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SKIL Plummets 53% in 6 Months: Should Investors Buy the Dip Now?
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Key Takeaways
SKIL is driving growth through AI-led learning design and skills intelligence initiatives.
Percipio platform saw 74% more AI learners and a 158% y/y surge in AI learning hours.
Expense cuts lifted SKIL's EBITDA margin to 22% and supported the positive free cash flow.
Skillsoft Corp. (SKIL - Free Report) shares have declined 52.6% in the past six months against 22.9% growth of its industry and 19.4% rise of the Zacks S&P 500 Composite.
SKIL underperformed its competitors, with Parsons (PSN - Free Report) and Peraso (PRSO - Free Report) rising 29.2% and 1.3%, respectively.
6-Month Share Price Performance
Image Source: Zacks Investment Research
The one-year performance highlights that SKIL has underperformed Parsons and Peraso. Skillsoft has declined 30.2% against Parsons’ 13.8% drop and Peraso’s 26.4% rise.
Investors may buy SKIL shares, banking on the six-month price drop. Let us analyze to find out whether buying the dip is the best decision.
Skillsoft’s AI-Play: A Game-Changer
SKIL’s path forward is strictly governed by AI-led innovation, focusing on intelligent learning design, skills intelligence and engaging learning experience. Skilsoft’s global workforce earned more than 20,000 certifications in cloud, data and AI, cybersecurity, and service management.
These wins highlight the surging demand for scalable, critical learning solutions as companies adapt to crucial shifts in the workforce and AI technology. The company is inclined to meet this demand by implementing its product strategy, focusing on AI-embedded design, skills intelligence and greater flexibility.
During the second quarter fiscal 2026 earnings call, management disclosed that a global semiconductor manufacturer engaged with the company to improve their learning ecosystem for 43,000 employees, leveraging AI-powered content and bespoke learning trajectory. This validates SKIL’s focus on AI-led innovation and skills intelligence.
Skillsoft Percipio platform momentum boosted AI learners 74% year over year and AI learning hours 158%. This excellent improvement underlines SKIL’s success in AI-led strategy and its ability to ride on the rising market demand for AI upskilling solutions.
On the financial front, the company registered a 5.9% year-over-year decline in content and software development expenses due to productivity gains utilizing AI.
SKIL’s Expense Cut: Means to Margin Discipline
In the second quarter of fiscal 2026, management disclosed that the company delivered $45 million in expense reduction since the launch of its transformation actions in August last year. This steep reduction was due to the implementation of a dual business unit structure, enhanced operational execution, a shift in critical resources and the formation of a talented leadership group.
These actions had a positive impact on SKIL’s adjusted EBITDA margin, pushing it up to 22% from the year-ago quarter’s 21.4%. This was achievable despite the dip in the top line, highlighting the success of the company’s prudent expense management.
It is also impressive how the cost-cut originated from fixed expenses and not the variable ones, portraying SKIL’s ability to transform strategically rather than drifting toward short-term cuts. In the second quarter of fiscal 2026, Skillsoft witnessed a 5.9% year-over-year dip in content and software development expenses, 3% fall in selling and marketing expenses and a 10.5% decline in general and administrative costs.
Overall, this has contributed positively toward a sustainable EBITDA and $3.5 million in year-to-date free cash flow (FCF). Management reiterated its expectation of adjusted EBITDA of $112-$118 million and FCF of $13-$18 million for the year, highlighting its confidence.
SKIL’s Capital Return Beats Industry, Valuation Discounted
Return on equity (ROE) is a profitability metric that assesses how effectively a company utilizes shareholders' equity to generate earnings. By the end of the second quarter of fiscal 2026, SKIL’s ROE was 16.03% surpassing the industry’s 15.89%, highlighting effective capital management.
SKIL is priced at 2.12 times forward 12-month price-to-earnings, way below the industry average of 25.19 times. Skilsoft’s trailing 12-month EV-to-EBITDA ratio stands at 3.05, significantly lower than the industry average of 15.87. Being undervalued on both counts is a green flag for value investors.
Image Source: Zacks Investment Research
Image Source: Zacks Investment Research
It's Time to Add SKIL to Your Portfolio
Skillsoft’s AI-led innovation and focus on intelligent learning and skills intelligence position it well to capture the growing customer demand and win large contracts. Cost-cutting initiatives are improving the company’s margins and FCF. Management’s reiteration of its full-year guidance exudes confidence in its operations.
We recommend investors to hurry up and buy this stock now, which currently stands undervalued and generates a strong capital return. Investors looking for long-term gains must add this stock to their portfolio.
Image: Bigstock
SKIL Plummets 53% in 6 Months: Should Investors Buy the Dip Now?
Key Takeaways
Skillsoft Corp. (SKIL - Free Report) shares have declined 52.6% in the past six months against 22.9% growth of its industry and 19.4% rise of the Zacks S&P 500 Composite.
SKIL underperformed its competitors, with Parsons (PSN - Free Report) and Peraso (PRSO - Free Report) rising 29.2% and 1.3%, respectively.
6-Month Share Price Performance
The one-year performance highlights that SKIL has underperformed Parsons and Peraso. Skillsoft has declined 30.2% against Parsons’ 13.8% drop and Peraso’s 26.4% rise.
Investors may buy SKIL shares, banking on the six-month price drop. Let us analyze to find out whether buying the dip is the best decision.
Skillsoft’s AI-Play: A Game-Changer
SKIL’s path forward is strictly governed by AI-led innovation, focusing on intelligent learning design, skills intelligence and engaging learning experience. Skilsoft’s global workforce earned more than 20,000 certifications in cloud, data and AI, cybersecurity, and service management.
These wins highlight the surging demand for scalable, critical learning solutions as companies adapt to crucial shifts in the workforce and AI technology. The company is inclined to meet this demand by implementing its product strategy, focusing on AI-embedded design, skills intelligence and greater flexibility.
During the second quarter fiscal 2026 earnings call, management disclosed that a global semiconductor manufacturer engaged with the company to improve their learning ecosystem for 43,000 employees, leveraging AI-powered content and bespoke learning trajectory. This validates SKIL’s focus on AI-led innovation and skills intelligence.
Skillsoft Percipio platform momentum boosted AI learners 74% year over year and AI learning hours 158%. This excellent improvement underlines SKIL’s success in AI-led strategy and its ability to ride on the rising market demand for AI upskilling solutions.
On the financial front, the company registered a 5.9% year-over-year decline in content and software development expenses due to productivity gains utilizing AI.
SKIL’s Expense Cut: Means to Margin Discipline
In the second quarter of fiscal 2026, management disclosed that the company delivered $45 million in expense reduction since the launch of its transformation actions in August last year. This steep reduction was due to the implementation of a dual business unit structure, enhanced operational execution, a shift in critical resources and the formation of a talented leadership group.
These actions had a positive impact on SKIL’s adjusted EBITDA margin, pushing it up to 22% from the year-ago quarter’s 21.4%. This was achievable despite the dip in the top line, highlighting the success of the company’s prudent expense management.
It is also impressive how the cost-cut originated from fixed expenses and not the variable ones, portraying SKIL’s ability to transform strategically rather than drifting toward short-term cuts. In the second quarter of fiscal 2026, Skillsoft witnessed a 5.9% year-over-year dip in content and software development expenses, 3% fall in selling and marketing expenses and a 10.5% decline in general and administrative costs.
Overall, this has contributed positively toward a sustainable EBITDA and $3.5 million in year-to-date free cash flow (FCF). Management reiterated its expectation of adjusted EBITDA of $112-$118 million and FCF of $13-$18 million for the year, highlighting its confidence.
SKIL’s Capital Return Beats Industry, Valuation Discounted
Return on equity (ROE) is a profitability metric that assesses how effectively a company utilizes shareholders' equity to generate earnings. By the end of the second quarter of fiscal 2026, SKIL’s ROE was 16.03% surpassing the industry’s 15.89%, highlighting effective capital management.
SKIL is priced at 2.12 times forward 12-month price-to-earnings, way below the industry average of 25.19 times. Skilsoft’s trailing 12-month EV-to-EBITDA ratio stands at 3.05, significantly lower than the industry average of 15.87. Being undervalued on both counts is a green flag for value investors.
It's Time to Add SKIL to Your Portfolio
Skillsoft’s AI-led innovation and focus on intelligent learning and skills intelligence position it well to capture the growing customer demand and win large contracts. Cost-cutting initiatives are improving the company’s margins and FCF. Management’s reiteration of its full-year guidance exudes confidence in its operations.
We recommend investors to hurry up and buy this stock now, which currently stands undervalued and generates a strong capital return. Investors looking for long-term gains must add this stock to their portfolio.
Skilsoft sports a Zacks Rank #1 (Strong Buy) at present. You can see the complete list of today’s Zacks #1 Rank stocks here.