Skillz (SKLZ) Reports Q1: Everything You Need To Know Ahead Of Earnings

Jabin Bastian /
2023/05/08 5:05 am EDT

Mobile game developer Skillz (NYSE:SKLZ) will be announcing earnings results tomorrow after market hours. Here's what investors should know.

Last quarter Skillz reported revenues of $42.7 million, down 59.3% year on year, missing analyst expectations by 12.4%. It was a weak quarter for the company, with declining number of users and revenue. The company reported 235 thousand monthly active users, down 61.5% 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 52.5% year on year to $44.4 million, a significant deceleration compared to the 11.7% year-over-year decrease in revenue the company had recorded in the same quarter last year. Adjusted loss is expected to come in at -$0.07 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 four times over the last two years.

Looking at Skillz's peers in the consumer internet segment, some of them have already reported Q1 earnings results, giving us a hint what we can expect. Revolve's revenues decreased 1.37% year on year, missing analyst estimates by 3.63% and Uber reported revenues up 28.7% year on year, exceeding estimates by 1.42%. Revolve traded down 8.35% on the results, Uber was up 7.18%. Read our full analysis of Revolve's results here and Uber's results here.

Tech stocks have been facing declining investor sentiment in 2022 and while some of the consumer internet stocks have fared somewhat better, they have not been spared, with share price declining 4.71% over the last month. Skillz is down 5.81% during the same time, and is heading into the earnings with analyst price target of $0.9, compared to share price of $0.64.

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.

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