Skillsoft (SKIL) Q1 2027 earnings summary

Executive summary

• Revenue declined 4.7% year-over-year to $94.5 million, mainly due to macroeconomic uncertainty, elongated enterprise purchasing cycles, and a 21% drop in consumer business.

• Executed agreement to divest the Global Knowledge (GK) segment, classifying it as discontinued operations and focusing on an AI-native skills management platform.

• New platform customer agreements grew 67% quarter-over-quarter, with strong customer retention and engagement; DRR reached 105%.

• Management is prioritizing growth acceleration, product innovation, and debt refinancing post-GK sale.

• Net loss widened to $43.1 million, including $24.4 million loss from discontinued operations; new CFO Ron Kisling appointed.

Financial highlights

• Q1 FY27 revenue was $94.5 million, down 4.7% year-over-year.

• Adjusted EBITDA was $26.6 million (28.2% margin), flat year-over-year.

• Adjusted net income was $10.2 million ($1.16/share), up from $9.5 million ($1.15/share) year-over-year.

• Free cash flow was $25.4 million, slightly down from $26.2 million in the prior year.

• Cash and equivalents were $115.6 million as of April 30, 2026; net debt was $457 million.

Outlook and guidance

• Fiscal 2027 guidance reaffirmed: revenue of $388–$406 million, adjusted EBITDA of $108–$116 million (28% margin), and free cash flow of $14–$22 million.

• Expect cash consumption in Q2 and Q3, with free cash flow generation in Q4.

• Guidance excludes Global Knowledge, which is classified as discontinued operations.

• Sale of GK segment expected to close in the quarter ending July 31, 2026, with anticipated net proceeds of $5–8 million over two years.

• Management expects sufficient liquidity for at least the next twelve months.