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Why I'm Bullish About Skillz's New Strategic Partnership

By Jose Najarro – Aug 3, 2021 at 11:30AM

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Skillz invested $50 million for a small stake in a multiplayer gaming technology company.

Skillz (SKLZ -0.56%) reported on August 2, a day before earnings, that it had entered a strategic partnership with Exit Games. In today's video I look at how this partnership can benefit Skillz in the long term, and below I share some highlights from the video. 

  1. Exit Games is the developer of Photon, a platform used by thousands of game publishers and developers to add multiplayer capabilities to games easily. Ubisoft (UBSFF 5.96%)EA Games (EA -1.11%), and Square Enix (SQNXF -4.23%) are some of the game publishers that have previously used Photon's services. 
  2. Skillz has invested $50 million for a minority stake in Exit Games. The CEO of Skillz has also joined the board of Exit Games. Skillz has also gained permanent access to Exit's technology. This technology advancement for Skillz can accelerate its expansion into new genres. 
  3. Earnings for Skillz are scheduled for August 3, 2021, after the market closes. During the earnings call, investors will want to pay attention to how soon this partnership can start providing positive returns for Skillz. 

Click the video below for my full thoughts and analysis. 

*Stock prices used were the premarket prices of August 2, 2021. The video was published on August 2, 2021.

 


  

Jose Najarro owns shares of Skillz Inc. The Motley Fool owns shares of and recommends Skillz Inc. The Motley Fool recommends Electronic Arts and Ubisoft Entertainment. The Motley Fool has a disclosure policy. Jose is an affiliate of The Motley Fool and may be compensated for promoting its services. If you choose to subscribe through his link, he will earn some extra money that supports his channel. His opinions remain his own and are unaffected by The Motley Fool.

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Stocks Mentioned

Skillz Inc. Stock Quote
Skillz Inc.
SKLZ
$0.96 (-0.56%) $0.01
Electronic Arts Stock Quote
Electronic Arts
EA
$129.50 (-1.11%) $-1.46
Ubisoft Stock Quote
Ubisoft
UBSFF
$27.11 (5.96%) $1.52
Square Enix Holdings Co., Ltd. Stock Quote
Square Enix Holdings Co., Ltd.
SQNXF
$45.00 (-4.23%) $-1.99

*Average returns of all recommendations since inception. Cost basis and return based on previous market day close.

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