SKIL's AI-Native Strategy: Is Growth Painted in Its Long-Term Picture?

Skillsoft Corp. SKIL has adopted AI as a native construct inside its platform, which is turning out to be a critical component in the company’s journey. Inclination toward AI is due to the company’s faith in trends shifting toward AI-driven skills management, which is changing the go-to-market (GTM) approach to capturing opportunities.

The CEO stated that the company is pivoting toward an AI-native platform and content provider like Netflix, a pretty optimistic comparison, displaying the management’s confidence. On the operational and content efficiency front, Skillsoft’s AI-led strategy bears fruit. In the third quarter of fiscal 2026, SKIL reported that it used AI in more than 50% of the design, curation and production of its content.

Content and software development expenses dipped 2.4% year over year on the back of productivity gains from utilizing AI. The company has gathered trust points from its customers by using the same AI tools internally that it provides to its customers.

Investors might be taken aback due to the deterioration in SKIL’s revenues, as it dipped 6% year over year to $129 million in the third quarter of fiscal 2026. The primary contributor to this detriment was the Global Knowledge (“GK”) segment, which recorded an 18% year-over-year decline in its revenues. However, the Talent Development Solutions (“TDS”) segment appears promising.

During the recently reported quarter’s earnings call, the CEO remarked that AI is not replacing learning platforms, but rather elevating their strategic relevance. The company’s motives align with the aforementioned phenomenon as it integrates AI and CAISY in the next-gen Skillsoft Percipio to drive enterprise contracts.

SKIL’s Price Performance, Valuation & Estimates

Skillsoft has plummeted 73% in a year against the industry’s 19.4% growth. Meanwhile, SKIL’s industry peer VerifyMe VRME has fallen 74.1%, while Agora API has gained 13.2%.

1-Year Share Price Performance

From a valuation standpoint, SKIL trades at a 12-month forward price-to-sales ratio of 0.14. It trades cheaper than VerifyMe’s and Agora’s 1.04 and 2.94, respectively.

Price/Sales - F12M

Skillsoft has a Value Score of A. Agora and VerifyMe carry a Value Score of C.

The Zacks Consensus Estimate for EPS for 2025 is set at $4.17, which has been revised up 19.8% over the past 60 days. The consensus mark for EPS for 2026 is pinned at $4.54, which has been revised down 9.9% over the past 60 days.

SKIL sports a Zacks Rank #1 (Strong Buy) at present. You can see the complete list of today’s Zacks #1 Rank stocks here.

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This article originally published on Zacks Investment Research (zacks.com).

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