Skylark Opera, the venerable Twin Cities company known for tackling technically and thematically challenging operas, operettas and musical theater, has scotched its upcoming season because of “a challenging and serious financial situation.”

“I don’t want to sugarcoat it — this is do-or-die time for us,” managing director Heather Brands said Friday. “If people don’t step up right now, this might be good night — I hate to say the word goodbye.”

Skylark has an annual budget of around $200,000. Last year, it ended about $10,000 in the red after urgent, last-minute fundraising.

The company announced the decision in a letter Friday to stakeholders. Imploring supporters to “stand by our side during this time of discovery so we emerge reinvigorated,” the letter said Skylark will use this break — the first in its 36-year history — to reevaluate its mission.

The announcement comes a month after the retirement of artistic director Steve Stucki, a former New York City Opera conductor who has served in that part-time role since 1989. He set the tone for the company, whose main program for the past 20 years has been a weekend-long festival, usually consisting of two shows, at Concordia University in St. Paul. That system, of “going to market one time a year,” created cash-flow problems, said Brands. Last summer, performances of works by Puccini and Sondheim played to 58 percent of capacity — well below budget projections.

The artistic director post will be left vacant for now.

Friday’s move, surprisingly, was applauded by some artists.

“No one likes to see a company cancel contracts, so I have great empathy for what the artists are going through,” said noted Twin Cities singing and actor Jennifer Baldwin Peden, who made her professional debut with the company in 1995. “On the other hand, this is a good moment for them to pause and reassess. Skylark has a cherished place in our community.”

Founded by Virginia Hardin Olson and Irma Wachtler in 1980 as Opera St. Paul, the company grew along with its audience and mission, changing its name to North Star Opera in 1986. It became Skylark in 2006. Occupying a space below the nationally ranked Minnesota Opera, the company is committed to hiring talent from the Twin Cities.

Robert Neu has directed a show at Skylark each of the past eight years and was slated to do “On the Twentieth Century” next year. He said that the company was being “responsible.”

“They’re looking to make it more viable, and put it on better footing down the road,” he said. “That’s totally understandable and I hope they succeed. Fingers crossed.”