skillz(SKLZ) - 2025 Q1 - Quarterly Results

Skillz Preliminary First Quarter 2025 Results Management Commentary Management highlights progress towards top-line growth and positive Adjusted EBITDA, driven by increased PMAU, disciplined expense management, and a strong cash position - CEO Andrew Paradise noted a quarter-over-quarter increase in paying monthly active users (PMAU), with a focus on improving player retention and spending[4] - A $75 million accelerator program is underway to broaden the company's skill-based mobile game offerings[4] - CFO Gaetano Franceschi stated that disciplined operating expense management is improving the Adjusted EBITDA loss year-over-year[4] - The company maintains a strong balance sheet with over $264 million in cash and restricted cash, providing financial flexibility for strategic initiatives[4] Preliminary First Quarter Financial Update Preliminary Q1 2025 results show revenue of $22.4 million, a net loss of $14.9 million, and an Adjusted EBITDA loss of $15.1 million, with 124,000 PMAU Q1 2025 Preliminary Financial & Operational Metrics | Metric | Value | | :--- | :--- | | Revenue | $22.4 million | | Net Loss | $14.9 million | | Adjusted EBITDA | $(15.1) million | | Paying Monthly Active Users (PMAU) | 124,000 | | Average Revenue Per Paying Monthly Active User (ARPPU) | $62.2 | | Total Operating Expenses (Non-GAAP) | $34.7 million | Filing Status and Preliminary Nature of Results Preliminary Q1 2025 results are subject to change, with the company addressing a NYSE non-compliance notice for its delayed 2024 Form 10-K filing and a six-month grace period - The Q1 2025 results are preliminary and may differ from final figures upon completion of internal review and audit[13] - The company has delayed the filing of its Annual Report on Form 10-K for the year ended December 31, 2024[14] - Skillz received a non-compliance notice from the NYSE for the late filing, with a six-month period from March 17, 2025, to regain compliance by filing its Form 10-K[15] Financial Statements Preliminary Q1 2025 financial statements show decreased revenue but improved net loss due to a litigation settlement, alongside reduced cash and total assets, and increased negative operating cash flow Consolidated Statements of Operations Q1 2025 vs Q1 2024 Statement of Operations (in thousands) | Metric | Q1 2025 (Thousands) | Q1 2024 (Thousands) | | :--- | :--- | :--- | | Revenue | $22,413 | $25,235 | | Total Costs and Expenses | $35,678 | $52,106 | | Gain from litigation settlement | $(7,500) | $— | | Loss from Operations | $(13,265) | $(26,871) | | Net Loss | $(14,931) | $(26,723) | | Basic and Diluted EPS | $(0.92) | $(1.45) | Consolidated Balance Sheets Balance Sheet Highlights (in thousands) | Account | March 31, 2025 (Thousands) | December 31, 2024 (Thousands) | | :--- | :--- | :--- | | Cash and cash equivalents | $254,341 | $271,923 | | Total Current Assets | $275,897 | $292,408 | | Total Assets | $346,973 | $362,176 | | Total Liabilities | $189,741 | $190,927 | | Total Stockholders' Equity | $157,232 | $171,249 | Consolidated Statement of Cash Flows Q1 2025 vs Q1 2024 Cash Flow Summary (in thousands) | Activity | Q1 2025 (Thousands) | Q1 2024 (Thousands) | | :--- | :--- | :--- | | Net cash used in operating activities | $(10,767) | $(4,396) | | Net cash provided by (used in) investing activities | $(1,891) | $169 | | Net cash used in financing activities | $(4,924) | $(7,200) | | Net change in cash | $(17,582) | $(11,427) | | Cash, cash equivalents and restricted cash – end of period | $264,341 | $300,601 | Non-GAAP Financial Measures Adjusted EBITDA loss improved to $15.1 million in Q1 2025 from $17.7 million in Q1 2024, driven by reduced operating expenses, with a $7.5 million litigation settlement gain excluded Reconciliation of GAAP Net Loss to Adjusted EBITDA Reconciliation of Net Loss to Adjusted EBITDA (in thousands) | Line Item | Q1 2025 (Thousands) | Q1 2024 (Thousands) | | :--- | :--- | :--- | | Net loss | $(14,931) | $(26,723) | | Stock-based compensation | $5,536 | $8,740 | | Gain from litigation settlement | $(7,500) | $— | | Adjusted EBITDA | $(15,062) | $(17,736) | Reconciliation of GAAP to Non-GAAP Operating Expenses Non-GAAP Operating Expenses (in thousands) | Expense Category | Q1 2025 (Thousands) | Q1 2024 (Thousands) | | :--- | :--- | :--- | | Non-GAAP research and development | $4,563 | $4,477 | | Non-GAAP sales and marketing | $17,891 | $18,983 | | Non-GAAP general and administrative | $12,226 | $16,457 | Key Operating Metrics Key operating metrics for Q1 2025 show mixed results, with increased PMAUs but decreased GMV and MAUs, leading to lower average revenue per user, though the PMAU to MAU ratio improved to 16% Key Operating Metrics (YoY Comparison) | Metric | Q1 2025 | Q1 2024 | Change | | :--- | :--- | :--- | :--- | | Gross marketplace volume (GMV) (000s) | $126,485 | $161,269 | 🔽 | | Paying monthly active users (PMAUs) (000s) | 124 | 121 | 🔼 | | Monthly active users (MAUs) (000s) | 764 | 860 | 🔽 | | Average revenue per paying monthly active user (ARPPU) | $62.2 | $69.8 | 🔽 | | Paying MAU to MAU ratio | 16% | 14% | 🔼 |