Q1 2024 Financial Summary Compared to Q1 2023
- Total revenue decreased 20.4% to
$7.0 million , compared to$8.7 million - Managed Services revenue decreased 21.2% to
$6.7 million , compared to$8.5 million - SaaS Services revenue increased 9.1% to
$0.3 million , compared to$0.2 million - Total costs and expenses decreased 9.1% to
$11.0 million compared to$12.1 million - Net loss was
$3.3 million compared to a net loss of$2.8 million - Adjusted EBITDA* for the quarter was
$(2.8) million , compared to$(2.2) million - Cash, cash equivalents, and investments on
March 31, 2024 totaled$60.8 million with no long-term debt
Q1 2024 Operational Highlights
- IZEA wins Gold at the 2024 Muse Creative Awards
- Released new iOS App, bringing generative AI tools to mobile users
- CEO
Ted Murphy named among the 2024 People of the Year by Ragan - IZEA-owned Hoozu honored as
Australia's Best Boutique Influencer Marketing Agency by AiMCO
* Adjusted EBITDA is a non-GAAP financial measure. Refer to the definition and reconciliation of this measure under “Use of Key Metrics and Non-GAAP Financial Measures."
Management Commentary
“We saw strong customer demand and related bookings in Q1, though the corresponding revenue has yet to be realized,” commented
"Managed services bookings experienced a resurgence in growth year-over-year in Q1, propelled by a robust pipeline from Q4 2023 and a new record pipeline in Q1 2024,” continued Murphy. “This pipeline growth is not only in dollar value but also in the number of opportunities, aligning with our strategy to diversify revenue. While managed services continue to generate the vast majority of our revenue, SaaS revenue is on a path to recovery. We concluded Q1 with a new all-time record number of active SaaS customers, a positive trend that has persisted into the second quarter."
“Our marketing strategy and investment in demand generation are having a material impact. We have seen continued year-over-year pipeline growth in Q2, and we are off to a strong start with bookings for the quarter,” continued Murphy.
Q1 2024 Financial Results
Total revenue in the first quarter of 2024 decreased 20.4% to
Managed Services bookings increased to
Revenue from SaaS Services increased by
Cost of revenue decreased to
Costs and expenses other than the cost of revenue totaled
Net loss in the first quarter of 2024 was
Adjusted EBITDA (as defined below, a non-GAAP measure management uses as a proxy for operating cash flow) totaled a loss of
As of
Conference Call
IZEA will hold a conference call to discuss its first quarter 2024 results on
Date:
Time:
Toll-free dial-in number: 1-877-407-4018
International dial-in number: 1-201-689-8471
Please call the conference telephone number five (5) minutes before the start time. An operator will register your name and organization. A call replay will be made available approximately 3 hours after the conference ends until
Toll-free replay number: 1-844-512-2921
International replay number: 1-412-317-6671
Replay ID: 13746140
About
Use of Key Metrics and Non-GAAP Financial Measures
Managed Services bookings measure all sales orders received during a period less cancellations received or refunds given during the same period. Sales order contracts vary in complexity with each customer and range from custom content delivery to integrated marketing services; our contracts generally run from several months for smaller contracts to twelve months for larger contracts. We recognize revenue from our Managed Services contracts based on a percentage of completion basis as we deliver the content or services over time, which can vary greatly from a few weeks to a year. For this reason, Managed Services bookings, while an overall indicator of the health of our business, may not be used to predict quarterly revenues and could be subject to future adjustments.
Managed Services bookings is a useful metric as it reflects the amount of orders received in one period, even though revenue may be reflected over time. Management uses the Managed Services bookings metric to plan its operating staff, identify key customer group trends, enlighten go-to-market activities, and inform its product development efforts.
"Adjusted EBITDA" is a non-GAAP financial measure under the
We believe that Adjusted EBITDA provides useful information to investors as it primarily excludes non-cash transactions, and it provides consistency to facilitate period-to-period comparisons.
All companies do not calculate bookings, and Adjusted EBITDA in the same manner. These metrics and financial measures, as presented by IZEA, may not be comparable to those presented by other companies. Moreover, these metrics and financial measures have limitations as analytical tools. You should not consider them in isolation or as a substitute for an analysis of our results of operations as reported under GAAP. A reconciliation of adjusted EBITDA to the most directly comparable GAAP measure is presented in the financial tables included in this press release.
Safe Harbor Statement
All statements in this release that are not based on historical fact are “forward-looking statements” intended to qualify for the safe harbor from liability established by the Private Securities Litigation Reform Act of 1995. Forward-looking statements, which are based on certain assumptions and describe our future plans, strategies, and expectations, can generally be identified by the use of forward-looking terms such as “may,” “will,” “would,” “could,” “should,” “expect,” “anticipate,” “hope,” “estimate,” “optimistic,” “believe,” “intend,” “ought to,” "likely," "projects," “plans,” "pursue," "strategy" or "future," or the negative of these words or other words or expressions of similar meaning. Examples of forward-looking statements include, among others, statements we make regarding expectations concerning product development and platform launches, future financial performance and operating results, including regarding recognition of bookings as revenues, the share repurchase authorization and any use of such authorization, growth, or maintenance of customer relationships, and expectations concerning IZEA’s business strategy. Forward-looking statements involve inherent risks and uncertainties which could cause actual results to differ materially from those in the forward-looking statements as a result of various factors, including, among others, the following: competitive conditions in the content and social sponsorship segment in which IZEA operates; failure to popularize one or more of the marketplace platforms of IZEA; our ability to maintain disclosure controls and procedures and internal control over financial reporting; our ability to satisfy the requirements for continued listing of our common stock on the Nasdaq Capital Market; changing economic conditions that are less favorable than expected; and other risks and uncertainties described in IZEA’s periodic reports filed with the
Press Contact
Phone: 407-674-6911
Email: ir@izea.com
Unaudited Consolidated Balance Sheets | |||||||
2024 | 2023 | ||||||
Assets | |||||||
Current assets: | |||||||
Cash and cash equivalents | $ | 39,035,332 | $ | 37,446,728 | |||
Accounts receivable, net | 4,798,692 | 5,012,373 | |||||
Prepaid expenses | 989,737 | 739,988 | |||||
Short term investments | 17,034,673 | 17,126,057 | |||||
Other current assets | 20,496 | 26,257 | |||||
Total current assets | 61,878,930 | 60,351,403 | |||||
Property and equipment, net of accumulated depreciation | 178,446 | 205,377 | |||||
5,285,293 | 5,280,372 | ||||||
Intangible assets, net of accumulated depreciation | 1,704,437 | 1,749,441 | |||||
Digital assets | 269,064 | 162,905 | |||||
Software development costs, net of accumulated amortization | 2,002,307 | 2,056,972 | |||||
Long term investments | 4,708,910 | 9,618,996 | |||||
Total assets | $ | 76,027,387 | $ | 79,425,466 | |||
Liabilities and Stockholders’ Equity | |||||||
Current liabilities: | |||||||
Accounts payable | 1,156,495 | 1,504,348 | |||||
Accrued expenses | 2,935,278 | 3,083,460 | |||||
Contract liabilities | 8,833,084 | 8,891,205 | |||||
Contingent liability | 114,400 | 114,400 | |||||
Total current liabilities | 13,039,257 | 13,593,413 | |||||
Finance obligation, less current portion | 48,573 | 63,419 | |||||
Deferred purchase price, less current portion | 60,600 | 60,600 | |||||
Deferred tax liability | 377,110 | 394,646 | |||||
Total liabilities | 13,525,540 | 14,112,078 | |||||
Commitments and Contingencies | — | — | |||||
Stockholders’ equity: | |||||||
Preferred stock; | — | — | |||||
Common stock; | 1,667 | 1,660 | |||||
(1,019,997 | ) | (1,019,997 | ) | ||||
Additional paid-in capital | 152,419,065 | 152,027,110 | |||||
Accumulated deficit | (88,710,644 | ) | (85,444,794 | ) | |||
Accumulated other comprehensive income (loss) | (188,244 | ) | (250,591 | ) | |||
Total stockholders’ equity | 62,501,847 | 65,313,388 | |||||
Total liabilities and stockholders’ equity | $ | 76,027,387 | $ | 79,425,466 |
Unaudited Consolidated Statements of Operations | |||||||
Three Months Ended | |||||||
2024 | 2023 | ||||||
Revenue | $ | 6,952,883 | $ | 8,737,722 | |||
Costs and expenses: | |||||||
Cost of revenue | 3,967,975 | 5,960,162 | |||||
Sales and marketing | 3,056,291 | 2,404,551 | |||||
General and administrative | 3,783,086 | 3,403,608 | |||||
Depreciation and amortization | 204,186 | 346,262 | |||||
Total costs and expenses | 11,011,538 | 12,114,583 | |||||
Loss from operations | (4,058,655 | ) | (3,376,861 | ) | |||
Other income (expense): | |||||||
Change in the fair value of digital assets | 106,159 | — | |||||
Interest expense | (2,001 | ) | (1,564 | ) | |||
Other income (expense), net | 669,865 | 572,086 | |||||
Total other income (expense), net | 774,023 | 570,522 | |||||
Net loss before income taxes | $ | (3,284,632 | ) | $ | (2,806,339 | ) | |
Tax benefit | 18,782 | — | |||||
Net loss | (3,265,850 | ) | (2,806,339 | ) | |||
Weighted average common shares outstanding – basic and diluted | 16,333,415 | 15,611,885 | |||||
Basic and diluted loss per common share | $ | (0.20 | ) | $ | (0.18 | ) |
Unaudited Consolidated Statements of Comprehensive Loss | |||||||
Three Months Ended | |||||||
2024 | 2023 | ||||||
Net loss | $ | (3,265,850 | ) | $ | (2,806,339 | ) | |
Other comprehensive income | |||||||
Unrealized (gain) loss on securities held | (58,177 | ) | (126,180 | ) | |||
Unrealized (gain) loss on currency translation | (4,170 | ) | — | ||||
Total other comprehensive income (loss) | (62,347 | ) | (126,180 | ) | |||
Total comprehensive income (loss) | $ | (3,203,503 | ) | $ | (2,680,159 | ) |
Revenue Details | |||||||||||||||||
Revenue details by type: | |||||||||||||||||
Three Months Ended | |||||||||||||||||
2024 | 2023 | $ Change | % Change | ||||||||||||||
Managed Services Revenue | $ | 6,696,542 | 96.3 | % | $ | 8,502,754 | 97.3 | % | $ | (1,806,212 | ) | (21.2) | % | ||||
SaaS Services Revenue | 256,341 | 3.7 | % | 234,968 | 2.7 | % | 21,373 | 9.1 | % | ||||||||
Total Revenue | $ | 6,952,883 | 100.0 | % | $ | 8,737,722 | 100.0 | % | $ | (1,784,839 | ) | (20.4) | % |
Reconciliation of GAAP Net loss to Non-GAAP Adjusted EBITDA | |||||||
Three Months Ended | |||||||
2024 | 2023 | ||||||
Net loss | $ | (3,265,850 | ) | $ | (2,806,339 | ) | |
Adjustment to fair market value of digital assets | (106,159 | ) | — | ||||
Non-cash stock-based compensation | 354,189 | 195,524 | |||||
Non-cash stock issued for payment of services | 75,006 | 75,000 | |||||
Tax benefit | (18,782 | ) | — | ||||
Interest expense | 2,001 | 1,564 | |||||
Depreciation and amortization | 204,186 | 346,262 | |||||
Adjusted EBITDA | $ | (2,755,409 | ) | $ | (2,187,989 | ) | |
Revenue | $ | 6,952,883 | $ | 8,737,722 | |||
Adjusted EBITDA as a % of Revenue | (39.6 | )% | (25.0 | )% |
Source:
2024 GlobeNewswire, Inc., source