A：The significance of the AI native platform announced by Skills Hall in September 2026 lies in its role as a platform that can help customers move from learning activities to workforce capabilities and measurable outcomes, marked by the addition of 15 paying customers and internal use in the company's operations.

A：The three differentiators that set Skills Hall apart in the market are: 1) Skills Intelligence with a mapped body of enterprise learning data, 2) Integration of content, platform, and data for an end-to-end solution, and 3) The ability to operationalize AI in enterprise environments.

A：According to Skills Hall, AI is increasing the urgency of workforce readiness by widening the skills gap faster than organizations can close, thus driving demand for solutions that can facilitate role-based execution, as evidenced by customer behaviors and buying decisions.

A：Yes, one example is Singapore's largest telecommunications provider, which selected Skills Hall to support an AI-led workforce transformation. Another example is a large global healthcare organization that entered into a multi-year partnership with Skills Hall to operationalize an AI-first operating model.

A：AI skill benchmark completions increased 994% year over year, AI content completions increased 261% year over year, and AI journey completions increased 222% year over year.

A：Buyers are focusing on ROI and measurable outcomes because they are aware of the risks associated with adopting AI without verified workforce capability. AI without demonstrable skills can lead to poor decision making, compliance issues, exposure, and lower productivity.

A：The company achieved significant strategic and operational progress and demonstrated financial durability in FY 26 despite a highly uncertain environment.

A：The company advanced its AI native platform and broad AI capabilities, sharpened the operating model, demonstrated financial durability, and executed well, showing clear evidence of market traction.

A：The financial objectives included a 26 state objectives with $45 million of annualized expense reduction, second margin expansion, and return to top line growth in fiscal 26. These objectives were achieved despite macroeconomic disruptions and minor operational time delays that impacted bookings and revenue.

A：Revenue for TDS was $102.6 million for the fourth quarter, nearly flat year over year. The GAAP net loss was $31.1 million in the prior year period, and the adjusted net income was $11 million in the fourth quarter. GAAP net loss per share was $4.19 compared to $3.75 in the prior year, and adjusted net income per share was $1.26 compared to $2.11.

A：Cost of revenue was $34.2 million or 26% of revenue, up 2.5% year over year. Content and software development expenses were $12.8 million or 10% of revenue, down approximately 5% year over year. Selling and marketing expenses were $37.5 million or 29% of revenue, down approximately 5.6% year over year. General and administrative expenses were $15 million or 11% of revenue, 1% year over year. Total operating expenses were $99.5 million or 76% of revenue, and adjusted EBITDA was $31.2 million, up approximately 4% compared to the prior year.

A：The increase in GAAP net loss resulted primarily from an intangible impairment charge and higher restructuring expenses, which were somewhat offset by lower expenses.

A：The company expects revenue for the full fiscal 2027 year between $388 and $406 million, adjusted EBITDA between $108 million and $116 million or around 28% of revenue, and free cash flow in the range of $14 to $22 million for TDS.

A：The business dynamics influencing TDS guidance include a focus on operational turnaround and strategic transformation. Revenue is expected to show growth first in bookings before appearing in the revenue number. The market is currently slowed, and there are headwinds related to churn and government federal clients that impact bookings. The company is working to overcome these to potentially grow revenue in the enterprise business.

A：The consumer business makes up about 9% of the total enterprise business. At the midpoint of the guidance, there is a projected year-over-year decrease of nearly $7 million, which is almost entirely due to the consumer business. The enterprise business has performed reasonably well and is at an inflection point, indicating an expectation for revenue growth in the enterprise despite continued challenges in the consumer business.

A：Churn and challenges with government federal clients have created bookings headwinds, which are expected to affect fiscal 27. The company acknowledges the need to generate growth from bookings before it shows in revenue and is working to overcome these challenges to potentially grow revenue in the enterprise while facing further challenges in the consumer business.

A：The guidance range reflects a couple of market conditions, with the low end influenced by pressure from the Middle East and the high end assuming a well-performing Middle East business and the ability to temper client and consumer business challenges. This range allows for tracking the company's performance throughout the year and is reflective of the market conditions being experienced.

A：The process for customers to move from initial engagement with AI APIs to workforce transformation and monetization is multi-dimensional. Early adoption is being encouraged with usage tracking and structured pricing to ensure customer adoption. As customers progress, they move towards large migrations, eventually becoming multimillion-dollar customers. The full migration phase will see customers transition from hundreds of thousands to multiple millions in size, with each step along the way increasing the impact and value proposition for the customer.

A：The adoption of the company's products and strategies, particularly around custom content, will impact the customer lifecycle by driving engagement and providing data to inform a life cycle journey. This journey will be structured into four big chunks, with a focus on turning enterprises into multimillion-dollar contract customers and determining the speed and value at each stage of the adoption process.

A：The outlook for EBITDA and free cash flow is positive, despite a slight decrease in TDS, suggesting sufficient investment for growth. Once certain conditions are cleared, there may be room for further improvement and additional investment in areas like EBITDA and free cash flow. The company is focused on making strategic investments to support growth and is optimistic about the potential for improvement in these financial metrics.

A：The company has been successful in reducing costs on a year over year basis, which has provided a tailwind for investing in growth areas such as marketing programs and the platform.

A：The main components of track costs are the business processes and the cost structure. The company believes it can get track costs out of the run rate by the end of the fourth quarter, pending a satisfactory transaction.

A：The TK business may have stabilized at a 28 million revenue run rate level, although it declined. The company does not focus on TK anymore and is looking for an exit, but the business is considered stable at the mentioned revenue level.

A：One of the challenges for the business in the fourth quarter was the process itself and the fact that 20% of the business is in the Middle East, which put intense pressure on the business. Despite these challenges, the business absorbed them well.

A：The company believes the business has growth potential and that if it had kept the same pace as CDS, there would be a reason to keep the business within the company. Individually, the EMEA business is starting to look like a good performer, and there is solid progress in North America despite needing work to repair the business.

A：There is confidence that DRR will recover and return to historical levels. This is influenced by positive factors such as the introduction of new products, the marketing around them, and improvements in customer retention rates and churn.

A：The company views competition as a catalyst for customers to migrate from point solutions to a unified platform. The company is optimistic about its position in the learning space due to its comprehensive skills management offering and its data-rich platform, content, and skills ontology.