SKLZ — Skillz Inc.

Summary of Skillz, Inc. Q4 2025 Earnings Call

1. Key Financial Results and Metrics

• Q4 2025 Revenue: $30 million, an 11% increase from Q3 2025 ($27 million) and a 67% increase year-over-year from Q4 2024 ($18 million).
• Full Year 2025 Revenue: $105 million, up from $93 million in 2024 (13% year-over-year growth).
• Adjusted EBITDA Loss: $10 million in Q4 2025, improved from a loss of $12 million in Q3 2025 and a loss of $17 million in Q4 2024. Full year adjusted EBITDA loss was $51 million, down from $61 million in 2024.
• Net Loss: $18 million in Q4 2025, improving 27% year-over-year.
• Cash Position: Ended Q4 2025 with $195 million in cash and cash equivalents, with $130 million in current debt.

2. Strategic Updates and Business Highlights

• AI Ad Tech Segment (RZR): Rebranded from Aarki, achieved 146% net revenue growth year-over-year and positive adjusted EBITDA for the first time since acquisition.
• Pro SDK Launch: Introduced at the Annual Game Developers Conference, aimed at enhancing developer engagement and monetization.
• Operational Improvements: Focus on enhancing efficiency across Skillz and RZR, with a strengthened Board of Directors to support growth strategies.
• Fair Play Initiative: Ongoing litigation against Papaya Gaming and Voodoo Gaming to address issues of bot usage, with a trial set for April 2026.

3. Forward Guidance and Outlook

• Skillz aims to continue its trajectory towards profitability, leveraging improvements in RZR and the Skillz platform.
• The company is focused on acquiring and retaining high-quality paying users while optimizing monetization strategies.

4. Bad News, Challenges, or Points of Concern

• Decline in Paying Monthly Active Users (PMAU): PMAU decreased by 9% from Q3 2025 to 141,000, although it showed a 28% increase year-over-year.
• Loss of Major Partner: A significant gaming developer, which accounted for 51% of revenue last year, left the platform, impacting PMAU and necessitating a transition to Skillz-owned games.
• Technical Issues: Encountered engagement and marketing technology problems that affected player metrics in Q4.

5. Notable Q&A Insights

• Management acknowledged the dip in PMAU due to the departure of a major partner and emphasized efforts to transition players to Skillz-branded games.
• They also noted that technical issues contributed to the decline in PMAU, which have since been addressed.

Overall, Skillz demonstrated strong revenue growth and operational improvements in Q4 2025 but faces challenges related to user engagement and the impact of losing a key partner. The company remains focused on strategic initiatives to drive future growth and profitability.