects of the shutdown.”

Lawmakers earlier this year approved $12.5 billion to improve air traffic control, though the industry said it needs billions more to modernize the system in the U.S.

The fatal collision of an American Airlines regional jet and an Army Black Hawk helicopter in Washington, D.C., in January also made hiring controllers more urgent, especially at congested facilities.

About a month after the crash, Duffy announced the country’s air traffic controller academy would raise pay for students, and he authorized more universities to teach a similar curriculum to help ease the shortage. The academy in Oklahoma City also stayed open, a different tactic than in the 2018-2019 shutdown.

But those aren’t immediate fixes. It takes years for controllers to be fully trained to work at some of the more complex facilities, and applicants to the academy can be no older than 30.

CORRECTION: An earlier version of this story misstated a comparison to this month’s flight cancellations.

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A person rides an electric scooter past the air traffic control tower at Reagan Washington National Airport as the U.S. government shutdown continues in Arlington, Virginia, U.S., Oct. 8, 2025.

Nathan Howard | Reuters

U.S. air traffic controllers Tuesday missed their first full paychecks since the government shutdown began at the start of the month, while the Department of Transportation said flight delays due to staffing shortages have increased.

The controllers are facing increased financial stress and it’s getting harder to recruit much-needed workers, union officials and Transportation Secretary Sean Duffy said Tuesday. Air traffic controllers and airport security screeners are among the employees required to work during the shutdown as essential employees, even though they’re not getting regular paychecks.

“The problems are mounting daily,” said Nick Daniels, president of the National Air Traffic Controllers Association, at a news conference at New York’s LaGuardia Airport.

Duffy told reporters that 44% of the flight delays on Sunday, and about 24% of them on Monday, were due to air traffic controller staffing, compared with around 5% of the delays so far this year.

U.S. Transportation Secretary Sean Duffy holds a press conference on the impact of the government shutdown on air travel, at LaGuardia Airport in the Queens borough of New York City, U.S., October 28, 2025.

Shannon Stapleton | Reuters

Duffy also said that the shutdown is hurting government air traffic training and recruiting, and that some funds for trainee stipends are “about to run out.”

Air traffic controller union officials have said that some members have been driving for ride-hailing platforms and taking other jobs to make ends meet.

Members of the union, including its president, plan to hand out leaflets and speak to the public at several airports across the U.S. on Tuesday, urging travelers to push Congress to end the shutdown.

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The government shutdown, entering its fourth week, has added to concerns about additional strain on the U.S. air traffic control system, which has challenged airlines and travelers alike because of years of understaffing.

Flights earlier this month were delayed at several U.S. airports but the severe disruptions that preceded the end of the longest-ever shutdown, between late 2018 and early 2019, have not occurred.

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An airplane takes off the control tower at Reagan National Airport in Arlington, Virginia, on Oct. 8, 2025.

Brendan Smialowski | AFP | Getty Images

U.S. air traffic controllers have received partial paychecks, their union said Tuesday, and they could miss their next paychecks altogether if the government shutdown lasts another two weeks.

“The job is stressful enough as it is. Now you’re adding this factor of, ‘Hey, when am I going to get this next paycheck?'” said Raymond Dahlstrom, an air traffic controller.

Dahlstrom and some of his colleagues handed out leaflets outside of LaGuardia Airport in New York on Tuesday to urge the public to ask lawmakers to end the shutdown. Air traffic controllers were also scheduled to hand out informational pamphlets at other airports in Washington, D.C., and Chicago on Tuesday.

The government shut down on Oct. 1, as the Senate has failed to pass a bill to fund the government. Air traffic controllers and airport security screeners are among the thousands of government employees who are required to work despite not getting paid during the impasse.

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Last week, shortages of air traffic controllers caused delays at airports, including in Nashville, Tennessee, and Burbank, California, though most facilities were sufficiently staffed.

“We’re still showing up, nobody is calling out sick … other than they’re sick,” Dahlstrom said. He said some controllers are taking second jobs like driving for ride-sharing companies to help make ends meet while they’re going without pay.

A more than monthlong shutdown starting in late 2018 ended hours after a shortage of air traffic controllers snarled air travel in the New York area.

Even outside of the shutdown, the U.S. has been dealing with a shortage of trained air traffic controllers, which has periodically disrupted flights. Airline executives have pushed for more training initiatives and more modern technology for years.

But the government shutdown has also put additional focus on U.S. aviation.

Some airports including Las Vegas, the three major New York City airports and others are refusing to air a video of Homeland Security Secretary Kristi Noem that blames the shutdown on Democrats, airport officials told CNBC on Tuesday.

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The Hollywood Burbank Airport air traffic control tower stands in Burbank, California, on Oct. 6, 2025.

Mario Tama | Getty Images

A shortage of air traffic controllers are delaying flights, the Federal Aviation Administration warned on Wednesday, as concerns grow about the effect of the government shutdown on U.S. aviation.

There were half-hour delays at Ronald Reagan Washington National Airport late Wednesday afternoon due to staffing, the FAA said.

About 10,000 flights were delayed on Monday and Tuesday, though disruptions dropped on Wednesday to just over 3,200. Delays could be caused by weather or other reasons aside from staffing issues. But a shortfall of already-thin air traffic control staffing this week had prompted the FAA to slow or halt arrivals in Burbank, California, and Nashville, Tennessee, among others.

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Transportation Secretary Sean Duffy warned Monday that the FAA is seeing a “slight uptick” in sick calls of air traffic controllers.

He also said the shutdown is exacerbating concerns about the strain on air traffic controllers, a shortage of whom has vexed airline executives for years. 

“Nearly 11,000 fully certified controllers remain on the job, many working 10-hour shifts as many as six days a week, showing extraordinary dedication to safely guiding millions of passengers to their destinations—all without getting paid during this shutdown,” the air traffic controllers’ union, the National Air Traffic Controllers Association, said in a statement.

Earlier Wednesday, the FAA had warned there could be a staffing trigger at Newark Liberty International Airport, but that caution had been removed by the afternoon. Newark was not seeing an influx of flight delays.

The government shutdown stretched into its eighth day Wednesday, as the Senate failed to pass a funding proposal again.

Duffy said Tuesday on CNBC’s “Squawk Box” that no one airport is consistently having issues with air traffic controller staffing and urged Congress to pass a funding bill.

“The conversations and the fights that are happening are about issues allegedly that are going to come to fruition at the end of the year,” he said. “Open up the government, take the months to have a conversation and negotiate, but let’s not use this as leverage with hardworking Americans that keep our skies safe for political benefit.”

During a shutdown, “essential” workers such as air traffic controllers and TSA agents are continuing to work without pay, while many other employees are placed on furlough.

A more than monthlong shutdown that started in late 2018 ended early the next year, hours after a shortage of air traffic controllers snarled air travel in New York.

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An airport control tower is seen at Newark Liberty International Airport, on May 6, 2025 in Newark, New Jersey.

Andres Kudacki | Getty Images

Air traffic controllers have been under strain for years, but a 90-second equipment failure last month exposed how decades of staffing shortages, underinvestment and patchwork solutions for those who guide planes through some of the world’s most congested airspace are taking their toll.

The outage also sparked hundreds of flight delays, disrupting travel for thousands of people for days — again. Less than two weeks later, on Friday, there was another similar outage at the same facility, though it was overnight, when far fewer planes are in the air.

Vexed by costly delays, airline executives have clamored for years for upgrades to fix the aging air traffic infrastructure and end staffing shortages.

With the CEOs of the largest U.S. airlines present, Transportation Secretary Sean Duffy on Thursday unveiled a plan to replace dated radar and communications systems across U.S. airspace, an overhaul that airlines estimate could require Congress to approve more than $30 billion in funding.

Duffy didn’t provide a price tag but has said the job will cost billions of dollars and added Thursday that it will require those funds from Congress “up front.”

“The system we have here, it’s not worth saving,” Duffy said at the event. “It’s too old.”

Airlines, Airbus, GE Aerospace, labor unions and other industry members on Thursday applauded a $12.5 billion House spending proposal set aside to improve air traffic control and said another $18.5 billion in emergency funding is needed over the next three years for upgrades and improved staffing.

Some Democrats said they were encouraged by Duffy’s new proposal but criticized the Trump administration’s layoffs of dozens of Federal Aviation Administration employees earlier this year, which didn’t include air traffic controllers.

“If America wants to remain the gold standard in aviation safety, we need smart investments—not canceled investments and funding cuts,” said Sen. Tammy Duckworth, D-Ill., in a statement on Thursday.

What’s the problem at Newark?

On the afternoon of April 28, air traffic controllers at a facility in Philadelphia who are responsible for guiding planes to and from Newark Liberty International Airport in New Jersey faced dark radar screens and were unable to talk to planes for more than a minute.

The outage lasted about 30 seconds. It took another 30 to 60 seconds for aircraft to reappear on radarscopes, according to the FAA.

United Airlines’ Captain Deon Byrne check her phone as she arrives at Terminal C in Newark Liberty International Airport, on May 6, 2025 in Newark, New Jersey.

Andres Kudacki | Getty Images

Pilots for major U.S. airlines say they are specially trained to handle such outages.

But an outage of even a few seconds “is an eternity for air traffic controllers,” said Jeff Guzzetti, a retired air safety investigator for the U.S. National Transportation Safety Board and the FAA.

The incident, which was not the first time equipment outages hit the facility, was so jarring some have “taken time off to recover from the stress of multiple recent outages,” the FAA said.

More than 1,500 Newark flights were delayed in the week after the outage, according to FlightAware. United Airlines, which runs a hub out of Newark, said it was cutting 35 flights a day from its schedule to ease strain on its operation and customers.

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A Newark runway has also been closed for construction, adding to disruptions.

A similar radar and communication outage occurred before dawn on Friday at the same facility that oversees planes arriving and departing from Newark airport.

New steps

On Wednesday, the FAA said it would beef up staffing at the Philadelphia facility and work to fix communication lines that feed data to controllers there for Newark flights. It said it plans to install a temporary backup system there to “provide redundancy during the switch to a more reliable fiberoptic network.”

New upgrades can’t come soon enough.

“We have computers, and I kid you not, today in 2025, that are based on Windows 95 and floppy disks,” Nick Daniels, president of the National Air Traffic Controllers Association, said in an interview in March.

The FAA last year said that the average age of its towers is 40 and that most radar systems are approaching 40 years old. “Aging facilities add risk to the system, including risk of service disruptions,” it said.

The plan Duffy unveiled on Thursday called for replacing 618 radars and the construction of six new air traffic control centers, as well as installing new fiber optic, wireless and satellite systems to replace old communications systems.

People wait in line for a delayed flight at Newark International Airport on May 5, 2025 in Newark, New Jersey.

Spencer Platt | Getty Images

Accident draws urgency

The April 28 incident and previous outages didn’t cause any accidents but the failures raised more worries about an outmoded system and chronic shortages of air traffic controllers, particularly in the busy airspace around New York City.

U.S. air traffic controllers handle about 45,000 flights a day overall, according to the FAA.

The urgency to fix lingering problems reached a new level after a Black Hawk Army helicopter collided with an American Airlines regional jet on Jan. 29, killing all 67 people on board the aircraft. It was the deadliest air crash in the United States since 2001.

“It should not take a tragedy to solve this problem,” JetBlue Airways CEO Joanna Geraghty said at Thursday’s Transportation Department event in Washington, D.C. “As the only airline that is headquartered and based in New York City, we know air traffic control delays and challenges far, far too well.

“Let’s get this done,” she said.

Why is Newark such a problem?

Newark is already dealing with space constraints to begin with.

It handled around 414,000 flights last year, 11% fewer than John F. Kennedy International Airport, in Queens, New York, according to data from their operator, the Port Authority of New York and New Jersey. But Newark is about half JFK’s size.

Technology glitches and staffing shortfalls have been especially hard on Newark in recent days. Last year, the FAA moved controllers who handle Newark from a facility on Long Island, New York — where planes are also sequenced to and from LaGuardia Airport and JFK in Queens — to a remote station in Philadelphia. The move was meant to ease congestion and strain on the Long Island facility, but there are still issues.

An inside view of Newark Airport as travelers are facing eight straight days of massive delays, United Airlines canceling routes and staffing shortages in Newark, New Jersey, United States, on May 06, 202

Mostafa Bassim | Anadolu | Getty Images

Air traffic staffing shortages have vexed airline executives who are eager to capitalize on strong demand but are constrained and face high costs due to a lack of controllers.

“Keep in mind, this particular air traffic control facility has been chronically understaffed for years and without these controllers, it’s now clear — and the FAA tells us — that Newark airport cannot handle the number of planes that are scheduled to operate there in the weeks and months ahead,” United CEO Scott Kirby told customers on May 2, announcing schedule cuts.

Before April 26, four flights a day were canceled at Newark in April, on average, but that rose to 39 a day through Monday, according to aviation analytics firm Cirium. About 80% of flights were on schedule in April before that date, but dropped to 63%, “far below industry norms,” Cirium said.

Slowing it down

U.S. Transportation Secretary Sean Duffy speaks to the media outside the White House in Washington, D.C., U.S., May 6, 2025.

Kent Nishimura | Reuters

Duffy has said air travel is safe. After a visit to the Philadelphia facility following the April 28 outage, he said that the FAA will slow, if not halt, arrivals altogether if there is a shortage of air traffic controllers.

United’s CEO, Kirby, told employees in a memo Wednesday that flying to and from Newark is safe. He said the carrier’s pilots have thousands of hours of experience and training on procedures to “follow to re-establish communication if controllers lose radio contact to navigate the airplane safely to its destination.”

Airlines have sought capacity limits to help the congestion, and the last disruption was no exception.

“United has been urging the US government for *years* to use its authority to effectively limit the number of flights to what the airport can realistically handle,” Kirby said in a note to employees. “Past failure to make those changes had led to the circumstances that United and, most importantly, our customers now face.”  

In 2016, the FAA eased flight restrictions at the airport and Kirby said the FAA should return to prior rules.

“It’s long past time to treat EWR like the crown jewel that it is,” he told employees in the Wednesday note, using the airport’s code. “We’ll continue to work closely with the FAA and [Transportation Department] to get EWR fixed once and for all and deliver the country the first-class air traffic system it deserves.”

Staffing shortfalls

The U.S. has around 10,800 air traffic controllers, well short of its full staffing goal by 3,000, according to the controllers’ union, the NATCA.

“Over the last eight years, we’ve had 146,000 applicants and we’ve hired 7,905 of those,” Chris Wilbanks, vice president of mission support at the FAA who is in charge of controller hiring and training, said in interview in March. “Less than 10% of the people that apply for the job actually make it to the [Oklahoma training] academy and then graduate to go out into the field.”

In the previous fiscal year, the FAA’s goal was to hire 1,800 controllers.

“We’ll lose 35% of those at the academy. We’ll lose another 20% once they get in the field, on the job training. So we don’t net 1,800 controllers,” Wilbanks said.

The grueling job requires air traffic controllers to retire at age 56, and applicants to the academy can be no older than 30. Many are forced to work six-day workweeks because of the shortages.

Duffy has recently moved to increase financial incentives, like higher pay for air traffic controllers. Starting pay is around $45,000, the union’s Daniels said, though the median pay for a U.S. air traffic controller is $144,580 a year, according to the U.S. Labor Department.

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Chegg seen at the New York Stock Exchange on Feb. 13, 2025. 

Danielle DeVries | CNBC

Chegg on Monday filed suit in federal district court against Google, claiming that artificial intelligence summaries of search results have hurt the online education company’s traffic and revenue.

The legal move come nearly two years after former CEO Dan Rosensweig said students engaging with OpenAI’s ChatGPT assistant were cutting into Chegg’s new customer growth.

Chegg is worth less than $200 million, and in after-hours trading Monday, the stock was trading just above $1 per share. Chegg has engaged Goldman Sachs and will look at strategic options, including getting acquired and going private, President and CEO Nathan Schultz told analysts on a Monday earnings call.

Chegg reported a $6.1 million net loss on $143.5 million in fourth-quarter revenue, a 24% decline year over year, according to a statement. Analysts polled by LSEG had expected $142.1 million in revenue. Management called for first-quarter revenue between $114 million and $116 million, but analysts had been targeting $138.1 million. The stock was down 24% in extended trading.

Google forces companies like Chegg to “supply our proprietary content in order to be included in Google’s search function,” said Schultz, adding that the search company uses its monopoly power, “reaping the financial benefits of Chegg’s content without having to spend a dime.”

Despite the suit, Chegg has its own AI strategy. It has drawn on Meta’s open-source Llama, as well as models from privately held Anthropic and Mistral, Schultz said. Chegg has also partnered with OpenAI, which the education company views as a competitor, alongside Google. The company reported that 3.6 million students had subscriptions in the fourth quarter, down 21%. Subscriptions include access to AI-powered learning assistance. Chegg also rents and sells textbooks.

AI Overviews, as Google’s artificial intelligence summaries are called, are available in the company’s search engine in over 100 countries, with more than 1 billion users, the company said in October. They show up above links to other pages in search results.

A Google spokesperson told CNBC that the company will defend itself against Chegg’s suit, which asserted that the search company violated sections one and two of the Sherman Antitrust Act of 1890.

“Every day, Google sends billions of clicks to sites across the web, and AI Overviews send traffic to a greater diversity of sites,” the Google spokesperson said.

Chegg claimed that Google drew on Chegg’s collection of 135 million questions and answers on a variety of subjects in its model training data sets.

After training its models, Google can generate content that competes with information that publishers have on offer in search results, Chegg argued in its complaint. The online learning company included a screenshot of a Google AI Overview that borrows details from Chegg’s website but does not attribute the information. However, the relevant Chegg page does show up lower down in search results.

Chegg cited a federal judge’s ruling last August that Google holds a monopoly in the search market. The decision came after the Department of Justice in 2020 filed its landmark case, alleging that Google controlled the general search market by creating strong barriers to entry and a feedback loop that sustained its dominance.

WATCH: Google unrolls AI Overviews in six more countries

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