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Here's Why Skillz Stock Popped Today

By Jon Quast – Oct 21, 2021 at 3:09PM

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The company is gaining an experienced industry veteran in one of its biggest areas of need.

What happened

Shares of mobile-gaming platform Skillz (SKLZ -3.20%) got a boost on Thursday after the company announced a former Amazon executive is joining its corporate leadership team. As of 1:45 p.m. EDT, Skillz stock was up almost 10%.

So what

Vatsal Bhardwaj is joining Skillz as its chief product officer after previous stints at Amazon, Facebook, and Zynga, among others. I think investors are probably happy to see previous experience at these large public companies. However, I believe there's something more important here: While at Amazon, Bhardwaj was general manager and director of game tech for Amazon Web Services (AWS).

A person appears to be happy with something they see on their phone.

Image source: Getty Images.

Skillz's platform currently only supports a limited number of game genres and this is something holding back the company's growth. Real-time (synchronous) multi-player games aren't possible now because even the slightest delay to play-for-cash games could result in an advantage for one player over another. However, it's something that the company is actively trying to address and it appears that it's hiring Bhardwaj to continue making progress in this area, given his previous expertise at AWS. 

Now what

It's good to see Skillz continue to actively address this issue so that its platform can support more game genres. More game genres should attract more game developers which, in turn, could attract new users. Previously the company announced a partnership with Exit Games, which is a leading player in this synchronous gaming space, demonstrating this isn't a new area of focus. It's ongoing.

However, trying to launch synchronous gaming and actually doing it are two different things. Today's news is certainly encouraging for shareholders. But they should temper their excitement until Skillz is proven to have successfully launched synchronous gaming capabilities. We should know more about Skillz's progress and plans when it reports third-quarter financial results on Nov. 3.

John Mackey, CEO of Whole Foods Market, an Amazon subsidiary, is a member of The Motley Fool's board of directors. Randi Zuckerberg, a former director of market development and spokeswoman for Facebook and sister to its CEO, Mark Zuckerberg, is a member of The Motley Fool's board of directors. Jon Quast owns shares of Skillz Inc. and Zynga. The Motley Fool owns shares of and recommends Amazon, Facebook, Skillz Inc., and Zynga. The Motley Fool recommends the following options: long January 2022 $1,920 calls on Amazon and short January 2022 $1,940 calls on Amazon. The Motley Fool has a disclosure policy.

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