Skillsoft Corp. · NYSE:SKIL
Skillsoft — Investor Day (July 2024)
111 slides from Skillsoft's investor day presentation, Jul 11, 2024
Slide 1: Skillsoft Investor Day 2024
SKILLSOFT INVESTOR DAY 2024 July 11, 2024
Slide 2: Chad Lyne, SVP, IRO
Chad Lyne SVP, IRO 2
Slide 3: Agenda
AGENDA 1. Welcome & Opening Remarks 9:00 AM + Chad Lyne, Investor Relations Officer 2. Our Opportunity and Transformation Journey 9:05 AM + Ron Hovsepian, Executive Chairman 3. Business Unit Strategic Updates 9:35 AM + Apratim Purakayastha, General Manager – Talent Development Solutions + Darren Ban
Slide 4: Safe Harbor Forward-Looking Statements
SAFE Forward-Looking Statements This presentation includes statements that are, or may be deemed to be, “forward-looking statements” within the meaning of Section 27A of HARBOR the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended, which are inten
Slide 5: Our Opportunity & Transformation Journey
OUR OPPORTUNITY & TRANSFORMATION JOURNEY
Slide 6: Ron Hovsepian, Executive Chairman
Ron Hovsepian Executive Chairman 6
Slide 7: Investment Thesis
Investment Thesis Leveraging a unique and Making immediate Executing a compelling powerful asset portfolio changes to “Fix The Basics” “Invest To Grow” strategy positioned to win in the talent and achieve profitable growth to capitalize on a significant and development industry growing market opport
Slide 8: Skillsoft Is A Leading Provider Of Transformative Learning Experiences
Skillsoft Is A Leading Provider Of Transformative Learning Experiences For Organizations And Learners STRONG & SCALABLE $545M $102M ~2,300 25+ LTM Revenue1 LTM Adj. EBITDA1, 2 Employees Year history FOUNDATION GLOBAL REACH & ~100M 12K+ 150+ >60% IMPACT Community of learners Customers supported Count
Slide 9: Complementary Business Units To Capture The Evolving Market Opportunity
Complementary Business Units To Capture The Evolving Market Opportunity Talent Development Solutions (TDS) Global Knowledge (GK) (f/k/a Content & Platform) (f/k/a Instructor-Led Training) FINANCIAL 74% of 26% of (LTM REVENUE1) $404M Total Company $141M Total Company Full Digital learning portfolio:
Slide 10: Driving Workforce Transformation Outcomes For The World's Most Recognized Organizations
Driving Workforce Transformation Outcomes For The World’s Most Recognized Organizations 8+ Years ~101% ~105% Diversified Average Customer Tenure 1 LTM Total Dollar Retention Rate 1, 2 LTM Large Enterprise Dollar Retention Rate 1,2 Customer Base 3 FINANCE CONSUMER & SOLUTION TELECOM & FEDERAL & BANKI
Slide 11: Our purpose and vision are aligned to a compelling market opportunity
Our purpose and vision are aligned to a compelling market opportunity Our Purpose + We propel organizations and people to grow together through transformative learning solutions Our Vision + Be the #1 Talent Development Partner For Organizations And Learners 11
Slide 12: Past Performance
DESIGN NOTE: I BUILT IN (OPTIONAL) ANIMATION ON THESE 3 SLIDES Past Performance FY21-FY24 FY25-FY26 FY27+ FINANCIAL OUTCOME Below-market growth KEY ACTIONS Divested non-core business Enhanced Tech & Dev leadership LTM DRR1 gains (93% to 101%) Interactive learning leadership (e.g., CAISY™ AI Simulato
Slide 13: My 90 Day Observations And Areas For Improvement
My 90 Day Observations And Areas For Improvement Strengths Challenges + Unique portfolio of assets + Businesses not aligned for success with potential for market + Limited ecosystem to serve customers and scale company STRATEGIC alignment + Slow response to market shifts and execution below + Custom
Slide 14: What's Next: Be The #1 Talent Development Partner
DESIGN NOTE: I BUILT IN (OPTIONAL) ANIMATION ON THESE 3 SLIDES What’s Next: Be The #1 Talent Development Partner For Organizations And Learners FY21-FY24 FY25-FY26 FY27+ Fix the Basics and Invest to Grow 14 Notes: (1) Refer to Appendix for “Non-GAAP Financial Measures and Key Performance Metrics” fo
Slide 15: Making Immediate Changes To "Fix The Basics" And Achieve Profitable Growth
Making Immediate Changes To “Fix The Basics” And Achieve Profitable Growth FY21-FY24 FY25-FY26 FY27+ FINANCIAL TARGET OUTCOMES $45M1+ annualized expense reduction in FY25 Margin expansion in FY25 & FY26 Return to topline growth in FY26 FCF generation in FY26 KEY ACTIONS Dual Business Unit structure
Slide 16: Foundational Transformation Of Our Business Model
Foundational Transformation Of Our Business Model PAST: FUNCTIONAL MODEL GO-FORWARD: RATIONALIZED BU STRUCTURE Talent Development Global Content & Platform ILT Solutions Knowledge REPORTING Booking & Bookings & Revenue TDS P&L GK P&L BY SEGMENT Revenue B2C TDS GM GK GM OPERATING B2B GM ILT GM GM GTM
Slide 17: Foundational Transformation Of Our Business Model
Foundational Transformation Of Our Business Model PAST: FUNCTIONAL MODEL GO-FORWARD: RATIONALIZED BU STRUCTURE Talent Development Global Content & Platform ILT Solutions Knowledge REPORTING Booking & Bookings & Revenue TDS P&L GK P&L BY SEGMENT Revenue B2C OPERATING B2B GM ILT GM TDS GM GK GM GM GTM
Slide 18: Two Complementary Businesses Add To Skillsoft's Differentiated Value Proposition
Two Complementary Businesses Add To Skillsoft's Differentiated Value Proposition Creates Allows Provides multi-modal multiple use case more compelling value to customers and partners blended scenarios for organization learning bundle and learner Creates Drives Cross-pollinates selling advantage orga
Slide 19: Laser Focus On Improving Operational Execution
Laser Focus On Improving Operational Execution NEW PERFORMANCE WORKFORCE & CULTURE GTM EFFECTIVENESS MANAGEMENT SYSTEM TRANSFORMATION + Sales forecasting discipline and + Skill Transformation for 30-40% of + Market segmentation management system talent base + New routes to market + BU management cad
Slide 20: Strategic Resource Reallocation Program To Deliver $45M+
Strategic Resource Reallocation Program To Deliver $45M+ Of Annualized Expense Reduction To Fund Growth FY25 REDUCTIONS FY25-FY26 GROWTH REALLOCATIONS FUNCTIONAL CONSOLIDATION OPPORTUNITIES GTM EFFECTIVENESS AND EFFICIENCY GEOGRAPHIC PRIORITIZATION PARTNER ECOSYSTEM SET-UP BACKOFFICE TRANSFORMATION
Slide 21: Executing A Compelling "Invest To Grow" Strategy
Executing A Compelling “Invest To Grow” Strategy To Capitalize On A Significant And Growing Market Opportunity FY21-FY24 FY25-FY26 FY27+ FINANCIAL TARGET OUTCOMES At or above-market growth Industry-leading financial profile KEY ACTIONS AI-centric product innovation aligned to market New routes to ma
Slide 22: The Reskilling Revolution Will Impact Every Industry, Organization, And Knowledge Worker
The Reskilling Revolution Will Impact Every Industry, Organization, And Knowledge Worker C-SUITE IMPERATIVE OF 1 LEARNING 81% of organizations view investments in 1.1 learning as the most promising strategy to deliver on their goals in the next 5 years.2 WORKFORCE TRANSFORMATION 2 BILLION HINGES ON
Slide 23: Organizations And Learners Are Struggling To Keep Pace With Technology's Impact
Organizations And Learners Are Struggling To Keep Pace With Technology’s Impact Key Market Challenges: + Pervasive and growing skills gaps + Talent acquisition and retention + Internal career mobility and progression GenAI Hybrid / + Workforce engagement and Remote productivity Digital / Work Cloud
Slide 24: Addressing These Gaps Requires Significant And Growing Organizational Investment
Addressing These Gaps Requires Significant And Growing Organizational Investment $4.5M 23% Increase in spending Average annual on external training training expenditure products and per organization1 services in 20231 24 Notes: (1) 2023 Training Industry Report
Slide 25: Assembling A Talent Development Program Has Significant Challenges
Assembling A Talent Development Program Has Significant Challenges Organizational Challenges PACKAGE AND DELIVER LEARNING EXPERIENCES + Highly fragmented vendors ASSESS SKILLS MAINTAIN LEARNING REPOSITORY + Discrete point solutions per CREATE LEARNING EXPERIENCES modality and content area + Ineffici
Slide 26: Skillsoft Is Naturally Positioned To Provide A Differentiated, Connected Solution At Scale
Skillsoft Is Naturally Positioned To Provide A Differentiated, Connected Solution At Scale The Skillsoft Advantage PACKAGE AND + Demonstrable ROI for workforce DELIVER LEARNING EXPERIENCES transformation, leadership ASSESS SKILLS MAINTAIN LEARNING development, and succession REPOSITORY CREATE LEARNI
Slide 27: Our Customer Profile Is Evolving
Our Customer Profile Is Evolving Buyers of Online Learning… … to Talent Champions + HR as functional + HR as strategic + Success as utilization, completion + ROI and quantifiable business outcome expectations + Optimized for enterprise needs only + Optimized for enterprise needs and learner interest
Slide 28: Customers Are Shifting Towards A Talent Development Lifecycle Approach Creating A $400B Market Opportunity
Customers Are Shifting Towards A Talent Development Lifecycle Approach Creating A $400B Market Opportunity Lifecycle Talent Champions Talent Development Approach Discrete, Buyers of Online Learning Silo’d Video-based, Interactive, Workforce Utilization Metrics Transformation Outcomes Learning Style
Slide 29: The Power Of Skillsoft Across The Full Talent Lifecycle
The Power Of Skillsoft Across The Full Talent Lifecycle COACHING Skillsoft Collaborates with Microsoft to INSTRUCTOR-LED Develop Generative AI Skilling Program DIGITAL SKILLING “This learning experience is designed to empower individuals and organizations to harness the full capabilities of generati
Slide 30: Our Journey To Become The #1 Global Talent Development Partner
Our Journey To Become The #1 Global Talent Development Partner For Organizations And Learners FY25-FY26 FY27+ FINANCIAL TARGET OUTCOMES FINANCIAL TARGET OUTCOMES $45M1+ annualized expense reduction in FY25 At or above-market growth Margin expansion in FY25 & FY26 Industry-leading financial profile R
Slide 31: World-Class Leadership Team Committed To Winning
World-Class Leadership Team Committed To Winning Ron Hovsepian Rich Walker Apratim Purakayastha Darren Bance Executive Chairman Chief Financial Officer GM – Talent Development GM – Global Knowledge Solutions Business Unit Business Unit Matthew Glitzer Lindsey Padrino Ciara Harrington Orla Daly Chief
Slide 32: Investment Thesis Recap
Investment Thesis Recap Leveraging a unique and Making immediate Executing a compelling powerful asset portfolio changes to “Fix The Basics” “Invest To Grow” strategy positioned to win in the talent and achieve profitable growth to capitalize on a significant and development industry growing market
Slide 33: Business Unit Strategic Updates: Talent Development Solutions
BUSINESS UNIT STRATEGIC UPDATES Talent Development Solutions
Slide 34: Apratim Purakayastha (AP), GM, Talent Development Solutions BU
Apratim Purakayastha (AP) GM, Talent Development Solutions BU 34
Slide 35: Key Messages
Key Messages 1 2 3 We have a strong The market is shifting We are executing GTM foundation of enterprise from learning and skills and Product actions customers and to talent development We expect to drive above-market ~100 million learners We are well positioned to growth and profitability We have o
Slide 36: Talent Development Solutions Is The Global Leader For Organizations and Learners
Talent Development Solutions Is The Global Leader For Organizations and Learners Enterprise-grade Consumer-grade experience solution serving 3,000+ serving ~60M learners organizations and ~40M A premium brand known employees worldwide worldwide for technology learning + Largest offering of + AI-enab
Slide 37: Enabling Workforce Transformation At Scale
Enabling Workforce Transformation At Scale Talent Development Solutions LTM REVENUE1 $404M 74% of Total Company REVENUE COMPOSITION ~95% Recurring SaaS & Subscription / ~5% Professional Services GEOGRAPHIC MIX ~80% United States / ~20% Rest of world CUSTOMERS ~40% of Fortune 1000 companies ~20% of F
Slide 38: Unique Product Offering Drives A Significant Market Advantage
Unique Product Offering Drives A Significant Market Advantage AI-LED INTERACTIVE BENCHMARKS, PREMIUM TECH EXPERIENCE, OUTCOMES, TAILORED LEARNING BRAND MULTIMODAL, BLENDED SOLUTIONS ENTERPRISE GRADE BUSINESS, SECURITY AND TECHNOLOGY, RISK & INTEGRATIONS COMPLIANCE 38
Slide 39: Unique Product Offering Drives A Significant Market Advantage
Unique Product Offering Drives A Significant Market Advantage BUSINESS, AI-LED INTERACTIVE BENCHMARKS, ENTERPRISE GRADE TECHNOLOGY, RISK & PREMIUM TECH EXPERIENCE, OUTCOMES, TAILORED SECURITY AND LEARNING BRAND COMPLIANCE MULTIMODAL, BLENDED SOLUTIONS INTEGRATIONS CONTENT + Interactive tech + Codeca
Slide 40: Integrated Measurable Methodology Accelerates Organizational Workforce Skills Transformation
Integrated Measurable Methodology Accelerates Organizational Workforce Skills Transformation And Impact 1. Benchmark Index capability and reveal gaps 2. Instruct Immersive self-paced content with practice exercises 5. Perform On-going support by ICF- certified coach to ensure new approaches take roo
Slide 41: Best-In-Class Interactive And Curated Learning Platform Delivers Learner Skill Proficiency
Best-In-Class Interactive And Curated Learning Platform Delivers Learner Skill Proficiency 1. Discover Find the right skill or career path 2. Learn Interactive, multimodal learning with a companion AI-based learning assistant 5. Outcome Job readiness and certificates 3. Assess Real world practice, c
Slide 42: Unmatched Breadth And Depth Of Our Multimodal Offering
Unmatched Breadth And Depth Of Our Multimodal Offering Tech & Dev Business & Security/IT Ops Leadership 1,100+ Courses & Assessments | 100+ Practice Labs Business & 1,300+ Books | 75+ Skill Benchmarks Digital Dexterity Leadership 700+ Courses | 210+ Audio Books 17,485 Cloud 2800+ Books | 15+ Skill B
Slide 43: Compelling Offering Drives Value For Customers And Skillsoft
Compelling Offering Drives Value For Customers And Skillsoft 1 2 3 CUSTOMER GROWTH EXAMPLE CUSTOMER GROWTH EXAMPLE CUSTOMER GROWTH EXAMPLE COMPETITIVE TAKE OUT: EXPANSION: LARGE NATIONAL RETENTION: LARGE GLOBAL FINANCIAL SERVICES PROVIDER LARGE INTERNATIONAL TELCO TECHNOLOGY PROVIDER VALUE PROPOSITI
Slide 44: Market Is Shifting Towards Talent Development Lifecycle Approach
Market Is Shifting Towards Talent Development Lifecycle Approach Lifecycle Talent Champions Talent Development Approach Discrete, Buyers of Online Learning Silo’d Video-based, Interactive, Workforce Utilization Metrics Transformation Outcomes Learning Style Valued, Outcomes Achieved Future market ex
Slide 45: Learner And Organizational Alignment Creates Unique Competitive Advantage
Learner And Organizational Alignment Creates Unique Competitive Advantage Across The Talent Development Lifecycle CAREER Learner SKILLING BEFORE OR BETWEEN JOBS HIRING & PLACEMENT ON THE JOB UPSKILLING ADVANCEMENT / TRANSITION Skillsoft Partner Skillsoft Partner Organization WORKFORCE PLANNING HIRIN
Slide 46: Intersection Of Learner And Organizational Journeys Creates A Natural Flywheel Opportunity
Intersection Of Learner And Organizational Journeys Creates A Natural Flywheel Opportunity CAREER Learner SKILLING BEFORE OR BETWEEN JOBS HIRING & PLACEMENT ON THE JOB UPSKILLING ADVANCEMENT / TRANSITION Skillsoft Partner Skillsoft Partner Job Transition Programs Lead Generation Reimbursement progra
Slide 47: Integration With Ecosystem Partners Provides Turnkey Solution
Integration With Ecosystem Partners Provides Turnkey Solution For Organizations And Enhances Retention CAREER Learner SKILLING BEFORE OR BETWEEN JOBS HIRING & PLACEMENT ON THE JOB UPSKILLING ADVANCEMENT / TRANSITION Skillsoft Partner Skillsoft Partner Organization WORKFORCE PLANNING HIRING & PLACEME
Slide 48: Accelerated AI-Centric Innovation Plan To Capture Platform Value
Accelerated AI-Centric Innovation Plan To Capture Platform Value 1 2 3 4 5 AI-led Curation, Open AI-led Enablement interactive aggregation platform expansion of lifelong experience and ecosystem of category learners for organization authoring for partners offerings and B2B B2C and learners for blend
Slide 49: Our Accelerated Innovation Plan
Our Accelerated Innovation Plan FY25-FY26 Outcomes AI-led interactive • Embed CAISY™ in courses • Deeper learner engagement 1 experience for organizations and learners • AI Assistant • Gamify benchmarks • Grow monthly active learners • Learner advocacy Curation, aggregation • AI-led curation • Incre
Slide 50: Our Accelerated Innovation Plan
Our Accelerated Innovation Plan FY25-FY26 Outcomes AI-led interactive • Embed CAISY™ in courses • Deeper learner engagement 1 experience for organizations and learners • AI Assistant • Gamify benchmarks • Grow monthly active learners • Learner advocacy Curation, aggregation • AI-led curation • Incre
Slide 51: Our Accelerated Innovation Plan
Our Accelerated Innovation Plan FY25-FY26 Outcomes AI-led interactive • Embed CAISY™ in courses • Deeper learner engagement 1 experience for organizations and learners • AI Assistant • Gamify benchmarks • Grow monthly active learners • Learner advocacy Curation, aggregation • AI-led curation • Incre
Slide 52: Our Accelerated Innovation Plan
Our Accelerated Innovation Plan FY25-FY26 Outcomes AI-led interactive • Embed CAISY™ in courses • Deeper learner engagement 1 experience for organizations and learners • AI Assistant • Gamify benchmarks • Grow monthly active learners • Learner advocacy Curation, aggregation • AI-led curation • Incre
Slide 53: Our Accelerated Innovation Plan
Our Accelerated Innovation Plan FY25-FY26 Outcomes AI-led interactive • Embed CAISY™ in courses • Deeper learner engagement 1 experience for organizations and learners • AI Assistant • Gamify benchmarks • Grow monthly active learners • Learner advocacy Curation, aggregation • AI-led curation • Incre
Slide 54: Demonstrated Success in Leveraging GenAI To Solve The Hardest Problems In The Talent Lifecycle
Demonstrated Success in Leveraging GenAI To Solve The Hardest Problems In The Talent Lifecycle Learner Organizational Leader Content GEN AI SKILLING ROLE-SKILL-CONTENT MAPPING LOCALIZATION OF CONTENT Foundational and Role-based Automatically map client roles to High quality, high-speed localization
Slide 55: Growing GenAI Upskilling Program Deployed In The Market
Growing GenAI Upskilling Program Deployed In The Market 250K+ learners upskilled within two quarters of deployment Cohort-based learning approach to train frontline workers, leaders & mobilizers and technology specialists BENCHMARK LEARN PRACTICE + Proficiency score + Skillsoft courses + CAISY™ AI C
Slide 56: Growing GenAI Upskilling Program
Growing GenAI Upskilling Program Measure GenAI skills to set a baseline 56
Slide 57: Growing GenAI Upskilling Program
Growing GenAI Upskilling Program Learn in cohorts based on role 57
Slide 58: Growing GenAI Upskilling Program
Growing GenAI Upskilling Program Live simulations and live training 58
Slide 59: Growing GenAI Upskilling Program
Growing GenAI Upskilling Program AI-assisted coding and prompt engineering practice 59
Slide 60: CAISY Coaching AI Simulator
CAISY™ Coaching AI Simulator Deployed to 2M+ learners since launch in FY24 70+ SCENARIOS L&D DASHBOARD + CAISY™ Engagement CLIENT-SPECIFIC and Proficiency levels SCENARIOS + Custom CAISY™ SELECT YOUR OWN COACH (AVATAR) (H2 FY25) LOCALIZATION – Next Generation UxD German, French, Spanish INDUSTRY & C
Slide 61: FY25-FY26 Roadmap To Value Creation
FY25-FY26 Roadmap To Value Creation Revenue Margin growth improvement GTM effectiveness and efficiency Fix the Basics Re-establish growth for B2C consumer Establish B2C2B flywheel New routes to market AI-led interactive experience Curation, aggregation, and authoring Invest to Grow AI-led category e
Slide 62: Key Takeaways
KEY TAKEAWAYS 3 1 2 + Strong new customer + Positioning to capitalize acquisition and increased + Strengthening on Talent Development the foundation with lifetime value market shift product and GTM to deliver above-market enhancements by executing accelerated growth with category-leading innovation
Slide 63: Business Unit Strategic Updates: Global Knowledge
BUSINESS UNIT STRATEGIC UPDATES Global Knowledge
Slide 64: Darren Bance, GM, Global Knowledge BU
Darren Bance GM, Global Knowledge BU 64
Slide 65: Key Messages
Key Messages 1 2 3 Growing ILT market Executing clear roadmap Investing in well-defined opportunity to “Fix the Basics” expansion opportunities in which we have a scaled and return to growth to grow at or above the market global presence 65
Slide 66: Leading Global Provider For Tech-Focused Live Learning With A ~30-year Pedigree
Leading Global Provider For Tech-Focused Live Learning With A ~30-year Pedigree + Live learning partner of choice for ~50% High Interactivity Experiences of the world’s top 1000 corporations Led by a Subject Matter Expert + Essential interactive skill-building + Virtual and in-classroom + 2000+ cour
Slide 67: Strong Foundation For Growth
Strong Foundation For Growth LTM REVENUE1 $141M 26% of Total Company REVENUE COMPOSITION ~100% Fee for Service (Virtual, on-demand, and classroom training) GEOGRAPHIC MIX ~30% United States / ~70% Rest of World NPS 52 ENTERPRISE CLIENTS ~50% Fortune 1000 penetration 67 Notes: (1) as of quarter-ended
Slide 68: Organizational And Learner Requirements Drive Strong Demand For Live Learning
Organizational And Learner Requirements Drive Strong Demand For Live Learning ADVANCED AND COMPLEX INSTRUCTIONAL LEARNER SUCCESS REQUIRES TOPICS REQUIRE LIVE LEARNING INSTRUCTIONAL VARIETY CHANGE ACCESS TO SUBJECT MANAGEMENT MATTER EXPERTS SECURITY BREAK OUT SESSIONS LIVE LEARNING HANDS-ON DATA & AI
Slide 69: Market For Live Learning Is Large And Growing
Market For Live Learning Is Large And Growing WORLDWIDE IT EDUCATION AND TRAINING SERVICES SPENDING ($B)1 4% $25.3 $20.6 CAGR ~52% Delivered through virtual and classroom-based Instructor Led Training (5% CAGR) 2023 2024E 2025E 2026E 2027E 2028E “IT talent shortages continue to challenge enterprises
Slide 70: Operating In One Of The Largest Verticals With Clear Adjacencies For Expansion
Operating In One Of The Largest Verticals With Clear Adjacencies For Expansion ILT SHARE OF TRAINING MARKET1 EDUCATION & GOVERNMENT TECHNOLOGY & CERTIFICATIONS ($5.2B) ($10.4B) + Growth sector + GK core (~76%) focus area today with opportunities to grow market share Education & + Nominal exposure fo
Slide 71: Differentiated By Global Scale And Scope
Differentiated By Global Scale And Scope GLOBAL QUALITY OF QUALITY OF SCALE TRAINERS CONTENT PREMIER PARTNER BLENDED OFFERING FOR KEY VENDORS 71
Slide 72: Differentiated By Global Scale And Scope
Differentiated By Global Scale And Scope SCALE + Leading global provider of + Resources to solve needs of tech-focused live learning large global organizations PREMIER PARTNER TRAINERS CONTENT BLENDED OFFERING FOR KEY VENDORS + 100% qualified or + Access to content and + Market leading blended + Lea
Slide 73: Authorized Training Provider For The World's Largest Technology Companies & Certification Authorities
Authorized Training Provider For The World’s Largest Technology Companies & Certification Authorities 73
Slide 74: Competitive Differentiation Enables Us To Win
Competitive Differentiation Enables Us To Win 1 2 3 COMPETITIVE TAKE-OUT: MULTI-PARTNER WIN: PARTNER COLLABORATION: INT’L TECH SERVICES PUBLIC SECTOR SOLUTION TO SERVE INT’L TELCO ORGANIZATION EUROPE NORTH AMERICA / INDIA EUROPE VALUE PROPOSITION VALUE PROPOSITION VALUE PROPOSITION + Multi-vendor Cl
Slide 75: Clear FY25-FY26 Roadmap To Enhance Our Foundation
Clear FY25-FY26 Roadmap To Enhance Our Foundation And Capitalize On Our Unique Product Offering Revenue Margin growth improvement Improving productivity through org redesign & standardized tooling Evolving GTM strategy by localizing approach sales and marketing Fix the Basics Strategic focus on key
Slide 76: Targeting Fastest-Growing Markets With Proprietary And Licensed Courses
Targeting Fastest-Growing Markets With Proprietary And Licensed Courses To Complement Partner Content Data Science Application GenAI Cybersecurity and AI Development Software Training Platforms Software 80% 22% 10% 15% CAGR1 CAGR1 CAGR2 CAGR3 Notes: (1) Gartner Forecast Analysis: Artificial Intellig
Slide 77: Transitioning Mix To Higher Margin Proprietary Content
Transitioning Mix To Higher Margin Proprietary Content + Top 200 courses today deliver ~80% of revenue + Launching 40+ new courses in next 18 months + Utilizing Talent Development Solutions’ library of content to bring to market efficiently & cost effectively + Targeting all new courses to be in the
Slide 78: Key Takeaways
KEY TAKEAWAYS 3 1 2 + Investing in proprietary, + “Fix the Basics” owned content + Strong foundation by improving operations, to enhance profitability with a global leadership productivity, and GTM position strategy to grow at or above the market 78
Slide 79: Our Path To Growth
OUR PATH TO GROWTH
Slide 80: Matthew Glitzer, Chief Revenue Officer
Matthew Glitzer Chief Revenue Officer 80
Slide 81: Key Messages
Key Messages 1 2 3 We have a sizeable We are transforming our We are positioning opportunity for future talent and routes to to grow across all expansion market market segments in our installed base and the to drive more efficient and to deliver above-market growth overall talent development effecti
Slide 82: Significant Global Market Opportunity: $400B+ TAM
Significant Global Market Opportunity Talent Champions $400B+ Aspiring Talent Champions TAM Growing 10%+ CAGR1 Buyers of Online Learning Current market Future market expansion ~$300B market, Additional >$100B market, ~8% CAGR1 ~14% CAGR1 82 Notes: (1) SKIL research and analysis across range of indus
Slide 83: Broad And Loyal Customer Base To Grow From
Broad And Loyal Customer Base To Grow From 8+ Years Average Customer Tenure1 ARR Enterprise Mix3 ~101% FY24 LTM Total Dollar Retention Rate1,2 ~80% Mid Market ~15% ~105% FY24 LTM Large Enterprise Dollar Retention Rate1,2 SMB ~5% Diversified Customer Base Enterprise ~25% SMB Customer ~50% Count Mid M
Slide 84: Aligning Our Go-To-Market Priorities To Buyer Type
Aligning Our Go-To-Market Priorities To Buyer Type ARR GTM Priorities Enterprise Mix1 ~80% Mid Market ~15% 1. Grow Talent Champions SMB ~5% 2. Develop Aspiring Talent Champions 3. Engage Buyers of Online Enterprise ~25% Learning More Effectively SMB Customer ~50% Count 4. Accelerate Learner Advocacy
Slide 85: Optimizing Our Routes-To-Market To More Efficiently Serve Organizational And Learner Needs
Optimizing Our Routes-To-Market To More Efficiently Serve Organizational And Learner Needs Market Segmentation Route to Market Growth Strategy Enterprise High Touch Grow current Talent Champions Mid-Market Hybrid Develop Aspiring Talent Champions SMB Low/No Touch Engage Buyers of Online Learning B2C
Slide 86: Substantial Opportunity For Growth Within Our Fortune 1000 Customers
Substantial Opportunity For Growth Within Our Fortune 1000 Customers ~60% % of Fortune 1000 Companies That Are Existing Skillsoft Customers ~$28B ~29M Estimated Total Opportunity Within Existing Fortune 1000 Customers2 Total Employees At Skillsoft’s Fortune 1000 Customers1 Notes: 86 (1) Based on emp
Slide 87: Recent Success With Talent Champions
Recent Success With Talent Champions ~$1.7M ~$1.5M ~4x ~5x ARR ARR growth growth ~$0.5M ~$0.3M Start Year 1 Year 2 Year 3 Start Year 1 Year 2 Year 3 Expanded our relationship by Expanded our relationship by ~4x with a foreign government ministry ~5x with a Fortune 500 technology company to support 2
Slide 88: Delivering Measurable Customer Outcomes Is Driving Sustained Progress Towards Our Long-Term DRR Target
Delivering Measurable Customer Outcomes Is Driving Sustained Progress Towards Our Long-Term DRR1 Target ~93% ~97% ~100% ~101% FY21 FY22 FY23 FY24 ~108% Long-Term Target 88 Notes: (1) Refer to Appendix for “Non-GAAP Financial Measures and Key Performance Metrics” for the definitions of our key operat
Slide 89: Large Opportunity To Serve The Remaining ~40% Of The Fortune 1000
Large Opportunity To Serve The Remaining ~40% Of The Fortune 1000 ~40% ~$8B % Of Fortune 1000 Companies Unserved by Skillsoft Estimated Total Opportunity At Fortune 1000 ~8M Unserved by Skillsoft2 Total Employees At Fortune 1000 Unserved by Skillsoft1 Notes: 89 (1) Based on employee count at 2023 Fo
Slide 90: Compelling Value Propositions Enable Us To Win Large New Talent Champions
Compelling Value Propositions Enable Us To Win Large New Talent Champions 1 2 3 NEW CUSTOMER WIN EXAMPLE NEW CUSTOMER WIN EXAMPLE NEW CUSTOMER WIN EXAMPLE GLOBAL HEAVY LARGE GLOBAL FINANCIAL MANUFACTURER ASIAN BANK SERVICES WINNING VALUE PROPOSITION WINNING VALUE PROPOSITION WINNING VALUE PROPOSITIO
Slide 91: Global Acquisition Pipeline Growing And Shifting To Higher Value
Global Acquisition Pipeline Growing And Shifting To Higher Value $500k+ ARR >50% YoY Growth1 $250k-$499k ARR >30% YoY Growth1 >30% YoY Growth In H2 Enterprise Acquisition Pipeline1 $100k-$249k ARR >25% YoY Growth1 91 Notes: (1) Based on H2 FY25 to H2 FY24 comparison of B2B Net New Business pipeline
Slide 92: Investing In The Partner Ecosystem For Scalable Growth
Investing In The Partner Ecosystem For Scalable Growth Demand Strategic Technical Generation Engagement Expansion Current State Future State + Opportunistic and organic + Strategic and programmatic + Manual onboarding, management and + Automated tooling for full partner lifecycle measurement + Point
Slide 93: FY25-FY26 Go-To-Market Transformation Priorities
FY25-FY26 Go-To-Market Transformation Priorities Grow Current Develop Engage Buyers Learner Talent Aspiring Talent of Online Engagement Champions Champions Learning Separate BU GTM Talent transformation – leadership & field Fix the Value selling capabilities Basics Routes to market Operational rigor
Slide 94: Key Takeaways
KEY TAKEAWAYS 3 1 2 + Evolving the partner + Building momentum ecosystem and operations with Talent Champions + Transforming routes to to scale for global market market across installed base and reach new logos for more efficient and effective growth 94
Slide 95: Our Financial Framework
OUR FINANCIAL FRAMEWORK
Slide 96: Rich Walker, Chief Financial Officer
Rich Walker Chief Financial Officer 96
Slide 97: Value Creation Gameplan
Value Creation Gameplan Create long-term shareholder value through an industry-leading financial profile with above-market growth and profitability STRATEGIC OPERATIONAL FINANCIAL + Validated market opportunity + Fixing the basics AND investing + Resetting FY25 expectations for profitable growth for
Slide 98: Key Financial Priorities To Deliver On Our Objectives
Key Financial Priorities To Deliver On Our Objectives FY25-FY26 FY27+ Focused Actions Expense Comprehensive organization-wide expense 1 Reduction actions to deliver $45M+ annualized cost savings GTM transformation; AI-centric innovation; 2 Invest to Grow geographic & partner ecosystem expansion; our
Slide 99: Executing A Strategic Resource Reallocation Program To Deliver $45M+ Of Annualized Expense Reduction
Executing A Strategic Resource Reallocation Program To Deliver $45M+ Of Annualized Expense Reduction To Fund Growth $45M+ annualized ~4-5% expense reduction1 Sales & Marketing Run-Rate Reduction ~2-3% Delivering expanded FY25 General & Administrative Run-Rate Adj. EBITDA margins Reduction Content &
Slide 100: Updating Our FY25 Outlook To Reaffirm Adj. EBITDA Expectations On Lower Revenue
Updating Our FY25 Outlook To Reaffirm Adj. EBITDA Expectations On Lower Revenue Original FY25E Revised FY25E ($Ms) FY24A Outlook1 Outlook Commentary • Slower YTD pacing in Global Knowledge and anticipated timing of current turnaround actions into FY26 Revenue $553 $530 - $550 $510 - $525 • Elongated
Slide 101: Financial Objectives: Talent Development Solutions
Financial Objectives: Talent Development Solutions FY25E Mid-Term Objective Long-Term Objective Revenue Growth YoY% (2%) - Flat 5% - 7% 9% - 12% Non-GAAP Gross Margin1 Mid 80s % Mid 80s % Mid 80s % (% of Revenue) Non-GAAP Business Unit Contribution Margin1 Low 30s % Low to Mid 30s % High 30s % (% of
Slide 102: Financial Objectives: Global Knowledge
Financial Objectives: Global Knowledge FY25E Mid-Term Objective Long-Term Objective Revenue Growth YoY% (20%) - (15%) 5% - 7% 5% - 7% Non-GAAP Gross Margin1 Mid 40s % High 40s % 50%+ (% of Revenue) Non-GAAP Business Unit Contribution Margin1 <5% Low Teens % Mid Teens % (% of Revenue) Key Actions: Fi
Slide 103: Financial Objectives: Total Company
Financial Objectives: Total Company FY25E Mid-Term Objective Long-Term Objective Revenue Growth YoY% (8%) - (5%) 5% - 7% 10%+ Non-GAAP Gross Margin1 Mid 70s % Mid 70s % High 70s % (% of Revenue) Non-GAAP Business Unit Contribution Margin1 Mid 20s % High 20s % Low 30s % (% of Revenue) Adj. EBITDA1 20
Slide 104: Capital Allocation Priorities
Capital Allocation Priorities We will continue to prioritize funding organic growth investments that we believe will fuel growth, accelerate innovation, and drive profitable execution of our strategy INVEST TO GROW STOCK BUYBACK DELEVERAGING + Partner ecosystem + $10M share repurchase + Adj. EBITDA
Slide 105: Key Takeaways
KEY TAKEAWAYS 3 1 2 + Opportunity for + Building strong go- shareholder value + Taking immediate forward financial actions creation fundamentals through new operational with a recurring revenue performance management model and roadmap for system to reduce cost, strong free cash flow expand margins,
Slide 106: Analyst & Investor Q&A
ANALYST & INVESTOR Q&A with the Skillsoft Leadership Team
Slide 107: Closing Comments
CLOSING COMMENTS
Slide 108: Thank You
skillsoft® THANK YOU ~ _— | mH Ss oe
Slide 109: Appendix
Appendix
Slide 110: Non-GAAP Financial Measures And Key Performance Metrics
Non-GAAP Financial Measures And Key Performance Metrics The Company has organized its business into two segments (or Business Units): Content & Platform (or Talent Development Solutions) and Instructor-Led Training (or Global Knowledge). We use the following non-GAAP financial measures and key perfo
Slide 111: Reconciliation of Non-GAAP Financial Measures
Reconciliation of Non-GAAP Financial Measures SKILLSOFT CORP. SKILLSOFT CORP. RECONCILIATION OF NON-GAAP FINANCIAL MEASURES FREE CASH FLOW RECONCILIATION (in thousands, unaudited) (in thousands) Three Months Ended Year Ended January Three Months Ended January 31, 31, January 31, 2024 Year Ended Janu