Skillsoft Corp is a leader in corporate digital learning. The company's segments include Talent Development Solutions (formerly known as Content & Platform) and Global Knowledge (formerly known as Instructor-Led Training). The majority of revenue is from the Talent Development Solutions segment.
Performance Overview
Skillsoft Corp (SKIL, Financial) reported total revenue of $132 million for the second quarter of fiscal 2025, a 6% decline from the previous year. This figure fell short of the analyst estimate of $131.41 million. The Talent Development Solutions segment generated $102 million, down 1% year-over-year, while the Global Knowledge segment saw a significant 20% decline in revenue to $31 million.
The company reported a net loss of $40 million, compared to a net loss of $32 million in the prior year. Net loss per share was $4.84, compared to $4.00 in the previous year. However, the adjusted net loss improved to $20 million from $30 million, with adjusted net loss per share improving to $2.40 from $3.68.
Financial Achievements
Despite the revenue decline, Skillsoft Corp (SKIL, Financial) achieved an adjusted EBITDA of $28 million, reflecting a margin of 21% of revenue, up from $25 million and an 18% margin in the prior year. This improvement in adjusted EBITDA is a positive indicator of the company's operational efficiency and cost management.
"Our revenue and adjusted EBITDA performance were in line with our expectations for the quarter," said Ron Hovsepian, Skillsoft’s Executive Chair and Chief Executive Officer. "Our progress on the ‘Fix the Basics’ strategy, including transitioning to a dual business unit structure, already shows improved outcomes."
Key Financial Metrics
| Metric | Q2 FY2025 | Q2 FY2024 |
|---|---|---|
| Total Revenue | $132 million | $140 million |
| Net Loss | $40 million | $32 million |
| Adjusted Net Loss | $20 million | $30 million |
| Adjusted EBITDA | $28 million | $25 million |
Business Highlights
Skillsoft Corp (SKIL, Financial) made significant strides in its strategic initiatives during the quarter. The company partnered with Microsoft to innovate GenAI upskilling programs, launched a reimagined Skillsoft platform user experience, and received multiple industry awards, including being named Overall eLearning Company of the Year in the Edtech Breakthrough Awards.
Additionally, Skillsoft released its 2024 C-Suite Perspectives report, highlighting a critical skills crisis in cybersecurity, AI, and data science areas. The company also hosted a successful Investor Day, where leadership outlined strategic priorities and reaffirmed the financial outlook for FY25.
Financial Outlook
Skillsoft Corp (SKIL, Financial) reaffirmed its financial outlook for the full fiscal year 2025, projecting GAAP revenue between $510 million and $525 million and adjusted EBITDA between $105 million and $110 million.
"I am pleased with the progress we made this quarter towards our longer-term goals to grow at or above market rates in all areas of our business," said Rich Walker, Skillsoft’s Chief Financial Officer. "Equally important, we remain laser focused on near-term operational execution and are reaffirming our outlook for FY25."
Analysis
Skillsoft Corp (SKIL, Financial) faces challenges with declining revenue, particularly in the Global Knowledge segment. However, the improvement in adjusted EBITDA and the company's strategic initiatives indicate a focus on long-term growth and operational efficiency. The reaffirmation of the financial outlook for FY25 suggests confidence in the company's ability to navigate current challenges and achieve its goals.
Investors and analysts will be closely monitoring Skillsoft Corp (SKIL, Financial)'s ability to stabilize and grow its revenue while maintaining cost efficiencies. The company's focus on AI-driven learning solutions and strategic partnerships could be key drivers for future growth.
Explore the complete 8-K earnings release (here) from Skillsoft Corp for further details.
