Core Insights - Skillsoft Corp. (SKIL) experienced a 6% year-over-year decline in revenue during Q3 2026, primarily due to an 18% drop in Global Knowledge (GK) revenues, although the company maintained its margins through operational discipline [1][9] Financial Performance - The company recorded total operating expenses of $101 million, a 4.1% decrease year-over-year, achieved by reducing content, software, sales, marketing, and general and administrative expenses [2][9] - Productivity improvements from AI and a focused strategy led to a 2.4% year-over-year reduction in content and software development expenses, while selling and marketing expenses decreased by 7.1% due to headcount reductions [3][9] - General and administrative expenses saw an 11.9% year-over-year decline, contributing to an adjusted EBITDA of $28 million, with an adjusted EBITDA margin of 22%, down from 23.3% in the previous year [4][9] Segment Analysis - The Talent Development Solutions segment remained profitable, while the GK segment reported a negative EBITDA of $3.3 million, indicating a strategic shift towards higher-margin SaaS platforms to stabilize long-term margins [5][9] Market Performance - Over the past year, SKIL's stock has decreased by 71.3%, contrasting with the industry growth of 10.2%, while peers Nable (NABL) and Agora (API) saw declines of 30.3% and 8.6%, respectively [6][9] Valuation Metrics - SKIL trades at a 12-month forward price-to-earnings ratio of 1.99X, significantly lower than the industry average of 25.21X and cheaper than Nable's 12.9X and Agora's 26.81X [10] - The Zacks Consensus Estimate for EPS for 2025 is $4.17, revised up by 19.8% in the last 60 days, while the estimate for 2026 is $4.54, revised down by 9.9% [13]

Financial Performance - Talent Development Solutions revenue was $101.2 million, a decrease of less than 1% year-over-year[26, 30] - Global Knowledge revenue declined by 10% in Q2 '26[30] - Total revenue declined by 3% in Q2 '26[30] - Adjusted EBITDA was $28.3 million, approximately flat compared to the prior year, representing 22% of revenue[26, 35] - Free cash flow was negative $22.6 million, influenced by seasonality and the timing of collections and disbursements[34, 35] - Adjusted operating expenses decreased by 3% year-over-year to $100.5 million[35] Business Highlights - The company achieved a roughly 99% Last-Twelve-Month (LTM) Dollar Retention Rate[26] - The number of technology learners on the Skillsoft platform increased by 50% year-over-year[17] - AI learners increased by 74% and total AI learning hours increased by 158%[17] Strategic Direction - The company is focused on AI-centric product innovation and reshaping its go-to-market strategy[12, 20] - Skillsoft is shifting towards a talent development lifecycle approach, targeting a $400 billion market opportunity[21, 22]