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1. Company Snapshot

1.a. Company Description

Skillsoft Corp.provides corporate digital learning services in the United States and internationally.The company operates through Content, Global Knowledge, and SumTotal segments.


It offers enterprise learning solutions to prepare organizations for the future of work, as well as enable them to overcome critical skill gaps, drive demonstrable behavior-change, and unlock the potential in their greatest assets.In addition, it provides various platform capabilities, such as open platform, custom channels and journeys, administrator-promoted content, and flexible assignments, tracking and in-depth reporting, training groups, and records management.Further, the company offers learning management systems and talent management software.


The company is based in Nashua, New Hampshire.

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1.b. Last Insights on SKIL

Here is a 90-word analysis of the positive drivers behind Skillsoft Corp.'s recent stock performance: Skillsoft Corp.'s Q3 results showed signs of progress in its turnaround efforts, driven by cost savings programs that improved margins despite a slight revenue decline. Talent Development Solutions revenue increased 2% year-over-year, and the company generated strong free cash flow during the quarter. The market has reacted favorably to these results, and the company's cheap valuation is attractive to investors. However, the heavy debt load remains a concern.

1.c. Company Highlights

2. Skillsoft's Q3 FY2026 Earnings: A Mixed Bag

Skillsoft's third-quarter fiscal 2026 revenue per TDS was $100.8 million, down 2.1% year over year, with enterprise solutions declining approximately 1% and Global Knowledge revenue down 17.6% to $28.2 million. The adjusted EBITDA margin was 21.7%, down from 23.3% last year, resulting in an adjusted EBITDA of $28 million, a 12% decline from $31.9 million in the prior year. The GAAP net loss was $41.3 million, compared to a net loss of $23.6 million in the prior year, largely due to a non-cash goodwill impairment loss of $20.8 million related to Global Knowledge. Earnings per share, however, beat estimates with an actual EPS of $1.65 relative to estimates of $1.26.

Publication Date: Dec -20

📋 Highlights
  • Platform-Driven DRR Growth:: TDS LTM dollar retention rate reached 99% (up from 98 Y/Y), driven by higher customer upgrades amid Precipio's unified learning capabilities.
  • TDS Revenue Decline:: Revenue fell 2.1% Y/Y to $100.8M, with 70% of the drop from B2C (9% of TDS revenue) and 1% from enterprise churn.
  • Adjusted EBITDA Margin Pressure:: Declined to 21.7% ($28M) from 23.3% ($31.9M) Y/Y, impacted by higher labs/content costs and a $20.8M GAAP goodwill impairment loss.
  • Strategic Investment Shift:: Withdrew consolidated guidance, now targeting TDS $410M revenue and 28% EBITDA margin in FY26, prioritizing TDS growth over Global Knowledge (GK).

Segment Performance

The decline in revenue was largely driven by the B2C learner product, which accounts for around 9% of TDS revenue, and Global Knowledge's revenue decline. The enterprise solutions, however, showed resilience with a relatively modest decline of 1%. The TDS LTM dollar retention rate improved year over year to 99% from 98%, reflecting higher customer upgrades.

Operational Highlights

Skillsoft's management highlighted the progress made in transforming the business, with a focus on the talent development market. The company has rebuilt its marketing team and invested in skilled subject matter experts to connect its differentiated capabilities to customer workforce needs. As Ronald Hovsepian noted, "We've reshaped our go-to-market approach to ensure we can capture the opportunity ahead." The company's next-generation Skillsoft Precipio platform is expected to drive growth by unifying content, blended learning, hands-on practice, and skills intelligence into one platform.

Guidance and Outlook

Skillsoft withdrew its previous consolidated revenue and adjusted EBITDA guidance due to the divestiture of Global Knowledge. For TDS, the company expects revenue for the full fiscal '26 year to be between $410 million and adjusted EBITDA of between $112 million and $116 million, or about 28% of revenue. Analysts estimate revenue growth to be -2.6% next year, indicating a continued challenging environment.

Valuation

Skillsoft's valuation metrics indicate a challenging environment, with a P/S Ratio of 0.13 and EV/EBITDA of 45.29. The company's ROE and ROIC are also negative, at -264.56% and -12.02%, respectively. The current valuation may be factoring in some of the challenges the company is facing, but the transformation efforts and the focus on the talent development market could potentially drive growth in the future.

3. NewsRoom

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Skillsoft Announces New Employee Inducement Grant Under NYSE Rule 303A.08

Feb -20

Source: businesswire.com

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Skillsoft Plummets 75% in a Year: Should You Hold or Fold the Stock?

Feb -11

Source:

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Best Growth Stocks to Buy for February 9th

Feb -09

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Skillsoft Leads the Shift to Skills Management for Workforce Readiness

Feb -04

Source: businesswire.com

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4. Business Breakdown

4.a. Revenues by Country

4.b. Revenues by Segment

5. Expected revenues mid-term growth (2.23%)

6. Segments

Content & Platform

Expected Growth: 2.5%

Content & Platform from Skillsoft Corp. growth driven by increasing demand for online learning, expansion into new markets, and strategic partnerships. The 2.5% growth rate is fueled by the need for continuous skill development, rising adoption of digital learning platforms, and the company's ability to provide high-quality, engaging content.

Instructor-Led Training

Expected Growth: 1.5%

Instructor-Led Training from Skillsoft Corp. growth driven by increasing demand for upskilling and reskilling, adoption of digital learning platforms, and growing need for customized training solutions. Additionally, expansion into new markets, strategic partnerships, and investments in AI-powered learning tools contribute to 1.5% growth.

7. Detailed Products

Percipio

A cloud-based learning platform that offers a wide range of courses, books, and videos on various topics such as business, technology, and creative skills.

SumTotal Systems

A human capital management (HCM) software that provides a suite of tools for talent management, learning management, and workforce management.

Content Anytime

A subscription-based service that provides access to a vast library of e-learning content, including videos, courses, and books.

Skillsoft Leadership Development

A suite of leadership development programs and resources designed to help leaders develop critical skills and competencies.

Skillsoft Compliance

A suite of compliance training solutions that provide regulatory compliance training, policy management, and risk management.

8. Skillsoft Corp.'s Porter Forces

Forces Ranking

Threat Of Substitutes

The threat of substitutes for Skillsoft Corp. is medium due to the presence of alternative e-learning platforms and traditional educational institutions.

Bargaining Power Of Customers

The bargaining power of customers is low due to the specialized nature of Skillsoft's products and services, making it difficult for customers to switch to alternative providers.

Bargaining Power Of Suppliers

The bargaining power of suppliers is medium due to the presence of multiple suppliers of digital content and technology, but the company's dependence on a few key suppliers.

Threat Of New Entrants

The threat of new entrants is high due to the relatively low barriers to entry in the e-learning industry and the increasing demand for online education.

Intensity Of Rivalry

The intensity of rivalry is high due to the presence of several established players in the e-learning industry, leading to intense competition for market share.

9. SWOT Analysis

Strength

Weaknesses

Opportunities

Threats

10. Capital Structure

10.a. Balance Sheet

10.b. Weighted Average Cost of capital

Value
Debt Weight 75.45%
Debt Cost 9.80%
Equity Weight 24.55%
Equity Cost 9.80%
WACC 9.80%
Leverage 307.37%

11. Quality Control: Skillsoft Corp. passed 2 out of 9 key points

12.a Historical Valuation

12.b Price/Earnings Ratio

12.c Margin Valuation

12.d Peers Valuation

Peers Group Analysis

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American Public Education

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Value: 5.0

Growth: 5.6

Quality: 5.9

Yield: 0.0

Momentum: 9.5

Volatility: 3.3

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Coursera

A-Score: 4.1/10

Value: 7.5

Growth: 6.0

Quality: 2.9

Yield: 0.0

Momentum: 6.0

Volatility: 2.3

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Udemy

A-Score: 3.6/10

Value: 5.0

Growth: 5.7

Quality: 5.6

Yield: 0.0

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Chegg

A-Score: 3.0/10

Value: 10.0

Growth: 2.9

Quality: 3.4

Yield: 0.0

Momentum: 1.0

Volatility: 0.7

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Skillsoft

A-Score: 2.7/10

Value: 5.1

Growth: 6.1

Quality: 1.6

Yield: 0.0

Momentum: 2.5

Volatility: 1.0

1-Year Total Return ->

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Elite Education Group International

A-Score: 2.6/10

Value: 9.6

Growth: 0.9

Quality: 4.7

Yield: 0.0

Momentum: 0.0

Volatility: 0.7

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Peers Metrics

12.e Scoring Insights

12.f DCF BETA

Parameters

Short Term Growth

Short term Time

Long-Term Growth

WACC

Target Price

5.15$

Current Price

5.15$

Potential

-0.00%

Expected Cash-Flows