Skillz Inc. SEC 10-Q Report

Skillz Inc., a leading eSports gaming and monetization platform, has released its Form 10-Q report for the first quarter of 2025. The report highlights the company's financial performance, operational challenges, and strategic initiatives aimed at navigating a complex business environment. Financial Highlights Total Revenue: $21.9 million, reflecting a decrease from $25.2 million in the prior year period, primarily due to reduced user acquisition and engagement marketing expenses.Loss from Operations: $(15.5) million, an improvement from $(26.9) million in the prior year period, driven by a gain from litigation settlement and reduced general and administrative expenses.Net Loss: $(17.1) million, compared to $(26.7) million in the prior year period, indicating a narrowing of losses due to cost management and a litigation settlement gain.Loss per share, basic and diluted: $(1.05), compared to $(1.45) in the prior year period, reflecting the impact of reduced net loss and a decrease in weighted average shares outstanding. Business Highlights Revenue Segments: Skillz operates two main segments: the Skillz segment, which focuses on eSports gaming and monetization services for game developers, and the Aarki segment, which provides advertising solutions using AI technology. For the three months ended March 31, 2025, the Skillz segment generated $17.6 million in revenue, while the Aarki segment contributed $4.4 million.Geographical Performance: The majority of the company's revenue is generated in the United States, with $16.3 million from the Skillz segment and $1.3 million from the Aarki segment. Other countries contributed $1.3 million and $3.1 million, respectively, indicating a strong presence in international markets.User Acquisition and Engagement: The company has reduced its user acquisition marketing spend to $4.5 million in Q1 2025 from $5.6 million in Q1 2024. This reduction, along with decreased engagement marketing expenses, has led to a substantial reduction in revenue, a trend expected to continue.Litigation Impact: The company is involved in significant litigation with Tether, which accounted for 45% of its revenue in 2024. The outcome of this litigation could materially affect the company's business and operations.Future Outlook: The company is focused on resolving its litigation with Tether and maintaining its listing on the NYSE by complying with filing requirements. The company is also working on regaining compliance with its reporting covenants under the Indenture for its 2021 Senior Secured Notes.Operational Challenges: The company is facing challenges related to the termination of agreements by Tether, which could impact its platform if key games are removed. The company is actively seeking to resolve these issues through legal action.Segment Adjusted EBITDA: The Skillz segment reported an adjusted EBITDA of negative $16.3 million, while the Aarki segment reported negative $973,000, reflecting operational challenges and ongoing investments in growth and litigation.SEC Filing: Skillz Inc. [ SKLZ ] - 10-Q - Dec. 11, 2025