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LAS VEGAS--(BUSINESS WIRE)--Firy Inc. (NYSE: FIRY) ("FIRY"), formerly Skillz Inc., today announced a post-trial victory over Papaya Gaming: the U.S. District Court for the Southern District of New York issued an order stating that it will enter judgment against Papaya Gaming of $719 million in disgorgement of Papaya's unjust profits to FIRY's wholly owned subsidiary, Skillz Platform Inc. (the "Company"), plus an award of certain attorney's fees and costs, nearly $300 million more than the jury'.

Firy Inc. (SKLZ) Discusses Rebranding, Legal Victories, and Strategic Evolution in Mobile Gaming Prepared Remarks Transcript

Golden Matrix Group (NASDAQ: GMGI - Get Free Report) and Skillz (NYSE: SKLZ - Get Free Report) are both small-cap consumer discretionary companies, but which is the superior stock? We will compare the two companies based on the strength of their earnings, institutional ownership, risk, valuation, dividends, profitability and analyst recommendations. Analyst Ratings This is a breakdown

LAS VEGAS--(BUSINESS WIRE)--Skillz Inc. (NYSE: SKLZ) (“Skillz” or the “Company”), the leading mobile games platform bringing fair competition to players worldwide, today reported financial results for the fourth quarter and fiscal year ended December 31, 2025.

Fourth Quarter 2025 Financial Highlights:

Revenue of $30.0 million Gross profit of $26.5 million Net loss of $17.9 million Adjusted EBITDA1 loss of $10.0 million Paying monthly active users (PMAUs)2 of 141 thousand Average revenue per PMAU (ARPPU)3 of $71.1 Total operating expenses (which does not include cost of revenue) of $42.7 million Full Year 2025 Financial Highlights:

Revenue of $104.5 million Gross profit of $91.4 million Net loss of $70.4 million Adjusted EBITDA1 loss of $50.5 million Paying monthly active users (PMAUs)2 of 141 thousand Average revenue per PMAU (ARPPU)3 of $61.7 Total operating expenses (which does not include cost of revenue) of $162.9 million Cash and cash equivalents of $194.5 million as of December 31, 2025 Total outstanding debt of $129.7 million as of December 31, 2025 “Throughout 2025, we made meaningful progress executing against our strategic priorities, delivering four consecutive quarters of sequential revenue growth and returning to year-over-year growth in the second half of the year,” said Andrew Paradise, Skillz’ CEO. “Our AI ad-tech segment, RZR, recently rebranded from Aarki, delivered significant growth and achieved positive Adjusted EBITDA for the full year, reflecting the strength of its platform and operating discipline. Paired with continued improvement across the Skillz platform, we are building a more integrated system designed to scale engagement, monetization, and long-term value.”

Gaetano Franceschi, Skillz’ CFO, added, “Our 2025 results reflect improved execution and stronger fundamentals across both the Skillz and RZR businesses. We delivered revenue growth and a 16% year-over-year improvement in Adjusted EBITDA, while continuing to invest in product innovation and marketing with discipline. We ended the year with $195 million in cash and cash equivalents, and remain focused on optimizing our capital structure as we move toward sustained profitability and long-term value creation.”

Investor Conference Call

Skillz will host a live conference call at 4:30 p.m. ET on April 1, 2026. To access the call, please register using the following link:

https://www.netroadshow.com/events/login/LE9zwo3hxjkv5wLcwh6x2dljPbWhXgMVsA4

After registering, an email will be sent, including dial-in details and a unique conference call access code and PIN required to join the live call. Access to the live audio webcast of the discussion in listen-only mode will also be available at investors.skillz.com.

A replay of the webcast will be archived on the Company’s investor relations website. An audio replay of the conference call will be available through Thursday, April 7, 2026, and can be accessed by dialing (866) 813-9403 (US) or (929) 458-6194 (international) and entering the passcode 575328.

About Skillz Inc.

Skillz is the leading mobile games platform dedicated to bringing out the best in everyone through competition. The Skillz platform helps developers create multi-million dollar franchises by enabling social competition in their games. Leveraging its patented technology, Skillz hosts billions of casual eSports tournaments for millions of mobile players worldwide, with the goal of building the home of competition for all. Skillz has earned recognition as one of Fast Company’s Best Workplaces for Innovators, CNBC’s Disruptor 50, Forbes’ Next Billion-Dollar Startups, Fast Company’s Most Innovative Companies, and the number-one fastest-growing company in America on the Inc. 5000. Please visit www.skillz.com to learn more.

Use of Non-GAAP Financial Measures

In this press release, the Company includes Adjusted EBITDA, which is a non-GAAP performance measure that the Company uses to supplement its results presented in accordance with U.S. GAAP. The Company’s management believes Adjusted EBITDA is useful in evaluating its operating performance and is a similar measure reported by publicly-listed U.S. competitors, and regularly used by securities analysts, institutional investors, and other interested parties in analyzing operating performance and prospects. By providing this non-GAAP measure, the Company’s management intends to provide investors with a meaningful, consistent comparison of the Company’s profitability for the periods presented. Non-GAAP operating expense is also included in this press release, which is a non-GAAP financial measure. The Company’s management believes non-GAAP operating expense is useful to investors and analysts as a supplement to its financial information prepared in accordance with GAAP for analyzing operating performance and identifying operating trends in its business. The Company uses non-GAAP operating expense internally to facilitate period-to-period comparisons and analysis in order to make operating decisions. As required by the rules of the Securities and Exchange Commission (the “SEC”), the Company has provided herein a reconciliation of Adjusted EBITDA and non-GAAP operating expense to the most directly comparable measures under GAAP. Adjusted EBITDA and non-GAAP operating expense are not intended to be substitutes for any U.S. GAAP financial measures and, as calculated, may not be comparable to other similarly titled financial measures of other companies in other industries or within the same industry.

The Company defines and calculates Adjusted EBITDA as net income (loss), excluding interest income (expense), net; change in fair value of common stock warrant liabilities; other income (expense), net; provision for (benefit from) income taxes; depreciation and amortization; stock-based compensation expense and related payroll tax expense; and certain other non-cash or non-recurring items impacting net loss from time to time, including, but not limited to charges related to impairment of goodwill and long-lived assets, litigation accruals, loss contingency accruals, gain on extinguishment of debt, gains from litigation settlements, restructuring charges and one-time nonrecurring expenses, as they are not indicative of business operations.

The Company defines and calculates non-GAAP operating expense as GAAP operating expense adjusted for stock-based compensation and other special items determined by management, which may include, but are not limited to acquisition-related expenses for transaction costs, certain loss contingency accruals and restructuring charges, as they are not indicative of business operations.

Forward-Looking Statements

This press release includes “forward-looking statements” within the meaning of the “safe harbor” provisions of the United States Private Securities Litigation Reform Act of 1995. The Company’s actual results may differ from its expectations, estimates, and projections and, consequently, you should not rely on these forward-looking statements as predictions of future events. Words such as “expect,” “estimate,” “project,” “budget,” “forecast,” “anticipate,” “intend,” “plan,” “may,” “will,” “could,” “should,” “believes,” “predicts,” “potential,” “continue,” and similar expressions (or the negative versions of such words or expressions) are intended to identify such forward-looking statements.

These forward-looking statements involve significant risks and uncertainties that could cause the Company’s actual results to differ materially from those discussed in the forward-looking statements. Most of these factors are outside of the Company’s control and are difficult to predict. Factors that may cause such differences include, but are not limited to, the ability of Skillz to: sustain profitability if Skillz’ revenue continues to decline; effectively compete in the global entertainment and gaming industries; attract and retain successful relationships with the third party developers who develop and update the games hosted on Skillz’ platform; drive brand awareness with end users; issues in the development and use of artificial intelligence and machine learning; invest in growth and development of employees; comply with laws, regulations and expectations applicable to its business, including with respect to cybersecurity and corporate governance matters; mitigate the commercial, reputational and regulatory risks to our business; remediate during fiscal year 2026 certain non-fully remediated material weaknesses in our internal controls over financial reporting. Additional factors that may cause such differences include other risks and uncertainties indicated from time to time in the Company’s SEC filings, including those under “Risk Factors” therein, which are available on the SEC’s website at www.sec.gov. Additional information will be made available in other filings that the Company makes from time to time with the SEC. In addition, any forward-looking statements contained in this press release are based on assumptions that the Company believes to be reasonable as of this date. The Company undertakes no obligation to update any forward-looking statements to reflect events or circumstances after the date of this press release or to reflect new information or the occurrence of unanticipated events, except as required by law.

Skillz Inc.

Consolidated Statements of Operations and Comprehensive Loss

(in thousands, except for number of shares and per share amounts)

  ​

Three Months Ended
December 31,

Twelve Months Ended
December 31,

​

2025

2024

2025

2024

Revenue

$

30,011

$

17,771

$

104,496

$

92,865

Costs and expenses:

​

​

Cost of revenue

3,511

3,234

13,050

13,405

Research and development

5,519

3,109

20,621

16,747

Sales and marketing

19,321

15,222

71,125

76,360

General and administrative

17,849

20,437

71,118

78,856

Gain from litigation settlement

—

—

(7,500

)

(46,000

)

Total costs and expenses

46,200

42,002

168,414

139,368

Loss from operations

(16,189

)

(24,231

)

(63,918

)

(46,503

)

Interest (expense) income, net

(1,863

)

(390

)

(5,815

)

298

Change in fair value of common stock warrant liabilities

—

—

—

11

Other income (expense), net

199

(452

)

(567

)

(530

)

Loss before income taxes

(17,853

)

(25,073

)

(70,300

)

(46,724

)

Provision for income taxes

49

(76

)

108

66

Net loss

$

(17,902

)

$

(24,997

)

$

(70,408

)

$

(46,790

)

Net loss per share attributable to common stockholders:

Basic and diluted

$

(1.07

)

$

(1.42

)

$

(4.51

)

$

(2.62

)

Weighted average common shares outstanding:

Basic and diluted

16,683,099

17,614,979

15,605,220

17,845,771

Other comprehensive loss:

Change in unrealized gain on available-for-sale investments, net of tax

$

—

$

—

$

—

$

7

Foreign currency translation loss

(371

)

—

(371

)

—

Total other comprehensive loss

(371

)

—

(371

)

7

Total comprehensive loss

$

(18,273

)

$

(24,997

)

$

(70,779

)

$

(46,783

)

Skillz Inc.

Consolidated Balance Sheets

(in thousands, except for number of shares and par value per share amounts)

  ​ December 31,

December 31,

​

2025

2024

Assets

Current assets:

Cash and cash equivalents

$

194,513

$

271,923

Restricted cash

—

9,000

Accounts receivable, net

14,412

4,890

Prepaid expenses and other current assets

7,553

17,342

Total current assets

216,478

303,155

Property and equipment, net

20,776

16,282

Operating lease right-of-use assets, net

1,082

308

Non-marketable equity securities

52,768

52,768

Restricted cash, non-current

1,000

1,000

Other non-current assets

1,351

755

Total non-current assets

76,977

71,113

Total assets

$

293,455

$

374,268

Liabilities and stockholders’ equity

​

​

Current liabilities:

​

​

Accounts payable

$

9,713

$

9,799

Operating lease liabilities, current

465

1,544

Current portion of long-term debt

127,589

—

Other current liabilities

42,944

54,564

Total current liabilities

180,711

65,907

Non-current liabilities:

Operating lease liabilities, non-current

665

9,338

Long-term debt, net

—

125,654

Other non-current liabilities

259

333

Total non-current liabilities

924

135,325

Total liabilities

181,635

201,232

Stockholders’ equity:

​

​

Preferred stock $0.0001 par value; 10 million shares authorized — no shares issued and outstanding as of December 31, 2025 and 2024, respectively

—

—

Common stock $0.0001 par value; 31.3 million shares authorized; Class A common stock – 25.0 million shares authorized; 19.3 million and 18.7 million shares issued; 12.2 million and 13.3 million shares outstanding as of December 31, 2025 and 2024, respectively; Class B common stock - 6.3 million shares authorized; 3.4 million shares issued and outstanding as of December 31, 2025 and 2024, respectively

1

1

Additional paid-in capital

1,245,462

1,226,642

Accumulated other comprehensive loss

(371

)

—

Accumulated deficit

(1,091,666

)

(1,021,258

)

Treasury shares, at cost, 7.1 million and 5.4 million shares as of December 31, 2025 and 2024, respectively

(41,606

)

(32,349

)

Total stockholders’ equity

111,820

173,036

Total liabilities and stockholders’ equity

$

293,455

$

374,268

Skillz Inc.

Consolidated Statement of Cash Flows

(in thousands)

  ​ Twelve Months Ended
December 31,

​

2025

2024

Operating Activities

​

​

Net loss

$

(70,408

)

$

(46,790

)

Adjustment to reconcile net loss to net cash used in operating activities:

​

Depreciation and amortization

1,381

1,665

Stock-based compensation

19,580

30,015

Accretion of unamortized debt discount and amortization of debt issuance costs

1,935

1,719

Non-cash lease expense

306

—

Change in fair value of common stock warrant liabilities

—

(11

)

(Recoveries of) provision for bad debt

(16

)

221

Changes in operating assets and liabilities:

​

Accounts receivable

(9,506

)

831

Prepaid expenses and other assets

9,193

(8,683

)

Accounts payable

411

7,022

Operating lease liabilities

(10,369

)

(298

)

Other accruals and liabilities

(11,434

)

7,235

Net cash used in operating activities

(68,927

)

(7,074

)

Investing Activities

​

​

Purchases of property and equipment

(1,403

)

(668

)

Capitalization of software development costs

(4,734

)

(1,841

)

Purchases of marketable securities

—

(5

)

Proceeds from sales of marketable securities

—

1,137

Net cash used in investing activities

(6,137

)

(1,377

)

Financing Activities

​

​

Principal payments on finance leases obligations

(462

)

(869

)

Repurchase of common stock

(9,257

)

(19,349

)

Issuance of common stock, net of proceeds from exercise of stock options

(1,256

)

(1,436

)

Net cash used in financing activities

(10,975

)

(21,654

)

Effect of exchange rates on cash and cash equivalents

(371

)

—

Net change in cash, cash equivalents and restricted cash

(86,410

)

(30,105

)

Cash, cash equivalents and restricted cash – beginning of year

281,923

312,028

Cash, cash equivalents and restricted cash – end of year

$

195,513

$

281,923

Skillz Inc.

Reconciliation of GAAP Net Loss to Adjusted EBITDA Loss

(in thousands)

  ​ Three Months Ended
December 31,

Twelve Months Ended
December 31,

​

2025

2024

2025

2024

Net loss

$

(17,902

)

$

(24,997

)

$

(70,408

)

​

$

(46,790

)

Interest expense (income), net

1,863

390

5,815

​

(298

)

Provision (benefit) for income taxes

49

(76

)

108

​

66

Depreciation and amortization

796

477

1,381

​

1,665

Stock-based compensation

5,359

7,121

19,580

30,015

Change in fair value of common stock warrant liabilities

—

—

—

(11

)

Gain from litigation settlement(1)

—

—

(7,500

)

(46,000

)

Other (income) expense, net

(199

)

452

567

​

530

Adjusted EBITDA loss

$

(10,034

)

$

(16,633

)

$

(50,457

)

​

$

(60,823

)

  (1) For the twelve months ended December 31, 2025 and 2024, amount includes gain on litigation settlement with AviaGames.

Skillz Inc.

Reconciliation of GAAP to Non-GAAP Operating Expenses

(in thousands)

  ​

Three Months Ended December 31,

Twelve Months Ended December 31,

​

2025

2024

2025

2024

Research and development

$

5,519

$

3,109

$

20,621

$

16,747

Less: stock-based compensation

(624

)

(190

)

​

(1,173

)

(841

)

Non-GAAP research and development

$

4,895

$

2,919

$

19,448

$

15,906

Sales and marketing

$

19,321

$

15,222

$

71,125

$

76,360

Less: stock-based compensation

(660

)

(1,582

)

​

(3,189

)

(6,467

)

Non-GAAP sales and marketing

$

18,661

$

13,640

$

67,936

$

69,893

General and administrative

$

17,849

$

20,437

$

71,118

$

78,856

Less: stock-based compensation

(4,075

)

(5,346

)

(15,214

)

(22,697

)

Non-GAAP general and administrative

$

13,774

$

15,091

$

55,904

$

56,159

Skillz Inc.

Supplemental Financial Information

  Three Months Ended
December 31,

Twelve Months Ended
December 31,

2025

2024

2025

2024

Gross marketplace volume (“GMV”) (000s)(1)

$

139,326

$

127,079

$

541,853

$

608,248

Paying monthly active users (“PMAUs”) (000s)(2)

141

110

141

118

Monthly active users (“MAUs”) (000s)(3)

506

753

658

816

Average GMV per PMAU(4)

$

330.3

$

385.1

$

319.8

$

429.6

Average GMV per MAU(5)

$

91.9

$

56.3

$

68.7

$

62.1

Average revenue per PMAU (“ARPPU”)(6)

$

71.1

$

53.9

$

61.7

$

66.6

Average revenue per MAU (“ARPU”)(7)

$

19.8

$

7.9

$

13.2

$

9.6

PMAU to MAU ratio

28

%

15

%

21

%

14

%

Average end-user incentives, included as sales and marketing expense, per PMAU(8)

$

18

$

19

$

20

$

26

Average end-user incentives, included as sales and marketing expenses, per MAU(9)

$

5

$

3

$

4

$

4

  (1) “Gross Marketplace Volume” or “GMV” means the total entry fees paid by users for contests hosted on Skillz’ platform. Total entry fees include entry fees paid by end-users using cash deposits, prior winnings from end-users’ accounts that have not been withdrawn, and end-user incentives used to enter paid entry fee contests.

(2) “Paying Monthly Active Users” or “PMAUs” means the number of end-users who entered into a paid contest hosted on Skillz’ platform at least once in a month, averaged over each month in the period.

(3) “Monthly Active Users” or “MAUs” means the number of playing end-users who entered into a paid or free contest hosted on Skillz’ platform at least once in a month, averaged over each month in the period.

(4) “Average GMV per PMAU” means the average GMV in a given month divided by PMAUs in that month, averaged over the period.

(5) “Average GMV per MAU” means the average GMV in a given month divided by MAUs in that month, averaged over the period.

(6) “Average Revenue per PMAU” or “ARPPU” means the average revenue in a given month divided by PMAUs in that month, averaged over the period and does not include a deduction for end-user incentives that are included in sales and marketing expense.

(7) “Average Revenue per MAU” or “ARPU” means the average revenue in a given month divided by MAUs in that month, averaged over the period and does not include a deduction for end-user incentives that are included in sales and marketing expense.

(8) Amount reflects the average end-user incentives included in sales and marketing expense in a given month divided by PMAUs in that month, averaged over the period.

(9) Amount reflects the average end-user incentives included in sales and marketing expense in a given month divided by MAUs in that month, averaged over the period.

More News From Skillz Inc.

Skillz (NYSE:SKLZ) reported fourth-quarter and full-year 2025 results that management said reflected continued progress toward profitability, driven in part by accelerating growth in its AI ad tech segment, RZR, formerly known as Aarki.

Quarterly and full-year results show revenue growth and narrowing losses For the fourth quarter of 2025, Skillz reported GAAP revenue of $30 million, up from $27 million in the third quarter and $18 million in the prior-year period. The company’s adjusted EBITDA loss was $10 million, improving from a $12 million loss in Q3 and a $17 million loss a year earlier.

Management characterized the quarter as the company’s fourth consecutive quarter of sequential revenue growth and the second consecutive quarter of year-over-year revenue growth.

For full-year 2025, Skillz reported GAAP revenue of $105 million, up from $93 million in 2024, representing 13% year-over-year growth. Adjusted EBITDA loss improved to $51 million from $61 million in 2024, which management said represented a 16% year-over-year improvement.

RZR rebrand and performance marketing momentum In prepared remarks, management highlighted RZR as a key growth driver in 2025. The segment, which was rebranded from Aarki “last month,” delivered 146% net revenue growth year-over-year, and, for the first time since Skillz acquired the business in 2021, generated positive adjusted EBITDA for full-year 2025.

The company attributed the momentum to “stronger systems, deeper advertiser relationships, and disciplined channel growth.” Management also said it has spent the past two years modernizing RZR’s technology stack and scaling infrastructure, positioning it as “a scaled performance marketing platform.”

Skillz said RZR is increasing machine learning training capacity and improving “auction-level intelligence,” building on data models introduced in the second quarter of 2025. The company also said RZR is expanding its retargeting and user acquisition share while improving performance across channels. Management noted that RZR’s revenue growth is being driven by both existing and new customers, and that machine learning enhancements and campaign optimization contributed to margin expansion.

Platform updates, organization changes, and player metrics Skillz outlined initiatives across what it described as four business pillars, including platform enhancements and organizational changes. On the core Skillz platform, the company said it continues to invest in content and developer tools. Management highlighted the debut of its “Pro SDK” at the Game Developers Conference in San Francisco, describing it as an architecture that expands the company’s development framework and provides developers “full creative control of the entire gameplay experience,” while also strengthening monetization through meta-game systems and leveraging Skillz’s competition and security infrastructure.

In its go-to-market discussion, Skillz reported paying monthly active users (PMAU) of 141,000, down from 155,000 in the third quarter but up from 110,000 in the prior-year period, representing 28% year-over-year growth.

During the Q&A, Jefferies equity research analyst Ed Alter asked about the shift between paying users and monetization trends. CFO Gaetano Franceschi said that in Q4, “one of our larger gaming developers” left the platform, contributing to the decline in paying MAU, while the company continued to increase “GMV per paying MAU.” Franceschi said that as Skillz drives better efficiencies in user acquisition, it plans to “rescale our UA spend and continue to grow also on our PMAU.”

Alter also referenced a disclosure in Skillz’s 10-K that the departing partner represented 51% of revenue last year, and asked how the transition to Skillz-branded versions of that content was progressing. Franceschi said the company does not disclose details of the transition, adding that when the partner left, some games departed immediately, while “the two larger games that are… the majority, call it 80%+, are there,” and Skillz is “in the process of transitioning to our own games.”

CEO Andrew Paradise also added that the company experienced a technical issue affecting some engagement and marketing technologies for its player base in Q4, and said the issue has been addressed. Paradise said investors were “seeing both effects in the change in PMAU in Q4.”

On the organizational front, management said operational efficiency continues to improve across both Skillz and RZR, and announced additions to its board of directors: Gary Vecchiarelli, president and CFO of CleanSpark, and Shannon Demus, CFO of the Americas at Light & Wonder. Skillz also said Jeff Shouger, former CFO of Niantic, joined the company’s board advisory group.

Expenses, net loss, and balance sheet Franceschi said the fourth quarter “highlight[s] the benefits of disciplined execution and structural improvements across both the Skillz and RZR businesses.” He detailed several expense line items for Q4 2025:

Research and development: $6 million, up 78% year-over-year Sales and marketing: $19 million, up 27% year-over-year General and administrative: $80 million, down 13% year-over-year Skillz reported a Q4 2025 net loss of $18 million, which Franceschi said improved 27% year-over-year. Adjusted EBITDA loss improved both sequentially and year-over-year, which the company quantified as a 17% improvement quarter-over-quarter and a 41% improvement year-over-year.

On liquidity, the company ended Q4 2025 with $195 million in cash and cash equivalents and $130 million of debt outstanding, which Franceschi said is now classified as current. With the debt approaching maturity later in 2026, Skillz said it is evaluating “a range of strategic alternatives to optimize our capital structure.”

Fair play litigation update and settlement payments Management also provided an update on its “fair play initiative,” reiterating that it is pursuing litigation against Papaya Gaming and Voodoo over alleged use of bots. The company said the Papaya trial is set for April 13, 2026 in the Southern District of New York.

Skillz also referenced its 2024 settlement with AviaGames. Management said the annual $7.5 million payment was received in the first quarter of 2026, bringing total payments received from AviaGames to $65 million to date. The company said it expects two additional $7.5 million payments in March 2027 and March 2028.

In closing remarks, management said 2025 was “a meaningful year of progress,” citing stabilized operations, improved discipline, and expanded technology foundations across Skillz and RZR. The company said it is focused on combining competitive skill gaming with AI-driven performance marketing to build an ecosystem designed to scale “engagement, data, and monetization with discipline.”

About Skillz (NYSE:SKLZ) Skillz Inc (NYSE: SKLZ) operates a mobile e-sports platform that connects game developers, advertisers and players through skill-based competition. By integrating its software development kit into a variety of casual and midcore mobile titles, the company enables in-app tournaments and head-to-head matches in which users compete for virtual or cash prizes. Skillz’s marketplace also offers real-time leaderboards, live events and social features designed to enhance player engagement and retention.

The company’s core offering includes developer tools and analytics that help game studios monetize through entry fees, in-game purchases and ad revenue sharing.

Featured Articles Five stocks we like better than Skillz

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Despite this morning’s share-price pop, Skillz (NYSE:SKLZ) stock has been a brutal ride for investors, shedding 42% year-to-date. So when Cantor stepped in with a fresh Overweight initiation, it raised an obvious question: doesn’t Wall Street see something the market is missing?

The initiation arrives as Skillz shows its first real signs of stabilization in years. Q4 2025 revenue rose 34% year-over-year to $30.01 million, capping four consecutive quarters of sequential revenue growth in 2025. That’s not a recovery yet, but it’s a turning point worth watching.

Ticker Company Firm Action Old Rating New Rating Old Target New Target SKLZ Skillz Cantor Initiation N/A Overweight N/A N/A The Analyst’s Case Cantor’s Overweight initiation signals conviction that Skillz’s mobile gaming platform and restructured business model can deliver a meaningful turnaround. The bull case rests on two pillars: the core Skillz competitive tournament platform and the RZR AI ad-tech segment, formerly known as Aarki, which achieved positive Adjusted EBITDA for the full year 2025. That’s a tangible milestone in a company still burning cash overall.

Paying user monetization is also improving. Skillz’s paying Monthly Active Users rose to 141,000 from 110,000 year-over-year in Q4, and average revenue per paying user rose to $71.1 from $53.9. Fewer users, but higher-value ones. That’s a defensible monetization strategy if the platform can stabilize its broader audience.

Company Snapshot Skillz operates a mobile gaming platform that hosts competitive tournaments, connecting players globally in a real-money esports format. The company is headquartered in Las Vegas, Nevada, and sits in the electronic gaming and multimedia industry. Its RZR segment adds an AI-powered advertising technology layer, creating a two-sided business that’s still finding its footing.

Also, Skillz’s full-year 2025 revenue came in at $104.5 million, up from $95.5 million in 2024, but the company carries a $127.6 million current portion of long-term debt and cash declined to $194.5 million from $271.9 million year-over-year. The balance sheet warrants serious attention.

Why the Move Matters Now With a market cap near $39 million and a price-to-book ratio of 0.349x, Skillz stock trades well below its book value, which is exactly the kind of distressed-but-stabilizing setup that initiating analysts often target. Skillz CEO Andrew Paradise noted in the Q4 earnings call:

“Throughout 2025, we made meaningful progress executing against our strategic priorities, delivering four consecutive quarters of sequential revenue growth and returning to year-over-year growth in the second half of the year.”

That said, unresolved material weaknesses in internal controls and a beta of 3.089 make this one of the higher-risk analyst calls you’ll see this year.

What It Means for Your Portfolio Cantor’s Overweight initiation gives Skillz a credibility boost it sorely needs, but the risk profile places it firmly outside the comfort zone of income-focused or safety-first investors. The turnaround signals are real, and if RZR’s profitability expands while the core platform stabilizes, there’s a legitimate bull case here.

If you think mobile gaming monetization and AI ad-tech can carry Skillz to cash-flow breakeven, the current price near $2.70 may look compelling in hindsight. If the debt load and cash burn accelerate, the downside is equally real. Speculative positions in this category are typically sized small relative to a broader portfolio.

Investors are bailing on Skillz (NYSE: SKLZ) on Friday morning despite the company securing a monumental $420 million jury verdict in its high-stakes litigation against Papaya Gaming.

The federal jury in Manhattan ruled that Papaya had engaged in systematic false advertising by using “bots” in its skill-based games, misleading players into thinking they were competing against real humans.

This landmark victory initially sent SKLZ stock skyrocketing, seemingly validating the company’s long-standing claims against its rival.

However, it crashed later on to a low of about $7.20 due to three big reasons.

Skillz shares' collapse is primarily driven by a textbook case of “sell the news” profit-taking. The stock had already nearly quadrupled on Apr. 23, as speculators front-ran potential for a favorable ruling.

But in the high-velocity world of micro-cap stocks, such parabolic moves are rarely sustainable.

Once the official news hit the wires and the price peaked in the early morning hours, institutional traders and retail investors alike rushed for the exits to lock in their windfall.

This mass exodus created a liquidity vacuum where the sheer volume of “sell orders” overwhelmed the remaining buying interest, triggering multiple volatility halts and sending the share price into a tailspin as the initial euphoria evaporated.

While a $420 million award is nearly three times the current market cap of Skillz, investors seem skeptical about the firm’s ability to actually see that cash.

Historically, massive jury awards are often the beginning of a new legal battle, not the end of one.

Papaya Gaming is almost certain to file post-trial motions to minimize damages or launch a multi-year appeals process that could keep the funds tied up until the end of the decade.

Skill stock is also crashing because investors are questioning the solvency and immediate liquidity of the defendant.

If Papaya lacks the balance sheet to satisfy a nearly half-billion-dollar judgment, SKLZ could be left with a “paper win” – a legal victory that looks great on a press release but fails to provide the immediate cash infusion it needs to pivot its operations.

Long-term fundamentals remain an overhangBeyond courtroom drama, the underlying health of Skillz Inc remains a significant concern for long-term shareholders.

A one-time legal windfall – even if collected in full – doesn’t really solve the fundamental issues of declining revenue and user engagement that have plagued the company for the past two years.

Skillz’s Q4 earnings report highlighted a continuing struggle to achieve profitability, with net loss of $17.9 million due to fierce competition and rising user acquisition costs in mobile gaming.

Investors are realizing that while $420 million would provide a substantial lifeline to SKLZ shares, it does not inherently fix a broken business model or provide a clear path back to the double-digit growth seen during the pandemic era.

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LAS VEGAS--(BUSINESS WIRE)--Skillz Inc. (NYSE: SKLZ) (“Skillz” or the “Company”), the leading competitive mobile gaming platform bringing fair and fun competition to players worldwide, today announced that it will release its 2026 first quarter financial results after the market closes on Friday, May 15, 2026 and host a conference call and webcast on Tuesday, May 19, 2026 at 4:30 p.m. ET. During the call, Skillz management will review the Company’s financial results and provide a business update, followed by a question-and-answer session. Both the call and webcast are open to the public.

To listen to the audio-only webcast, please use the following link: webcast link. If you would like to participate and ask questions during the call, please register here: registration link. After registering, you will receive an email with dial-in details along with a unique access code and PIN required to join the live call.

A replay of the webcast will be archived on the Company’s investor relations website. An audio replay of the conference call will be available through Tuesday, May 26, 2026, and can be accessed by dialing +1 800-770-2030, access code: 45394.

About Skillz Inc.

Skillz Inc. is the leading competitive mobile games platform dedicated to bringing out the best in everyone through competition. The Skillz platform helps developers create multi-million dollar franchises by enabling social competition in their games. Leveraging its patented technology, Skillz hosts billions of casual esports tournaments for millions of mobile players worldwide, with the goal of building the home of competition for all. Skillz has earned recognition as one of Fast Company’s Best Workplaces for Innovators, CNBC’s Disruptor 50, Forbes’ Next Billion-Dollar Startups, Fast Company’s Most Innovative Companies, and the number one fastest-growing company in America on the Inc. 5000. www.skillz.com

More News From Skillz Inc.

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Skillz Inc NYSE: SKLZ Stock a Buy: An Esports Platform with UpsideSkillz NYSE: SKLZ reported higher year-over-year revenue for the first quarter of 2026 while continuing to post losses, as management highlighted improving underlying profitability, a profitable contribution from RZR and a major legal victory against Papaya Gaming.

Chief Executive Andrew Paradise said first-quarter GAAP revenue was $29 million, down 3% from the fourth quarter and up 33% from the prior-year period. Adjusted EBITDA was a loss of $13 million, compared with a loss of $10 million in the fourth quarter. Paradise said the wider sequential adjusted EBITDA loss was driven by higher litigation-related expenses.

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Excluding litigation-related expenses, adjusted EBITDA was a loss of $7 million, which Paradise said represented a 15% sequential improvement on a normalized basis. RZR generated adjusted EBITDA of $2 million, marking its third consecutive quarter of profitability.

Paying users decline sequentially, but monetization improves Skillz reported paying monthly active users, or PMAU, of 128,000 in the first quarter, down 9% sequentially and up 3% year over year. Paradise said the sequential decline was partly due to lower user acquisition spending, which resulted in fewer new user cohort additions.

Management said the company is emphasizing higher-quality users and stronger unit economics rather than broad user growth. Paradise said retention among more mature cohorts improved from the prior quarter, and average revenue per paying user increased 7% quarter over quarter.

In response to a question from Jefferies analyst Ed Alter about gross marketplace volume rising despite lower paying users, Chief Financial Officer Gaetano Franceschi said Skillz has been focused on “high-paying users” and “long-term users.” He said that while PMAU was down, GMV and ARPU continued to grow.

Paradise added that the company had reduced user acquisition spending in the quarter while tightening its focus on profitable acquisition, shorter breakeven periods and better one-year paybacks. He said Skillz was “thinking about how to thoughtfully expand on marketing” after reaching what he described as a very tight level of spend exiting the quarter.

Papaya verdict remains a central focus Paradise spent a significant portion of the call discussing Skillz’s litigation against Papaya Gaming. In April, a unanimous jury in the U.S. District Court for the Southern District of New York found Papaya liable for false advertising under the Lanham Act and deceptive practices under New York law, awarding Skillz $420 million in actual damages.

Paradise called it “the largest false advertising award in U.S. history under the Lanham Act.” He said the jury also made advisory findings supporting disgorgement of either $719 million based on Papaya’s profits or $652 million based on Papaya’s cost savings, though he emphasized those are alternative theories and will not be added together.

The court will determine whether to award disgorgement and in what amount. Paradise said the Lanham Act allows the court to enhance actual damages by up to three times the $420 million award, while any disgorgement award would not be subject to a cap on enhancement. He said the total potential award ranges from $420 million to more than $1.2 billion, depending on the court’s determinations.

Paradise said Skillz brought the case as part of its “Fair Play Initiative,” arguing that the skill-based competitive gaming category depends on players competing against real human opponents. He said Papaya’s internal documents showed bots were deployed at scale, with bot scores determining outcomes without disclosure to players.

Paradise also referenced Skillz’s earlier litigation against AviaGames, noting that a federal jury awarded Skillz $42.9 million for patent infringement in 2024 and that Skillz later settled related cases with Avia for $80 million.

Looking ahead, Paradise said Skillz expects the court to determine the final disgorgement award in June. He said the parties have been ordered to engage in settlement discussions, and Skillz is also evaluating alternatives to secure capital against the judgment while monitoring whether an appeal bond or other secured capital will be required.

RZR and Beamable positioned as part of broader ecosystem Management outlined three operating priorities for 2026: strengthening demand and engagement, executing a more efficient go-to-market strategy and improving platform performance and infrastructure.

Paradise said Solitaire Skillz continues to scale as a top title on the platform. He also pointed to Skillz’s acquisitions of Blackout Bingo and Dominoes Gold, saying the company now owns and operates three of the top five titles on its platform.

RZR, the company’s performance marketing business, added new advertisers across gaming, consumer applications, retail and entertainment during the quarter, Paradise said. RZR also launched a Connected TV business, which management said opens a new channel for advertiser spending. Paradise said RZR continued to migrate to more advanced neural network models and improve training efficiency and prediction accuracy.

Skillz also completed its acquisition of Beamable in the first quarter. Paradise described Beamable as a developer platform providing game services and backend infrastructure that Skillz expects to use across its products over time. He said Beamable will continue serving developers and studios that used the platform before the acquisition.

Expenses, cash position and debt Franceschi said first-quarter research and development expenses were $5 million, up 5% year over year, reflecting continued investment in Skillz and RZR. Sales and marketing expenses were $17 million, down 4% year over year. Within that total, end-user marketing was $8 million and user acquisition was $3 million.

General and administrative expenses were $19 million, up 2% year over year. Net loss was $11 million, improving 36% from the prior-year period. Franceschi said the company ended the quarter with $185 million in cash and cash equivalents and $130 million of debt outstanding due by the end of 2026.

As the debt approaches maturity, Franceschi said Skillz is evaluating “a range of strategic alternatives” to optimize its capital structure. He said management believes the company’s balance sheet remains healthy and that Skillz is managing capital prudently as it works toward sustained profitability.

Management discusses owned content strategy During the question-and-answer session, analysts asked about Skillz’s shift toward owning and operating more games on its platform. Paradise said owning and operating games represents a shift from the company’s historical reliance on third-party and second-party developer relationships, though he noted Skillz has invested in platform content for years.

Paradise said owning games in categories with relatively little future development, such as solitaire, can create stability and provide a consistent offering for the platform. He compared the strategy to approaches used elsewhere in the gaming industry, citing Epic’s Fortnite and Valve’s Dota 2 and Counter-Strike as examples of gaming platforms that also operate major content.

Asked by Cantor Fitzgerald analyst Bharath Nagaraj about user acquisition costs following the Papaya verdict, Paradise said it would be difficult to directly link the lawsuit outcome to customer acquisition costs. However, he said Skillz exited the first quarter with the best user acquisition prices it had seen in multiple years and is considering how to scale spending where prices are attractive.

About Skillz NYSE: SKLZSkillz Inc NYSE: SKLZ operates a mobile e-sports platform that connects game developers, advertisers and players through skill-based competition. By integrating its software development kit into a variety of casual and midcore mobile titles, the company enables in-app tournaments and head-to-head matches in which users compete for virtual or cash prizes. Skillz's marketplace also offers real-time leaderboards, live events and social features designed to enhance player engagement and retention.

The company's core offering includes developer tools and analytics that help game studios monetize through entry fees, in-game purchases and ad revenue sharing.

This instant news alert was generated by narrative science technology and financial data from MarketBeat in order to provide readers with the fastest reporting and unbiased coverage. Please send any questions or comments about this story to [email protected].

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