Skillsoft reports Q3 FY25 results with revenue stability and improved profitability

Skillsoft announced its financial results for the third quarter of fiscal 2025, ending October 31, 2024.

The company reported steady revenue, improved adjusted EBITDA, a reduced net loss, and positive free cash flow, showing initial results from its strategic transformation initiatives.

Key financial metrics

  • Total Revenue for Q3 FY25 was $137 million, slightly down from $139 million in the same period last year.

  • Talent Development Solutions revenue grew by 2% to $103 million, compared to $101 million in Q3 FY24.

  • Global Knowledge revenue declined to $34 million, down from $38 million in the prior year.

Despite a slight dip in total revenue, net loss improved to $24 million, compared to $28 million in Q3 FY24. Net loss per share was $2.86, an improvement from $3.45. On an adjusted basis, net loss improved to $15 million, compared to $23 million the previous year, with adjusted net loss per share of $1.82 versus $2.82.

Adjusted EBITDA increased to $32 million, reflecting a margin of 23%, up from $30 million and a margin of 21% in Q3 FY24. The improvement highlights Skillsoft’s progress in enhancing operational efficiency and managing costs.

Debt and cash flow position

Skillsoft continued to reduce its debt, reporting gross debt of $591 million, down $35 million from $626 million a year ago. The company closed the quarter with $102 million in cash, cash equivalents, and restricted cash. Positive free cash flow was generated during the quarter, reflecting stronger financial management.

Rich Walker, Skillsoft’s Chief Financial Officer, stated:

“I am pleased with our financial results for the quarter, which are highlighted by strong revenue execution, improved profitability, and positive free cash flow. Our third quarter performance, coupled with momentum from our transformation execution, gives us confidence to raise and tighten our FY25 revenue guidance range, while reaffirming our adjusted EBITDA outlook.”

Strategic transformation initiatives

Skillsoft's transformation strategy, outlined during the July Investor Day, is beginning to show results. The company launched several new AI-driven tools to enhance its learning platform, Percipio, and drive customer engagement:

  • AI Coaching Assistant: Helps leaders develop coaching plans.

  • AI Learning Assistant: Personalizes the learning experience.

  • AI Coding Assistant: Provides coding exercises and real-time feedback.

Skillsoft also introduced new compliance tools and certification pathways to support companies in managing risk and accelerating skill development. These innovations align with Skillsoft’s goal to provide end-to-end workforce training solutions.

The quarter saw notable customer wins in AI-driven workforce transformation. Contracts totaling $8 million over multiple years were secured with six global companies focused on AI upskilling and skill measurement.

Ron Hovsepian, Skillsoft’s Executive Chair and CEO, commented:

“Our fiscal third quarter financial results demonstrate our first step in executing our transformation strategy. The operationalization of our strategy is showing the first signs of business and financial improvement for our shareholders and customers.”

Based on Q3 performance, Skillsoft raised and tightened its full-year FY25 revenue guidance to a range of $520 million to $530 million. The company reaffirmed its adjusted EBITDA outlook of $105 million to $110 million, signaling confidence in its strategic initiatives and financial performance.

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