Latest news with #Skillz
Yahoo
28-05-2025
- Business
- Yahoo
3 Reasons to Avoid SKLZ and 1 Stock to Buy Instead
While the broader market has struggled with the S&P 500 down 1.9% since November 2024, Skillz has surged ahead as its stock price has climbed by 10.7% to $6.31 per share. This was partly due to its solid quarterly results, and the run-up might have investors contemplating their next move. Is now the time to buy Skillz, or should you be careful about including it in your portfolio? Get the full stock story straight from our expert analysts, it's free. We're happy investors have made money, but we're cautious about Skillz. Here are three reasons why we avoid SKLZ and a stock we'd rather own. As a video gaming company, Skillz generates revenue growth by expanding both the number of people playing its games as well as how much each of those players spends on (or in) their games. Skillz struggled with new customer acquisition over the last two years as its paying monthly active users have declined by 33.6% annually to 124,000 in the latest quarter. This performance isn't ideal because internet usage is secular, meaning there are typically unaddressed market opportunities. If Skillz wants to accelerate growth, it likely needs to enhance the appeal of its current offerings or innovate with new products. EBITDA is a good way of judging operating profitability for consumer internet companies because it excludes various one-time or non-cash expenses (depreciation), providing a more standardized view of the business's profit potential. Skillz's expensive cost structure has contributed to an average EBITDA margin of negative 54.3% over the last two years. Unprofitable consumer internet companies require extra attention because they spend heaps of money to capture market share. As seen in its historically underwhelming revenue performance, this strategy hasn't worked so far, and it's unclear what would happen if Skillz reeled back its investments. Wall Street seems to think it will face some obstacles, and we tend to agree. If you've followed StockStory for a while, you know we emphasize free cash flow. Why, you ask? We believe that in the end, cash is king, and you can't use accounting profits to pay the bills. Skillz's demanding reinvestments have drained its resources over the last two years, putting it in a pinch and limiting its ability to return capital to investors. Its free cash flow margin averaged negative 36%, meaning it lit $36.04 of cash on fire for every $100 in revenue. We see the value of companies helping consumers, but in the case of Skillz, we're out. With its shares beating the market recently, the stock trades at 1.3× forward price-to-gross profit (or $6.31 per share). While this valuation is optically cheap, the potential downside is huge given its shaky fundamentals. There are better stocks to buy right now. We'd suggest looking at the most dominant software business in the world. Market indices reached historic highs following Donald Trump's presidential victory in November 2024, but the outlook for 2025 is clouded by new trade policies that could impact business confidence and growth. While this has caused many investors to adopt a "fearful" wait-and-see approach, we're leaning into our best ideas that can grow regardless of the political or macroeconomic climate. Take advantage of Mr. Market by checking out our Top 5 Strong Momentum Stocks for this week. This is a curated list of our High Quality stocks that have generated a market-beating return of 183% over the last five years (as of March 31st 2025). Stocks that made our list in 2020 include now familiar names such as Nvidia (+1,545% between March 2020 and March 2025) as well as under-the-radar businesses like the once-micro-cap company Kadant (+351% five-year return). Find your next big winner with StockStory today. Sign in to access your portfolio
Yahoo
27-05-2025
- Business
- Yahoo
Penguin Solutions, Skillz, Zumiez, OneWater, and Utz Shares Are Soaring, What You Need To Know
A number of stocks jumped in the afternoon session after the major indices rebounded (Nasdaq +2.0%, S&P 500 +2.0%) as President Trump postponed the planned 50% tariff on European Union imports, shifting the start date to July 9, 2025. Companies with substantial business ties to Europe likely had some relief as the delay reduced near-term cost pressures and preserved cross-border demand. The stock market overreacts to news, and big price drops can present good opportunities to buy high-quality stocks. Among others, the following stocks were impacted: Processors and Graphics Chips company Penguin Solutions (NASDAQ:PENG) jumped 5.1%. Is now the time to buy Penguin Solutions? Access our full analysis report here, it's free. Video Gaming company Skillz (NYSE:SKLZ) jumped 5.1%. Is now the time to buy Skillz? Access our full analysis report here, it's free. Apparel Retailer company Zumiez (NASDAQ:ZUMZ) jumped 5.8%. Is now the time to buy Zumiez? Access our full analysis report here, it's free. Boat & Marine Retailer company OneWater (NASDAQ:ONEW) jumped 7.2%. Is now the time to buy OneWater? Access our full analysis report here, it's free. Shelf-Stable Food company Utz (NYSE:UTZ) jumped 5%. Is now the time to buy Utz? Access our full analysis report here, it's free. OneWater's shares are extremely volatile and have had 50 moves greater than 5% over the last year. In that context, today's move indicates the market considers this news meaningful but not something that would fundamentally change its perception of the business. The biggest move we wrote about over the last year was 10 months ago when the stock dropped 20.8% on the news that the company reported weak second-quarter 2024 results. Its revenue and EPS missed analysts' expectations, and its full-year earnings forecast fell short of Wall Street's estimates. Notably, revenue declined by 8.7%, mostly due to weaknesses in the New boat segment (sales down 10.4%). Overall, this quarter could have been better. OneWater is down 13.7% since the beginning of the year, and at $14.82 per share, it is trading 52.5% below its 52-week high of $31.18 from June 2024. Investors who bought $1,000 worth of OneWater's shares 5 years ago would now be looking at an investment worth $950.00. Today's young investors likely haven't read the timeless lessons in Gorilla Game: Picking Winners In High Technology because it was written more than 20 years ago when Microsoft and Apple were first establishing their supremacy. But if we apply the same principles, then enterprise software stocks leveraging their own generative AI capabilities may well be the Gorillas of the future. So, in that spirit, we are excited to present our Special Free Report on a profitable, fast-growing enterprise software stock that is already riding the automation wave and looking to catch the generative AI next. Error in retrieving data Sign in to access your portfolio Error in retrieving data Error in retrieving data Error in retrieving data Error in retrieving data
Yahoo
23-05-2025
- Business
- Yahoo
Q1 Earnings Roundup: Roblox (NYSE:RBLX) And The Rest Of The Video Gaming Segment
As the Q1 earnings season wraps, let's dig into this quarter's best and worst performers in the video gaming industry, including Roblox (NYSE:RBLX) and its peers. Since videogames were invented in the 1970s, they have gradually taken more share of entertainment time. Ubiquitous mobile devices have powered a surge in 'snackable' games that can be played on the go. Over time, games have developed more social engagement features where friends can play games together over the internet. The business models of games publishers have become less volatile due to digitization of distribution, in game monetization, and like Hollywood, an increasing dependence on surefire hit franchises. Covid driven lockdowns accelerated adoption and usage of videogames – a trend that has not slowed. The 4 video gaming stocks we track reported a mixed Q1. As a group, revenues beat analysts' consensus estimates by 4.9% while next quarter's revenue guidance was in line. Thankfully, share prices of the companies have been resilient as they are up 8.8% on average since the latest earnings results. Best known for its wide assortment of user-generated content, Roblox (NYSE:RBLX) is an online gaming platform and game creation system. Roblox reported revenues of $1.04 billion, up 29.2% year on year. This print exceeded analysts' expectations by 3.3%. Despite the top-line beat, it was still a slower quarter for the company with full-year EBITDA guidance missing analysts' expectations. 'In Q1 2025, all of our results were above the guidance we provided on our Q4 2024 earnings call as we continue to deliver on several key growth initiatives. In addition to our focus on raw performance and quality, investments in the virtual economy and search and discovery are driving growth in platform monetization, bookings, and creator earnings. During the quarter, Roblox creators earned a record $281.6 million and over the past 12 months, more than 100 Roblox developers earned over $1 million. As a whole, the community is on pace to exceed $1 billion of earnings for the full year,' said David Baszucki, founder and CEO of Roblox. Roblox achieved the fastest revenue growth of the whole group. The company reported 97.8 million daily active users, up 25.9% year on year. The stock is up 21.6% since reporting and currently trades at $81.50. Is now the time to buy Roblox? Access our full analysis of the earnings results here, it's free. Taking a new twist at video gaming, Skillz (NYSE:SKLZ) offers developers a platform to create and distribute mobile games where players can pay fees to compete for cash prizes. Skillz reported revenues of $22.41 million, down 11.2% year on year, outperforming analysts' expectations by 8%. The business had an exceptional quarter with a solid beat of analysts' EBITDA estimates and an impressive beat of analysts' number of paying monthly active users estimates. Skillz pulled off the biggest analyst estimates beat among its peers. The company reported 124,000 monthly active users, up 2.5% year on year. The market seems happy with the results as the stock is up 21.7% since reporting. It currently trades at $6.43. Is now the time to buy Skillz? Access our full analysis of the earnings results here, it's free. Best known for its Grand Theft Auto and NBA 2K franchises, Take Two (NASDAQ:TTWO) is one of the world's largest video game publishers. Take-Two reported revenues of $1.58 billion, up 13.1% year on year, exceeding analysts' expectations by 0.9%. Still, it was a slower quarter as it posted full-year EBITDA guidance missing analysts' expectations. Take-Two delivered the weakest performance against analyst estimates and weakest full-year guidance update in the group. As expected, the stock is down 2.9% since the results and currently trades at $225.83. Read our full analysis of Take-Two's results here. Best known for its Madden NFL and FIFA sports franchises, Electronic Arts (NASDAQ:EA) is one of the world's largest video game publishers. Electronic Arts reported revenues of $1.90 billion, up 6.5% year on year. This print surpassed analysts' expectations by 7.6%. Aside from that, it was a satisfactory quarter as it also logged EPS guidance for next quarter exceeding analysts' expectations. Electronic Arts scored the highest full-year guidance raise among its peers. The stock is down 5.2% since reporting and currently trades at $146.50. Read our full, actionable report on Electronic Arts here, it's free. Thanks to the Fed's rate hikes in 2022 and 2023, inflation has been on a steady path downward, easing back toward that 2% sweet spot. Fortunately (miraculously to some), all this tightening didn't send the economy tumbling into a recession, so here we are, cautiously celebrating a soft landing. The cherry on top? Recent rate cuts (half a point in September 2024, a quarter in November) have propped up markets, especially after Trump's November win lit a fire under major indices and sent them to all-time highs. However, there's still plenty to ponder — tariffs, corporate tax cuts, and what 2025 might hold for the economy. Want to invest in winners with rock-solid fundamentals? Check out our Top 5 Growth Stocks and add them to your watchlist. These companies are poised for growth regardless of the political or macroeconomic climate. Join Paid Stock Investor Research Help us make StockStory more helpful to investors like yourself. Join our paid user research session and receive a $50 Amazon gift card for your opinions. Sign up here.
Yahoo
21-05-2025
- Business
- Yahoo
Q1 Earnings Recap: Skillz (NYSE:SKLZ) Tops Video Gaming Stocks
Let's dig into the relative performance of Skillz (NYSE:SKLZ) and its peers as we unravel the now-completed Q1 video gaming earnings season. Since videogames were invented in the 1970s, they have gradually taken more share of entertainment time. Ubiquitous mobile devices have powered a surge in 'snackable' games that can be played on the go. Over time, games have developed more social engagement features where friends can play games together over the internet. The business models of games publishers have become less volatile due to digitization of distribution, in game monetization, and like Hollywood, an increasing dependence on surefire hit franchises. Covid driven lockdowns accelerated adoption and usage of videogames – a trend that has not slowed. The 4 video gaming stocks we track reported a mixed Q1. As a group, revenues beat analysts' consensus estimates by 4.9% while next quarter's revenue guidance was 0.8% above. Luckily, video gaming stocks have performed well with share prices up 11.4% on average since the latest earnings results. Taking a new twist at video gaming, Skillz (NYSE:SKLZ) offers developers a platform to create and distribute mobile games where players can pay fees to compete for cash prizes. Skillz reported revenues of $22.41 million, down 11.2% year on year. This print exceeded analysts' expectations by 8%. Overall, it was an exceptional quarter for the company with a solid beat of analysts' EBITDA estimates and an impressive beat of analysts' number of paying monthly active users estimates. Skillz scored the biggest analyst estimates beat but had the slowest revenue growth of the whole group. The company reported 124,000 monthly active users, up 2.5% year on year. Unsurprisingly, the stock is up 26.9% since reporting and currently trades at $6.70. Is now the time to buy Skillz? Access our full analysis of the earnings results here, it's free. Best known for its Madden NFL and FIFA sports franchises, Electronic Arts (NASDAQ:EA) is one of the world's largest video game publishers. Electronic Arts reported revenues of $1.90 billion, up 6.5% year on year, outperforming analysts' expectations by 7.6%. The business had a satisfactory quarter with EPS guidance for next quarter exceeding analysts' expectations. Electronic Arts pulled off the highest full-year guidance raise among its peers. Although it had a fine quarter compared its peers, the market seems unhappy with the results as the stock is down 1.7% since reporting. It currently trades at $151.95. Is now the time to buy Electronic Arts? Access our full analysis of the earnings results here, it's free. Best known for its Grand Theft Auto and NBA 2K franchises, Take Two (NASDAQ:TTWO) is one of the world's largest video game publishers. Take-Two reported revenues of $1.58 billion, up 13.1% year on year, exceeding analysts' expectations by 0.9%. Still, it was a slower quarter as it posted full-year EBITDA guidance missing analysts' expectations. Take-Two delivered the weakest performance against analyst estimates and weakest full-year guidance update in the group. As expected, the stock is down 1.5% since the results and currently trades at $229.08. Read our full analysis of Take-Two's results here. Best known for its wide assortment of user-generated content, Roblox (NYSE:RBLX) is an online gaming platform and game creation system. Roblox reported revenues of $1.04 billion, up 29.2% year on year. This number surpassed analysts' expectations by 3.3%. Zooming out, it was a slower quarter as it logged full-year EBITDA guidance missing analysts' expectations. Roblox achieved the fastest revenue growth among its peers. The company reported 97.8 million daily active users, up 25.9% year on year. The stock is up 21.9% since reporting and currently trades at $81.65. Read our full, actionable report on Roblox here, it's free. Thanks to the Fed's series of rate hikes in 2022 and 2023, inflation has cooled significantly from its post-pandemic highs, drawing closer to the 2% goal. This disinflation has occurred without severely impacting economic growth, suggesting the success of a soft landing. The stock market thrived in 2024, spurred by recent rate cuts (0.5% in September and 0.25% in November), and a notable surge followed Donald Trump's presidential election win in November, propelling indices to historic highs. Nonetheless, the outlook for 2025 remains clouded by potential trade policy changes and corporate tax discussions, which could impact business confidence and growth. The path forward holds both optimism and caution as new policies take shape. Want to invest in winners with rock-solid fundamentals? Check out our 9 Best Market-Beating Stocks and add them to your watchlist. These companies are poised for growth regardless of the political or macroeconomic climate. Join Paid Stock Investor Research Help us make StockStory more helpful to investors like yourself. Join our paid user research session and receive a $50 Amazon gift card for your opinions. Sign up here. Error in retrieving data Sign in to access your portfolio Error in retrieving data Error in retrieving data Error in retrieving data Error in retrieving data
Yahoo
08-05-2025
- Business
- Yahoo
Skillz (NYSE:SKLZ) Delivers Strong Q1 Numbers
Mobile game developer Skillz (NYSE:SKLZ) reported revenue ahead of Wall Street's expectations in Q1 CY2025, but sales fell by 11.2% year on year to $22.41 million. Its GAAP loss of $0.92 per share was 16.4% above analysts' consensus estimates. Is now the time to buy Skillz? Find out in our full research report. Revenue: $22.41 million vs analyst estimates of $20.75 million (11.2% year-on-year decline, 8% beat) EPS (GAAP): -$0.92 vs analyst estimates of -$1.10 (16.4% beat) Adjusted EBITDA: -$15.06 million vs analyst estimates of -$15.95 million (-67.2% margin, 5.6% beat) Operating Margin: -59.2%, up from -106% in the same quarter last year Free Cash Flow was -$12.66 million compared to -$21.06 million in the previous quarter Paying Monthly Active Users: 124,000, up 3,000 year on year Market Capitalization: $86.66 million Taking a new twist at video gaming, Skillz (NYSE:SKLZ) offers developers a platform to create and distribute mobile games where players can pay fees to compete for cash prizes. A company's long-term sales performance can indicate its overall quality. Any business can put up a good quarter or two, but many enduring ones grow for years. Over the last three years, Skillz's demand was weak and its revenue declined by 38.2% per year. This was below our standards and suggests it's a low quality business. This quarter, Skillz's revenue fell by 11.2% year on year to $22.41 million but beat Wall Street's estimates by 8%. Looking ahead, sell-side analysts expect revenue to decline by 2.6% over the next 12 months. While this projection is better than its three-year trend, it's tough to feel optimistic about a company facing demand difficulties. Software is eating the world and there is virtually no industry left that has been untouched by it. That drives increasing demand for tools helping software developers do their jobs, whether it be monitoring critical cloud infrastructure, integrating audio and video functionality, or ensuring smooth content streaming. Click here to access a free report on our 3 favorite stocks to play this generational megatrend. As a video gaming company, Skillz generates revenue growth by expanding both the number of people playing its games as well as how much each of those players spends on (or in) their games. Skillz struggled with new customer acquisition over the last two years as its paying monthly active users have declined by 33.6% annually to 124,000 in the latest quarter. This performance isn't ideal because internet usage is secular, meaning there are typically unaddressed market opportunities. If Skillz wants to accelerate growth, it likely needs to enhance the appeal of its current offerings or innovate with new products. Luckily, Skillz added 3,000 paying monthly active users in Q1, leading to 2.5% year-on-year growth. The quarterly print was higher than its two-year result, suggesting its new initiatives are accelerating user growth. Average revenue per user (ARPU) is a critical metric to track because it measures how much revenue each user generates, which is a function of how much paying users spend on its games. Skillz's ARPU growth has been subpar over the last two years, averaging 2.9%. This raises questions about its platform's health when paired with its declining paying monthly active users. If Skillz wants to grow its users, it must either develop new features or lower its monetization of existing ones. This quarter, Skillz's ARPU clocked in at $62.20. It declined 10.9% year on year, worse than the change in its paying monthly active users. We enjoyed seeing Skillz beat analysts' revenue, EPS, and EBITDA expectations this quarter. Zooming out, we think this quarter featured some important positives. The stock traded up 3.4% to $5.46 immediately after reporting. Indeed, Skillz had a rock-solid quarterly earnings result, but is this stock a good investment here? When making that decision, it's important to consider its valuation, business qualities, as well as what has happened in the latest quarter. We cover that in our actionable full research report which you can read here, it's free. Sign in to access your portfolio
