Skillsoft Corp.

Good afternoon.

And welcome to Skillsoft's second quarter fiscal 2023 earnings call. After the market closed, we issued our Q2 earnings press release and posted supplemental materials to the Skillsoft Investor Relations website. Today's call will contain forward-looking statements about the company's business outlook and expectations, including statements concerning financial and business trends. Our expected future business and financial performance, financial condition, and outlook. These forward-looking statements and all statements that are not historical facts reflect management's beliefs and predictions as of today and are therefore are subject to risks and uncertainties that could cause actual results to differ materially from expectations. For a discussion of the material risks and other important factors that could affect our actual results, please refer to the risks described in the safe harbor discussion found in the company's SEC filings. During the call, we will also discuss certain non-GAAP financial measures, which are not prepared in accordance with generally accepted accounting principles. GAAP requires accounting periods before and after the merger and de-SPAC on June 11, 2021, to be separated into predecessor and successor periods to reflect the change in ownership and lack in comparability between periods due to different ownership and investment bases. In addition, global knowledge activity is only reflected in the GAAP financial statements after June 11th. References on this call to combined GAAP results reflect a combination of the predecessor period before June 11th that excludes global knowledge with the successor period after June 11th. For all non-GAAP measures in the supplemental materials and in today's commentary, the company is providing normalized results as if Skillsoft and global knowledge had been combined for all periods presented, which we believe is useful to investors to show the trends of the go-forward company. A reconciliation of these non-GAAP financial measures to the most directly comparable GAAP financial measures as well as how we define these metrics and other metrics is included in our earnings press release, which has been furnished to the SEC and is also available on our website at www.skillsoft.com. After our prepared remarks, Jeff Tarr, CEO, and Gary Ferrer, CFO, will be available to take questions. With that, it's my pleasure to turn the call over to Jeff.

Thanks, Eric. Good afternoon, and thank you all for joining us. Today, I'll discuss our progress extending Skillsoft's leadership position in corporate learning. I'll cover a few operational highlights, provide some context to our financial results, and speak to our share or purchase authorization before turning the call over to Gary. Q2 marked our first anniversary as a newly formed management team and public company. Through a combination of organic investment, a number of strategic acquisitions and a successful divestiture, we have repositioned Skillsoft to benefit from positive secular trends in the enterprise learning market. Skillsoft now benefits from strong positions in the three most important categories of corporate learning, including leadership and business skills, tech and dev and compliance. across a wide range of learning modalities, including micro videos, hands-on learning, coaching, assessments, and instructor-led training delivered through our leading enterprise grade learning experience platform. We also benefit from a large enterprise customer base serving more than 15,000 corporate customers, more than 70% of the Fortune 1000, and a community of more than 80 million learners adjusted for the sale of SumTotal. With the benefit of these capabilities, we believe we are best positioned to deliver on the complex learning needs of the world's most sophisticated organizations. Over the long term, we believe this should enable us to accelerate revenue growth, expand margin, and generate strong cash flow. In our first year, acquisitions and divestitures were an important priority to better position our portfolio for the long term. Codecademy was a major building block to scale our offering within tech and dev, which is where organizational skills gaps are most acute. Additionally, through the acquisition of Pluma, we added coaching and mentoring capabilities, which are highly sought after by our enterprise customers. And shortly after the quarter, we announced the closing of the sale of SumTotal. This marked another major milestone in our strategy to become a more focused enterprise learning provider. Our investments have been focused on three key areas, content, platform, and go-to-market. Let me touch on a few important accomplishments in each. Over the past year, we invested heavily in new content and consolidated the Skillsoft and Global Knowledge on-demand collections, greatly increasing the breadth of our offering. We also expanded our local language coverage and released innovative new courses in DE&I, customer service, psychological safety, code of conduct, cloud and DevOps, among many others. In Q2, We released our new career journey experiences, which blend self-study and e-learning with instructor-led courses and other capabilities to address skills gaps and critical domains such as cybersecurity and advance the learner from novice to certified expert. We believe this approach provides superior outcomes for the employer and the learner alike and is easy for our customers to deploy at scale. With regard to platform leadership, over the past year, we reached our goal of migrating more than 90% of ARR onto Precipio and dual deployment. We achieved FedRAMP certification, which has enabled us to sell Precipio within the federal government and combined with the completed Workday integration will help us retire our legacy Skillport platform. We launched our skills benchmark offering. and we signed important content partnership agreements with Coursera and Udemy, adding to more than 30 other partners whose content can be accessed through Percipio, along with our customers' custom content to deliver even more comprehensive learning journeys. We believe making Percipio the one-stop learning experience platform is an important differentiator. Our investments in content and platform are paying off by driving higher engagement, which we believe will contribute to higher retention and new sales. At the end of Q2, monthly average users are up 21%, completed courses up 26%, and badges issued are up 16%. We have also made solid progress with our go-to-market transformation, which is now largely complete and sets itself well for Q4. With higher key talent, made investments in new tools and technology, and realigned our sales force to a more strategic coverage model that better enables cross-sell, upsell, and acquiring new business. In Q2, we added more than 150 new logos, including a large Australian multinational, one of India's largest private sector banks, and a large European grocery retailer. In North America, through investment in dedicated state and local government resources, we added several large customers, including city governments, municipal health care providers, and port authorities. We also signed a large auto manufacturer, a global publisher, a Fortune 100 financial services company, and one of the nation's largest and most visible nonprofits. Turning to Codecademy, we've made excellent initial progress with the integration. We acquired the business to strengthen our tech and dev offering with hands-on learning and programming and data science, an area where our enterprise customers are experiencing severe skills gaps. We also acquired a strong brand and community of learners. Every month, millions of people around the globe come to Codecademy to advance their skills. This community is passionate about Codecademy. By leveraging the Codecademy brand, community advocacy within the enterprise, and our large sales force, we believe we will be able to capture a substantial cross-sell opportunity. In our first quarter of ownership, we have integrated the product into Percipio, trained our sales force, and built a healthy pipeline of enterprise opportunity. We've also closed our first sales, including two Fortune 50 retailers. We are in the process of attaching Codecademy to a growing number of Q4 renewals and expect to report material progress at year end. The B2C side of the business continue to grow at a double digit rate, and we believe we are taking share in an environment where competitors are seeing declines. Before I turn the call over to Gary, I'd like to provide some context to our financials and update to our global knowledge business. I'm proud that we delivered five straight quarters of subscription content bookings growth after seven years of decline, despite an increasingly difficult economy. Q2 LTM content bookings was up 9% compared to flat in the year-ago period on a constant currency basis. Excluding Code Academy, it was up 8% from down 2% in the year-ago period. Dollar retention rate on an LTM basis was 98%. up three percentage points year over year. We expect these metrics to finish the year strong based on the strength of our Q4 pipeline and the fact that approximately 50% of our Q4 content subscription forecast is already booked or committed. With that said, I'm acutely aware that our financial results have fallen short of our initial expectations. The world is very different than it was a year ago, and those external changes have had a material impact on global knowledge, which is a transactional business and more sensitive to economic factors. Approximately 75% of the first half bookings decline in global knowledge was due to changes in training programs at two large technology partners. Other contributors are staffing challenges and inside sales, which should improve as recent hires become fully productive. Difficult comparisons due in part to last year's COVID bounce back and the economy. We believe our actions to date have now stabilized the business. Turning to expenses, as we integrate all our businesses into a more cohesive offering, we have been reducing costs and realizing operating synergies across the portfolio. These actions will help our overall cost structure become more efficient, and we believe we will drive greater adjusted EBITDA growth as revenue grows. Moving on to capital allocation. Today, we announced that our board of directors has authorized up to a $30 million share repurchase. We believe the current dislocation in our share price, combined with the strength of our balance sheet and confidence in our outlook and long-term prospects, have elevated repurchasing Skillsoft stock as the best use of capital available to us at this time. In closing, I remain as optimistic as ever in our ability to create a recognized leader in our space. with a high growth, high margin recurring revenue business capable of creating and sustaining a much higher public company valuation. The world is materially different than the one that existed when we announced the formation of the new Skillsoft in October 2020. However, I'm confident in our long-term opportunity and I'm looking forward to seeing our progress more appropriately reflected in our financial results and share price in the coming quarters and years. And with that, I'll turn the call over to Gary.