Skillz Inc. reported its financial results for the third quarter and the nine months ended September 30, 2024, revealing significant changes in revenue, profitability, and operational strategies compared to the previous fiscal period.

For Q3 2024, Skillz generated total revenue of $24.6 million, a decline of 33% from $36.4 million in Q3 2023. The decrease was attributed to a 19% reduction in monthly active users, driven by a 43% cut in user acquisition marketing spend and a 40% reduction in engagement marketing spend. For the nine months ended September 30, 2024, total revenue was $75.1 million, down 38% from $121.0 million in the same period of 2023.

Despite the revenue decline, Skillz reported a net loss of $21.1 million for Q3 2024, an improvement from a net loss of $33.5 million in Q3 2023. For the nine-month period, the net loss was $21.8 million, significantly reduced from $85.8 million in the prior year. The company attributed this improvement to a substantial decrease in total costs and expenses, which fell by 33% to $45.6 million in Q3 2024, and by 55% to $97.4 million for the nine months.

The Skillz segment, which primarily drives revenue, reported a revenue of $21.5 million for Q3 2024, down 35.8% from $33.4 million in Q3 2023. The Aarki segment maintained its revenue at $3.1 million for both periods. Adjusted EBITDA for the Skillz segment improved to a loss of $12.3 million in Q3 2024 from a loss of $16.8 million in Q3 2023.

On the operational front, Skillz has been actively managing its costs. Research and development expenses decreased by 40% to $4.7 million in Q3 2024, while sales and marketing costs dropped by 40% to $19.3 million. General and administrative costs also saw a reduction of 26% to $18.1 million, primarily due to lower legal fees following a settlement with AviaGames.

Skillz's total assets as of September 30, 2024, were $390.2 million, down from $395.8 million at the end of 2023. The company reported cash and cash equivalents of $301.4 million, slightly decreasing from $302.0 million at the end of the previous year. Long-term debt remained relatively stable at $125.2 million.

In terms of strategic developments, Skillz settled a patent infringement case against AviaGames, resulting in a gain of $46.0 million for the nine months ended September 30, 2024. The company also repurchased 1.8 million shares at a weighted average price of $5.99 per share during the nine months.

Overall, while Skillz faced challenges in user engagement and revenue generation, it demonstrated improved operational efficiency and cost management, leading to reduced losses compared to the previous year.