SKLZ

Skillz is a competitive-mobile-gaming platform in structural decline dressed up as a turnaround. The headline FY2025 revenue of $104M (+12.5%) is noise off a collapsed base: the multi-year arc is $380M → $270M → $152M → $92.9M → $104M, and the one-year uptick is largely the RZR/Aarki ad-tech segment, not a recovery in the core skill-gaming business. Management removes any ambiguity in the MD&A: they cut UA marketing to ~$17.4M from $18.4M, state plainly that this 'has resulted in a reduction in revenue and is expected to continue to result in a reduction in revenue,' and say they cannot even estimate the magnitude. A company deliberately starving its own top line is not a growth story.

The economics are dire and worsening. Operating margin is -61.2%, net margin -67.4%, ROE -63%, and net income deteriorated to -$70.4M from -$46.8M. Operating cash flow swung to -$68.9M (YoY -874%), so the business burns roughly its entire market cap in cash every ~2 years. The $195M cash pile looks like a cushion until you see the balance sheet mechanics: long-term debt went to $0 but $128M reclassified into current portion, driving current liabilities +174% to $181M — the debt is now due, and near-term cash must service it while the operation bleeds. A -$1.09B accumulated deficit confirms this enterprise has never created value. Spending $9.26M on buybacks amid a $69M cash burn is capital misallocation.