Skillsoft's Q2 2026 Earnings: A Make-or-Break Moment for a Struggling SaaS Player?

Skillsoft (SKIL), a once-dominant player in the enterprise learning software space, finds itself at a crossroads. The SaaS industry, long characterized by high-growth expectations, has grown increasingly unforgiving in 2026 as macroeconomic pressures and shifting corporate spending priorities test the resilience of even the most established firms. Skillsoft's Q2 2026 earnings report, released in early November, offers a mixed bag of results: a revenue decline in its legacy Global Knowledge (GK) segment, stable performance in its Talent Development Solutions (TDS) division, and a revised full-year guidance range that reflects both caution and strategic recalibration. For investors, the question is whether these developments signal a turning point-or a further erosion of confidence in a company that has struggled to maintain its growth trajectory for years.

A Revenue Decline, but Margin Discipline Holds Firm

Skillsoft's Q2 2026 earnings report revealed a 2.6% year-over-year decline in total revenue to $128.8 million, driven primarily by a 10% drop in the GK segment, which now accounts for just $28 million of the company's revenue. This segment, historically reliant on certification and training services for IT professionals, has been disproportionately affected by macroeconomic headwinds, including reduced corporate spending on discretionary learning programs. In contrast, the TDS segment, which focuses on enterprise-level upskilling and AI-driven learning platforms, maintained stable revenue at $101 million, with enterprise solutions posting their fourth consecutive quarter of growth.

Adjusted EBITDA, a critical metric for SaaS firms, remained resilient at $28.3 million, with margins expanding to 22%-a testament to Skillsoft's cost discipline and operational efficiency. This margin expansion is particularly noteworthy given the broader industry trend of declining profitability as companies grapple with rising customer acquisition costs and pricing pressures. However, the company's decision to revise its full-year revenue guidance downward to $510–530 million-from a previously stated range of $530–545 million-signals ongoing uncertainty about its ability to regain growth momentum.

Guidance Accuracy and Investor Sentiment: A Tenuous Balance

Skillsoft's history of earnings surprises and guidance adjustments has long been a point of contention for investors. In Q1 2026, the company reported a GAAP net loss of $38 million, a significant deterioration from the prior year's $27.6 million loss. While it later narrowed its full-year revenue guidance to $510–530 million, this move was accompanied by a reaffirmation of its adjusted EBITDA and free cash flow targets, which remain anchored at $112–118 million and $60–65 million, respectively. This duality-lowering revenue expectations while maintaining profitability goals-reflects a strategic pivot toward operational efficiency over top-line growth, a common tactic among SaaS firms facing macroeconomic headwinds.

However, the credibility of Skillsoft's guidance has been called into question by analysts. For instance, the company's Q2 2026 results fell short of the midpoint of its original guidance, with revenue declining 3% year-over-year. This underperformance, coupled with the downward revision of full-year targets, has led to skepticism about the company's ability to execute its transformation strategy. According to a report by Bloomberg, Skillsoft's stock has underperformed the SaaS sector index by over 20% in 2026, with investor sentiment increasingly influenced by concerns over recurring revenue visibility and customer retention.

Strategic Moves in a Challenging Market

Amid these challenges, Skillsoft has doubled down on AI-driven learning solutions, a move that could prove pivotal in the long term. The company reported a 50% increase in technology learners on its platform and a 158% surge in AI learning hours year-over-year. These figures highlight the growing demand for AI-related skilling programs, a trend that aligns with Skillsoft's strategic focus on enterprise-driven, AI-powered platforms. Additionally, partnerships with tech giants like Salesforce and the introduction of AI Innovation-based products underscore the company's attempt to differentiate itself in a crowded market.

Yet, the success of these initiatives hinges on execution. While AI skilling is a high-growth area, it also requires significant R&D investment and customer adoption. Skillsoft's ability to monetize these offerings-particularly in a climate where enterprises are prioritizing cost-cutting-remains unproven. As stated by a Reuters analyst, "Skillsoft's pivot to AI is ambitious, but without clear evidence of pricing power or customer stickiness, it's hard to see this as a silver bullet".

The Path Forward: A Make-or-Break Test

Skillsoft's Q2 2026 earnings and revised guidance present a critical inflection point. On one hand, the company's margin discipline and strategic investments in AI offer a glimmer of hope for long-term growth. On the other, the persistent revenue declines and downward guidance adjustments underscore a lack of confidence in its ability to navigate the current economic environment. For investors, the key will be monitoring two metrics in the coming quarters: (1) the rate of adoption for AI-driven learning solutions and (2) the company's ability to stabilize its TDS segment's growth trajectory.

If Skillsoft can demonstrate that its AI offerings are not only attracting learners but also driving higher customer retention and pricing power, it may yet regain investor trust. Conversely, a failure to address the structural weaknesses in its GK segment and a continued lack of top-line growth could cement its status as a cautionary tale in the SaaS sector. As the company prepares to report Q3 2026 results in December, all eyes will be on whether its strategic bets can translate into tangible value creation-or if this is merely another chapter in a long, uncertain journey.