What happened
Just after market close on Tuesday, Skillz(NYSE: SKLZ) published its latest set of quarterly earnings. Investors didn't like what they saw, generally, and traded the company's shares down by more than 10% the following day.
So what
In its first quarter, Skillz booked revenue of $44.4 million. This was, uncomfortably, less than half its almost $92 million take in the same quarter the previous year. Gross marketplace volume (GMV), which is the tally of all entry fees paid by users accessing games on the company's platform, sank to less than $278 million versus first-quarter 2022's $552 million.
On a brighter note, Skillz managed to narrow its loss based on generally accepted accounting principles (GAAP) considerably. This landed at nearly $35.6 million ($0.09 per share) for the period, against the year-ago deficit of $149.6 million.
Collectively, analysts following Skillz stock were expecting a higher revenue figure of almost $48 million. Their consensus net loss figure matched the company's actual result.
Skillz is in the midst of a shift in business strategy aimed at reaching profitability; judging by that narrowed loss, it's having some success marching toward that goal. In the earnings release, it quoted CEO Andrew Paradise as saying that "Although we are very much in the middle of a turnaround, we are cautiously optimistic about our progress."
Now what
Skillz did not illustrate that cautious optimism by proffering any guidance. Other prognosticators are predicting more pain; they continue to forecast net losses for the company for the entirety of both 2023 and 2024.
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Eric Volkman has no position in any of the stocks mentioned. The Motley Fool has positions in and recommends Skillz. The Motley Fool has a disclosure policy.
