IZEA(US:IZEA)2025-11-12 21:03Revenue Performance - Revenue for the three months ended September 30, 2025, decreased by $759,414, or 9%, compared to the same period in 2024, totaling $8,072,380[166]. - Excluding revenue from the divested Hoozu, revenue grew by $200,000, or 2.48%, driven by strong growth among large enterprise customers[167]. - Revenue for the nine months ended September 30, 2025, increased by $295,482, or 1%, to $25,173,975 compared to $24,878,493 in 2024[175]. - Excluding the divested Hoozu, revenue increased by $2.6 million, or 11%, driven by strong growth among large enterprise customers[176]. - Revenue from Managed Services, excluding Hoozu, increased by 14% for the nine months ended September 30, 2025, compared to the prior-year period, while overall growth slowed to 5% in the quarter[198]. Cost Management - Cost of revenue declined by $1,057,729, or 20%, to $4,152,375, primarily due to the absence of Hoozu-related costs[166]. - Cost of revenue declined by $1.4 million, or 10%, primarily due to the absence of costs related to Hoozu; excluding Hoozu, costs increased by 5.2% year-over-year[177]. - Sales and marketing expenses decreased by $1,783,957, or approximately 62%, to $1,095,363, due to lower payroll and reduced advertising spending[169]. - Sales and marketing expenses decreased by $6.0 million, or approximately 65%, due to lower payroll and reduced advertising spending[178]. - General and administrative expenses decreased by $2,835,706, or approximately 49%, to $3,004,321, primarily from lower employee-related costs[170]. - General and administrative expenses decreased by $4.2 million, or approximately 32%, primarily from lower employee-related costs[179]. - Depreciation and amortization expenses decreased by $89,109, or approximately 37%, to $150,740, due to intangible assets becoming fully amortized[172]. - The total costs and expenses for the three months ended September 30, 2025, were $8,402,799, a decrease of $9,783,223, or 54%, compared to the prior year[166]. Profitability - Net income for the three months ended September 30, 2025, was $147,745, compared to a net loss of $8,768,319 for the same period in 2024, representing an improvement of $8,916,064[166]. - Net income for the nine months ended September 30, 2025, was $1,210,013, a $15,439,010 increase from a net loss of $14,228,997 in 2024[183]. - EBITDA improved by $10.7 million during the first nine months of 2025, moving from a $9.1 million loss in 2024 to a $1.6 million profit in 2025[199]. Cash Flow and Financial Position - Cash and cash equivalents increased to $51.4 million as of September 30, 2025, compared to $44.6 million as of December 31, 2024[193]. - Net cash provided by operating activities was $2.4 million during the nine months ended September 30, 2025, primarily driven by net income and strong accounts receivable collections[194]. - The company believes its cash and cash equivalents are sufficient to fund planned growth initiatives over the next twelve months[201]. Strategic Initiatives - The company implemented a new account management model focusing on larger, more valuable recurring accounts, resulting in a strategic realignment and improved profitability[195]. - The company expects profitable organic growth over the next twelve months, albeit from a lower, but more profitable revenue base in 2025[200]. - Operating expenses are expected to increase gradually as the company invests in expansion, but the current cost structure is better aligned to scale efficiently[200]. Accounting and Risk Disclosures - The company recorded a full impairment of goodwill of $4,016,722 in September 2024, impacting the prior year's results[171]. - There have been no material changes to the company's critical accounting policies as of the latest quarterly report[202]. - The company did not report any applicable market risk disclosures as it is classified as a smaller reporting company[204]. - No off-balance sheet arrangements were engaged by the company as of September 30, 2025[201].