Skillz 2025 Q2 Earnings Sharp Net Loss and Continued Strategic Focus

Skillz (SKLZ) reported its fiscal 2025 Q2 earnings on Aug 07th, 2025. The company reported a net loss of $-8.92 million in 2025 Q2, a significant deterioration from the net income of $26.05 million in the same period the previous year. Despite a modest 8.2% revenue increase to $27.37 million, the earnings miss raised concerns about ongoing financial challenges.

Revenue
Skillz reported total revenue of $27.37 million for the quarter, reflecting an 8.2% year-over-year increase from $25.30 million in 2024 Q2. The company noted 30% sequential growth in GAAP revenue and 22% growth when excluding one-time adjustments. While the revenue growth is a positive sign, the earnings decline overshadowed this progress.

Earnings/Net Income
Skillz swung to a loss of $0.58 per share in 2025 Q2 from a profit of $1.47 per share in 2024 Q2, representing a 139.5% negative change. The company posted a net loss of $-8.92 million, a 134.2% decline from the $26.05 million net income in the prior year. The company has reported losses for the sixth consecutive year during this period, signaling persistent financial headwinds. The EPS performance was notably weak, with the company unable to maintain its profitability and delivering a sharp negative surprise.

Price Action
The stock price of Skillz has experienced a downward trend, dropping 6.74% during the latest trading day, 4.18% during the most recent full trading week, and 7.52% month-to-date. This continued weakness in share price reflects investor concerns about the company’s earnings performance and future prospects.

Post Earnings Price Action Review
The strategy of buying Skillz shares following a revenue increase quarter-over-quarter and holding for 30 days underperformed significantly. Over the past three years, the strategy delivered a return of -75.45%, vastly underperforming the benchmark return of 51.69%. The excess return was -127.14%, and the strategy's CAGR was -37.81%, indicating a substantial loss in value. This underperformance raises questions about the market’s trust in the company's ability to deliver consistent returns despite sequential revenue growth.

CEO Commentary
Andrew C. Paradise, CEO & Chairman of the Board, highlighted that Q2 GAAP revenue was $27 million, showing 30% sequential growth and 8% year-over-year growth, with 22% growth excluding one-time adjustments. He noted 18% sequential growth in paying MAU to 146,000 and a $10 million adjusted EBITDA loss, improved by 36% sequentially. The CEO emphasized platform innovations, including a revamped loyalty program, ACH deposits, instant withdrawals, and the Skillz Arcade, as key drivers of engagement and growth. He also underscored the 3-year, $75 million Developer Accelerator program to support new content. Strategic priorities included enhancing player and developer experiences, strengthening the global team, and refining user acquisition. Cautiously optimistic, Paradise affirmed that the company is on a clear path to positive adjusted EBITDA and is committed to restoring trust in fair competition through litigation.

Guidance
The CEO did not provide specific forward-looking quantitative guidance for revenue, EPS, or CAPEX. Instead, he expressed qualitative expectations of continued sequential growth, improved marketing efficiency, and progress toward profitability, noting the positive trajectory of Skillz's platform and Aarki's AI-powered ad tech innovations. He also emphasized ongoing efforts to achieve compliance with NYSE listing standards and file the delayed 2024 annual report within the 6-month extension granted.

Additional News
Nigerian news outlet Punch reported on a range of national events, including a terrorist attack in Borno foiled by the Nigerian Air Force and a ransom demand of N7 million for the release of an Ondo varsity worker. Political developments included the ADC faction denouncing David Mark as party chair and the APC registration efforts in Akwa Ibom. Economic news highlighted Stanbic IBTC’s savings promotion, which awarded N23 million to 148 customers. These reports underscore a range of socio-political and economic issues impacting Nigeria, though none directly relate to Skillz.