-- TDS Segment(1) delivered full year revenue in line with guidance, with
TDS Segment Adjusted EBITDA and consolidated Free Cash Flow above the top
end guidance
-- Next-generation Skillsoft Percipio$(R)$ Platform generally available,
with 15 new customers since release
-- Early adopters accelerating utilization of our AI tools
BOSTON--(BUSINESS WIRE)--April 07, 2026--
Skillsoft Corp. (NYSE: SKIL) ("Skillsoft", "we", "us" or "our"), a leading AI-native skills management platform, today announced its financial results for the fourth quarter and full fiscal year ended January 31, 2026 and provided its TDS Segment financial outlook for full year fiscal 2027.
Fiscal 2026 Fourth Quarter Select Financial Measures
-- Total Revenue of $131 million compared to $134 million in the prior
year.
-- Talent Development Solutions Revenue of $103 million, flat versus the
prior year.
-- Global Knowledge Revenue of $28 million compared to $31 million in the
prior year.
-- Net Loss of $37 million compared to Net Loss of $31 million in the
prior year. Net Loss per share of $4.19 compared to Net Loss per share of
$3.75 in the prior year.
-- Adjusted EBITDA(2) of $31 million, reflecting an Adjusted EBITDA
margin(2) of 24% of Revenue, compared to $30 million and a margin of 22%
of Revenue in the prior year.
-- Free Cash Flow(2) of $27 million compared to $13 million in the prior
year.
Fiscal 2026 Full Year Select Financial Measures
-- Total Revenue of $513 million compared to $531 million in the prior
year.
-- Talent Development Solutions Revenue of $404 million compared to $406
million in the prior year.
-- Global Knowledge Revenue of $109 million compared to $125 million in
the prior year.
-- Net Loss of $140 million compared to Net Loss of $122 million in the
prior year. Net Loss per share of $16.27 compared to Net Loss per share
of $14.87 in the prior year.
-- Adjusted EBITDA(2) of $110 million, reflecting an Adjusted EBITDA
margin(2) of 21% of Revenue, compared to $109 million and a margin of 21%
of Revenue in the prior year.
-- Free Cash Flow(2) of $6 million compared to $12 million in the prior
year.
"This quarter's strong TDS Segment results, led by TDS enterprise solutions, demonstrate the critical role Skillsoft plays in helping organizations navigate the rapid pace of human and AI change. Over the past 18 months, we've made meaningful progress executing our transformation, streamlining the business through improved capital allocation, and repositioning our platform, which is now in market and gaining traction," said Ron Hovsepian, Skillsoft Executive Chair and CEO. "As AI reshapes the global workforce, demand for our AI-driven learning solutions, particularly our CAISY$(TM)$ simulator, continues to build, and we believe we are well positioned to support workforce readiness while driving toward sustainable growth and improved free cash flow."
Hovsepian concluded, "As we noted last quarter, we initiated a strategic review of the Global Knowledge Segment, which remains ongoing as we evaluate the best path forward to maximize overall value at Skillsoft. Looking ahead, we remain focused on executing our strategic plan and maintaining disciplined capital allocation."
Fiscal 2026 Fourth Quarter Business Highlights
-- Skillsoft announced the general availability of its next-generation
skills management platform to power enterprise workforce readiness and
outcomes
-- Skillsoft and edX formed a strategic partnership to expand
university-led learning in The Skillsoft Percipio Platform, strengthening
how enterprises build workforce readiness for an AI-driven world
-- AI skill benchmark completions increased 994% year over year, with AI
content completions up 261% year over year and AI journey completions up
222% year over year. CAISY learners increased 146% year over year, and
CAISY launches or engagement increased 341% year over year.
"Strong performance in our TDS Segment drove Adjusted EBITDA margin expansion and robust free cash flow generation for the quarter, reflecting the continued benefits of a leaner, more-directed cost structure and operational discipline," said John Frederick, Skillsoft's Chief Financial Officer. "We believe that removing the impact of our GK Segment would improve growth, operating results and free cash flow. Building on our strategic foundation, we are focusing on our core TDS enterprise solutions, whose profitability and cash generation capability, we believe, will drive long-term value for our shareholders."
Full-Year Fiscal 2027 Financial Outlook
In connection with our continuing exploration of strategic alternatives for our GK segment, we are only able to provide revenue and Adjusted EBITDA(2) guidance for our TDS segment for the fiscal year ending January 31, 2027 ("fiscal 2027").
The following table reflects Skillsoft's financial outlook for fiscal 2027, based on current market conditions, expectations, and assumptions:
TDS Revenue $388 million -- $406 million
TDS Adjusted EBITDA(2) $108 million -- $116 million
TDS Free Cash Flow $14 million -- $22 million
(1) Skillsoft has two operating and reporting segments: Talent Development
Solutions ("TDS") and Global Knowledge ("GK")
(2) Denotes a non-GAAP financial measure. See "Non-GAAP Financial Measures"
below for the definitions of these and other non-GAAP financial
measures included in this press release, how they are calculated, and
the rationale for their use. A reconciliation of historical non-GAAP
financial measures to the most directly comparable GAAP financial
measures is provided in the tables at the back of this press release.
We do not provide quantitative reconciliations for forward-looking
non-GAAP financial measures, as we are unable to provide a meaningful
or accurate calculation or estimation of reconciling items and the
information is not available without unreasonable effort. See "Non-GAAP
Financial Measures" below for further detail.
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) 407-3088 from the United States and Canada or (201) 389-0927 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 twelve months.
About Skillsoft
Skillsoft (NYSE: SKIL) is a global leader in skills management for the human + AI era. The AI-native Skillsoft platform gives a clear view of workforce capability, closes critical skill gaps, and proves the impact of skills on business outcomes. With Skillsoft, organizations can build AI-ready teams, lower the cost and time of workforce development, and reduce execution risk as work continues to change. Thousands of organizations worldwide trust Skillsoft to power workforce readiness. Learn more at skillsoft.com
Non-GAAP Financial Measures
In addition to disclosing detailed operating results in accordance with U.S. GAAP, Skillsoft provides supplementary non-GAAP financial measures to consider in evaluating our operating performance. We track the non-GAAP financial measures that we believe are key financial measures of our success. Non-GAAP measures 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 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. In addition, management uses these non-GAAP financial measures to assess operating performance, financial leverage and the effective use and allocation of resources; to provide more normalized period-to-period comparisons of operating results; to enhance investors' understanding of the core operating results of our business; and to set management incentive targets. We believe investors use both U.S. GAAP and non-GAAP financial measures to assess management's decisions associated with our priorities and capital allocation, as well as to analyze how our business operates in, or responds to, macroeconomic trends or other events that impact our core operations. We disclose the non-GAAP financial measures included in this press release because we believe that they provide meaningful supplemental information. However, non-GAAP financial measures have limitations as analytical tools. Because not all companies use identical calculations, our presentation of non-GAAP financial measures 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 non-GAAP financial 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.
The non-GAAP financial measures included in this press release are: adjusted net income (loss), on both a consolidated and segment basis; adjusted net income (loss) per share; adjusted net income (loss) margin % (i.e., adjusted net income (loss) as a percentage of revenue) on both a consolidated and segment basis; adjusted EBITDA, on both a consolidated and segment basis; adjusted EBITDA margin % (i.e., adjusted EBITDA as a percentage of revenue), on both a consolidated and segment basis; adjusted total operating expenses; adjusted contribution margin; business unit contribution profit; business unit contribution margin (i.e., business unit contribution profit as a percentage of business unit revenue); adjusted costs of revenues; adjusted content and software development expenses; adjusted selling and marketing expenses; adjusted general and administrative expenses; business unit costs of revenues, business unit content and software development expenses; business unit product research and management expenses, free cash flow, and adjusted free cash flow (levered), free cash flow conversion and adjusted net leverage.
We have provided at the back of this press release reconciliations of these non-GAAP financial measures to the most directly comparable U.S. GAAP financial measures for the three and twelve months ending January 31, 2026 and 2025. We do not reconcile our forward-looking non-GAAP financial measures to the most directly comparable U.S. GAAP financial 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 measures 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 adjusted calculations and the U.S. GAAP financial measures may be materially different than the non-GAAP financial measures.
The non-GAAP measures included in this press release are defined as follows:
-- Adjusted net income (loss)* is defined as net income (loss) excluding
non-cash items, discrete and event-specific costs that do not represent
normal cash operating expenses necessary for our business operations, and
certain accounting income and/or expenses. Management believes these
exclusions enhance the comparability of our results from period to period,
and as compared to peers, and are useful in assessing our operating
performance, and consist of the following (including the related tax
effects), when applicable to the periods presented:
-- Impairment charges - Non-cash goodwill and intangible asset
impairment charges.
-- Amortization of acquired intangible assets -- Non-cash
amortization expense of finite-lived intangible assets recognized
as a part of business combination accounting.
-- Acquisition and integration related costs -- Costs incurred to
effectuate an acquisition, including contingent compensation
expenses, and integration-related costs.
-- Restructuring charges -- Charges related to strategic cost
saving initiatives, including severance costs, losses associated
with the abandonment of right-of-use assets, and contract
termination costs.
-- Transformation costs -- Costs incurred to transform our
operations through significant strategic non-ordinary course
transactions.
-- System migration costs -- Costs of temporary resources needed
for the migration of content and customers from our legacy system
to a global platform.
-- Long-term incentive compensation expenses -- Charges associated
with long-term incentive compensation programs, including
stock-based compensation, cash awards tied to stock performance,
and awards granted in-lieu of stock that are intended to be
settled in cash.
-- Executive exit costs -- Costs associated with the departure of
executives.
-- Fair value adjustments -- Mark-to-market adjustments of interest
rate swap agreements.
-- Other (income) expense, net -- Unrealized and realized gains or
losses primarily resulting from fluctuations of U.S. dollar
appreciating or depreciating against other currencies, and
impairments associated with property and equipment and other
tangible assets when their carrying values are not recoverable.
-- Adjusted net income (loss) per share is defined as adjusted net income
(loss) divided by the number of diluted weighted average shares
outstanding, and adjusted net income (loss) margin % is defined as
adjusted net income (loss) as a percentage of revenue.
-- Adjusted net income (loss) margin %* is defined as adjusted net income
(loss) as a percentage of revenue.
-- Adjusted EBITDA* is defined as net income (loss) excluding (when
applicable to the periods presented) the same exclusions set forth above
for the determination of adjusted net income (loss) plus the additional
exclusions set forth below. Management believes these exclusions enhance
the comparability of our results from period to period, and as compared
to peers, and are useful in assessing our operating performance. The
additional exclusions are:
-- Amortization of capitalized internally developed software--
Non-cash amortization expense for finite-lived intangible assets
other than those recognized as a part of business combination
accounting.
-- Interest expense, net -- Gross interest expense offset by
interest income
-- Depreciation expense -- Non-cash depreciation expense for
property and equipment assets.
-- Provision for (benefit from) income taxes -- Current and
deferred federal, state and foreign income tax expense (benefit).
-- Adjusted EBITDA margin %* is defined as adjusted EBITDA as a percentage
of revenue.
-- Adjusted costs of revenues is defined as costs of revenues excluding
(where applicable) depreciation expense, long-term incentive compensation
expense, system migration costs and transformation costs.
-- Adjusted content and software development expenses is defined as
content and software development expenses excluding (where applicable)
depreciation expense, long-term incentive compensation expense, system
migration costs and transformation costs.
-- Adjusted selling and marketing expenses is defined as selling and
marketing expenses excluding (where applicable) depreciation expense,
long-term incentive compensation expense, system migration costs and
transformation costs.
-- Adjusted general and administrative expenses is defined as general and
administrative expense excluding (where applicable) depreciation expense,
long-term incentive compensation expense, system migration costs,
transformation costs, and executive exit costs.
-- Adjusted total operating expenses is defined as costs of revenues,
content and software development expenses, selling and marketing expenses,
and general and administrative expenses, in each case excluding (where
applicable) depreciation expense, long-term incentive compensation
expense, system migration costs, transformation costs, and executive exit
costs.
-- Adjusted contribution margin is defined as revenue less adjusted total
operating expenses, divided by revenue for the same period.
-- Business unit contribution profit - Segment ("business unit")
contribution profit is defined as business unit revenue, less business
unit cost of revenues, business unit content and software development
expenses, and business unit product research and management expenses.
-- Business unit contribution margin is defined as business unit
contribution profit divided by business unit revenue for the same
period.
-- Business unit cost of revenues is defined as cost of revenues
attributable to the business unit, excluding, where applicable,
depreciation expense, long-term incentive compensation expense, system
migration costs, and transformation expenses.
-- Business unit content and software development expenses are defined as
content and software development expenses attributable to the business
unit, excluding, where applicable, depreciation, long-term incentive
compensation, system migration costs, and transformation expenses.
-- Business unit product research and management expenses are defined as
certain selling and marketing costs attributable to the business unit
reflected in the business unit contribution profit.
-- Free cash flow is defined as net cash provided by (used in) operating
activities less net purchases of property and equipment and internally
developed software. Note that free cash flow does not represent residual
cash flow available to Skillsoft for discretionary expenditures.
-- Adjusted free cash flow (levered) is defined as free cash flow plus the
cash impact of the charges excluded in the determination of adjusted
EBITDA (as set forth above). Note that adjusted free cash flow (levered)
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