Skillz (SKLZ) Q3 Earnings: What To Expect

Radek Strnad /
2023/11/07 2:01 am EST

Mobile game developer Skillz (NYSE:SKLZ) will be reporting earnings tomorrow after market close. Here's what to look for.

Last quarter Skillz reported revenues of $40.2 million, down 44% year on year, missing analyst expectations by 5.7%. It was a weak quarter for the company, with a decline in its user base and slow revenue growth. The company reported 196,000 monthly active users, down 53.3% year on year.

Is Skillz buy or sell heading into the earnings? Read our full analysis here, it's free.

This quarter analysts are expecting Skillz's revenue to decline 34% year on year to $39.8 million, improvement on the 41% year-over-year decrease in revenue the company had recorded in the same quarter last year. Adjusted loss is expected to come in at -$1.32 per share.

Skillz Total Revenue

Majority of analysts covering the company have reconfirmed their estimates over the last thirty days, suggesting they are expecting the business to stay the course heading into the earnings. The company missed Wall St's revenue estimates six times over the last two years.

Looking at Skillz's peers in the consumer internet segment, some of them have already reported Q3 earnings results, giving us a hint what we can expect. PlayStudios delivered top-line growth of 5.2% year on year, missing analyst estimates by 1.9% and Coursera reported revenues up 21.4% year on year, exceeding estimates by 4.2%. PlayStudios traded flat on the results, Coursera was up1.6%.

Read our full analysis of PlayStudios's results here and Coursera's results here.

Investors in the consumer internet segment have had steady hands going into the earnings, with the stocks up on average 0.6% over the last month. Skillz is up 40.3% during the same time, and is heading into the earnings with analyst price target of $12.4, compared to share price of $5.8.

One way to find opportunities in the market is to watch for generational shifts in the economy. Almost every company is slowly finding itself becoming a technology company and facing cybersecurity risks and as a result, the demand for cloud-native cybersecurity is skyrocketing. This company is leading a massive technological shift in the industry and with revenue growth of 70% year on year and best-in-class SaaS metrics it should definitely be on your radar.

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The author has no position in any of the stocks mentioned.