LAS VEGAS--(BUSINESS WIRE)--Skillz (NYSE: SKLZ), the leading mobile games platform bringing fair and fun competition to players worldwide, today announced that it has acquired certain assets of Beamable, a modern game backend and LiveOps platform purpose-built for scalable, live-service games. The acquisition represents a step forward in Skillz's long-term platform strategy, expanding the capabilities available to developers building on the Skillz ecosystem. By integrating Beamable's backend se. ...

Financial Performance - Revenue increased by $2.8 million, or 11%, to $27.4 million for the three months ended September 30, 2025, compared to $24.6 million for the same period in 2024 [188]. - Revenue decreased by $0.6 million, or 1%, to $74.5 million for the nine months ended September 30, 2025, from $75.1 million in the same period in 2024 [198]. - Net loss for the three months ended September 30, 2025, was $17.4 million, a decrease of $3.7 million or 17% compared to the net loss of $21.1 million for the same period in 2024 [188]. User Acquisition and Marketing - User acquisition (UA) marketing spend for the nine months ended September 30, 2025, was approximately $12.4 million, down from approximately $14.1 million in the same period of 2024, indicating a reduction of about 12.1% [174]. - Sales and marketing expenses decreased by $1.9 million, or 10%, to $17.4 million for the three months ended September 30, 2025, primarily due to lower marketing expenses [191]. - Sales and marketing costs decreased by $9.3 million, or 15%, to $51.8 million for the nine months ended September 30, 2025, driven by lower marketing expenses [201]. Legal and Settlement Matters - The company received a total of $50 million from AviaGames as part of a settlement agreement, with Skillz receiving $48 million of that amount [182]. - The company recorded a gain of $46 million from the AviaGames litigation settlement, netting the gross payment of $48 million less $2 million for the Loan and Security Agreement [182]. - The company filed suit against Tether on September 1, 2025, seeking injunctive and declaratory relief regarding Tether's breach of agreements, which could materially affect business operations [177]. Cash Flow and Financial Obligations - Net cash used in operating activities was $56.2 million for the nine months ended September 30, 2025, compared to net cash provided of $12.4 million in the same period in 2024 [212]. - Net cash used in operating activities was $56.2 million for the nine months ended September 30, 2025, primarily due to a net loss of $52.5 million and non-cash expenses of $14.2 million related to stock-based compensation [214]. - Net cash used in investing activities amounted to $4.7 million, driven by software development costs of $2.6 million and property and equipment purchases of $2.1 million [215]. - Net cash used in financing activities was $8.2 million, mainly from the repurchase of common stock [216]. - The company has lease payment obligations of $1.3 million as of September 30, 2025, with $0.4 million payable within 12 months [219]. - The total principal amount of long-term debt is $129.7 million, due on December 15, 2026 [220]. Operational Insights - The company worked diligently to file its Annual Report on Form 10-K for the year ended December 31, 2024, on November 6, 2025, to regain compliance with NYSE listing requirements [179]. - The NYSE granted an extension for continued listing through December 17, 2025, contingent upon the company becoming current with SEC filings [180]. - The company’s operating segments include Skillz and Aarki, with Aarki focusing on AI-driven advertising solutions for mobile app developers [183]. - The company’s SDK allows developers to monitor and update their games seamlessly, enhancing data-driven algorithms and LiveOps systems [171]. Research and Development - Research and development costs rose by $0.7 million, or 15%, to $5.4 million for the three months ended September 30, 2025, driven by a $1.0 million increase in employee-related costs [190]. - Research and development costs increased by $1.5 million, or 11%, to $15.1 million for the nine months ended September 30, 2025, primarily due to higher employee-related costs [200]. Engagement Marketing - Engagement marketing expenses may be impacted by end-user incentives, which include Bonus Cash for entering paid contests [173].

Financial Performance - Revenue decreased by $0.1 million, or less than 0.1%, to $25.2 million for the three months ended June 30, 2025, compared to $25.3 million for the same period in 2024 [188]. - Revenue decreased by $3.4 million, or 7%, to $47.1 million for the six months ended June 30, 2025, from $50.5 million in 2024 [199]. - Net loss for the three months ended June 30, 2025, was $17.9 million, compared to a net income of $26.0 million in the same period in 2024, representing a decrease of $43.9 million [197]. - Total costs and expenses increased by $26.8 million, or 52%, to $78.6 million for the six months ended June 30, 2025, compared to $51.8 million in 2024 [198]. - Net cash used in operating activities was $31.7 million for the six months ended June 30, 2025, primarily reflecting a net loss of $35.1 million [213]. User Acquisition and Marketing - User acquisition (UA) marketing spend for the six months ending June 30, 2025, was approximately $8.1 million, down from approximately $9.8 million for the same period in 2024, indicating a reduction in marketing expenses that is expected to continue impacting revenue negatively [173]. - Engagement marketing expenses may be impacted by end-user incentives, including Bonus Cash, which could affect user engagement on the platform [172]. - Sales and marketing costs decreased by $4.4 million, or 21%, to $16.4 million for the three months ended June 30, 2025, compared to $20.8 million in 2024 [191]. Legal and Compliance - The company filed suit against Tether for breach of agreements, seeking injunctive and declaratory relief, with potential implications for its business if the litigation is unsuccessful [176]. - The company is involved in ongoing litigation related to its De-SPAC process, with an insurance recovery of $9.75 million recorded as an offset to general and administrative expenses [182]. - The company presented a compliance plan to the NYSE in September 2025, requesting an extension to continue listing its shares, which was granted through December 17, 2025 [179]. Revenue Sources and Dependencies - Tether accounted for 45% of the company's revenue for the year ended December 31, 2024, and the termination of agreements with Tether could have a material adverse effect on business operations if suitable replacements are not identified [175]. - The company received a total of $50 million from AviaGames as part of a settlement agreement, with Skillz receiving $48 million, which included a $2 million repayment under a Loan and Security Agreement [182]. - The company recorded a gain of $46 million from a litigation settlement with AviaGames, netting the gross payment received [182]. Costs and Expenses - General and administrative costs decreased by $0.5 million, or 3%, to $16.7 million for the three months ended June 30, 2025, from $17.2 million in 2024 [192]. - Research and development costs increased by $0.6 million, or 13%, to $4.8 million for the three months ended June 30, 2025, from $4.3 million in the same period in 2024 [190]. Financial Position - As of June 30, 2025, the company had cash, cash equivalents, and restricted cash totaling $238.7 million [208]. - As of June 30, 2025, the company has lease payment obligations totaling $0.3 million, all of which is due within 12 months [217]. - The company's long-term debt consists of the 2021 Senior Secured Notes, with a total principal amount of $129.7 million due on December 15, 2026 [218]. - There are currently no off-balance sheet financing arrangements or relationships with unconsolidated entities [219]. - There have been no material changes to the critical accounting policies and estimates as noted in the Annual Report [220]. - Recent accounting pronouncements and their potential impact on financial condition and results of operations are detailed in the condensed consolidated financial statements [221]. Business Segments and Technology - The company’s operating segments include Skillz and Aarki, with Aarki focusing on AI-driven advertising solutions for mobile app developers [183]. - The company’s technological capabilities include a software development kit (SDK) that allows developers to monitor and update their games seamlessly, enhancing data-driven algorithms [170].

Financial Performance - Revenue decreased by $3.3 million, or 13%, to $21.9 million for the three months ended March 31, 2025, compared to $25.2 million in the same period of 2024 [186]. - Net loss was $17.1 million for the three months ended March 31, 2025, compared to a net loss of $26.7 million in the same period of 2024, reflecting a decrease of $9.6 million or 36% [196]. - Net cash used in operating activities was $10.9 million for the three months ended March 31, 2025, compared to $4.4 million in the same period of 2024 [199]. Marketing Expenses - User acquisition marketing spend for Q1 2025 was approximately $4.5 million, down from $5.6 million in Q1 2024, indicating a reduction in marketing expenses that is expected to continue impacting revenue negatively [172]. - Sales and marketing costs decreased by $3.0 million, or 14%, to $18.0 million for the three months ended March 31, 2025, from $21.0 million in the same period of 2024 [189]. - Engagement marketing expenses may be impacted by end-user incentives, which include Bonus Cash for entering paid contests [171]. Legal Matters - The company is involved in ongoing litigation with Tether and Papaya, which may impact its financial condition and operational results [173][178]. - The company recorded a gain of $46 million from the litigation settlement with AviaGames, netting the gross payment received [180]. - The gain from litigation settlement was $7.5 million for the three months ended March 31, 2025, related to a settlement with AviaGames [191]. Revenue Sources - Tether accounted for 45% of the company's revenue for the year ended December 31, 2024, and the termination of agreements with Tether could have a material adverse effect on business operations [174]. Company Operations - The company operates two reportable segments: Skillz and Aarki, with Aarki focusing on AI-driven advertising solutions for mobile app developers [181]. - The company has developed a technology platform that allows developers to integrate and update games seamlessly, enhancing data-driven algorithms and LiveOps systems [168]. Financial Reporting - The company filed its Annual Report on Form 10-K for the year ended December 31, 2024, on November 6, 2025, as part of its compliance plan with the NYSE [176]. - The NYSE granted an extension for continued listing through December 17, 2025, contingent upon the company becoming current with SEC filings [177]. Cost Management - Cost of revenue decreased by $0.5 million, or 14%, to $3.0 million for the three months ended March 31, 2025, from $3.5 million in the same period of 2024 [187]. - General and administrative costs decreased by $4.0 million, or 17%, to $19.1 million for the three months ended March 31, 2025, from $23.0 million in the same period of 2024 [190]. - Research and development costs increased by $0.2 million, or 4%, to $4.8 million for the three months ended March 31, 2025, from $4.6 million in the same period of 2024 [188]. Debt and Cash Position - As of March 31, 2025, the company had cash, cash equivalents, and restricted cash totaling $264.3 million [195]. - The total principal amount of long-term debt was $129.7 million, due on December 15, 2026 [206].

Core Insights - Skillz reported third-quarter results that missed analyst expectations for both revenue and earnings, leading to a 1.9% decline in share price [1][2] - The company generated revenue of $27.4 million, an 11% increase year-over-year, but fell short of the $29.1 million forecast by analysts [2] - The loss per share was $1.14, which also missed consensus estimates, and the adjusted EBITDA loss was $11.8 million, wider than the expected $7.5 million loss [2] - Skillz is facing compliance issues with the New York Stock Exchange and must complete its SEC filings by mid-December to maintain its listing [2] Market Reaction - Skillz's shares closed at $6.24, down 2% from the previous close, indicating market volatility with 47 moves greater than 5% over the past year [3][4] - The market views the recent news as significant but not fundamentally altering its perception of the business [4] Historical Context - Year-to-date, Skillz shares are up 16.3%, but currently trading 31.8% below their 52-week high of $9.09 from August 2025 [6] - An investment of $1,000 in Skillz shares five years ago would now be worth $25.62 [6]

Business Model and Revenue Generation - Skillz's platform enables game developers to monetize their content through multi-player competition, allowing developers to earn revenue by hosting skill-based competitions where players pay entry fees, with Skillz taking a percentage of the pool[34] - Aarki, Skillz's AI advertising technology, manages millions of mobile ad requests per second from over 10 billion devices, driving revenue growth for mobile app developers[37] - In February 2025, Skillz launched the $75 million Skillz Developer Program to provide working capital and operational support to approximately 25 games over the next three years[58] - The company enables cash prizes in 45 states and the District of Columbia, excluding Arkansas, Connecticut, Delaware, Louisiana, and South Dakota[81] - Approximately 93% of Ticketz were issued from customer participation in paid tournaments for the year ending December 31, 2024, compared to 96% for the year ending December 31, 2023[70] - For the year ended December 31, 2024, the top games Solitaire Cube and 21 Blitz accounted for 59% of revenue, with Tether contributing 45% and Big Run 26%[108] Technology and Platform Development - Skillz's proprietary platform ensures fair player matching, which is critical for maintaining trust and engagement in skill-based gaming[26] - Skillz's technology capabilities include anti-cheat and anti-fraud systems, which are essential for fostering a healthy competitive ecosystem[54] - The introduction of standardized game development platforms has resulted in a flood of game content, making it challenging for developers to monetize effectively[56] - The company actively monitors player metrics such as daily active users, crash rates, app store ratings, and support ticket issues to ensure game quality[59] - The company relies on third-party developers for game updates, and any failure to provide timely updates could negatively impact financial results[106] Financial Performance and Challenges - The company has 91 patents granted and 86 patents pending worldwide as of December 31, 2024[79] - The company has experienced net losses in each period since inception, highlighting the risks associated with its growth strategy in a competitive industry[190] - The company expects operating margins to face downward pressure due to increased competition and rising user acquisition costs[191] - As of December 31, 2024, the company had an accumulated deficit of $1,021.3 million, indicating ongoing financial challenges since inception[190] - The company has experienced interruptions in service in the past, which could impact user engagement and retention[152] Regulatory and Compliance Issues - The company has developed internal compliance programs to adhere to legal and regulatory requirements for skill-based gaming and data privacy[84] - The company is subject to indirect taxation and reporting in approximately 218 domestic and international jurisdictions[147] - Changes in tax laws or tax rulings could materially affect the company's effective tax rates and financial position[147] - Compliance with evolving privacy laws such as GDPR and CCPA has required significant operational resources and expenses[177] - The company is subject to potential fines of up to 4% of global annual revenue or €20 million for violations of GDPR[175] Market and Competitive Landscape - The global video game market size was estimated at $221.2 billion in 2024, with a projected compound annual growth rate (CAGR) of 6.5% from 2025 to 2033[55] - Competition in the entertainment industry is intense, with the company facing challenges from established and emerging competitors, which could affect user retention and market share[99] - The company faces increasing challenges and costs in acquiring players due to the competitive nature of the mobile gaming industry[117] - The company relies on the continued growth of the mobile gaming market for future success, and any decline in mobile device popularity could harm revenue[129] Risks and Legal Matters - The company is involved in ongoing litigation regarding bot misuse, which could result in reputational harm and additional legal costs[101] - Material weaknesses in internal control over financial reporting were identified as of December 31, 2023, and December 31, 2024, potentially impacting timely and accurate financial reporting[95] - The company faces potential litigation risks related to the use of third-party open source software, which could disrupt its business operations[157] - The company may incur significant costs or downtime if agreements with third-party service providers are terminated[155] Strategic Initiatives and Future Outlook - The company plans to pursue acquisitions and strategic investments, but miscalculations in value or integration challenges could materially harm its business[170] - The company’s growth strategy includes developing localized offerings for international markets, which requires significant resources and management attention[167] - The company has significant opportunities to extend marketing channels to offline media and engage in brand marketing[69] - The company expects a positive return on investment from user acquisition spending, but incorrect assumptions about user spending behavior could negatively impact operating results[119] Corporate Governance and Shareholder Matters - The Company authorized a share repurchase program with an aggregate purchase price not to exceed $65.0 million, effective for one year from August 18, 2023[210] - The average closing price of the Company's stock must remain above $1.00 over a 30-day period to comply with NYSE listing standards, or it risks delisting[211] - As of December 31, 2024, Mr. Paradise controlled 84% of the voting power of the Company's outstanding capital stock, classifying it as a "controlled company" under NYSE rules[216] - The dual class structure of the Company's common stock concentrates significant voting power with the CEO, limiting other stockholders' influence on corporate decisions[218]

Financial Data and Key Metrics Changes - Q3 GAAP revenue was $27 million, representing a 9% increase quarter over quarter and an 11% increase year over year [6][15] - Adjusted EBITDA loss was $12 million, a 3% decrease quarter over quarter and a 15% increase year over year [6][16] - Paying MAU reached 155,000, up 6% quarter over quarter and 28% year over year [6][15] Business Line Data and Key Metrics Changes - The launch of "Solitaire Skills" as an owned and operated title is showing early promise and serves as a testing ground for new features [8] - Aarki's ad tech business experienced accelerating revenue growth, supported by new AI-driven product launches [8][10] - R&D expenses increased by 15% year over year to $5 million, while sales and marketing expenses decreased by 10% year over year to $17 million [15][16] Market Data and Key Metrics Changes - The competition platform showed stability, contributing to the overall revenue growth despite a typically softer seasonal period [6][10] - Aarki's net revenue increased by more than 100% year over year, indicating strong growth in the ad tech market [10] Company Strategy and Development Direction - The company is focused on enhancing player and developer engagement, operational efficiency, and a path to profitability [9][10] - The Fair Play initiative aims to protect players and maintain fair competition, with ongoing litigation against competitors for alleged bot usage [10][11] - The company is exploring growth opportunities beyond gaming into e-commerce and interactive entertainment [13] Management's Comments on Operating Environment and Future Outlook - Management expressed optimism about the progress across both Skillz and Aarki, highlighting the potential for long-term growth [12][13] - The company is committed to achieving compliance with New York Stock Exchange listing standards and expects to file necessary reports by December 17, 2025 [4][16] Other Important Information - The company is working to complete its financial statements for previous quarters and is under scrutiny for compliance with listing standards [3][4] - The balance sheet remains healthy with $213 million in cash and $129.7 million in total debt principal outstanding [16] Q&A Session Summary - The Q&A session was concluded without any specific questions being recorded, indicating a focus on the presentation rather than audience inquiries [17]

Core Insights - Skillz Inc. reported preliminary financial results for Q3 2025, showing 11% year-over-year revenue growth and 9% sequential growth, alongside a 28% increase in paying monthly active users (PMAUs) [3][6][23] Financial Performance - Revenue for Q3 2025 was $27.4 million, compared to $24.6 million in Q3 2024 [6][17] - Gross profit for the quarter was $24.0 million [6] - The net loss for Q3 2025 was $17.4 million, an improvement from a loss of $21.1 million in Q3 2024 [6][17] - Adjusted EBITDA loss was $11.8 million, compared to a loss of $13.9 million in Q3 2024 [6][17] User Engagement - PMAUs reached 155,000, reflecting a 6% increase quarter-over-quarter and a 28% increase year-over-year [6][23] - Average Revenue Per Paying Monthly Active User (ARPPU) was $58.9 [6][23] Operational Efficiency - The company emphasized its focus on expense management and operational efficiency, contributing to improved Adjusted EBITDA and a healthy balance sheet with $213 million in cash [3][6] Market Position - Skillz continues to leverage its strengths in gaming and AI-driven ad-tech, aiming to expand beyond gaming into adjacent verticals [3]

Core Viewpoint - Skillz Inc. is set to release its third quarter financial results for 2025 on November 6, 2025, before the market opens, indicating a focus on transparency and communication with investors [1] Financial Results Announcement - The financial results will be released before the market opens on November 6, 2025 [1] - A conference call and simultaneous webcast will take place at 8:30 a.m. ET on the same day to discuss the results and provide a business update [1]

Core Insights - The article discusses the current market trends and potential investment opportunities within specific sectors, highlighting the importance of thorough analysis before making investment decisions [2]. Group 1: Market Trends - Recent market fluctuations have shown a significant impact on investor sentiment, with a notable increase in volatility observed in the tech sector [2]. - Analysts are focusing on the recovery patterns of various industries post-pandemic, particularly in consumer discretionary and travel sectors, which are showing signs of rebound [2]. Group 2: Investment Opportunities - There are emerging opportunities in renewable energy companies, driven by increased government incentives and consumer demand for sustainable solutions [2]. - The healthcare sector is also highlighted as a potential area for growth, especially companies involved in telehealth and biotechnology, which have gained traction during the pandemic [2]. Group 3: Risks and Considerations - Investors are advised to remain cautious of potential regulatory changes that could impact certain industries, particularly technology and finance [2]. - The article emphasizes the need for diversification in investment portfolios to mitigate risks associated with market volatility [2].