- Earnings call transcript Q3 2023

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Operator

Hello, and welcome to the Skillsoft Third Quarter 2023 Financial Results Conference Call and Webcast. At this time, all participants are in a listen-only mode. [Operator Instructions] As a reminder, this conference is being recorded. It’s now my pleasure to turn the call over to Eric Boyer, Senior Vice President and Head of Investor Relations. Please go ahead, sir.

Eric Boyer

to quarter welcome call. XXXX and afternoon, Skillsoft's fiscal third earnings Good Relations the our materials posted Investor issued closed, to earnings Skillsoft After we and QX market press release the website. supplemental statements about call expectations, statements performance, future financial concerning financial contain expected Today's business our and the including trends, will and business business outlook Company's condition and forward-looking financial and outlook. predictions and are all statements actual differ facts that beliefs and historical subject cause that reflect therefore and risks not and as are statements results today forward-looking materially uncertainties These could from to of management's to expectations.

filings. of risks Safe affect the to For the a that please risks factors the other Harbor could discussion discussion actual refer results, material SEC and found in important in described our Company's the

discuss XX, to GAAP due June ownership on requires and periods between the During XXXX financial in will non-GAAP periods investment prepared predecessor not to after call, measures, separated change accounting Principles. the with lack are we comparability Generally Accounting merger accordance and also basis. the leaseback certain ownership before and and reflect successor Accepted of be which periods different to and in the

Jeff XX. measures, the in materials to financial Knowledge directly to our In With activity Knowledge the had supplemental and take metrics is on remarks, pleasure CEO; merged which most non-GAAP is XXXX. after today's only is website Walker, in have in it's Codecademy well be reconciliation Skillsoft, been furnished will the this has to as pro that, our on Jeff. that and results financial reflect historical earnings as to on prepared turn call Tarr, Rich and of Global the over of questions. periods these February GAAP available X, commentary measures how to metrics release, GAAP addition, financial presented as included A statements available SEC the reflected including and June forma results we Global CFO, After to been to References our press also my our at other call the referred comparable and www.skillsoft.com. and to prepared define

Jeff Tarr

Today, Skillsoft Thanks, you financial our I'm previously quarter Development markets, companies, our Eric. take to Rich to to the the cover commentary very together. call some joining detail. has the since was CFO operational where return and as and on been us. we Good in and Rich the Officer, of the provide and served two CFO Walker on role. that then all Corporate worked in I'll for financial and Strategy thank public company's turn afternoon, HIS, Rich grateful public has involved agreed over before results Chief to including

to for contributions Before our our and the Gary want and also a business, commitment were turning we to transition. Ferrera to smooth to pleased his to our thank full-year line QX expectations with reaffirm guidance. are results company his I in

X% stabilized our bookings instructor-led Global or Importantly, sequential delivering we business, ILT successfully growth. training Knowledge

seen we've in potential reporting down progress. by to new partner, within directly deliver me, segment. are a was other the the year-over-year with With reduced quarter manager to one growth we experience healthy segment optimistic subsidies the continued due large in training instructor-led deep in the cautiously in While products general to

it into We subscription continue can focused a relevant offerings training instructor-led integrating differentiator. and also believe meaningful on be remain to

constant of X% which We at success our customer core downgrade due way is Content we best by macro Skillsoft metric to was with Despite wins continue to and currency, XX-month expect and QX, bookings segment. growth was large a up a bookings. in business the quarter represents primarily in down enterprises. trailing our solid believe headwinds, cross-sell subscription by to driven basis. approximately the in This That said, growth our account. upsell Skillsoft to half one Content on the general Turning look generally

to turning Finally, Codecademy.

and the acquired the early are one outpacing revenue traffic growth in in potential up establish dev, is we in tech of acute. believe BXC acquisition. of constant the we reminder, other and are Codecademy in XX% still most a up learning, Codecademy were our X% and realizing strongest business revenue Skills bookings year position earlier As the where We to and gaps in the a tech competitors. brands and was leadership currency. dev are

to and business a lot a a basis see term achieve help It currency Codecademy short-term important to in benefit cross-selling traction quarters Codecademy bookings to that depressed enterprise two learned a results our in we to early is October. return the start that to continue on growth also double-digit during promotion customers. due We've that We believe quarter to will returned us be acquiring the opportunity. longer a substantial first had what slow since to note cross-sell our we constant for

enterprise brands tech, more cross into XXX have regarding in customers and and discussions services. in professional offering the recognizable are than already most pharma of and the largest We with world's retail, sold some Codecademy

Given and shrinking been difficult through hiring. relentlessly slower approach with attrition, the on growth, making for I'm impact our less economic base doing a of currency focused members and to staffing, to our we've managing in team decisions, exchange disciplined and employee rates, numerous wage inflation our grateful cost reductions and structure more

fortunate in costs. who and selective to through propelling built experiences. together serve a an ongoing more and investments continuing Through to about grow learners an will are labor investment market manage with organizations acquisition, serve while an growth. of costs and We differentiated India of growing be in community XX we than us Managing future. base and highly Overall, million organic learning optimistic capabilities. we've our transformational people our make We to focus purpose, important a that's have operations a I'm helped the of important large suite

and blockchain-enabled believe and our content professionals better transformation modalities, complex to we array AWS sophisticated the hands-on-learning, nuanced of customers, a recognition business we our of XXX badges. and their was of is Palo covers to value such in no coaching team journey, wide including approximately leadership, learn compliance. released training which of in new training newly-refreshed of hands-on conduct code to Nutanix, by proficiency awarded workforce our leadership thinking nearly been and Skillsoft flexible our by people tech first We the by real-world cloud learners practice in with online. classes. integrators. Together, our of Fortune as and AI-driven XXXX. dev platforms courses, videos, and extend content deliver on learners excess deliver critical Hat, with XX with engaging of featuring the of a the such XX cloud including micro and instructor-led have platform, skills Our market, a assessments, demanding skills and We and problem coaches in Council. These situations. and editions the America. needs of QX, world's And we complexities helps learners our for topics design business our Similar navigate way solving, featuring highly training, through continue XX% We additional recognized achieve wellness. released XXXX Azure able one perspectives partner offerings scenarios of learning well most the courses received strength that we systems The are as career instructional the In designed and of Alto, the Red clients release to and from NPS our North to experience instructor-led was year skills, technology with add training EC the instructor-led leverage mentoring, as AWS VMware, help

language content in We continue expand capability recently dozen languages. and to AI-powered coverage caption released our have automation makes a that local our available an

and assessments most courses expand workforce to our to new content offering continue deliver our add focused reskilling, compelling customers on transformation also initiatives. important under helping and We collection our and upskilling

these As year-over-year are and up up the platform, we courses content monthly on users our most active XX%, basis, a completed investments up a and also are of strength in metrics. At are important seeing issued XX%, badges of QX, result XX%. learning are end in

We upskilling. by and that there strong embracing science-based our evidence believe unique positive are these are approach and learners reskilling encouraged trends are to

key acquiring We've go-to-market of hired transformation. the and also a and more realigned and our talent, We've investments learn cross-sell, model and made in our new, excited and absorbing upsell connected largely to a the to that Importantly, better innings potential online coverage of create integrating by we creating. what are completed new we capabilities logos. technology, are tools to way early our salesforce enables are and

large French corporation. levels wins leader, In large was This redesigned performance. company, positions but and global QX, future two a growth to disruptive, of major also notable for We media agencies, now drive predictably government U.S. a compensation a include better and value creation. higher us some hospitality energy transformation

Finally, a Responsible annual pleased a milestone as Values, our released impact Business journey. entitled, serves important to Our ESG This for in we an Sustainable report are have our Future. first Living report

our first business challenging the confidence businesses salesforce Instructor-Led have deliver to on over important are sequential important During you three a margin platform. growth long-term. it macro and a another, and look in that to forward turn updating segment over Skillsoft executing can and on been investments quarters our company, we've Content We've our transformation and acquired year our a segment progress with and stabilized Despite an returned we as transforming into Training basis a I'll LTM a Skillsoft made that, entering And complex made next much five and and expansion on QX public basis. with environment, growth content We our Rich. progress. to divested

Rich Walker

Skillsoft, Welcome, seamless be closely take has I I I've our just end Codecademy of as excited of start to team, Financial which year able with to a January by to had already, transition. finance XX, been before the begin strong basis a prior will results the quarters Thanks, and Gary pro on now QX turning of been XXXX. comparisons working aligned Chief everyone. role merged Officer. remainder how the on to Jeff. to I be Global this forma made thoughts been a and on for and had Knowledge The built with on presented if has fiscal the will year. saying want their summary am

pro the the SumTotal divestiture, comparisons to all forma due exclude periods. SumTotal Additionally, for

on at large revenue thoughts Skillsoft few level want it now content over with and of I looking to multi-year intensity. its same, Skillsoft Before the a primarily has largely The approximately through as into with I is get business be the in a quarter. business, divestitures. due model strong is operating bookings that a XX% can financials, part This the our low gone with to are and financial year difficult. half subscription-based the the business seasonality the approximately past contracts. just leverage the has the content fourth remains business the Therefore, from provide acquisitions SaaS-like portion basis of high changes on capital the quarterly business of which of

focus on expansion. XX% such, Training the try Knowledge useful which segment, the As Content last or of our more as grow expect transactional we XX-month remaining Over lower to is quickly, the is time, Instructor-Led to business The which a we should measure. Global margin trends more margin. segment and drive

to is our of the comments. results. basis, declines large due the constant referenced on company down the in and X% which down total XX% million, moving his customer $XXX a the that Now quarter in transactional for to on Jeff for downgrade third Bookings a business and largely were lower-margin QX currency

X% bookings a a We result Content constant sequentially, continue Notably, basis. bookings realignment in million, have currency Due content aforementioned our on currency in pace are in the the in X% down and X% in does reported on focus, currency. and downgrade subscription to $XX quarters, much constant efforts bookings a solid quarter, included due bookings to it bookings either content a incremental to were currency our grew first both the Codecademy this on constant take In our was direction. Content ILT of quarterly growth an to is smaller the X% three contribution a of year-over-year as LTM growth in year. account. larger quarter and one to third down third and grew not basis believe move basis, segment. end rate constant our our On the to

bookings a for our in by is pipeline We are and one more due XX% progress make changes continue report success million, for program enterprise building currency. the heaviest primarily We the signed recovered the of period, and with our which progress cross-sell quarter activity. has would constant deals fourth QX to decline large in Bookings third two was On closing the of in in renewal constant down cross-sell encouraged currency in technology basis, bulk quarter, material expect this ILT product. partners, in and down were training year-to-date we in when to the quarter. to the in XX% which $XX the

We productivity to continue of efforts expect stabilized the recent within improve. sales have our also the hires and largely business to ILT sales

to constant revenue was currency in X% Turning a and quarter, $XXX on revenue. the X% down GAAP million basis. down

$XX in and Content and currency. constant up XX% flat a million, was for was We conform with which of the which XX% in up revenue are gross revenue net quarter fees GAAP reseller GAAP $X to is currency which up included adjusted in was no Codecademy, GAAP fees. QX growth X% on were reporting the longer basis. revenue constant Reseller segment for million. accounting, in Skillsoft Content is the segment,

LTM Our ILT $XX quarters. currency. quarterly business QX and convert in-quarter revenue for at lower bookings steady in it XX% XX%. to to and two basis an million, DRR due was was within down constant prior typically as these held The on our decline was and revenue bookings GAAP quarter XX% down XX%,

to profitability. on Moving

$X currency. year. on points you to down mentioned quarter a for EBITDA XXX $XX through million, comparing we've in as prior costs XX% XX.X%, company. the of was EBITDA was compared increase X% and million, public basis in down previous also margin last QX need the consider adjusted Accordingly, decrease to as company approximately a EBITDA the adjusted move year As public calls we year-over-year, down first from the year when Adjusted constant

loss net of operations costs. which impairment from quarter, GAAP $XXX for the continuing Our an $XXX approximate and was million million included intangible goodwill

was million quarter. loss net $XX the adjusted for Our

and capital the negative Codecademy of At own X.Xx. of end the million to not basis, sheet cash we leverage net X.Xx, them. on which a On includes pro the Moving balance contribution was on ended net leverage forma with of QX, did $XXX for quarter periods, which reported allocation. we of the

As previously adjustments fees million and down Net in after mid-August. paid the of debt were mentioned, We in transaction all we closed million. SumTotal the proceeds cash approximately $XXX $XX quarter. other

XXX,XXX repurchased also shares. We

now trading information has been due was short window to publicly. cut that Our shared

of Moving forward, share we expect market versus on debt to benefits continuously weigh conditions. repurchase the reducing based

to conform a fundamentals however, a GAAP accounting, change are We GAAP business. reaffirming I outlook, prior not are our the revenue as presentation to mentioned to the of we earlier, to moving due in

now As such, million $XXX are is our GAAP the and midpoint $XXX revenue we to above million, outlook trending of the range.

$XXX million $XXX to remains With due Jeff. $XXX I'll the EBITDA of end revenue million, range the remains range booking to to million, Our call our adjusted and turn to that, $XXX trending lower primarily million are mix. we the range over back towards

Jeff Tarr

Thank you our joining all for call.

the online unique we uncertainty While environment, believe for people there to upskilling, questions. open to we benefits the complex with is and of call today's our deliver optimizing and demanding please on our most customers, provides learn reskilling organizations how approach organizations. positioned in the transformation needs are employees. of their By strategies believe and Operator, operating for the and solutions enterprise uniquely we aligning our workforce

Operator

a now will conducting we session. Certainly, be question-and-answer

question today first Raimo from Barclays. is Our from Lenschow coming

now is line live. Your

Sheldon McMeans

Hi. for Raimo. for Sheldon core our first about This content wanted is the on to business. taking questions. McMeans Thanks ask I

while the in a negative growth was first bookings here. quarter This that we time saw

isolated my And QX have reduction question as I in you follow-up. the is approach is, You confidence the renewal quarter. discussed incident gives that this period? a large an a And what you

Jeff Tarr

Sure. Thanks.

accounts this due revenue to have pressures don't don't anomaly. business at financial significantly that downgraded pointed of you customer have we and was It an many quarter us. their we one concentration experiencing was really quite size, We and any the As really significant with all. feel out, large was severe

the account of So was loss revenue of neighborhood a an that really X% is event. unusual

of closed the time. it at into month large pipeline quarter closed. how We As that's see we've much we're approximately we forward, can where We've how was the year business XX% one and ahead look last our of going quarter, is, this our quarter.

We So we about feel pipeline. about feel good really that. the good really

about shaky, is feel we're quarter. economy little fact keyed most And important good we the the for up our so despite a that how

Sheldon McMeans

for Thank you. And then Got it. second Richard.

ask call question the previous. philosophy broad any on there? relative role. new Thanks. a there is feel to on congratulations changes just out your how First, guidance to I Is you wanted to

Rich Walker

question for Thanks a we I the and the don't remarks. have think annual We different in about how guidance. viewpoint give guidance. only

And the we for that's our year. by our I finish think critically how fourth tied we informed coming how this so quarter, planning finished it's quarter. to in the case, forward

want and consistent the against make no short metrics. all. relevant at to guide, showing in sure more lifetime personally total to there's metrics, of trying then are guiding when But and bookings not if that looking a bookings that. look giving philosophy at we value I we're guidance, looking backlog at perhaps think We bookings, change at

Sheldon McMeans

you. Thank it. Got

Operator

Thank you.

is today from from question Next Singlehurst coming Tom Citi.

live. now is line Your

Thomas Singlehurst

Yes. that. [Indiscernible] suppose Good Thank question. taking to the I for go very evening. to wanted I back Yes, much you

very [indiscernible] of you sensitivity just companies to outlook smaller versus clear driver whether for whether say, around cycle. color to quick talk wondering about international as can one that, was Any any follow-up there's of You're difference and the that account, with your I the a larger that's that, perspectives sort if ones, cyclicality? of You I versus have I U.S. start can on, broad okay. sort in

Jeff Tarr

little Thanks, up. Tom. It broken was a

question let or performing asked of than about others exactly asking So if worse just is SMB. specifically me didn't are we than seen that I you're we've customers you are I seeing what But segments know. the and right, get historically, think or better

large our than lower has enterprise. SMB historically, – rates So has performed had retention

underperforming dollar large rate, customers our you we that enterprise anticipate and are meaningfully give blended are outperforming rate. when blended our SMB So customers rate, that retention should you a

other has the that significant that than we we than year less have a We change in our fact shifted, haven't seen had to and exposure mix ago. SMB

lens of we our continue pressure large So base, When enterprise the consider at to I than XX% look which question. is U.S. given the of SMB. a remarkable outside a the business pressure And we new – about we that been have And SMB, at or quite headwind cycle of substantial customer the we has biggest geography, that we're be in enterprise. do impact But the global report. on point, through see really to to to other impact currency, this expect the this would of hope on that exposure less business our roughly rather, and that, answers more nothing see

Thomas Singlehurst

And higher has clear. the sort cash sort sort once on from then of well, the in – you you of cash just buyback of mean sort and been I for rates usage sort just of again cost? intimated usage, on I here Very you somewhat interest curtailed. especially about can the therefore I talked – the priorities sort context, of of interest of outline rising suppose, in, the that

Rich Walker

Great. It's Rich.

it's pretty I simple. think

Given as capital a informed confidence want fourth the to our we that magnitude we'll from that with signaled be grows allocation. quarter, do to what as consistently quarter, of we've

if repurchase. Second, juxtaposing between debt and share

rate On and definitely much, question our the quarter been there's as particularly answer basis a to rate points. by the two current environment. of debt exacerbated second how when are do we something. I going side, XXX increases, simple think Even call, since the is It's

for very than place, debt capital repurchase. did a buyback. is the And less to in structure a approved announce share executed still share higher increasingly against that So only the to to that. attending us. about disciplined million and put continue million an and financial We profile $XX is plan evaluate We $X priority and specific up analysis, when you we'll probably

Thomas Singlehurst

very much. Okay. Very clear. you Thank

Operator

you. Thank

from Next question Raj Riley. B. coming is Sharma from

live. is line now Your

Rajiv Sharma

in for of a questions. just uptick to the you Thank see taking the that color on terms you and product continuing quarters? you and terms wanted I few Hi. address uptake question several Global expect Knowledge the And Do could the the to metrics in growth that have stabilization/increase sequentially Codecademy, in just some a if next give my things similar that. on you of then I see.

Jeff Tarr

thanks. Raj, Sure.

Global we much have been understanding a really that quarter. of able pleased the with Knowledge that So also business, passing we've each we to and are business stabilize better

So I feel future. foreseeable good the about continued for stabilization

transactional Now keep business. mind, a in it's

that have and stable, – see why we our that don't subscription news. more with a points. good that's But on it's visibility our can limited today, So than key said, understand from business. stable, I couple To is it what business of is

partners all, of year-over-year entirety Those and First be on the And the reduced deeply two that they we understand purchasing when decline the other they behind quarter. growing. in partners subsidies. rest in business basis that their subsidized their and That words, year-to-date the can in reduced one In subsidy partner has of consumption. very changed The the attributed a actually of it customer is training. today. largely to model, us, been business

that's that in news, where time. point this good and get is that's at we this business confidence So stable our

Rajiv Sharma

had then to And And as Great. breakeven expecting metrics on following months you're and product uptake, Codecademy, whether the you the that? on earlier? color in reach any XX expected growth a

Jeff Tarr

certainly. Yes,

about through then slow the quarter Code code lens quarter. let's is got quarter, current and start the but in It a into BXC So code the progressed growing. of talk the Codecademy and as reaccelerated BXB. BXC

a grower way, we believe good of we point on we when business, as a and look this about constant So thought the double-digit is sort by most are high point, where business of, at performing. the below low competitors acquired it's while our above – feel basis. what out, single-digit, the If I'll we that BXC currency we

and with If share at we BXC. news. traction of we're business, taking good customers. uptick. getting just sophistication look with That's caution Fortune sophisticated we very expected, is that's customers economy. longer in seeing of believe So little I'm we're than I But real the that the been side we that cycles XX largely scale talking to have BXB we the some believe and Codecademy. a this are taking Sales customers in good all code due

most very of we them and very companies expectations our achieve over time the than code, customers, original XXX about BXB about ability set are good the to of feel to side on We talking things. more large

Rajiv Sharma

And Am to wanted customers. new Got from a expect in just understanding correctly But that's bookings good I largely one this I quarter? you the the had of then the Content a downgrade Skillsoft, terms expect it. a And business. clarify don't that you obviously you this the one-off especially that you than in – shouldn't is perform minds, SMBs consistently, enterprise, event your going see shaky occurring the economy. expect are say a we large despite large since to potentially and to better that enterprises Is that... on

Jeff Tarr

few very hanging foreseeable have why organization have the say forward positioned reason of the another again, have future. to foreseeable size, that I'd believe we that well so experience, We we're going like not reason no anything anywhere that learned kind in and from and customers in feel I that's event, of that to there's out our has that future. also

If you the metrics. pretty were look through consistent that one our event, business the with metrics the in LTM quarter in

some look to get the and QX. confidence another at business around that's way really So

Rajiv Sharma

this I'll Thanks. Thank Okay. you. you my questions. for Thank answering take offline.

Jeff Tarr

Thank you.

Operator

you. Thank

Next question Oppenheimer. from today Wong Ken is coming from

Your line now live. is

Nancy Liu

our Hi. Nancy on Thanks Ken. questions. I taking two. for This is have for Liu

on cost the and you first forward have full levers here, of focus to savings you the you OpEx as can with reduce The savings pull see further bit or prior more do one, a P&L areas yet? more cost effect the going

Jeff Tarr

I that We've been we've focused our add? with to on going tightly. headcount headcount, to approaching the I why into is been year. that that. QX We're continue. and where sequentially. disciplined very and taking managing was I'm start add cost a something. anything talent expect Rich team structure approach Rich, really and may sense, offshoring pleased our Actually, how makes that And So next don't then down to very discipline

Rich Walker

context. add companies did in another. and only four together divest XX maybe We the first bring the months I'd of

the at on driving continue layers. the smartly do we're of around degrees we'll on spans the business efficiencies And is of our all and unrelentingly constantly further response look organizing how continually integration. of we do to So of business. And And continuum organized, drive to we're And this think in and is as I companies of evidence our process. efficiencies culture time. that, and a quick ILT the great part a journey, out

Nancy Liu

it. believe Knowledge you Thank inside Got I second update That sense. we productive there previously now? were to capacity more mentioned go? increasing is then those specifically. some fully you. reps get your you Can on Or makes my question, sales for that? Very And Are helpful. an Global

Jeff Tarr

organization staffed. The is largely

Global continuous not talent we are there's be expect productive productive. that's XX talent, this the turnover fully we XX months in fully the good take people like business, a made no. Instructor-Led the lot answer that future because will great to take to our effort of that to a one fully in the Now for of be salesforce, but XX XX that we always changes to and business. We to at terms within functions business, of our Training mean Knowledge, that. is generally productive, hired And of just I of Subscription lot too. months. And hired a reasons It's feel about

those So until we won't full achieve year. next hires productivity on

Nancy Liu

Thank you.

Operator

you. Thank

is Simmons Davidson. D.A. today from question Robert from Next coming

live. now is line Your

Robert Simmons

quarters? CFO-type operationally. strategy expect how and time our to things? your evolve then taking Is on more I'm are changes the for that next versus first, development how now the same questions. you few and looking activities as basically right is thanks it thinking your guidance, to guess, You much of do CFO, of but Rich? kind essentially you what role on be Hey, already I old approach over going touched kind to spent of And of

Rich Walker

But on address make at And think that allocation, partnerships my sure Have only in investment is on second spoke consuming we're and I'm a office. to focused we we're as capital share on an driving driving not Yes, and our the thanks to business. almost I of a we highest – portfolio, but business profitable more and now spending spending growth, the and not We'll to. continuity Mine for the time. all lot disciplined make the that's in of they evaluate question. a I'm question, environment capital time debt that. repurchase allocation. efficiencies, smart, that areas we sense, Robert. our productivity where more look the my time as not transformational development corporate acquisitive. of our entirely We're team, good of team good, continue your

Robert Simmons

And Subscription, Knowledge alluded color great. that's on give more can Global detailed You transition how but it. on us update Got any going? the briefly it, to an then would to have be you

Jeff Tarr

business. overstate to So business, is transactional I not suddenly it's going and want a don't to and a that. become subscription It remarkably

the opportunity So margin, our subscription as a on business. we the and ILT we the capability see for subscription differentiator see

journeys. area it's topic of we've business for leadership, career whether So nature immersive leveraging the But our capabilities the with career ILT transformative deliver the our our core in as a including the beyond continue that modalities, future and above transactional see is, really of growing experience of all ILT, business to will ILT of skills, and all likely is we and that, technology, source customers included journeys example, what our be. a to growth. and our of aligned really of regardless an strategies blend all learners Those to experience suite in that's of experience,

Robert Simmons

about Any color sales the And or you then there sense. seeing longer terms are this seeing But your you of helpful? much are the deal in getting? Got breakup? of so kind for in on what or this for compression would That they talked of you makes Codecademy. changes you it. How Are rest cycles be business? touched

Jeff Tarr

adapting transactions seeing days, nine maybe to big nine six months. These everybody cycles with their prolong to so is XX sophisticated And to months these reskilling, we we're are watching budgets performance, should from And remain transformation foreseeable more companies. We are larger said, guidance. to that's – continues for that that. critical see that in our in see upskilling it you our imperatives. And workforce the future. that With sales assume you

We a reason increasingly also in companies. as development, to certain employees and have key development are shortage labor they roles, with their stay own a looking

inside believe enterprise. is little business I positioned. we're well the critical a to longer or an So It increasingly upsell. This takes new service close just

Robert Simmons

Got you much. it. very Thank

Operator

you. Thank

from coming from is Piper question Ramnani Next Sandler. Arvind

line live. Your now is

Arvind Ramnani

comments you just on just the overall follow-up wanted made Hi. Thanks some question. sort the on Yes, of taking for I demand to environment. of my

taking you of on it indicated the are will budgets likely some done cycles overall, like from checks pressured. own will hand, my bit kind on I looks based spending spend, a curtailed come versus Like You XXXX it And be XXXX I've that deal while that looks just education. longer. enterprise one initial in kind checks. in like little XXXX of mean more overall, tech, good of on demand have still good appreciate been on – fully yet right, coming are it – of that environment not finalized, seeing. kind quite pretty things for like just those, that budgets Skillsoft like because hand, kind help of but there's looking. you're you of healthy. kind you I other feels Can for where the demand looks also that's pretty seems the demand reconcile how it have in, have budgets But And

Jeff Tarr

smart pricing win about really believe segmentation, a do. to to is our growing Yes. key have in We Thanks for growing we question. segments. we for really and and where we the a our those what and can we environment see be profitably, this where critical to need high and The understanding to an our grow aligning win, can products likelihood packaging where we like

we're we for too. a unique we and is we at And sure what doing that work environment outcome do best we critical So believe hard year. reality make that possible work, next a is offering. The a can to the have the deliver really hard reality need

deep customer are and enterprise the We base. largest a with player enterprise heritage

We have a tremendous breadth of content.

skills deep skills, technology, that's in player one leadership and the are business We compliance.

experience We a – the And content online transformational product learners. that today. of learn a as designed have we're way people breadth our creator our truly for we've deliver allows us a modalities to tremendous to

that have opportunity on of percentages mobile. and kind we're or – We that seize delivery. a are They the don't really workforce the as progress. phones, the laptops large are in of way, we working that They're with tablets. even this quarters deliver we approach learning positions mobile our believe example, micro value For and going for to optimized us unique

Arvind Ramnani

kind right, with unit That's of of of maybe to any all, as you helpful. some pressure keep seeing And just keep kind to healthy looking pricing? volumes your business and and pricing, are on you like clients on growing

Jeff Tarr

be study including quite compelling about kinds in conversations. a conversations ROI. data, which have powerful. And we our – to in end ROI of Well, this with them to ROI, up value really environment, often we always move really just try Forrester we I We think and did is those on we

to have we're equipped So those conversations.

get The we other of and from maybe a serve segment tend where generally don't important and sees that point to tool box, there. about and play a is there's there's Well, to clear market. to segmentation transformation check We A market that learning win a play the as need thinking to we to employees imperative and part is have pricing packaging. B. point a and need workforce the of There

a that's hire project example, from at win, and billable for lead. people development we intend to a reskilling to Like first from get to where and promotion or people our their and extend to better develop for that better leader. or cohort So we

Arvind Ramnani

It's get one about you've announced Terrific. been since And more just if in. I can Codecademy. a year

how provide update I can and one not on you businesses merged on of assume you But drag mean side on kind helpful. is business good sort has of sort be of Codecademy of a the land been rates. If fully discrete that have sort would how super it's of Any I keeping whether gone? there? full would acquisition, are some growth updates may growth is deals? – be help Or new accelerating Codecademy any

Jeff Tarr

quarters more of than two into little a we're our ownership. period Well,

The and amount They're I a competition really business good So we while it's as much the side. before. announced gain all, about particular first operate this at segment. year, off it, their of BXC BXC should feel went year, say, autonomy the progress last the business. good they're made. team I tremendous the has we believe of starting to in we That's I operated really outperforming the been that grow and

have I about we're that months. very customers dozen side, XXX we started. and signed. progress talking enterprise We've large are large Sales two that feel nine, On got got we're We've about than nine, just customers that very a six, our to, are with We've we're the cycles good customers. closed getting where making. first scale deals and more XX pipeline of the BXB of

out of back costs, tease lot In of we are being the the various integrating to structure. able terms office a cost

reportable integration on report line roughly the on office, we there that been But bottom track asking roughly as is a that, back segment. year? the feel and that there eclectic business think fact too. of next best tell, so that I breakeven set Codecademy. hard be separate we It's yes, to to was roughly substantial don't has a the as ask trajectory transaction. out. question it's So can for we not the of in that Are And time break But you're at to we earlier, I and on

Arvind Ramnani

Terrific. Thank answers. appreciate I you the it. it. for Got

Jeff Tarr

Thank you.

Operator

question-and-answer We’ve to Thank for closing turn you. reached floor back comments. or any the end the I'd like session. over of our further

Jeff Tarr

very Super. Thank much. you

ahead. We thank to follow and the our of a the much. And of I'd the granted. to globe. all thank the and Skillsoft of that the greatly the are I want business. way appreciate the our you with that pleased follow to stepping First all work all, challenge opportunity and entire up environment, challenging like do call We all don't company. team I'm team shareowners, to around on take analysts you thank for very hard This you our is operating who is this to also

started big feel in make to execution many ways, delivering on a committed difference. very deeply is the of are very will a we important and And and vision just We return. operational we're that getting

you thank posted. you very much. to look So We forward keeping

Operator

today's you. That does conclude Thank and teleconference webcast.

day. today. lines time a have you at and may We You for thank your your disconnect wonderful this participation

Skillsoft (SKIL) 7 Dec 222023 Q3 Earnings call transcript