Skillsoft Reports Financial Results for the Third Quarter of Fiscal 2025
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Raises and tightens fiscal year 2025 revenue outlook
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Continued strong growth in Adjusted EBITDA and margin expansion
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Generated positive free cash flow in the quarter
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Delivering on strategic transformation initiatives laid out at July
Investor Day
BOSTON--(BUSINESS WIRE)--December 10, 2024--
Skillsoft Corp. (NYSE: SKIL) ("Skillsoft" or the "Company"), a leading platform for transformative learning experiences, today announced its financial results for the third quarter of fiscal 2025 ended October 31, 2024.
Fiscal 2025 Third Quarter Select Metrics and Financials from Continuing Operations (1)(2)
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Total Revenue of $137 million compared to $139 million in the prior
year.
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Talent Development Solutions Revenue of $103 million up 2% from the
prior year.
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Global Knowledge Revenue of $34 million compared to $38 million in the
prior year.
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Net Loss of $24 million compared to net loss of $28 million in the
prior year. Net Loss per share of $2.86 compared to net loss per share of
$3.45 in the prior year. Adjusted Net Loss of $15 million improved from
Adjusted Net Loss of $23 million in the prior year. Adjusted Net Loss per
share of $1.82 improved from Adjusted Net Loss per share of $2.82 in the
prior year.
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Adjusted EBITDA from continuing operations of $32 million, reflecting a
margin of 23% of Revenue, compared to $30 million and a margin of 21% of
Revenue in the prior year.
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Gross debt of $591 million at the end of the quarter, down $35 million
compared to $626 million in the prior year.
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Ended the quarter with $102 million of cash, cash equivalents, and
restricted cash.
"Our fiscal third quarter financial results demonstrate our first step in executing our transformation strategy," said Ron Hovsepian, Skillsoft's Executive Chair and Chief Executive Officer. "The operationalization of our strategy is showing the first signs of business and financial improvement for our shareholders and customers."
Fiscal 2025 Third Quarter Business Highlights
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Skillsoft continues its leadership in AI innovation by launching key
learner and organizational tools including AI Coaching Assistant to help
leaders develop coaching plans, AI Learning Assistant to personalize the
learning experience, and AI Coding Assistant to provide tailored coding
exercises and immediate feedback.
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Skillsoft's organizational platform -- Percipio -- adds new
capabilities in compliance and certifications. Skillsoft's Compliance
Suite is a new offering that aids companies in developing competencies
needed to identify and mitigate business risk. Skillsoft's end-to-end
certification paths increase speed to productivity by helping learners
attain globally recognized technical certifications.
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Key customer wins were in workforce transformation catalyzed by AI,
which led to AI upskilling and global workforce skill measurement
generating more than $8 million over multiple years from six global
companies.
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"Partner of the Year" was awarded to Skillsoft multiple times as a
leader in the interactive learning experience market through Global
Knowledge by global vendors including Cisco, CompTIA, Palo Alto Networks,
and EC-Council.
"I am pleased with our financial results for the quarter, which are highlighted by strong revenue execution, improved profitability, and positive free cash flow," said Rich Walker, Skillsoft's Chief Financial Officer. "Our third quarter performance, coupled with momentum from our transformation execution, gives us confidence to raise and tighten our FY25 revenue guidance range, while reaffirming our adjusted EBITDA outlook."
Full-Year Fiscal 2025 Financial Outlook (2)
The following table reflects Skillsoft's updated financial outlook for the fiscal year ending January 31, 2025, based on current market conditions, expectations, and assumptions:
GAAP Revenue $520 million -- $530 million
Adjusted EBITDA $105 million -- $110 million
(1) Growth calculated relative to the comparable prior year period unless
otherwise noted.
(2) See "Non-GAAP Financial Measures and Key Performance Metrics" below for
the definitions of our key operational and non-GAAP metrics and how
they are calculated and more information regarding the fact that the
Company is unable to reconcile forward-looking non-GAAP measures
without unreasonable efforts. We have provided at the back of this
release reconciliations of our historical non-GAAP financial measures
to the comparable GAAP measures.
Webcast and Conference Call Information
Skillsoft will host a conference call and webcast today at 5:00 p.m. Eastern Time to discuss its financial results. To access the call, dial (877) 413--9278 from the United States and Canada or (215) 268--9914 from international locations. The live event can be accessed from the Investor Relations section of Skillsoft's website at investor.skillsoft.com. A replay will be available for six months.
About Skillsoft
Skillsoft delivers transformative learning experiences that propel organizations and people to grow together. The Company partners with enterprise organizations and serves a global community of learners to prepare today's employees for tomorrow's economy. With Skillsoft, customers gain access to blended, multimodal learning experiences that do more than build skills, they grow a more capable, adaptive, and engaged workforce. Through a portfolio of high-quality content, an AI-enabled platform that is personalized and connected to customer needs, and a broad ecosystem of partners, Skillsoft drives continuous growth and performance for employees and their organizations by overcoming critical skills gaps, unlocking human potential, and transforming the workforce. Learn more at www.skillsoft.com.
Non-GAAP Financial Measures and Key Performance Metrics
The Company has organized its business into two segments (or Business Units): Talent Development Solutions (formerly referred to as Content & Platform) and Global Knowledge (formerly referred to as Instructor-Led Training). We track the non-GAAP financial measures and key performance metrics that we believe are key financial measures of our success. Non-GAAP measures and key performance metrics are frequently used by securities analysts, investors, and other interested parties in their evaluation of companies comparable to us, many of which present non-GAAP measures and key performance metrics when reporting their results. These measures can be useful in evaluating our performance against our peer companies because we believe the measures provide users with valuable insight into key components of U.S. GAAP financial disclosures. For example, a company with higher U.S. GAAP net income may not be as appealing to investors if its net income is more heavily comprised of gains on asset sales. Likewise, excluding the effects of interest income and expense moderates the impact of a company's capital structure on its performance. However, non-GAAP measures and key performance metrics have limitations as analytical tools. Because not all companies use identical calculations, our presentation of non-GAAP financial measures and key performance metrics may not be comparable to other similarly titled measures of other companies. They are not presentations made in accordance with U.S. GAAP, are not measures of financial condition or liquidity, and should not be considered as an alternative to profit or loss for the period determined in accordance with U.S. GAAP or operating cash flows determined in accordance with U.S. GAAP. As a result, these performance measures should not be considered in isolation from, or as a substitute analysis for, results of operations as determined in accordance with U.S. GAAP.
We have provided at the back of this press release reconciliations of our historical non-GAAP financial measures to the comparable GAAP measures. We do not reconcile our forward-looking non-GAAP financial measures to the corresponding U.S. GAAP measures, due to variability and difficulty in making accurate forecasts and projections and/or certain information not being ascertainable or accessible; and because not all of the information necessary for a quantitative reconciliation of these forward-looking non-GAAP financial measures to the most directly comparable U.S. GAAP financial measure is available to us without unreasonable efforts. For the same reasons, we are unable to address the probable significance of the unavailable information. We provide non-GAAP financial measures that we believe will be achieved, however we cannot accurately predict all of the components of the non-GAAP calculations and the U.S. GAAP measures may be materially different than the non-GAAP measures.
We disclose the below non-GAAP financial measures and key performance metrics in this press release because we believe these non-GAAP financial measures and key performance metrics provide meaningful supplemental information.
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