DENVER--(BUSINESS WIRE)--Skillsoft (NYSE: SKIL), a leading platform for transformative learning experiences, today released its annual Lean Into Learning Report. As the global workforce experiences widespread disruption, the report examines the state of learning and most in-demand skills and competencies. “Rapidly advancing technologies – most notably generative AI – have exacerbated an already acute skills crisis. But with this challenge comes significant opportunity for organizations to reimagine their ...

DENVER--(BUSINESS WIRE)--Skillsoft (NYSE: SKIL), a leading platform for transformative learning experiences, today announced new enhancements to its technology skilling solution, Codecademy. With deeper integration of generative AI (GenAI) into Codecademy, Skillsoft is providing a highly interactive and immersive learning experience to help organizations and learners build critical technology skills and succeed in the new era of AI. “The proliferation of GenAI tools in the workplace is reshaping the dema ...

Skillsoft Corp. (NYSE:SKIL) Q3 2024 Results Conference Call December 5, 2023 5:00 PM ET Company Participants Chad Lyne - Head of IR Jeff Tarr - CEO Richard Walker - CFO Conference Call Participants Ken Wong - Oppenheimer Sheldon McMeans - Barclays Raj Sharma - B. Riley Operator Greetings, and welcome to the Skillsoft Corp Third Quarter 2024 Financial Results Conference Call. At this time, all participants are in a listen-only mode. A brief question-and-answer session will follow the formal presentation [Ope ...

UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 FORM 10-Q ☒ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the quarterly period ended October 31, 2023 or Table of Contents ☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the transition period from to Commission File Number: 001-38960 Skillsoft Corp. (Exact name of registrant as specified in its charter) (State or other jurisdiction of incorpora ...

Skillsoft Corp. (NYSE:SKIL) Q2 2024 Earnings Conference Call September 11, 2023 5:00 PM ET Company Participants Chad Lyne - Head of Investor Relations Jeff Tarr - Chief Executive Officer Rich Walker - Chief Financial Officer Conference Call Participants Robert Simmons - D.A. Davidson Sheldon McMeans - Barclays Raj Sharma - B. Riley Kenneth Wong - Oppenheimer Thomas Singlehurst – Citi Operator Greetings and welcome to Skillsoft Second Quarter 2024 Financial Results Conference Call. At this time, all particip ...

Table of Contents UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 FORM 10-Q ☒ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the quarterly period ended July 31, 2023 or ☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the transition period from to Commission File Number: 001-38960 Skillsoft Corp. (Exact name of registrant as specified in its charter) (State or other jurisdiction of incorporatio ...

Financial Data and Key Metrics Changes - The company reported total bookings of $108 million, down 4% year-over-year, primarily due to the decline in the Instructor-led Training (ILT) segment [47] - Content & Platform segment bookings were $65 million, reflecting a growth of 9% for the quarter and 3% on a Last Twelve Months (LTM) basis [24] - Total revenue was $136 million, down 3%, with Content & Platform revenue at $99 million, up 2%, and ILT revenue at $37 million, down 14% [26][29] - Adjusted EBITDA was $22 million, up 13%, with an adjusted EBITDA margin of approximately 16%, gaining over 200 basis points compared to the previous year [29][48] Business Line Data and Key Metrics Changes - The Content & Platform segment demonstrated strong performance with a dollar retention rate of 108% for the quarter and 101% on an LTM basis [19][24] - The ILT segment saw bookings decline by 18% to $44 million, attributed to changes in training subsidy programs [25] - Codecademy contributed to sustained double-digit growth within the Content & Platform segment [26][70] Market Data and Key Metrics Changes - The company noted a significant increase in demand for generative AI training, with a more than six-fold increase in completions for AI and machine learning courses [8] - Growth opportunities were identified in sectors such as professional services, technology, and retail, with a focus on organizations prioritizing workforce transformation [83] Company Strategy and Development Direction - The company is focusing on three growth drivers: leading workforce transformation, tech and development skilling, and preparing organizations for generative AI [42] - A strategic partnership was established with Kyndryl, emphasizing the importance of skills development and workforce transformation [20][21] - The company is leveraging generative AI to enhance its offerings, including an AI coaching simulator currently in alpha testing with large enterprise customers [17][40] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the long-term structural tailwinds, including low unemployment and the need for reskilling as a priority for organizations [6][40] - The company reaffirmed its full-year outlook, expecting total bookings of $610 million to $640 million and revenue of $555 million to $585 million [51] - Management acknowledged the challenges of a bifurcated pricing environment but remains optimistic about capturing market share in strategic customer segments [62][77] Other Important Information - The company ended the quarter with $178 million in cash and cash equivalents, having repurchased 4.4 million shares under its share repurchase program [30] - Non-GAAP sales and marketing expenses were $44 million, or 32% of revenue, reflecting a 7% increase due to investments in go-to-market strategies [28] Q&A Session Summary Question: Can you provide insights on Codecademy's revenue contribution and profitability metrics? - Management indicated that Codecademy is performing well on the top line and is tracking positively against profitability commitments made at the time of acquisition [54][69] Question: What is the expectation for the ILT business revenue cadence throughout the year? - Management noted that Q4 is typically the strongest quarter for ILT bookings, and they expect a more logical comparison in the second half of the year [73] Question: How is the sales force productivity, particularly for newer representatives? - Management confirmed that improved productivity is assumed in their guidance, with newer sales representatives expected to reach full productivity within 12 months [75] Question: How is the pricing environment affecting the business? - Management described the pricing environment as bifurcated, with a shrinking segment of price-sensitive customers and a growing segment that views skills development as strategic [62][77] Question: What are the growth opportunities across regions or verticals? - Management highlighted stronger growth in professional services, technology, and retail, particularly where organizations prioritize workforce transformation [83]

Revenue Performance - Total revenues for the three months ended April 30, 2023, were $135.6 million, a slight increase of 0.5% compared to $134.8 million for the same period in 2022[152]. - SaaS and subscription revenues from the Content & Platform segment increased by 10.3% to $93.6 million, up from $84.9 million in the prior year[152]. - Instructor-Led Training revenues decreased by 18.3% to $37.0 million, down from $45.2 million in the same period last year[152]. - The acquisition of Codecademy contributed to revenue growth, with approximately 40 million registered learners on the platform[143]. Operating Expenses - Total operating expenses decreased by 5.1% to $170.9 million, compared to $180.1 million for the three months ended April 30, 2022[153]. - General and administrative expenses decreased by 13.8% to $25.3 million, down from $29.3 million in the prior year[153]. - Acquisition-related costs significantly decreased by 89.6% to $1.4 million, compared to $13.3 million in the same period last year[153]. - Compensation and benefits in selling and marketing expenses rose by 22.9% to $33,834,000 for the three months ended April 30, 2023, up from $27,524,000 in 2022[158]. - Total content and software development expenses increased by 4.3% to $17,035,000 for the three months ended April 30, 2023, compared to $16,331,000 in the same period of 2022[157]. Financial Performance - The company reported an operating loss of 26.1% for the three months ended April 30, 2023, an improvement from a loss of 33.7% in the same period of 2022[146]. - Interest expense increased by 38.4% to $15,936,000 for the three months ended April 30, 2023, compared to $11,514,000 in 2022, primarily due to additional term loans and higher interest rates[166]. - The effective income tax rate for the three months ended April 30, 2023, was 9.1%, significantly lower than the 49.2% rate in the same period of 2022[170]. Cash Flow and Liquidity - Cash and cash equivalents on hand as of April 30, 2023, totaled $178,000,000, with expectations to fund operations and working capital needs for at least the next twelve months[173]. - The company reported a net cash increase of $9.5 million for the three months ended April 30, 2023, compared to a decrease of $88.3 million for the same period in 2022[181]. - Cash flows from operating activities increased to $21.5 million in the first three months of fiscal 2024, up from $7.9 million in the same period of fiscal 2023[182]. - Cash flows from investing activities included $2.7 million for internally developed software in the first quarter of fiscal 2024, while $198.7 million was spent on the Codecademy acquisition in the same period of fiscal 2023[183]. Debt and Financing - The company has a $480 million term loan facility scheduled to mature on July 16, 2028, which was used to refinance existing debt[174]. - The scheduled maturities of the company's debt total $601 million, with $8 million due in the remainder of fiscal 2024[187]. - The company incurred up to $160 million of Term B-1 Loans under the Amended Credit Agreement, with an applicable margin of 4.25% for base rate borrowings and 5.25% for SOFR borrowings[176]. - The company received $157.1 million in net proceeds from the Term Loan Facility on April 4, 2022, which was used for the Codecademy acquisition[185]. Strategic Actions - The sale of the SumTotal business for $200 million in cash was completed, allowing the company to focus on its core business[144]. - A gain of $55.9 million was recorded from the sale of the SumTotal business, completed on August 15, 2022, with final net proceeds of $174.9 million[169]. - The company completed the sale of its SumTotal business for net proceeds of $174.9 million, with a mandatory prepayment of $31.4 million made in August 2022[178]. - The company authorized a share repurchase program of up to $30 million, with $10.9 million spent to repurchase 5,995,530 shares by April 19, 2023[180]. Restructuring and Future Expectations - Restructuring charges for the first quarter of fiscal 2024 totaled $5.2 million, primarily related to lease termination and employee severance costs[164]. - The company expects to have sufficient qualifying expenditures to avoid additional mandatory prepayment of the remaining SumTotal proceeds by August 15, 2023[178]. Sensitivity Analysis - A hypothetical 100 basis point increase or decrease in interest rates would result in approximately $3.4 million additional or lower pre-tax interest expense on an annualized basis[210]. - A hypothetical 100 basis point increase or decrease in interest rates would result in an approximately $0.6 million increase or decrease in interest income on an annualized basis[211]. - A hypothetical 100 basis point increase or decrease in interest rates would result in an approximately $9.9 million increase or decrease in the fair value adjustment of hedge instruments[212]. - A hypothetical 10% increase or decrease in current exchange rates would have resulted in an impact of approximately $1.8 million on pre-tax income (loss) on an annualized basis[213].

Table of Contents UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 FORM 10-K ☒ ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the fiscal year ended January 31, 2023 or ☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the transition period from to Commission File Number: 001-38960 Skillsoft Corp. (Exact name of registrant as specified in its charter) Delaware 83-4388331 (State or other jurisdiction ...

Financial Data and Key Metrics Changes - Full year bookings were $607 million, down approximately 3% year-over-year, with GAAP revenue at $555 million and pro forma revenue at $563 million, reflecting a slight decline of 1% year-over-year [27][39][58] - Adjusted EBITDA from continuing operations was $107 million for the full year, representing a margin of 19% of GAAP revenue, with a GAAP net loss of $725 million for the year, including a significant noncash goodwill impairment charge [27][40][41] Business Line Data and Key Metrics Changes - Skillsoft Content segment bookings grew 5% year-over-year to $409 million, with strong performance in coaching, which more than doubled bookings during the year [7][39] - Instructor-led training (ILT) bookings were $199 million for the full year, down 16% year-over-year, primarily due to reductions in customer subsidies [20][58] Market Data and Key Metrics Changes - The deferred revenue balance increased to $281 million, up 8% year-over-year, indicating a positive outlook for future revenue [22][100] - The company reported a dollar retention rate (DRR) of approximately 100% for fiscal 2023, up from 97% in the prior year, suggesting improved customer satisfaction and retention [29][94] Company Strategy and Development Direction - The company aims to build a leader in enterprise learning through strengths in platform, content, and go-to-market strategies, focusing on workforce transformation and tech skills [17][41] - Investments in content, platform, and go-to-market strategies are expected to drive growth and enhance customer satisfaction, with a particular focus on generative AI and personalized learning experiences [13][15][35] Management's Comments on Operating Environment and Future Outlook - Management acknowledged a dynamic macro environment with challenges such as high inflation and rising interest rates but expressed confidence in the company's momentum and pipeline for fiscal 2024 [19][22] - The company remains committed to executing its strategic priorities and believes the investment thesis is compelling due to a large and growing market with structural tailwinds [17][41] Other Important Information - The company has made significant strides in enhancing its Codecademy product suite, launching new subscription products and features aimed at upskilling and career development [11][28] - The company has been recognized for its AI-driven learning experiences, receiving awards for its innovative use of AI in education [14][36] Q&A Session Summary Question: Demand trends in Q4 and fiscal year 2024 - Management noted that growth was strongest in the subscription business, which is capital light and has high retention rates, with broad-based growth across tech, leadership, and compliance areas [50] Question: Insights on win backs and customer retention - Management highlighted successful win backs of large accounts, emphasizing the value of their multimodal solutions tailored to customer needs [73] Question: Pricing and ARPU trends - Management indicated that while there is price pressure in some segments, there is significant growth in areas focused on strategic reskilling and workforce transformation, which are less price-sensitive [87] Question: Dynamics driving DRR improvement - The improvement in DRR was attributed to migrating customers to the Percipio platform, cross-selling, and upselling efforts, with expectations for continued improvement [94] Question: Free cash flow expectations relative to EBITDA - Management provided context on free cash flow expectations, indicating a path to positive free cash flow in fiscal 2024, with a focus on balancing investment and profitability [95]