Skillz (SKLZ) Stock Forecast & Price Target

Skillz Inc. has demonstrated a positive turnaround in its performance, with paid monthly active users experiencing a growth of 2.5% year-over-year for the first time since the first quarter of 2022, attributed to renewed marketing efforts aimed at re-engaging previous users. Projections suggest this growth momentum may accelerate further in the second quarter, with an anticipated increase of 6.6% year-over-year as re-engaged user spending ramps up over time. The company's strategy to scale spending on user acquisition is expected to drive ongoing growth in both user engagement and revenue generation.

Skillz Inc. is experiencing a decline in total monthly active users, estimated at -2.1% year-over-year, which can negatively impact its revenue growth. Although the company is actively reducing its operating cash burn to manage expenses, the ongoing user drop suggests potential challenges in sustaining a strong user base and revenue generation. The reliance on its Skillz segment for the majority of revenue, alongside these user metrics, raises concerns regarding the company's long-term financial stability.