Company: SKLZ
Filing Date: 2025-12-11
Form Type: 10-Q
Source: 0001801661-25-000071
Chunk: 30

Company: Skillz Inc.
Filing Date: 2025-12-11
Form: 10-Q
Item: Item 1
Chunk 30
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 substantially all its revenues through its competition-based Skillz segment by providing a service to game developers for monetization of their game content. The monetization service provided by Skillz allows developers to offer multi-player competition to their end-users for the purpose of end-user retention and engagement. Skillz provides developers with a software development kit (“SDK”) they can download and integrate with their existing games. The SDK serves as a data interface between Skillz and the game developers that enables Skillz to provide monetization services to the developer.Games provided by three developer partners accounted for 69% and 70% of the Company’s consolidated revenue for three and six months ended June 30, 2025, respectively.  Games provided by three developer partners accounted for 81% and 80% of the Company’s consolidated revenue for the three and six months ended 2024, respectively. End-User Incentive ProgramsTo drive traffic to the platform, the Company provides promotions and incentives to end-users in various forms. Evaluating whether a promotion or incentive is a payment to a customer may require significant judgment. Promotions and incentives, which are consideration payable to customers, are recognized as a reduction of revenue at the later of when revenue is recognized or when the Company pays or promises to pay the incentive. Promotions and incentives recorded as sales and marketing expenses are recognized when we incur the related cost. For the three and six months ended June 30, 2025, the Company recognized a reduction of revenue of $2.0 million and $4.8 million, respectively, related to these end-user incentives. For the three and six months ended June 30, 2024, the Company recognized a reduction of revenue of $2.7 million and $6.1 million, respectively, related to these end-user incentives. For the three and six months ended June 30, 2025, the Company recognized sales and marketing expense of $8.1 million and $17.6 million, respectively, related to these end-user incentives. For the three and six months ended June 30, 2024, the Company recognized sales and marketing expense of $10.6 million and $19.3 million, respectively, related to these end-user incentives. From time to time, the Company issues credits or refunds to end-users that are dissatisfied by the level of service provided by the game developer. There is no contractual obligation for the Company to refund such end-users nor is there a valid expectation by game developers for the Company to issue such