Q1 2025 Skillsoft Corp Earnings Call

It is clear to me that we need to move more quickly and lower the center of gravity to support more focused decisions at the right levels of the organization to meet the fast pace of the content market.

Ronald W. Hovsepian: to support more focused decisions at the right levels of the organization to meet the fast pace of the content market. To do so, we've fully rolled out and are quickly operationalizing a dual business unit structure run by two general managers with full P&L responsibility and accountability for the respective business units' operational performance, including product development, go-to-market, customer delivery, and success. Given the impact the instructor-led training segment has had on Skillsoft's performance, addressing its challenges has been one of my top priorities. We moved swiftly to recruit and onboard Darren Vance as the new general manager of this business.

Speaker Change: To do so, we've fully rolled out and are quickly operationalizing a dual business unit structure run by two general managers with full P&L responsibility and accountability for the respective business units operational performance.

Speaker Change: including product development, go-to-market, customer delivery, and success.

Speaker Change: Given the impact, the instructor-led training segment has had on SkillSoft's performance, addressing its challenges has been one of my top priorities.

Speaker Change: We move swiftly to recruit and onboard Darren Bance as the new general manager of this business unit.

Ronald W. Hovsepian: Darren is a proven executive and an accomplished operator in this space, and I'm confident in the positive impact his leadership and deep domain expertise will have as we re-energize this important part of the organization and build the foundation for innovation and a return to growth for instructor-led training. As part of this dual business unit structure, we've consolidated and more deeply integrated our Codecademy consumer teams and operations under the leadership of Aparatim Thurakai Atha, general manager of our content and platform segment.

Darren Vance: Darren is a proven executive and an accomplished operator in this space.

Darren Bance: And I'm confident in the positive impact his leadership and deep domain expertise will have as we re-energize this important part of the organization. And we build the foundation for innovation and a return to growth for the instructor-led training.

Darren Bance: As part of this dual business unit structure, we've consolidated and more deeply integrated our Codecademy consumer teams and operations under the leadership of operatim, Porakai Asta, general manager of our content and platform segment.

Ronald W. Hovsepian: Under AP's leadership, we expect to more broadly leverage Codecademy's brand halo, innovation engine, digital capabilities, and interactive learning competencies across the rest of the organization. And in our go-to-market organization, we've realigned and flattened the sales and marketing teams to directly support our two business units and their respective customer acquisition, growth, and retention efforts. We've upgraded several key leadership roles in recent quarters, and we'll continue to focus on bringing talent up to the enterprise to win in the enterprise and grow closer to our customers.

Darren Bance: Under AP's leadership, we expect to more broadly leverage Code Academy's brand Halo, Innovation Engine, digital capabilities, and interactive learning competencies across the rest of the organization.

Darren Bance: And in our go-to-market organization, we've realigned and flattened the sales and marketing teams to directly support our two business units and their respective customer acquisition, growth, and retention motions.

Darren Bance: We've upgraded several key leadership roles in the recent quarters and will continue to focus on up-leveling talent across the company to win in the enterprise and grow closer to our customers.

Ronald W. Hovsepian: Let me now turn to what I've been hearing and learning from our customers. The executives I've been meeting with share the view that the shift to a skill-centric economy is accelerating. The world of work is being reshaped and disrupted, underpinned by rapid technological advancements like generative AI. They echo research from Boston Consulting Group, which published a survey of more than 1,400 C-suite executives who indicated that nearly half of all workers will need to be re-skilled for Gen-AI in the next three years.

Speaker Change: Let me now turn to what I've been hearing and learning from our customers.

Speaker Change: The executives I've been meeting with share the view that the shift to a skill-centric economy is accelerating.

Speaker Change: The world of work is being reshaped and disrupted underpinned by the rapid technological advancements like generative AI.

Speaker Change: They echo research from Boston Consulting Group, which published a survey of more than 1,400 C-suite executives who indicated that nearly half of all workers will need to be re-skilled for Gen A.I. in the next three years.

Ronald W. Hovsepian: In this context, these business leaders continue to stress the importance of investing in to build a future-fit workforce that is skilled, agile, and adaptable for a more dynamic and rapidly changing market. We believe this creates a global catalyst for upskilling and reskilling that Skillsoft is well positioned to serve. At the same time, organizations are facing greater financial constraints, budgets have grown tighter, expenses are being reallocated or reduced, and investment plans are facing greater scrutiny.

Speaker Change: In this context, these business leaders continue to stress the importance of investing and to build a future fit workforce that is skilled, agile, and adaptable for a more dynamic and rapidly changing market.

Speaker Change: We believe this creates a global catalyst for upskilling and re-skilling that SkillSoft is well positioned to serve.

Speaker Change: At the same time, organizations are facing greater financial pressures.

Speaker Change: Budgets have grown tighter, expenses are being reallocated or reduced, and investment plans are facing greater scrutiny.

Ronald W. Hovsepian: In some instances, we've seen these factors have an impact on the demand environment, renewal rates, and sales cycles in our industry more broadly. But in other instances, we've seen organizations use this as an opportunity to pursue operational efficiencies and improve learner outcomes by consolidating with fewer of the best-of-breed partners like Skillsoft. In an industry that remains highly fragmented with many niche providers, we believe Skillsoft is strongly positioned. We offer the market an end-to-end interactive learning solution, a full continuum of immersive and experiential modalities, and competencies spanning the most in demand soft skills and power skills.

Speaker Change: In some instances, we've seen these factors have an impact on the demand environment, renewal rates, and sales cycles in our industry more broadly.

Speaker Change: But in other instances, we've seen organizations use this as an opportunity to pursue operational efficiencies and improve learner outcomes by consolidating with fewer of the best-of-breed partners like SkillSoft.

Speaker Change: In an industry that remains highly fragmented with many niche providers, we believe SkillSoft is strongly positioned.

Speaker Change: We offer the market an end-to-end interactive learning solution, a full continuum of immersive and experiential modalities and competencies spanning the most in demand, soft skills, and power skills.

Ronald W. Hovsepian: Taken together, this holistic capability enables our customers to drive workforce transformation and realize tangible business outcomes at an enterprise-wide scale. We've had some very exciting customer wins and expansions in the first quarter that validate our approach and our unique value proposition. In one example, we successfully expanded an existing relationship with one of the world's largest staffing and workforce solution providers, displacing an incumbent provider by deploying Skillsoft's Percipio, Custom Aspired Journeys capabilities, and Skill Benchmark.

Speaker Change: Taken together, this holistic capability enables our customers to drive workforce transformation and realize tangible business outcomes at an enterprise-wide scale.

Speaker Change: We've had some very exciting customer wins and expansions in the first quarter that validate our approach and the unique value proposition.

Speaker Change: In one of the examples, we successfully expanded an existing relationship with one of the world's largest staffing and workforce solution providers, displacing an incumbent provider by deploying SkillSoft's Percipio, custom-inspired journeys, capabilities, and skill benchmarks.

Ronald W. Hovsepian: Following an enterprise-wide rollout supporting more than 100,000 learners, the customer will experience stronger ROI with Skillsoft through improved skills, progression, and internal talent mobility across the organization. As another example, we're supporting a European-based multinational financial services company and their transformation to become a digital banking leader. Central to their transformation is a focus on providing technical re-skilling and enhanced leadership skills to more than 40,000 employees. The breadth of our capabilities across these domains allows the organization to consolidate providers while we secured a five-year renewal and expansion worth more than $2 million in total contract value.

Speaker Change: Following enterprise-wide rollouts supporting more than 100,000 learners, the customer will experience stronger ROI with Skillshare through an improved skills progression and internal talent mobility across the organization.

Speaker Change: And another example, we're supporting a European-based multinational financial services company and their transformation to becoming a digital banking leader.

Speaker Change: Central to their transformation is a focus on providing technical reskilling and enhanced leadership skills to more than 40,000 employees.

Speaker Change: The breadth of our capabilities across these domains allowed the organization to consolidate providers while we secured a five-year renewal and expansion worth more than $2 million of total contract value.

Ronald W. Hovsepian: And on the new customer front, we're pleased to win a three-year, seven-figure agreement to support the talent development strategy for a global leader in the freight rail technology industry. Our unified solution offered the company the ability to streamline its investments across multiple compliance, health and safety, leadership and development, and technical skilling providers while centralizing and enhancing the learner experience with Skillsoft for approximately 30,000 employees. Examples like these and the feedback I'm hearing from the executives at customers and the partners give me confidence that there is a clear and compelling opportunity for Skillsoft to enhance and grow its leadership position.

Speaker Change: And on the new customer front, we're pleased to win a three-year seven-figure agreement to support the talent development strategy for a global leader in freight rail technology industry.

Speaker Change: Our unified solution offered the company the ability to streamline its investments across

Speaker Change: multiple compliance, health and safety, leadership and development, and technical skilling providers, while centralizing and enhancing the learner experience with skill soft for approximately 30,000 employees.

Speaker Change: Examples like these and the feedback I'm hearing from the executives at the customers and the partners give me confidence that there is a clear and compelling opportunity for Skillsoft to enhance and grow its leadership position.

Ronald W. Hovsepian: As with any business in which I've been involved with, growth and value creation hinge on a clear strategic direction and priority. A Bias for Action: Streamlined Decision Making and Effective and Aligned Execution Across the Organization This is where you will see me and the entire Skillsoft team focused on our journey ahead. You can expect to hear much more about our strategy, priorities, and plan for value creation at our upcoming Virtual Investor Day on July 11. With that, let me now hand the call over to Rich to discuss our financial results. Right, Rich?

Speaker Change: As with any business in which I've been involved with, growth and value creation hinge on clear strategic direction and priorities, a bias for action in streamlined decision-making and effective and aligned execution across the organization.

Speaker Change: This is where you will see me and the entire SkillSoft team focus for our journey ahead.

Unknown Executive: You can expect to hear much more about our strategy, priorities, and plan for value creation at our upcoming virtual investor day on July 11th.

SkillSoft team: You can expect to hear much more about our strategy, priorities, and plan for value creation at our upcoming Virtual Investor Day on July 11th.

Ronald Hovsepian: With that, let me now hand the call over to Rich to cover our financial results.

Speaker Change: With that, let me now hand the call over to Rich to cover our financial results. Rich?

Rich: Thank you, Ron, and thank you, everyone, for joining today's call. As Ron shared in his opening remarks, we are disappointed in our first quarter financial results, or the broader macro environment has exacerbated budget pressures at many organizations and was a contributing factor to our performance. We did not execute to our internal expectations. We are moving swiftly to address the issues that affected our performance, and we expect our progress to be evident in the coming quarters. The long-term market opportunity for Skillsoft remains compelling and exciting, and we are committed to ensuring the company is positioned to realize its full growth and value potential.

Richard Walker: Thank you, Ron, and thank you everyone for joining today's call. As Ron shared in his opening remarks, we are disappointed in our first quarter financial results, or the broader macro environment has exacerbated budget pressures at any organization and was a contributing factor to our performance. We did not execute to our internal expectations.

Rich: Thank you, Ron, and thank you everyone for joining today's call. As Ron shared in his opening remarks, we are disappointed in our first quarter financial results.

Rich: While the broader macro environment has exacerbated budget pressures at many organizations, and was a contributing factor to our performance, we did not execute to our internal expectations.

Richard Walker: We are moving swiftly to address the issues that affected our performance, and we expect our progress to be evident in coming quarters. The long-term market opportunity for Skillsoft remains compelling and exciting, and we are committed to ensuring the company is positioned to realize its full growth and value potential.

Rich: We are moving swiftly to address the issues that affected our performance, and we expect our progress to be evident in coming quarters.

Rich: The long-term market opportunity for Skillsoft remains compelling and exciting, and we are committed to ensuring the company is positioned to realize its full growth and value potential.

Rich: Turning now to a review of our financial results, content and platform revenue of $98 million was roughly flat year-over-year, primarily due to the impact of tighter budgets on some of our larger end-quarter renewals and upgrades and softer consumer subscription performance. Our LTM dollar retention rate was approximately 99% in the quarter, compared to approximately 101% in Q1 of last year.

Richard Walker: Turning now to a review of our financial results, content and platform revenue of $98 million was roughly flat year over year, primarily due to the impact of tighter budgets on some of our larger, in-quarter renewals and upgrades, and softer consumer subscription performance. Our LTM dollar retention rate was approximately 99% in the quarter, compared to approximately 101% in Q1 of last year. Instructor led training revenue of $30 million was down 20% year over year, which includes an approximately 2% impact from the exit of our apprenticeship business in the United Kingdom in the second half of last year.

Rich: Turning now to a review of our financial results.

Rich: Content and platform revenue of $98 million was roughly flat year over year, primarily due to the impact of tighter budgets on some of our larger end-quarter renewals and upgrades and softer consumer subscription performance.

Rich: Our LTM dollar retention rate was approximately 99% in the quarter compared to approximately 101% in Q1 of last year.

Rich: Instructor-led training revenue of $30 million was down 20% year over year, which includes an approximately 2% impact from the exit of our apprenticeship business in the United Kingdom in the second half of last year. Additionally, revenue was impacted by lower sales linearity during the quarter, as well as weaker demand trends that we've discussed on previous calls. Total revenue of $128 million was down 6% year over year. Walking through expenses, cost of revenue of $34 million, or 27% of revenue, was favorably down 9% year-over-year, primarily due to lower instructor and courseware costs related to lower revenue in the instructor-led training segment. Content and software development expenses of $14 million, or 11% of revenue, were favorably down 2% year-over-year, primarily due to facility savings and Selling and marketing expenses of $41 million, or 32% of revenue, were favorably down 7% year over year, primarily due to proactive reductions in paid media spend and lower headcount and personnel-related expenses.

Speaker Change: Instructor-led training revenue of $30 million was down 20% year over year, which includes an approximately 2% impact from the exit of our apprenticeship business in the United Kingdom in the second half of last year.

Richard Walker: Revenue was impacted by lower sales, linearity during the quarter, as well as weaker demand trends that we've discussed on previous calls.

Speaker Change: Revenue was impacted by lower sales linearity during the quarter, as well as weaker demand trends that we've discussed on previous calls.

Rich: General and administrative expenses of $20 million, or 16% of revenue, were up 10% year-over-year, primarily due to a benefit in the prior year period related to transition services for the sum total divestiture and payroll tax credit. Total operating expenses were $109 million, or 85% of revenue, and were favorably down $5 million or 4% year over year. Adjusted EBITDA was $19 million, or 15% of revenue, compared to $22 million and 16% of revenue in the prior year period.

Richard Walker: Total revenue of $128 million was down 6% year over year. Walking through expenses, cost of revenue of $34 million or 27% of revenue was favorably down 9% year over year, primarily due to lower instructor and coursework cost related to lower revenue in the instructor-led training segment. Content and software development expenses of $14 million or 11% of revenue were favorably down 2% year over year, primarily due to facility savings and our ongoing focus to leverage lower-cost geographies. Selling and marketing expenses of $41 million, or 32% of revenue, were favorably down 7% year over year, primarily due to proactive reductions in paid media spend and lower head count and personnel-related expenses.

Speaker Change: Total revenue of $128 million was down 6% year over year.

Speaker Change: Walking through expenses, cost of revenue of $34 million or 27% of revenue was favorably down 9% year over year, primarily due to lower instructor and courseware costs related to lower revenue in the instructor-led training segment.

Speaker Change: Content and software development expenses of $14 million or 11% of revenue were favorably down 2% year over year, primarily due to facility savings and our ongoing focus to leverage lower cost geographies.

Speaker Change: Selling and marketing expenses of $41 million or 32% of revenue were favorably down 7% year over year, primarily due to proactive reductions in paid media spend and lower headcount and personnel-related expenses.

Richard Walker: General and administrative expenses of $20 million, or 16% of revenue, were up 10% year over year, primarily due to a benefit in the prior year period related to transition services for the sum total divestiture and payroll tax credit. Total Operating Expenses were $109 million or 85% of revenue and were favorably down $5 million or 4% year over year. Adjusted EBITDA was $19 million or 15% of revenue, compared to $22 million and 16% of revenue in the prior year period. Gatnet loss was $28 million and Gatnet loss for share was $3.42. Compared to a Gatnet loss of $44 million or $5.42 per share in the prior year period.

Speaker Change: General and administrative expenses of $20 million or 16% of revenue were up 10% year over year, primarily due to a benefit in the prior year period related to transition services for the sum total divestiture and payroll tax credits.

Speaker Change: Total operating expenses were $109 million or 85% of revenue, and were favorably down $5 million or 4% year over year.

Speaker Change: Adjusted EBITDA was $19 million or 15% of revenue compared to 22 million and 16% of revenue in the prior year period.

Rich: Gap net loss was $28 million, and gap net loss per share was $3.42 compared to a gap net loss of $44 million or $5.42 per share in the prior year period. Adjusted net loss was $27 million, and adjusted net loss per share was $3.37 compared to an adjusted net loss of $30 million or $3.68 per share in the prior year period.

Speaker Change: Gap net loss was $28 million and gap net loss per share was $3.42 compared to a gap net loss of $44 million or $5.42 per share in the prior year period.

Richard Walker: Adjusted net loss was $27 million and adjusted net loss for share was $3.37. Compared to an adjusted net loss of $30 million or $3.68 per share in the prior year period.

Speaker Change: Adjusted net loss was $27 million, and adjusted net loss per share was $3.37, compared to an adjusted net loss of $30 million or $3.68 per share in the prior year period.

Rich: Moving to cash flow and balance sheet highlights, cash flow from operations was $15 million in the quarter. Working capital was the source of cash, with solid cash collections against prior-period accounts receivable. We invested $5 million in capitalized, internally-developed software and capital expenditures, resulting in positive free cash flow of $10 million in the quarter. We ended Q1 again maintaining a solid balance sheet and a strong liquidity profile. Cash and cash equivalents and restricted cash were $150 million, up from approximately $147 million in the fourth quarter. Total net debt, which includes borrowings on our term loan and accounts receivable facility, net of cash, cash equivalents, and restricted cash, was approximately $476 million, down from approximately $482 million in the fourth quarter.

Richard Walker: Moving to cash flow and balance sheet highlights, cash flow from operations was $15 million in the quarter. Working capital was a source of cash with solid cash collections against prior periods' accounts receivables. We invested $5 million in capitalized internally developed software and capital expenditures, resulting in positive free cash flow of $10 million in the quarter.

Speaker Change: Moving to cash flow and balance sheet highlights, cash flow from operations was $15 million in the quarter. Working capital was a source of cash with solid cash collections against prior periods accounts receivables.

Speaker Change: We invested $5 million in capitalized internally developed software and capital expenditures, resulting in positive free cash flow of $10 million in the quarter.

Richard Walker: We ended Q1 again maintaining a solid balance sheet and a strong liquidity profile. Cash and cash equivalents and restricted cash was $150 million, up from approximately $147 million in the quarter. Total net debt, which includes barrains on our turn loan and accounts receivable facility. Net of cash, cash equivalents, and restricted cash was approximately $476 million, down from approximately $482 million in the fourth quarter.

Speaker Change: We ended Q1 again maintaining a solid balance sheet and a strong liquidity profile. Cash and cash equivalence and restricted cash was $150 million, up from approximately $147 million in the fourth quarter.

Speaker Change: total net debt, which includes borrowings on our term loan and accounts receivable facility, net of cash, cash equivalents, and restricted cash was approximately $476 million.

Speaker Change: down from approximately $482 million in the fourth quarter.

Rich: Turning to our outlook, although our first quarter financial results pace below our internal objectives and we expect some ongoing impact into our second quarter, we believe the actions we are taking in the business will allow us to deliver on our full year expectations. We are reaffirming the ranges we provided on April 15, which called for full-year revenue of $530 million to $550 million and adjusted EBITDA of $105 million to $110 million.

Richard Walker: Turning to our outlook, although our first quarter financial results pace below our internal objectives, and we expect some ongoing impact into our second quarter. We believe the actions we are taking in the business will allow us to deliver on our full-year expectations. We are reaffirming the ranges we provided on April 15, which called for full year revenue of $530 million to $550 million. And adjusted EBITDA of $105 million to $110 million.

Speaker Change: Turning to our outlook, although our first quarter financial results paced below our internal objectives,

Speaker Change: and we expect some ongoing impact into our second quarter, we believe the actions we are taking in the business will allow us to deliver on our full year expectations.

Speaker Change: We are reaffirming the ranges we provided on April 15th, which called for full-year revenue of $530 million to $550 million, and adjusted EBIT of $10 million to $110 million.

Richard Walker: Prior to opening the call for questions, I wanted to conclude by sharing our conviction in the growth potential for Skillsoft and our opportunity to build a more valuable business in the near term and long term. Throughout the company, we are moving thoughtfully but swiftly to make changes that we believe will strengthen our execution and enhance our financial results.

Rich: Prior to opening the call for questions, I wanted to conclude by sharing our conviction in the growth potential for Skillsoft and our opportunity to build a more valuable business in the near term and long term. Throughout the company, we are moving thoughtfully but swiftly to make changes that we believe will strengthen our execution and enhance our financial results. We are excited by the infusion of new leadership and energy into Skillsoft's global knowledge, and we look forward to the positive impact and change in trajectory that we believe Darren will have on that business.

Speaker Change: Prior to opening the call for questions, I wanted to conclude by sharing our conviction in the growth potential for SkillSoft and our opportunity to build a more valuable business in the near term and long term.

Speaker Change: Throughout the company, we are moving thoughtfully but swiftly to make changes that we believe will strengthen our execution and enhance our financial results.

Richard Walker: We are excited by the infusion of new leadership and energy and skill soft global knowledge, and we look forward to the positive impact and change in trajectory that we believe Darren will have in that business. We can fix them. So I feel very confident on that particular piece.

Speaker Change: We are excited by the infusion of new leadership and energy into Skillsoft global knowledge, and we look forward to the positive impact and change in trajectory that we believe Darren will have in that business.

Rich: More broadly, our team is committed to ensuring Skillsoft is positioned to win in the market, deliver profitable and efficient growth, and generate value for our stakeholders. We appreciate your ongoing support and look forward to updating you on our progress in the coming quarter. With that, Operator, please open the call to questions, and then Ron will be back for some closing comments.

Speaker Change: More broadly, our team is committed to ensuring Skillsoft is positioned to win in the market, deliver profitable and efficient growth, and generate value for our stakeholders.

Speaker Change: We appreciate your ongoing support and look forward to updating you on our progress in the coming quarters.

Speaker Change: With that, operator, please open the call for questions, and then Ron will be back for some closing comments.

Operator: Thank you. We will now be conducting a question and answer session. If you would like to ask a question, please press star 1 on your telephone keypad. A confirmation tone will indicate that your line is in the question queue, and you may press star 2 if you would like to remove your question from the queue, for participants using speaker equipment. It may be necessary to pick up your handset before pressing the start key.

Operator: Thank you. We will now be conducting a question and answer session. If you would like to ask a question, please press star 1 on your telephone keypad.

Operator: A confirmation until will indicate that your line is in the question queue.

Operator: And you may press star 2 if you'd like to remove your question from the queue. For participants using speaker equipment, it may be necessary to pick up your handset before pressing the star keys.

Operator: One moment, please, while we pull for questions. Thank you. Our first question will come from the line of Ken Wong with Oppenheimer. Please proceed with your question.

Operator: One moment please, I'll we pull for questions.

Operator: Thank you. Our first question will come from the line of Ken Wong with Oppenheimer. Please proceed with your question.

Ken Wong: Great, thank you for taking my question. Yeah, this one, I assume probably better for you, Ron, but just thinking about the restructuring, I guess when we see something of this magnitude, it's typically a step back before seeing several steps forward. You know, with the reiterated guide, I guess it doesn't seem obvious that there's maybe a kind of a rebuild going on here. Maybe just walk us through how we should think about the magnitude of these organizational changes, you know, whether or not I'm thinking about the timeline from a kind of a recovery correctly here. And I'm sure everyone's wondering the confidence in kind of that four-year outlook, considering, again, the Sorry for the long question.

Ken Wong: Great, thank you for taking my question. Yeah, this one, I assume probably better for you, Ron, but just thinking about the restructuring, I guess when we see something of this magnitude typically,

Ken Wong: It's a step back before seeing several steps forward. You know, with the reiterated guide, I guess it doesn't seem obvious that, you know, there's maybe a kind of a rebuild going on here. Maybe just walk us through how we should think about the magnitude of these organizational changes, you know, whether or not I'm thinking about the timeline from kind of a recovery correctly here. And I'm sure everyone's wondering the confidence in kind of that fool your outlook, considering.

Ken Wong: Again, the softer start and the softer messaging on Q2. Sorry for the long question. No, no, no, no, great. Thank you, Ken. Great to hear from you again. From an overall perspective, when I look at where we are today,

Ronald W. Hovsepian: No, no, no, no. Great. Thank you, Ken. Great to hear from you again.

Ronald W. Hovsepian: From an overall perspective, when I look at where we are today and where we need to mature in the areas I highlighted in the script around the operational discipline and the execution piece, combined with strategic alignment, I do see some early wins that we can achieve as part of our journey here, and I do see the opportunity to close those things in short order. I'd tell you to look at the track record of things that we're trying to do, and Darren's hiring happened very, very quickly, within a few weeks of my time here, and I think that should bode well for the velocity that the team is energized to work on as we go on this part of the journey.

Ken Wong: and where we need to mature in the areas I highlighted in the script around the operational discipline and the execution piece.

Speaker Change: combined with strategic alignment,

Speaker Change: I do see some early wins that we can go get.

Speaker Change: as part of our journey here. And I do see the opportunity to close those things in short order.

Speaker Change: I tell you to look at the track record of things that we're trying to do and you know, Darren's hiring happened, you know, very, very quickly within, you know, measured weeks of my time here. And I think that should bode well for the velocity that the team is energized.

Ronald W. Hovsepian: So when you get underneath it to your core question of, okay, you know, with the reaffirmation of the full year, how do we get comfortable with that piece of it? And we're going through more details, climbing through all the pieces of that, and as I've been doing that with the team, I'm seeing areas where my confidence is growing and some areas where we need to do a little more testing, but at this point, I didn't see any reason to back away from where we are today from an overall perspective at this point in time. There's no reason to believe that.

Speaker Change: to work on as we go on this part of the journey. So when you get underneath it to your core question of, okay, you know, with the reaffirmation of the full year,

Speaker Change: How do we get comfortable with that piece of it? And we're going through more details, climbing through all the pieces of that. And as I've been doing that with the team,

Speaker Change: I'm seeing areas where my confidence is growing and some areas where we need to do a little more testing. But at this point, I didn't see any reason to back away from where we are today from an overall perspective at this point in time. There's no reason to believe that as Rich says multiple times, and I believe it, we are an annual business in general. About 70% of the revenue is in that neighborhood that's annual, and it is back in loaded as we've seen.

Ronald W. Hovsepian: As Rich says multiple times, and I believe it, we are an annual business in general. About 70% of the revenue is in that neighborhood that's annual, and it is back in full force, as we've seen. So there are things we can do right now to shore that piece of it up, and then the things that are closer in, like global knowledge, those are things that we are attacking very, very quickly, and I feel good about those near-term plans that we've laid out. More to come, and we'll talk more about it at our July 11th Investor Day.

Speaker Change: So there are things we can do right now to shore that piece of it up.

Speaker Change: And then the things that are closer in, like global knowledge, those are things that we are attacking very, very quickly. And I feel good about those near-term plans that we've laid out.

Speaker Change: More to come and we'll talk more about it on the July 11th Investor Day.

Rich: Got it. Okay, appreciate the thoughtful response there, Ron. And then, Rich, just on bookings, perhaps you guys are no longer disclosing that metric, but I just wondered if there's any color around the booking growth.

Speaker Change: Got it. Okay, appreciate the thoughtful response there on. And then, Rich, just on bookings, perhaps you guys are no longer disclosing that metric, but just wondered if there's any color around the booking growth.

Rich: Yeah, Ken, you're correct. We got input from investors. It's not industry practice. We looked across what competitors were sharing, and we no longer comment on the bookings. The revenue that we reported and our disappointment with that against our internal plans is the commentary we've provided. The bookings forecast would have similar commentary on it, but we're not gonna give a specific number. Okay, perfect. Thank you very much.

Rich: Yeah, Ken, you're correct. We...

Rich: We got input from investors. It's not been industry practice. We looked across what competitors were sharing, and we no longer comment on the bookings.

Rich: The revenue that we reported and are disappointment with that against our internal plans

Rich: is the commentary we provided. The bookings forecast would have similar commentary on it, but we're not going to give a specific number.

Speaker Change: Okay, perfect. Thank you very much.

Operator: Our next question comes from the line of Ramo Lunshall with Barclays. Please proceed with your question.

Speaker Change: Our next question comes from the line of Ramo Lenshau with Barclays. Please proceed with your question.

Sheldon Parker McMeans: Hi, this is Sheldon McMeans on for RIMO. Thanks for taking our question. Ron, I appreciate you giving some color on the IOP business and some of the learnings from your assessment there. And I wanted to ask, you know, are they mainly execution issues with some macro? And I'm wondering if this business is structurally challenged at all in the current environment, particularly as the in-person side seems to be doing a little bit worse than the virtual side? Are there things that you need to do from a pricing and packaging perspective? And how should we think about this business going forward?

Speaker Change: Hi, this is Shill Nick Meanson for Rimo. Thanks for taking our question.

Sheldon Parker McMeans: Ron, I appreciate you gave some color on the ILP business and some of the learnings from your assessment there and

Speaker Change: I wanted to ask, you know, is it,

Sheldon Parker McMeans: mainly execution issues with some macro and I'm wondering is there is there is this business you know structurally challenged at all in the current environment particularly as the in-person

Sheldon Parker McMeans: side seems to be doing a little bit worse than the virtual side. Is there things that you need to do from a pricing and packaging perspective, and how should we think about this business going forward?

Ronald W. Hovsepian: Yeah, so I think, let me just summarize, Sheldon, to make sure I answer your question properly. I think the macro question is, is the market level, and then two, are there any idiosyncrasies around demand specifically in certain categories? Is that a fair summary?

Sheldon Parker McMeans: Yeah, so I think let me just summarize Sheldon, make sure I answer your question properly. I think the question macro is the market level and then two other smithiosyncrasies around demand specifically in certain categories. Is that a fair summation?

Sheldon Parker McMeans: Yes, yes. Okay, in terms of the overall market, the data that I've now looked at shows the overall ILT market growing. So it gives me confidence that we have more of an execution focus that we need to get after. Underneath that, your call out that you mentioned about the classroom versus the virtual is a real phenomenon that is happening. And those are things that I think are demand-driven on that side of it where we are missing. They're just a simple example to help everyone understand it a little further. In the spirit of being more efficient, we centralized a number of the pieces around marketing as an example in that business, which got us the level of efficiency we wanted and consistency in the brand.

Speaker Change: Yes, yes.

Speaker Change: Okay. In terms of the overall market, the data that I've now looked at shows the overall ILT market growing. So it gives me confidence that we have more of an execution focus that we need to get after.

Speaker Change: Underneath that, your call out that you mentioned about in classroom versus out of class, uh, is, is a real phenomena that is happening there.

Speaker Change: And those are things that I think are demand driven on that side of it where we are missing the mark.

Speaker Change: They're just a simple example just to help everyone understand it a little further is

Speaker Change: We, in the spirit of being more efficient,

Speaker Change: we centralized a number of the pieces around marketing as an example in that business, which got us the level of efficiency we wanted and consistency in the brand.

Sheldon Parker McMeans: As I've learned more about the business and with guidance from Darren, I've also seen that a little more local focus is actually very important inside this business. Right, so we just had a slight misfire on that one that I think is very fixable and, in a quick period of time, we can get that fixed and operating better. And that's partly why you hear the confidence from me that we can get this thing fixed and operating properly.

Speaker Change: As I've learned more about the business and with guidance from Darren, I've also seen that a little more local focus is actually very important inside of this business.

Speaker Change: Right? So we just had a slight misfire on that one that I think is very fixable in a quick period of time. We can get that fixed and operating better.

Speaker Change: And that's partly why you hear the confidence from me that we can get this thing fixed and operating properly. Overall, I would say there's nothing that I see that says we have a...

Sheldon Parker McMeans: Overall, I would say there's nothing that I see that says we have a segment issue. I do see it primarily, vagaries of timing aside for a little bit, primarily as an operational matter that needed to get addressed very quickly, and we are trying to move as fast as we can on that front because

Speaker Change: segment issue, I do see it primarily, vagaries of timing aside for a little bit, I do see it primarily as an operational matter that needed to get addressed very quickly and we are trying to move as fast as we can on that front.

Ronald W. Hovsepian: understood. Yeah, a very helpful color there.

Speaker Change: Because that's for a hundredness at most.

Speaker Change: You know, understood. Yeah, a very helpful color there. And a quick follow-up.

Sheldon Parker McMeans: And a quick follow-up. So we did see the dollar base retention for the content and platform business move below 100%. And I was wondering if you could help us think about how that looks for the lower end of the customer base. Did that get incrementally worse? Or are you seeing some of the pricing pressures and some of the macro effects move up towards the higher end of the customer base?

Speaker Change: So we did see the dollar base retention for the content and platform business move below 100%. And I was wondering if you could help us think about how that looks for the lower end of the customer base. Did that get incrementally worse? Or are you seeing some of the pricing pressures?

Speaker Change: and some of the macro effects move up towards the higher end of the customer base.

Rich: Yeah, Sheldon, it's Rich. Year over year change in the LTM-DRR. We, we lapped a large upgrade in Q1 of last year, and we had a negative impact this quarter from a government funding relationship. The government is the quarter.

Rich: Yeah, Sheldon, it's rich. The year-over-year change in the LTM, DRR, we lapped a large upgrade to one of last year.

Rich: And we had a negative impact this quarter from a government funding relationship.

Rich: The government did not fund that line item in that agency, just to be really clear. So they literally cut the whole thing out because it didn't get funded from the bridging budget in the government.

Speaker Change: The quarter is the government did not fund that line item in that agency. Correct. So they literally cut the whole thing up because it didn't get funded from the bridging budget in the government.

Rich: And that impact in a quarter. It can, and we look at it on an LTM basis, but there's noise in that metric, my point. It is best to look at it on an LTM basis. The context I'd give you is that two years ago, at around D-SPEC, two to three years ago, we had DRRs in the low 90s. So being right around the 100 and 101 is where we think we can operate in the near term, but longer term, we should drive that up towards 110%.

Speaker Change: And that impact in a quarter,

Speaker Change: It can, and we look at it on an LTM basis, but there's noise in that metric is my point.

Speaker Change: It is best to look at it on an LTM basis.

Speaker Change: The context I'd give you is two years ago at around D spec, two to three years ago, we had DRRs in the low 90s.

Speaker Change: So being right around the 100, 101,

Speaker Change: is where we think we can operate in the near term, but longer term we should drive that up over towards 110%. And we are seeing the segment impact that you described, our largest customers.

Rich: And we are seeing the segment impact that you described. Our largest customers have DRRs over 105%, and it's a different drag at the lower end of the market, but no material change in one area or the other, just some general softness across all the segments. Operatally, the only thing I'd add.

Speaker Change: have DRRs over 105%, and it's a different drag at the lower end of the market. But no material change in one area or the other, just some general softness across all the segments.

Ronald W. Hovsepian: Operationally, the only thing I'd add there is that the team has put a different motion in place for retention in that segment as part of our journey there, and I like the early read on that particular part of it. We'll see if it shows up in the numbers. But right now, those motion changes in that particular segment you were asking about, Sheldon, have changed.

Speaker Change: Operationally, the only thing I'd add there is the team has put a different motion in place for retention.

Speaker Change: in that segment.

Speaker Change: as part of our journey there. And I like the early read on that particular part of it. We'll see if it shows up in the numbers. But right now, those motion changes in that particular segment you were asking about, Sheldon, it has changed.

Speaker Change: Understood, thank you.

Operator: And our next question comes from the line of Raj Sharma with B. Reilly. Please proceed with your question.

Speaker Change: And our next question comes from the line of Raj Sharma with B Riley. Please proceed with your question.

Rajiv Sharma: Hi, thank you for taking

Rajiv Sharma: My question is a follow-on from the last caller, about the enterprise renewal rates, you know, slowing down. You just said that, you know, it used to be that large enterprises were your strong point and stable retention. So that is, seemingly,

Rajiv Sharma: Hi, thank you for taking my questions. My, is the follow on from the last caller.

Rajiv Sharma: about the enterprise renewal rates, slow down. You just said that, you know, it used to be large enterprises were your strong point and stable retention. So that is seemingly with DRRs of greater than 105, that still seems to be the case.

Rajiv Sharma: If DRR is greater than 105, that still seems to be the case, relative to smaller companies. Any specific industries that are

Ronald W. Hovsepian: Any specific industries that are impacted more so than others? This is Ron.

Speaker Change: relative to smaller companies. Any specific industries that are impacted more so than others?

Ronald W. Hovsepian: I haven't seen any data yet that would indicate anything at the industry level. As Rich said, with the exception of the government, that was the one that we felt in multiple places when the budgets didn't get funded. The vertical piece, I don't see anything right now that's calling anything out. Again, this is a high signal to noise ratio in Q1 and Q2 because of the lower volume, Raj.

Ron: This is Ron, I haven't seen any data yet that would indicate anything in the industry level. As Rich said, with the exception of the government, that was the one that we felt multiple places when the budgets didn't get funded.

Rajiv Sharma: The industry vertical piece, I don't see anything right now that's calling anything out. Again, this is a high signal to noise ratio in Q1 and Q2 because of the lower volume, Raj. That would be the only thing I'd call out. We went back and looked at last year, Rich and I, and, you know,

Rich: That would be the only thing I'd call out. We went back and looked at last year, Rich and I, and we were at 101 percent last year on the DRR, and now we came in at 99. So I'm not going to over-rotate on that at this point. It's within the norm from my perspective, especially considering the big deal that Rich highlighted and then the government agency one that we slowly evaporated.

Rajiv Sharma: We were at 101 roughly percent last year on the DRR, and now we came in at 99. So I'm not going to over-rotate on that at this point. It's within the norm from my perspective, especially considering the...

Speaker Change: big deal that Rich highlighted and then the government agency one that we

Rich: That makes a big impact in these early quarters. You know, $1 million makes a huge difference in these early quarters. So I think it's important. We're very focused on it, but I don't see anything vertical necessarily at this point. Rich, I don't know if you have anything to add. Yeah, I would only add to that that what we saw in Q1 isn't a trend, Raj, and as we look out to the balance of the year, we expect that DRR, we're forecasting that it's going to improve over the course of the year, and as we inspect the pipeline and the pipeline built, it gives us that confidence. Right. Thank you for that color. And then you used to give metrics around engagement and, you know,

Speaker Change: slowly evaporated.

Rich: That makes a big impact in these quarters. You know, $1 million makes a huge difference in these early quarters. So I think it's important. We're very focused on it. But I don't see anything vertical necessarily at this point. Rich, I don't know if you have a go. Yeah, I would only add to that that what we saw in the Q1, I don't think is a trend, And if we look out.

Rich: to the balance of the year. We expect that DRR, we're forecasting that it's going to improve over the course of the year. And as we inspect the pipeline and the pipeline build, it gives us that confidence.

Speaker Change: Right, thank you for that color. And then you used to give metrics around engagement and, you know,

Rich: At www.skillsoft.com.

Ronald W. Hovsepian: more metrics on how engaged are the users and what kind of user they are, some user flow and metrics around AI related apps on the platform.

Speaker Change: certain viewing and learning videos and, you know, there are more any many metrics on how how engaged are the users and what's the kind of user, some user flow and metrics around AI related apps?

Ronald W. Hovsepian: Yeah, well, one thing I'll ask you to be sure to be at July 11th Investor Day. We're going to have a more wholesome discussion.

Speaker Change: on the platform.

Speaker Change: Yeah, well, one, I'll ask you to be sure to be at the July 11th Investor Day. We're going to have a more fulsome discussion. What's very interesting, though, is as we've seen the market move,

Ronald W. Hovsepian: What's very interesting, though, is as we've seen the market move, usage is probably..., a less important metric. Just utilization of the content is informative on one level, but our customers and our best customers really want us to measure out and how we're progressing with whatever strategic objective they've assigned to partnering with Skillsoft. So the metrics around usage from the individual learner are insightful, but increasingly, we're starting to measure outcomes, and our customers are asking us to do those measurements differently.

Speaker Change: Usage is probably

Speaker Change: a lesser of an important metric. Just utilization of the content is informative on one level, but our customers and our best customers really want us to measure outcomes.

Speaker Change: and how we're progressing with whatever strategic objective they've assigned to partnering with SkillSaw.

Speaker Change: So the metrics around usage from the individual learner are insightful, but increasingly we're starting to measure outcomes and our customers are asking us to do those measurements differently.

Rajiv Sharma: We saw that in Winback, by the way, as well, Raj, you know, that the outcome dimension of the quality of the platform and separately the content resignedated with that customer, so they felt like they weren't getting that from the competitor that they left this for and then came back. So the outcome metrics are, any sort of color on those? Are you doing better on those outcome metrics?

Speaker Change: [inaudible]

Speaker Change: Winback, by the way, as well, Raj, you know, that the outcome dimension of the quality of the platform and separately the content resonated with that customer so that they felt like they weren't getting that from the competitor that they left this store and then came back.

Speaker Change: So the outcome metrics are any sort of color on those? Are you doing better on those outcome metrics?

Ronald W. Hovsepian: Yeah. Thank you.

Ronald W. Hovsepian: The answer is yes, we're starting to frame those things. What I would tell you is that at the enterprise level, specifically, we've seen the emergence of three cohorts of customers. We're not going to regularly speak to that, but just to give you some color on the cohorts.

Rajiv Sharma: The answer is, yes, we're starting to frame those things. What I would tell you is we're seeing at the enterprise level, specifically, we've seen the emergence of three cohorts

Rajiv Sharma: of customers. We're not going to regularly speak to it, but just to give you the color on the

Ronald W. Hovsepian: One of them is around workforce transformation. And you can imagine, with all the technology things we've been talking about, that's front and center for a lot of companies. The second area that we see is continued leadership development, especially in this modern time, where there's a whole new set of things that leaders have to deal with from remote working to other social issues in this workplace environment, both remote and physical, but as well as all the other dynamics of developing a leader.

Rajiv Sharma: on the cohorts. One of them is around workforce transformation. You can imagine with all the technology things we've been talking about, that's front and center for a lot of companies.

Rajiv Sharma: The second area that we see is continued leadership

Rajiv Sharma: development, especially in this modern time where there's a whole new set of things that leaders have to deal with from remote working to other social issues in this workplace environment, both remote and physical, but as well as all the other dynamics of developing a leader.

Ronald W. Hovsepian: And then three, they're also looking for outcomes that drive more retention of their key employees and what I would call career mobility. Am I keeping the people I want in the company as part of it, or more broadly, succession? But I think career mobility, I've used that statistic internally for the last 15 years to track are our employees getting new opportunities within the level as a promotion opportunity, as a promotion opportunity within grade? Those are all things that are important to career mobility. Those are the three big cohorts that we've identified from our research so far. Got it.

Speaker Change: And then three, also they're looking for outcomes that drive more

Speaker Change: retention of their key employees and what I would call career mobility.

Speaker Change: Am I keeping the people I want in the company as part of it or more broadly succession? But I think career mobility, I've used that statistics internally in the last 15 years.

Speaker Change: to track

Speaker Change: Are our employees getting new opportunities within the level as a promotion opportunity, as a promotion opportunity within grade? Those are all things that are important to career mobility. Those are the three big cohorts that we've identified from our research so far.

Rajiv Sharma: And then lastly, from me on the ILT side, I think you just commented that the overall ILT market is growing, but clearly, your business of global knowledge is not growing. Is there anything specific that is different here? Is it the lack of content or different, you know, things or products that... Is it the execution internally? What is going to change, and we're sort of trying to get a sense of where the bottom is for

Speaker Change: Got it. And then lastly, from me on the ILT side, I think you just commented, the overall ILT market is growing, but clearly...

Speaker Change: your business of global knowledge is not growing. Is there anything specific that is different here, is a lack of content or different things or products that

Speaker Change: Is it the execution internally? What is going to change? And we're trying to get a sense of where the bottom is for the ILT business.

Ronald W. Hovsepian: So, three things quickly. One, the good news is this business is a very fast-paced business, meaning it occurs in a quick cycle. So that's that's a very important concept. So I think when we talk about where it bottoms out, I'm not ready to forecast anything there, but I will tell you I'm positively predisposed by how fast it can move. Two, it is operational in nature, and I would put that with us internally to the company, and that is really focusing on a couple of areas.

Ronald W. Hovsepian: So, three things quickly.

Speaker Change: So three things quickly. One, the good news is this business is a very fast-paced business, meaning it occurs at a quick cycle.

Speaker Change: So that's a very important concept.

Speaker Change: So I think when we talk about where it bottoms out, I'm not ready to forecast anything there, but I will tell you I'm positively predisposed by how fast it can move.

Speaker Change: Two, it is operational in nature.

Ronald W. Hovsepian: One, our marketing, and I gave an example a little earlier of how we really need to be more local in the way we market our products. Two, we need to focus on better execution on our fill rates, how many people are in attendance at our sessions, both virtual and physical as part of it. So those pieces play together in my mind in terms of pure operations. So that's the second big one. And then the last part of it, from my point of view, again, as I look at it, there's also an opportunity to increase margin in certain areas and product in certain areas.

Speaker Change: And I would put that with us internally.

Speaker Change: to the company and that is really focusing in a couple of areas.

Speaker Change: One, our marketing, and I gave an example a little earlier of we really need to be more local in the way we market our products.

Speaker Change: Two, we need to focus on better execution on our fill rates, how many people are in attendance at our sessions, both virtual and physical.

Speaker Change: as part of it. So those pieces play together in my mind.

Speaker Change: in terms of pure operations. So that's the second big one.

Speaker Change: And then the last part of it, from my point of view, again, as I look at it, there's also an opportunity to increase margin in certain areas and product in certain areas. So I do think there's some product bundling and packaging of how we're doing things and also the approach that we can take.

Ronald W. Hovsepian: So I do think there's some product bundling and packaging in how we do things and also the approach that we can take. All of those things could end up improving the overall profitability of the company and of GK specifically and the revenue momentum behind that. So those are things we're going to be very focused on as a business as I've looked at it.

Speaker Change: All of those things could end up improving the overall profitability of the company and of GK specifically and the revenue momentum behind that. So those are things we're going to be very focused on as a business as I've looked at it. Hopefully that helps on that one, Raj.

Rajiv Sharma: Hopefully, that helps on that one, Raj. Yeah, great. Thank you. Thank you so much. And I'll take my questions off. OK.

Speaker Change: Yeah, great. Thank you. Thank you so much, and I'll take my questions offline. Thank you.

Speaker Change: Okay.

Operator: And our next question comes from the line of Tom Singlehurst with Citi. Please proceed with your question.

Speaker Change: And our next question comes from the line of Tom Singlehurst with the City. Please proceed with your question.

Thomas A Singlehurst: Thank you. It's Tom here from A couple of questions if it's okay.

Thomas A Singlehurst: The first one is just whether you can give us any sort of geographical flavor on top of what you said. Is there any sort of wide divergence between geographies that sort of exacerbated some of the execution challenges you had? And then the second question is within ILT. You've been fairly clear that the market's growing, but you've had some challenges which you've attributed to execution. So I guess that's a slight market share loss, which hopefully will come back pretty quickly.

Thomas A Singlehurst: Yeah, thank you. It's Tom here from

Thomas A Singlehurst: A couple of questions if it's okay.

Thomas A Singlehurst: The first one is just whether you can give us any sort of, sort of,

Thomas A Singlehurst: geographical flavor on top of what you said. Is there any sort of wide divergence between

Thomas A Singlehurst: between geographies that sort of exacerbated some of the execution challenges you had. And then the second question is, within IELT, you've been fairly clear that

Thomas A Singlehurst: the market's growing, but you've had some challenges which you've attributed to execution. So I guess that's a slight market share loss, which hopefully comes back pretty quickly. On the content and platform side, do you actually think you're losing share?

Thomas A Singlehurst: On the content and platform side, do you actually think you're losing share? Or, you know, is your growth rate more sort of representative of the market? Those are the two questions. Thank you.

Thomas A Singlehurst: or is your growth rate more sort of representative of the market?

Ronald W. Hovsepian: In terms of geographic idiosyncrasies or trends that we're seeing, looking at my teammates here, we're all kind of thinking about it. Really, nothing has really leaped out at us at this point that I would call your attention to from an overall perspective. We're seeing good expansion growth in the Asian markets that we've selected to focus on more thoroughly. Europe continues to show the right trajectory of where it's been operating. When you get under the ILT, that's been consistent on the negative side, unfortunately, and those are things that we can fix, in my opinion, and fix quickly. So there's nothing that leaps out at me.

Thomas A Singlehurst: Those are the two questions, thank you.

Speaker Change: Okay, in terms of geographic idiosyncrasies or trends that we're seeing, looking at my teammates here, we're all kind of thinking about it. Really, nothing is leaped out at us at this point that I would call your attention to from an overall perspective. Okay.

Speaker Change: We're seeing

Speaker Change: good expansion growth in the Asian markets that we've selected to focus on.

Speaker Change: more thoroughly. Europe continues to

Speaker Change: show the right trajectory of where it's been operating.

Speaker Change: When you get under the ILT, that's been consistent on the negative side, unfortunately. And those are things that we, you know, we can fix, in my opinion, and fix quickly. So nothing that leaps out at me. Continuing the thread on ILT.

Ronald W. Hovsepian: Continuing the thread on ILT, in terms of your question there, and what I see with ILT there is really just the execution matters that we touched on, and I do see that as a highly fixable problem, if I could turn that into a word there. So we can fix that pretty quickly, in my opinion, as we go along with that. I'm not giving you a date yet because I've got to let poor Darren, you know, get going here. He just got in the door no more than two weeks ago.

Speaker Change: In terms of your question there, what I see with I see with I'll see there is really just the execution matters that we touched on.

Speaker Change: And I do see that as a highly fixable problem, if I could turn that into a word there. So we can fix that pretty quickly, in my opinion.

Speaker Change: as we go along that, not giving you a date yet because I got to let poor Darren, you know, get going here. He just got in the door no more than two weeks ago, so...

Ronald W. Hovsepian: So, from that perspective, I am more comfortable with where that one can lead, and I'm hopeful that it's faster, and we'll talk more about that. On the content and platform side, in terms of market share growth, it's a really fair question. I don't have a tight answer for you just yet. At the overall level, there are different segments in the content market. And when you look underneath the segments, we're performing at varying degrees there.

Speaker Change: So from that perspective, I am

Speaker Change: more comfortable where that one can lead to, and I'm hopeful that it's faster. And we'll talk more about that. On the content and platform side, in terms of market share growth, it's a really fair question. I don't have a tight answer to you just yet.

Speaker Change: At the overall level, there's in the content market, there's different segments.

Speaker Change: And when you look underneath the segments, we're performing at varying degrees there. You know, good leadership in certain categories, which I'm comfortable with. When we think about the customer segmentation,

Ronald W. Hovsepian: You know, good leadership in certain categories, which I'm comfortable with. When we think about customer segmentation, where we're choosing to engage, that's one area that's in my focus right now, to do that in a more wide-reaching way, and at a more cost-effective customer acquisition cost, and a cost-to-serve model. That is something that we're working on, and we'll look to share more of that with you at Investor Day as part of the overall journey. But nothing of great note that I'd call out in the subsegments that we're working on on the content side.

Speaker Change: Where we're choosing to engage, that's one area that's in my focus right now.

Speaker Change: to do that in a more wide-reaching way.

Speaker Change: and a more cost-effective customer acquisition cost and a cost-to-serve model that is something that we're working on and we'll look to share more of that with you at Investor Day as part of the overall journey.

Speaker Change: But nothing of great note that I'd call out in the sub-segments that we're working on on the content side.

Speaker Change: Perfect, thank you.

Operator: We have reached the end of our question and answer session, and with that, I would like to turn the floor back over to Mr. Ron Hovsepian for closing comments.

Speaker Change: Thank you.

Speaker Change: We have reached the end of our question and answer session, and with that I would like to turn the floor back over to Mr. Ron Huffsett Bian for closing comments.

Ronald W. Hovsepian: Thank you, Camilla. First and foremost, thank you for your patience and letting me get up the curve here. Give me a little time to get up the curve here. As I look at the business, I would want to leave you on this call not pleased with our overall performance from an execution perspective, and we're very focused as a team to work on that and get that to the right level of discipline, and that will take a little bit of time, not a ton, but just a little bit of time.

Ronald W. Hovsepian: Thank you, Camilla. First and foremost, thank you for your patience and letting me get up the curve here. Give me a little time to get up the curve here. As I look at the business, I would want to leave you from this call, not pleased with our overall performance from an execution perspective, and we're

Ronald W. Hovsepian: very focused as a team to work on that and get that to the right level of discipline. And that will take a little bit of time, not a ton, but just a little bit of time.

Ronald W. Hovsepian: Two, I am more convinced about the market opportunity, both at the overall company level as well as within the two business unit market segments that we're choosing to serve. As we talked through today, you can see my growing confidence in the ILT piece of it because it is growing and we can do a lot more there, in my opinion, from what we've studied. You'll see us continue the focus and execution approach; you'll hear that a lot from myself and the team as we go forward, and that's the name of the game for us as we look at these pieces and where we have product gaps or shortcomings. Every company goes through those prioritizations and will migrate from them.

Ronald W. Hovsepian: Two, I am more convicted on the market opportunity.

Ronald W. Hovsepian: both at the overall company level, as well as within the two business unit market segments that we're choosing to serve.

Ronald W. Hovsepian: As we chatted through on today, you can see a growing confidence on the ILT pieces because it is growing and we can do a lot more there, in my opinion, from what we've studied.

Ronald W. Hovsepian: You'll see us continue the focus and execution approach. You'll hear that a lot from myself and the team as we go forward, and that's the name of the game for us as we look at these pieces. And where we have product gaps or shortcomings,

Ronald W. Hovsepian: There's nothing that I've seen that is structurally wrong, and when I look across the whole business, there's nothing that I've seen here that I haven't seen before in my career and know that we can. So I feel very confident about that particular piece. And with that, a reminder that July 11th will be Investor Day, and I look forward to having a chance to go a little deeper and give you some more color behind the numbers and the references that we're making. So, thank you very much, and have a good day.

Ronald W. Hovsepian: You know, every company goes through those prioritizations and will migrate through them. There's nothing that I've seen that is structurally wrong. And when I look across the whole business, there's nothing that I've seen here that I haven't seen before in my career and know that we can fix it.

Richard Walker: And with that, a reminder that, you know, July 11th will be that investor day and look forward to having a chance to go a little deeper and give you some more color behind the numbers and the references that we're making.

Ronald W. Hovsepian: So I feel very confident on that particular piece.

Ronald W. Hovsepian: And with that, a reminder that, you know, July 11th will be that Investor Day and I look forward to having a chance to go a little deeper and give you some more color behind the numbers and the references that we're making. So thank you very much and have a good day.

Richard Walker: So thank you very much, and have a good day.

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Speaker Change: and and