Skillsoft Corp.

Greetings and welcome to the Skillsoft second quarter 2024 financial results conference call. At this time, all participants are in a listen-only mode. A question and answer session will follow the formal presentation. If anyone should require operator assistance during the conference, please press star zero on your telephone keypad. As a reminder, this conference is being recorded. It is now my pleasure to introduce your host, Chad Lyne, Head of Investor Relations. Thank you. You may begin.

Thank you, Operator. Good afternoon, and thank you for joining us today for Skillsoft's earnings call to discuss our results for the second quarter into July 31st, 2023. Participating on today's call are Jeff Tarr, Skillsoft's Chief Executive Officer, and Rich Walker, Skillsoft's Chief Financial Officer. Today after market close, Skillsoft issued a press release announcing its financial results, which is available on our investor relations website. Before I hand the call over to Jeff, I want to remind you that 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 market outlook. These forward-looking statements and all statements that are not historical facts reflect management's current beliefs and expectations as of today, and therefore are subject to risks and uncertainties that could cause actual results to differ materially. For a discussion of the material risks and other important factors that could affect our actual results, we refer you to our most recent Form 10-K and 10-Q filings with the Securities and Exchange Commission. We assume no obligation to update any forward-looking statements or information which speak as of the respective dates. During the call, we will also discuss certain non-GAAP financial measures, which are not prepared in accordance with generally accepted accounting principles. A reconciliation of the non-GAAP financial measures included in today's commentary 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 and Rich will be available to take questions. With that, it's my pleasure to turn the call over to Jeff. Thanks, Chad.

Good afternoon and thank you for joining us. Our team executed well in the second quarter. Bookings and revenue were both up for the total company, driven by high single-digit bookings growth and our high-margin SaaS-based content and platform segment. Further, I'm pleased to report bookings and revenue were up sequentially in our instructor-led training or ILT segment, which we believe is now positioned for a return to growth on a year-over-year basis. On the bottom line, we continue to lead our industry peers in profitability with adjusted EBITDA up on both the dollars and margin basis compared to the first quarter. As I'll share today, generative AI has emerged as a new catalyst for growth. This important technology has created a new critical reskilling opportunity with customers and prospects that plays to our strengths and that we have been quick to seize as an organization. Our LTM dollar retention rate was 101%, up 300 basis points, and is a testament to the value we deliver to customers. We secured several seven-figure contract renewals in our federal government business. a multimillion-dollar renewal with an international logistics and package delivery company, an expanded relationship with an international food products distributor, among others. We continue to win new customers on the strength of our enterprise-grade solution. During the quarter, more than 140 new customers chose Skillsoft to support their enterprise learning and workforce transformation imperatives. New customer wins included six figure contracts with a global specialty chemicals company, a leading provider of helicopter transportation solutions, a world leader in systems to lower carbon emissions, a global insurance claims settlement provider, and an international provider of products for sustainable mobility. New customers like these are telling us that our ability to deliver on their complex workforce transformation needs is unrivaled due to our unique integration of assessments, micro videos, hands-on learning, coaching, and instructor led training, all on our cutting edge AI driven learning experience platform. While industry peers focused primarily on catalogs of video content, We are increasingly winning based on our ability to deliver transformative learning experiences with measurable learning outcomes and tangible business results, all built on a scientifically validated approach, designed and optimized for the way people learn online. Our unique competitive advantage is driving strong growth in usage and engagement across what we believe to be the largest community of enterprise learners. In the past year and a half, we've grown monthly active users nearly 60% and course launches more than 40%, as well as course completion rates that are well above industry averages at more than 80%. Our rich metadata combined with our AI-enabled platform and our content creation capabilities enables us to optimize the learner experience inside the enterprise. As mentioned earlier, one of the important contributors to our growth strategy has been our early move to position Skillsoft to benefit from generative AI. This technology has created a new re-skilling imperative for our customers, as nearly all companies of scale grapple with the effect it is having on the nature of work. At Skillsoft, we believe that generative AI will affect every knowledge worker job, and the companies and individuals that ignore it will be left behind. We also believe that we have a solid first mover advantage in generative AI, born out of the fact that we are both a platform developer and content creator, that we have a long history in AI, and that we operate across a wide range of modalities and content categories. The strength of our position in this new domain is further enhanced by our acquisition of Codecademy with its hands-on learning platform. Further, preparing individuals and organizations for a world of generative AI is about more than just the technology and the skills to use it. It is also about leadership and business skills and compliance. And here too, we have unique capabilities that position Skillsoft to lead. I'm pleased with the speed with which our organization has moved to seize the generative AI opportunity with a shared belief that it changes what we teach, how we teach, and how we work. We now have several dozen AI offerings on Codecademy and year to date have enrolled more than half a million learners in these AI courses. We also recently developed and released a plugin for OpenAI's ChatGPT that recommends personalized and relevant Codecademy courses to users, thus meeting and serving learners from within the ChatGPT interface and expanding the reach of the Codecademy platform. And we've rolled out a ChatGPT Aspire journey designed to equip organizations with the skills needed to use the technology productively and ethically across the enterprise. We've also leveraged Skillsoft's deep library of proprietary content and experience delivering coaching at scale with a beta version of our conversation AI simulator, trademarked Casey, which provides experiential active learning through a generative AI coaching tool. Casey helps employees develop business and leadership skills by creating a safe place to practice crucial business conversations with real-time personalized feedback. The initial market reaction to Casey has been tremendous. Quoting the chief strategy officer and principal analyst at Brandon Hall Group, a leading industry analyst, quote, Skillsoft's Casey is the breakthrough technology for leadership development that organizations have been waiting for. It's the most progressive advancement I've seen to date. Skillsoft has effectively combined the on-demand support of a virtual assistant with leadership and management training to create a transformational new way of building interpersonal skills." End quote. Casey has wide-ranging applications and use cases far beyond our initial beta release, and I'm excited to see this innovative solution continue to evolve and move into general availability this quarter. As these examples highlight, we are committed to leading the market with innovation that delivers enhanced customer value and outcomes, enables upskilling and reskilling across the enterprise, and develops and grows learners for the jobs of the future. I am proud of our team and the demonstrable progress we are making as an organization. Across the globe, the reskilling revolution is unlocking new opportunities for Skillsoft and propelling us toward what we anticipate to be a future of accelerating profitable growth and value creation. With that, I'll now turn the call over to our CFO, Rich Walker, to review our financial results.