Skillsoft Corp (SKIL) Q2 2025 Earnings Report

Skillsoft delivered a challenging top-line quarter in QQ2 2025, with total revenue of $132.2 million, down 6% YoY and up 3.5% QoQ, reflecting softness in Global Knowledge (GK) and a steady but constrained Talent Development Solutions (TDS) base. Management reinforced a strategic pivot anchored on Fix the Basics and a dual-business-unit structure designed to drive deeper customer alignment, tighter P&L discipline, and accelerated growth. Adjusted EBITDA rose meaningfully to $28.0 million (21% of revenue) versus $25.0 million (18% of revenue) in the prior year, signaling improved operating leverage even as GAAP net income remained negative (-$39.6 million) and GAAP EPS deteriorated to -$4.84 per share. The company reaffirmed full-year guidance of revenue between $510 million and $525 million and adjusted EBITDA of $105–$110 million, with negative free cash flow of approximately $15 million, reflecting ongoing investments to fix the basics and fund growth initiatives.

Management underscored that the material cost-reduction program (~$45 million) is being reinvested into growth initiatives and that the resource reallocation impact will be most visible in Q3 and beyond as the dual-BU structure and related governance take hold. Management highlighted several early customer wins and product innovations, including AI-enabled learning experiences and strategic partnerships (notably with Microsoft), as indicators of demand for a scaled, multi-modal learning platform. The near-term cash flow profile remains seasonally skewed (FQ2 cash burn with Q4/Q1 typically generating cash), but management is increasing transparency by reporting adjusted free cash flow and expects incremental free cash flow benefits as the transformation programs mature. The combination of a clearer operating framework, disciplined cost management, and AI-enabled product roadmaps provides a constructive albeit cautiously valued long-term growth trajectory for investors to monitor over the next several quarters.