IZEA Reports Q3 2024 Revenue of $8.8 Million

ORLANDO, Fla., Nov. 14, 2024 (GLOBE NEWSWIRE) — IZEA Worldwide, Inc. (NASDAQ: IZEA), a premier provider of influencer marketing technology, data, and services for the Creator Economy, reported its financial and operational results for the third quarter ended September 30, 2024.

Q3 2024 Financial Summary Compared to Q3 2023

• Total revenue increased 12% to $8.8 million, compared to $7.9 million
• Managed Services bookings increased 11% to $7.9 million, compared to $7.1 million
• Managed Services revenue increased 10% to $8.6 million, compared to $7.8 million
• Total costs and expenses increased 73% to $18.2 million, including a $4.0 million non-cash charge for goodwill impairment, compared to $10.5 million
• Net loss was $8.8 million compared to a net loss of 2.0 million
• Adjusted EBITDA* for the quarter was $(2.8) million, compared to $(1.5) million
• Cash, cash equivalents, and investments on September 30, 2024 totaled $54.4 million

Article content

Q3 2024 Operational Highlights

• IZEA’s work for the Barbie movie won 2024 Global Influencer Marketing Awards, The Global Agency Awards, and Global Digital Excellence Awards
• IZEA Flex named Best Influencer Marketing Platform in 2024 MarTech Breakthrough Awards
• Earned multiple Comparably Awards for Benefits, Work-Life Balance, and Employee Happiness
• IZZY, a groundbreaking AI assistant is now available to users of IZEA Flex

* 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.”

Article content

Revenue from SaaS Services increased by $148,694, or 260%, in the third quarter of 2024 compared to the third quarter of 2023, with most of these customers actively utilizing IZEA’s AI tools.

Cost of revenue increased to $5.2 million in the third quarter of 2024, or 59% of revenue, compared to $4.7 million, or 59%, in the prior-year quarter. The percentage cost decline represents improved margins from our ongoing customer base.

Costs and expenses other than the cost of revenue totaled $13.0 million for the third quarter of 2024, $7.1 million or 122% above the prior-year quarter. Sales and marketing costs were $2.9 million during the third quarter of 2024, $0.2 million or 7% higher than the prior-year quarter, primarily due to higher costs for compensation offset by a decrease in spending on demand generation activities. General and administrative costs totaled $5.8 million during the quarter, $2.8 million or 93% higher than the prior-year quarter. The rise in expenses this quarter was largely due to increased human capital costs, primarily from accrued severance expenses related to the departure of two company executives. The company also experienced higher costs from professional fees related to the management transition and cooperation agreement with GP Investments, along with additional contractor expenses. We determined that goodwill related to a 2019 acquisition was impaired, leading to a $4.0 million non-cash charge in the current quarter.

Article content

Article content

Net loss in the third quarter of 2024 was $8.8 million, or $(0.52) per share, as compared to a net loss of $2.0 million, or $(0.13) per share in the third quarter of 2023, based on 17.0 million and 15.5 million average shares outstanding, respectively.

Adjusted EBITDA (as defined below, a non-GAAP measure management uses as a proxy for operating cash flow) totaled a loss of $2.8 million in the third quarter of 2024, compared with a loss of $1.5 million in the comparative period, decreasing $1.3 million due primarily to lower revenues. Adjusted EBITDA as a percentage of revenue in the third quarter of 2024 was a loss of 32% compared to a loss of 20% in the third quarter of 2023.

We previously announced our commitment to buy $10.0 million of our stock in the open market, subject to some restrictions. On September 30, 2024, we adopted a safe-harbor 10b5-1 plan to purchase the shares without restrictions related to our periodic insider restrictive window, which became active on November 1, 2024, following the required quiet period. As of November 11, 2024, we have purchased 51,503 shares at an average share price of $2.74 under our program for an aggregate investment of $142,273.

Article content

As of September 30, 2024, our cash, cash equivalents, and investments totaled $54.4 million. The company has no outstanding long-term debt.

Date: Thursday, November 14, 2024
Time: 5:00 p.m. EST
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 Thursday, November 21, 2024, at 11:59 p.m. EST.

Toll-free replay number: 1-844-512-2921
International replay number: 1-412-317-6671
Replay ID: 13749635

Article content

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.

Article content

“Adjusted EBITDA” is a non-GAAP financial measure under the Securities and Exchange Commission rules. EBITDA is commonly defined as “earnings before interest, taxes, depreciation, and amortization.” IZEA defines “Adjusted EBITDA” as earnings or loss before interest, taxes, depreciation and amortization, non-cash stock-based compensation, gain or loss on asset disposals or impairment, and certain other unusual or non-cash income and expense items such as gains or losses on settlement of liabilities and exchanges, and changes in the fair value of derivatives, if applicable.

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.

Article content

Article content

Article content

Article content

Article content

Article content