SKLZ - Earnings call transcript Q1 2022

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Operator

Good afternoon. Thank you for attending today's Skillz First Quarter 2022 Earnings Call. My name is Hannah, and I will be your moderator for today's call. [Operator Instructions]. I would now like to pass the conference over to our host, Stefan Gerhard, VP of Finance. ahead. go Please

Stefan Gerhard

introductory letter, welcome a on Andrew Officer; Conference and forward-looking Skillz which Quarter session a are First and release session. a company. Good We the the Financial Officer Chief Casey Chafkin, Hosting I'll to of Executive proceed today, Earnings question-and-answer brief press by followed earlier Call. Chief published also measures, we Relations our Revenue our you've and we Officer; chance shortly XXXX had and then non-GAAP question-and-answer have and day, and today, immediately the which read remark Paradise, by statements stockholder Ian our Lee, Chief of website. to hope both Investor available reading

a our CEO We video short have also business this of discussing posted quarter. website our highlights our to

forward-looking comments Some of federal securities of management's will the today within meaning laws. the statements include

statements, Forward-looking or the such materially to differ and should as we usually expect. expect, risks actual numerous results interpreting operating uncertainties will, phrases, to by which from Therefore, condition. are a relying of what subject should cause could risks that discussion similar words more in impact other filings identified you and company's financial caution exercise refer detailed on them. for could that the results to the and you future We SEC are

release. or evaluating isolation call, our remarks. reconciliation some to management the in operating company's measure comparable first A Andrew the performance. results turn in opening a for believe we XXXX measures directly earnings call be GAAP prepared These that, our useful considered I'll financial accordance the the During available should of be will to these discuss which With substitute over non-GAAP with can in most in brief quarter is GAAP. measures not for measures, as

Andrew Paradise

and results. Good us Stefan. you everyone, you, first XXXX afternoon, quarter today discuss to for our joining thank Thank

at highly a everyone QX Our site to this just I Investors look published it have time. letter our when afternoon. encourage was stockholder they take to

Before few to I'd taking share we questions, a begin like thoughts.

really growth, XXXX plan. profitable Change This for quarter, transition that we a commenced change significant to and required isn't easy. our our

a all I it think faster. would lot we wish be

As I'm Skillz, satisfied financial at larger certainly with the results. current the shareholder not

moving towards XXXX as significant our XXXX for made EBITDA We of with XXXX. of XX%, negative progress year. our is as ahead to end still be the better have goals year-over-year engagement rate our targeting reach margin a And we're to lot more the plan while but adjusted a than marketing by XX%. this above to we breakeven quarter a reminder, revenue after work growth a However, us, business exit

let period year So results. prior the active engagement quick was was million. adjusted XXX,XXX year you recap to X% by to XX% financial Revenue was that up which year XXXX. QX to up quarter, EBITDA over marketing over XX% up after users. of Paying the over to prior $XX $XX end, was users And $XX Revenue over our period a last million the million. me give QX improved monthly prior period

progress of QX, a private additionally, more from were will that we've meaningful XXXX in moving we important a step This gives we to after quarter, reduce been a balanced time, There the while We spend in able unlock out We our experience. that made efficiency expectations some significantly as which in us enabled larger efficiency, marketing that on gaming of remain towards billion last onboarding line a revenue about is quite investing marketing of overall some us strategy. access marketing discussed year. were beta focused been to marketing. we us product And launched low for in better which we As results our a hot deployed technology through building our unveil Overall, in XXXX the in some improving engagement an is strategy innovations growth product. for maintaining web with in gaming UA games. a reduction are And and percentage be first resulted there engagement return for marketing to which this to programs, X access we'll we engagement time audience able computers cloud-based And product. QX play It with improved to revenue. as computer QX. profile. our eliminated a our as users well we've

deeper We also user drive rolled will which engagement. chat out system-wide,

side, the range developer saw on our our content of the games platform. interest on in from GDC, developers invest On significantly level for and I consumer record Game attendance their Developers COVID. the GDC of conference we continue game to considering in exciting, think down which prior Conference, diversify very was the side, to at was the from prior to developers We especially that or the GDC

UFC, Skillz game multiyear world's to mobile challenge the into soft moving where arts and mixed on now with this creations developer also, for a are finalists NFL game platform. branded NFL the signed organization, the premier these a and quarter, selected We launch martial game, create phase our partnership we inspired

path be And and letter, able be website, social hope growth. the features and through and efficiency, community their QX in While for through this I monetize in increasing building We've developer to continue in that and chance you'll to we investment early investing while a XX increasing price, core definitely years more innings our continue monetization is plans still better and insights. incredibly building will pursue And on control that shared to profitable stockholder XXXX improving our platform business experience more better with to all personalization this innovative started which is get platform, to in we creative interactive consumers to When of entertainment building as our massive and ago, a product that this future excite do we're can for art delight developers. The education technologies can't developers our the our of. this published read. our our detail opportunity in developers. more committed we It's we of and improving stock we'll for first building and on the fast-growing a to build to players growth experience, and marketing we builds set greater our revenue the features, higher bright. the profitable such, control

for want when on those for easy. and of us, journey you support the be So gratitude things belief sincere haven't who my been with the to

let's So said, open with up questions. that for

Operator

[Operator Instructions].

of Genuity. The Canaccord Jason with first the is question Tilchen line from

Jason Tilchen

potential talked about it some you ambitions in obviously detailed At the there. And you the the gaming Day, Analyst the that's the and letter test again with around done. shareholder being cloud-based of beta

more during versus Android have if curious share Just the could to the base from games? over contribution about and access are app you do as you engagement users time the to of of from then have overall users sort get sense around And your testing. anything user any Android potential -- of the could on that able iOS Google Play the magnitude store

Andrew Paradise

great a question, Thank It's Sure. you. Jason.

games. testing we in X So private first, beta on -- the cloud gaming, on we're way

be So it's early to talking really user behavior. about still

for this that lower Android to can starting a I bit to but our UAC little comment So we both business. believe collect opportunity. we're can LTV increase Separately, data, on continue certainly just and the

when the XX% XX% which to a us. market, are in with we're market, that experience look -- payer core And comparable about are our about the think of you are all the -- X/X the U.S. U.S.-based for Android on We is iOS. over smartphones at U.S. of we deliver we market, If about those experience Android.

magnitude distribution? of to have anything And mean so have from the you do that. what about add size Casey, you'd to it of Android can distribution meaningful like sort would you

Casey Chafkin

Yes. Thanks, Andrew.

the -- opportunity cloud it's gaming when opportunity, domestic we're market. as the It's at we the a well roughly global of look certainly opportunity, right basis. both and pursuing Android footprint global from a that XX% the on the now, as which sizing Just

include And market. while States product, testing beta web Android, excited early private upside, are that both doesn't even about very globally. the the so the we also inside the on but United And on in cloud

Andrew Paradise

I'd fully Because most about right The games video are offering, you -- final piece that add is other be service will that have viral even big it is what if actually pretty said coefficient. if they of cloud great our we now when coefficient and Google that really think sharing. with go And current up a beyond thing Play a Casey viral. not the it non-Android, popular, really clean our having without viral damage platform, really

cloud, the of on on pick on exciting it opportunity, to Android game me game Andrew the things about shares sharing he with user, KCS the one And and about going launch I device, Casey. his if link. via my instantly you tap when play iOS single my if if that's it's on sharing and that just I'll So text Android, literally link, the to to enable will be think

so very And on experience caution to to that But different that a I don't merit. lot that, reasons have have data it's we just of to want said has -- a cloud. yet everyone having think we should user we share

Operator

The next with question Bazinet Jason is from Citi. the line of

Jason Bazinet

Just questions. had two

partial think marketing that it's through cost in efficient second, didn't impacts I the quarter, kick guys quarter. And some us think ARPU? you these full guys you paying spend, users sort As of and more mentioned a of help how focus you think you can on just then saves that for

just the So can it into well? that elaborate on second quarter you continues if as

Andrew Paradise

of I you. trouble little having was a hearing bit

on first monthly the actives marketing spend impacts in was it how efficiency ARPU? think paying I question and

Jason Bazinet

Yes. Correct.

Andrew Paradise

Okay.

control side of best the you Casey, think I probably, to you're acquisition that the user talk about as business. person

Casey Chafkin

system. in we initial question. Jason, thanks paying the about sequential spend, on see reduction And -- MAU Absolutely. the in reductions you reduction an When for the think marketing

in you if our spend XX%. acquisition So this at look we user quarter by caught particular,

down see efficiencies Our we that's is by and that And continue the sticky, itself paying we cut to was quite as MAU only product spend. because X%. more

to now. spend, reduce sequentially it then Then reduction it system. an long-term on the paying level we retention as based of so the and continue you initial off will in will see marketing grow And

that most that the spend. answer so users user to very system impact reductions higher in on would Does users, large marketing we In that higher-quality marketing terms question? level number mature and we your continue and expect today on of have system as average per a paying system, spend the revenue buying users are at don't reduce of a on

Jason Bazinet

It does.

at really we then ARPU of the year-over-year, that efforts? linked opposed that's we of marketing to more to comps decline So as COVID lockdown sort sort look when saw that

Casey Chafkin

were income market effect our checks positive business. discretionary stimulus globally, when increased a certainly, I and QX had on think, issued in the

Jason Bazinet

then on the my second And Okay. was saves. cost question just

for quarter true? you those the think full quarter. kicked during said I the maybe, in Is that not

Andrew Paradise

for little comment want the a savings? cost on do bit to you Ian, impact QX on

Ian Lee

Sure.

first. it's Just Jason, let I'll Ian.

So that just first yes. on part,

me hear Jason? you So we okay, can kind of -- sorry,

Jason Bazinet

yes. Yes,

Ian Lee

about Sorry that.

acquisition we user So the quarter. marketing did reduce across and engagement

at to did March lower we to in that yes, certainly So a January. kicked exit kind rate But relative in. March of --

discussed, of Casey of the part kind into as got middle think we is the day I the best quarter.

again, in the then more the for of January. the So not if during quarter, we of saw course that, fall

say acquisition, use we continue ROI-based user I'd the costs, we approach. acquisition value got user can at As in a for reduce but lifetime also base. our of look lot we're an to of work there into grow certainly doing We've we get our that products user QX, to terms how of

on spend there. the a spend between the we at at on to eliminating estimate million side, of user how right marketing acquisition In QX. more user range might when somewhere of for without for QX, could reduction low a engagement obviously, acquisitions guidance, where the think programs. million engagement for -- return revenue getting Similarly, focused marketing think on but a focused I think looking be we rough $XX I effort lot as be to UA percentage we a of our look $XX really optimizing QX, now, we we by So specific

in captured of lot QX, fruit, So you that if we a will. low-hanging

think, to in and more to just can into we year the else QX, QX As latter the optimize see loans beyond we QX. low-hanging those going get so had fruit of the programs, in running deeper half take the continue further where we're we've I test to

to is QX, So revenue relatively of expectation my percentage engagement as flat marketing will be again, a relative of as in revenue. that percentage again, a probably QX,

Andrew Paradise

continued as percentage we That's in to right, continue and decreases revenue just the as of expect Ian. efficient with business. that, more to And get marketing maybe a quarter-over-quarter summarize sequential

Operator

with The RBC the next question from Erickson is Brad of line Markets. Capital

Bradley Erickson

or slow regard and level, those a I you have cash the some hopefully and speed you're wonder, balance First, at sheet just to look product development And balance up talk mitigate And down about you with follow-up. I try burns. to today, to those do reduce just with at where the and burns? then as marketing spend how maybe product burns you development

Andrew Paradise

Sure. question, Brad. Great

I short-, very being think long-term each we approach our running milestone-based into investments. the and product is returns as investment are approach mid- we're and about thoughtful taking a of different then what development those tranche

we're short-term quarter investments the by end So making, we'll rolling very the be core loop a of out new experience. player for this

interface would bucket that pretty of for put changes return. So around that core players. user significant experience short-term That you'll investment see in and the

I -- something gaming returns to If core you something figure, was it multiple sizable investing our actually we would and for something Ian, loop. expectations is it's coming that us years, think you in like long-range yield, term have And expect only for although argue anything even something we is about more like you'd have a do quarter. longer-range cloud-based a add? originally that investment where dollar in short like now been to we that last than dollar for cloud, that unbilled investment

Ian Lee

No, I think it. you catch

Bradley Erickson

over Got that the just past, just it. year And hopefully ones drive can -- growth the think then and other better next you follow-up, two. on a retention some the of payer Remind about categories us or talked you've and Andrew. in particularly maybe the

excited Just any on horizon. really about you're categories that the

Andrew Paradise

sports we're younger Well, to because excited all as about the demographic. a male burgeoning category think on it I speaks primarily a platform and

some bit players puzzle the attract on you're you it that women typically a When and about to more so demo types majority card, will And think older. of a are us or allow platform. player not getting today

so excited generally. And we're sports pretty about

us sports I now titles, that on the great UFC the a think launch specific really numbers, built investment think from game year. fan personal playing certainly from on with NFL enjoy games, I'm I I'm I'll platforms. signed this focused helping excited yield soft I'm standpoint, content And our very and a as having all Photon with we're least on it's UFC. the a at getting about UFC is last in focusing

$XX you move games. as If for us Photon really sports into remember fighting these like is Ex or million the a we important synchronous Games, technology investment in

Operator

the of question Lampen line The is next Clark with BTIG.

William Lampen

and it's there are that expense Maybe have please. do at dollar UFC. could QX, on first your NFL help terms for might about but of the a saw figure be good first, stock the What that follow also already, my on over I'll know specifically on little gain of this timing Two up that SBC possible IP? of of for or me, underlying the Andrew, the disposal for layer it XQ And we go be sort any you for Skillz think are Is Could the exclusive you if on year? year? relationship the maybe the elements comments relevant? deeper onward with next we platform the developers the answer in comp bit UFC to I Or sort of of way? a more their in the to possible I suspect The see would in specific ratio course in willing a what half a figure is question you could us launches? second And Ian. building be

Andrew Paradise

Yes. Great.

them and would actually first Casey with So and the be best UFC to do about the about let's talk NFL, teams his talk and probably deals see partnerships.

Casey Chafkin

large, The the very developers access you the partnerships. UFC. licensing to often innovation brands SOKE well-known upfront little is And typical very game game minimum content. in that or gaming both result developers from get comes have because about the excited of that payment Really content or Absolutely. guarantee developers mobile requires in large from development like the model for a the NFL to that

And on so big developers there with in X Skillz, getting. the partnerships -- that are respect the are to things

more that more developers is games also first developers paying more take content to it the increases and minimum, right build upfronts risk. to access to and innovation the because creates without the and and The both IP enables inside and category those building interest

costs. comes get possess that go support when from well those the the to and that The marks support launch. marketing of games assets thing access that as marketing brands both second from marketing marketing and lower themselves for we entities each And is developers the hard to as

developers hear terms games complex more In are investment soft the core hit too. experiential games. and and really gets I to new factors making We're thing the time fine-tuning about timing, the loop the is platform of the excited on increasing the as longer the game themes, excited spending really that games, launch as our hit platform optimizing is inside about know into are they're are that developers more everyone period games. and The interesting those getting new typical about

of we we're a an And those launch of kind declare the so we're about. we're games season. to that have the line, excited kickoff is on and year's -- And current that that winner NFL next around still seeing growing NFL number of what a is think line, for time right time soft competition I said the

Andrew Paradise

hit do Ian, stock-based question? you And the to comp want

Ian Lee

I will. Thanks, Andrew.

So comp. on Clarke, just the stock-based

So for onetime-related million, that includes of the $XX you units. is cancellation QX the of a about stock CEO-related number expense $XX due total which performance a about to which saw million,

that that will you if run onetime kind million if give would of to what comp be in stock-based $XX exclude rate, So quarterly you you at charge will. QX, a the will closer

Andrew Paradise

company to my recommended cancel own Board comp. I comp a to my I mean given performance. for little credit the canceling

and great a And we of our very is right on built the think moving on I to pain is team think everyone now. no I future excited focused where possibly as as business. But about can The shareholders, am are one in team is I which path our all getting of XXXX one not a it's our we're to to insignificant. fast big XXXX of well. we shift. benefit It's cultural, as strategy off of moving

Operator

with line The next from Fitzgerald the Brian Fargo. question Wells is of

Brian Fitzgerald

questions couple a Aarki. of had around I

being, target. into to one publishers Aarki guys, don't First more to are mobile data have AT&T, they but lean you not you given impacts seeing from enough

leaning into then kind X of And data they're so Aarki. first more. scaled And one. of I have the the That's

Andrew Paradise

also Aarki One I of and the to -- little post-IDFA there. about a bit Sure. are couple you want Casey, we're do a about I how think over there about spend things talk to removing chat data. and world guess is talking and then

Casey Chafkin

first-party Sure. on Aarki to Brian. guidance are little separate complete developers media both monetization a we Happy report the as there, unit, continue to the and that with a offering between Skillz for business, Aarki's We respect enable both and service a we provide spend data. excited bit be business offer prospects don't -- and Aarki about its around of but particularly business to abilities exist potentially opportunity our to with both to our Aarki and business also acquisition, enhance to ability though really targeting to synergies our the

operated DSP growth so how migrate that to also and exists, -- much continued landscape expect we're when planning but but and our our owned exactly see And to to year. portion to shared business company to based plan do that a the of spend move product unit, of significant Aarki, strong kind we that, we're has. we both haven't the on we spend tracking own And Aarki this in that

Brian Fitzgerald

kind ecosystem wean into the or -- optimization the things, efforts concerted the you're you the really one take drive supply but side around of of other see supply -- value of in And know path then mobile more to the to it just some waste path of of to out the noise on kind optimization. seeing it. the Maybe kind of was DSP. and want techniques take don't in Got if middle

value from process? amount therefore, the you the you guys then, focus do they of with kind of efficiencies. and away more But DSPs see channel, out work kind the So deliver people of seeing of narrowing more to on

Andrew Paradise

I'm that, there's think see anything don't Casey, of. unaware to we I'd I but defer if

best like think value of generally, a do you when we're And -- dollar-based buying ROAS including it's we're Casey, per I looking dollar see comments? very spent. approach. have much for customers DSPs, we off

Casey Chafkin

was just definitely businesses I scale. learning-based add. to Yes, come Certainly, with synergies going machine have that

from just synergies best the And often towards gives as seen also so possible. to where we've spend and go as them a spend. return pointed And really what going profile. But will dollar geared are those efficiency that that Andrew out, are buyers that with exercise the we the on of winner-take-all necessarily provider buyers, ad is are the isn't

Andrew Paradise

last enough haven't DSP, problem. of of No build able Yes. a commented machine profile. learning any ours, kind to we The I to market create including lead is seen, just Yes. on thing that winner-take-all

So...

Operator

line is question of next Stifel. with from a the The Drew question Crum

Andrew Crum

Okay.

Or we've that And just your Are of employee company? you the of headcount What it's added XX% are heard add or is In in employees course your the that terms capital? more any planning turnover? year? over words, your seeing experience the labor intellectual should pretty to more Is been in employee the So recent during market's continue difficult other with XXXX. you something retain has to increase tight. salaries anniversaried? issues been not you been been to finding

Andrew Paradise

onetime, of proactively is Yes, ahead base that. moving of really a XX% increase the our recognizing experiencing inflation that proactively and the was level employee

-- a much QX in and rate. it's run our very it's So increase

we're is something business that. very mean, on I right now would the a understanding generally, market monthly for type of something laser-focused It's cautious a basis. it the labor terms of And at on. about Regrettable our one haven't tight. very the of we uptick that I of that look measures attrition in think, and huge In of regrettable good that, a is business, I attrit, seen health and we but is, of is weekly our add, we're the market

credentials. combined space, company, we've piece anything the market technology our piece more for in have and add upside business hiring a a are it's is of BXC that BXB say, than There in companies the developer it's the for BXBXC it's where with with best I space, the We very employees payment actually last have the And to that login seen position. few uniqueness, the world unique the potential the a helpful. the months. owns platform some if think community few in I'd -- Happy in tech color consumer

Operator

is line of question next with follow-up question a Clark The Lampen the from Lapin BTIG.

William Lampen

back saying what of leg maybe I I player the on Jason's of marketing Casey been short kind sort of that focus follow-up the of those next question if topic. their efficiencies Is the component sort to beyond sort expected deal that I and top greater dial cohorts future understood budget? asking experience likely way. better a I higher-value Or valuable, user missed sort earlier of circle and of a I run, to really existing just monetizing that the the growth future of most go and of the think being and another driving I unlocking think with pertains to and trying in to monetization display function appreciate on was of along great more wanted the But guess, maybe be commentary. growth, to improving wanted heard mature it back dollar mostly smaller I about in of encompasses latter the on as part to sort the system, the most on also. then cohorts ignorance

Andrew Paradise

question. great a that's No,

of messaging I driving that think I going cash this flow overall in think revenue position on business it's the a a focused end much this efficiency, we're been be range of XXXX. repeatedly very breakeven possible. total growth we've adjusted in so of by been within as to And profitable focus to business year, positive, bringing year, make a getting our intend that very EBITDA we our for

growth, in to against we're Casey terms user talk and I'll how think marketing over I marketing. a of UA little about it working to bit turn and both engagement

Casey Chafkin

Andrew. Thanks,

X thing it's the to run And is is it's acquisition short and a there's user think that reducing I inefficient spend engagement eliminated, marketing. in the doing think, efficiency, first about once inefficiency. it the spend our both is not inefficient that we're just Clark, way

of so effective investment in cut spend. the kink about continued base And through grow inefficient that advertising. revenue think that continuing growth X those there's short-term extensively channels business comes base the curve and is of user business you a the and the to direct-to-consumer things. after from profitable that profitably we One marketing in the the

marketing that The And content and thing continuing is platform marketing number products drive third but our invest content the content the increase friction LTV, rather to are and developers increasing than that to product. that continuing drive for Skillz them. second the is in of both of distribution the growth reduce who high-quality the to in also

of those coefficient, accelerates being that the example mentioned Andrew when growth on experience, drive think I the investments which loop LTV, that existing viral core a player friction reduces So that which increases something making. of investment we're of top marketing on couple gaming in and system the investments, improved being helps an an cloud an of discovery itself product

Operator

questions are time. There at waiting this additional no

turn call to will over I back the So Gerhard. Stefan

Stefan Gerhard

through Say of point, collected Great. from our At Technologies some that we'll post the this we investors questions portal.

in going to cryptocurrencies will we is and be rewards first Andrew, that aim The make to provide looking for NFTs? are question Andrew.

Andrew Paradise

that earn the player the it's when and community. is We're we're our the Skillz of is flattering pretty and very definitely in bigger found something thinking has considered in crypto a about deprecated marketing the traction at this is ways, or business. because is earn and how developers prices, the been looking themes map. broader pay that generally, is one at from original crypto to and Game be some now for gaining it. that looking pace for community year. road honest, how it not to aware we for But NFTs And pay To at near-term We're Developer GDC payments at frenetic to implement or Conference

Bitcoin XXXX. first to we gosh, XX Now servers in mined for, I since with say years want their almost

hype we want for continuing think and don't that, reality meet there out anyone us business in than deliver term. does that developers. to we're seeing crypto to investigate I you'll we're Other near this our message that So can to where what we the -- a from and meaningful see

Stefan Gerhard

Thank Andrew. Great. you,

for with that Casey. is or the on content developers question to you increase audiences large Are partnering can platform reach? you any the Next the

Casey Chafkin

Thanks, with of content that a and the over continue platform life the continue now the we've size as seen to is we're increase business What of the and they're building that complexity the on the Stefan. that of to partnering both business. see the developers

it. cheating you days, fraud network come in offering as well If matching, attract customer experiences the of to set, that business the companies data started best we're from that system, had we suited the that continue the as do both built just sophistication the to feature player optimizations of we're to able building imagine that the and product the And the just smaller to effect because aggregate increase. early large service the build as and was they seeing size increase, of continues with the anti of and and we

those, Etermax, maker so you we've crack, think I'm the or about Triviacrac. a the And the of is like the couple sorry, if holders which trivia thought world, announced or in largest IP of Hunter Trivia the game maker

the just and see developers point, of as should you some the few starting continue we to can over You past that years. see in those have to ecosystem trend the proof join

Stefan Gerhard

Great. Thank you.

we expect this one is and when Ian, for profitability? can news and direction growth question, Next Ian. regarding more

Ian Lee

Well, thanks, Stefan.

full quarter. some year I just So gave of the to recap last for we guidance think the

marketing EBITDA above full earlier, the XX%. expect to marketing again, of little for a just million exit the revenue negative So was again, better of mentioned than was year after And then with guidance year target and QX we $XXX $XXX engagement XX% million. of recap, growth for revenue adjusted this full XXXX of to rate engagement margin think after in revenue guidance year I the sort Andrew

on we Just rest or of some color a year more for quarter. of least little next bit the the trends the the expect in at

marketing acquisition optimize the a QX So seen in I year to the marketing we you'd QX. we growth in I engaged continued earlier and think probably looking talked top given engagement on bit see more marketing, and user than from call. you looking revenue that to lower initiatives rate the have line that And on expect rates, we're improve on also growth after to growth stabilize the probably then the as the product during do revenue about around be say impact little the rate, optimization

large So you. towards the after initiatives on out marketing end as of expect go impact the Thank users have product features we probably to more revenue of kind engagement to year of the those a those system. on more

Stefan Gerhard

I've since current stock got Ian. as well, you you get about for And thinking pricing? back to Skillz one already which is given the next all, I'll buying Is Great.

Ian Lee

Stefan. again, Thanks

have we how we going all So look, allocate and -- to our alternatives use the we're always capital. to evaluate

downstream platform users generate we're people let the better today, a developers, business, view by and content and of our today. that building better our our so higher much can So for by we a return back like things products shareholders potentially better in investing for and stock

returns that continue for we at to continue and shareholders. what alternatives, highest the is of all best would long-term So do think we to generate look we'll capital our use of the and all the

Andrew Paradise

I'd Maybe add, Yes. just Ian.

that to it's future. the we're stock near be a think pursuing buyback I unlikely in going

Stefan Gerhard

Makes sense.

gaming. Andrew, that of with about is for again, future coming any metaverse? up go the Next new This talking you the Are question. games with one for would

Andrew Paradise

Internet place. metaverse layer of abstracted building the years for And think a be the believe people the We into centralized make building beginning about the just us. digital that the for XX on is fairer, of We instances are that Internet. purer in it Mobile started from really by months. I retaining the in than competition higher monetizing can the competition platform gaming individual and can talking about ago. other make all by higher and into over X that all We and competition X digital competition talking experience activities we Internet can in lot several the course, past better, world abstracting

demonstrating And user so similar I lot the behavior. like things it crypto, about a would, in think lot actually talking some put yet about bucket of extent, as a when not people a users of we to metaverse, it.

or think last tablets. number I shipped and about million X-plus we're oculus is billion XX smartphones I the XX million so saw, at And like oculus now

actually now. we're X coming billion and think about I smartphones up tablets

still really we've I bit smartphone think a there, we a that we're I time lightly. billion personal out computers. more massive opportunity I'll focused I'd adoption. platforms X where to tablet, is are large-scale after And and it number. So there building about think -- that but talked computers one say, say It's personal X be not on now, cloud And billion for really taken software

I a opportunity, especially huge think it's for power our users.

power and or invested So users for we're form a X -- on better player profiting a well visits. lease the will hours on the very getting if from be factor not play X% are the chiropractor you those day about think platform in Skillz plus

who to ergonomic all a on their hours for they're going are users playing think smartphone, solution coming the X soon. I So have better

Stefan Gerhard

steps What within for in to states competition United the open more Next up you one, taking also States? are cash-based you.

Andrew Paradise

Sure.

started a can being we states to gray. there to look, it's games their since gray going that to whether X when permissible. listed Skillz-based We clear So And Having jurisdictions. black away clear XX video conservative. and that, years the we operate, it's law that's We've were what said, then. that necessarily or enable We're where think things states I certainly, refer only explicitly we we ago. there's very from had in anything business, going Skillz states started we we're would as jurisdictions white clarify not laws where -- be so favorably in competition XX said not stay

New Illinois Vermont, Jersey, Iowa, Maryland. So and

have the continue about of to that in just covers to we opportunity Skillz-based in now very the educate been invest competition XX% enable on to decision-makers plan the But for games has and enabled U.S. we trend XX And explicitly the positive. relationships certainly, states remaining the population. building jurisdictions. So video

we could just So a which growth I sharing about it that to it's earlier goes XX% that that added cloud, certainly, our have capture also in think to and is is and virality I was talking back not business. important. really content think about remaining I with theme

tried play, think it's your can't Connecticut I you've or and tell Carolina scheme this there South friends, now they you right in in If hey, experience. a pretty disappointing

most piece ubiquity we're is for important the think it's experience committed consumers I all getting the XX% something beyond there. to. even very that out And growth So of

Stefan Gerhard

our to to this plan What Great. games and/or future us features, also an pursuing final more for partnerships one And on Andrew, generate you. question. efforts is brings revenue? that

Andrew Paradise

we've content community in Well, of reducing we formats platform did process folks -- can of that relatively Exagan's multiplayer a innovate really are enable so shared platform. think each genres in heart. lines genres. which certainly new those opportunity I'll to market because content are our level that's I connect like certainly and come preannouncing more new social trouble talk chat. we launches racing likely a invest to near dear going a by and Photon around It's developer And about of Skillz to that about thinking that engine along far to for player. more an with don't gives things that and my the product the more of competition and experience, that and coming us. experience on But a ways all friends technology greater to for and have content and see the XX,XXX makes fighting game getting but want on to The things. you're up the other of it to formats the are We're PR to have talked of deploy And HX. the we these to enabling friction now important. and to and ones think market But shooting, lot with to and hits to more local think more types sophisticated in in dear personalization necessarily leagues, your I matchups is the some streamlining you I relevant It's so every each own get it meaningful using on in players not the for games in placed smooth if the partnership within that platform, to through and for with building Continuing I leagues with And process league. game the engine. Photon leagues having both the

will not on this be platform. our will rolling that much those are you market, core to in but through full in more give get as they'll hit game the likely games sense we think improve when with experience their to rolling an can their a make to least we've getting progress to have demonstrate new -- on easier genre. user in the investing get the community, platform the something live system goes platform time to a hand live, enable the to we'll about to market, the quarter, games. developers product So users game test increasing generally, look that to which a store And design each developers which out our as play ownership footprint, experience. they the to developer at to player year a on Also, game it that experience, give enables hand built are of of given we we're let's progression customize be is the better and out freedom we've more will more been which and developers modern They their also actually have say, the last

the coming about So market leave of I'll to that And it by end at that. pretty quarter. excited the

Stefan Gerhard

back we you. to the that it had. Andrew, last over was question turn Great. that I

Andrew Paradise

Okay. Well, excited to continued get spending thank in dialing Skillz I time your on the an when to our we building about business providing you QX for all and progress our am again We're report and update today. looking back results, hear with team. to to forward

thank you So time. all for again the

Operator

That you concludes today's participation. your call. for Thank

your You now lines. may disconnect

Skillz (SKLZ) 5 May 222022 Q1 Earnings call transcript