Banzai International(BNZI) - 2025 Q3 - Quarterly Report

Financial Performance - Banzai generated revenue of approximately $9.4 million for the nine months ended September 30, 2025, compared to $3.2 million for the same period in 2024, representing a year-over-year increase of 194%[318] - The company incurred net losses of approximately $17.5 million for the nine months ended September 30, 2025, compared to $23.7 million for the same period in 2024, indicating a reduction in losses[318] - For the nine months ended September 30, 2025, total revenue was approximately $9,351 thousand, an increase of 189.7% compared to $3,228 thousand in the same period of 2024[410] - Banzai reported total other income of approximately $3.2 million for the nine months ended September 30, 2025, reflecting a decrease in other expenses (income) of approximately $10.9 million, or -77.5%, compared to the same period in 2024[415] - The company reported a net loss of $17,461 thousand for the nine months ended September 30, 2025, a decrease of 26.2% from a net loss of $23,659 thousand in the same period of 2024[409] - Adjusted EBITDA for the nine months ended September 30, 2025, was approximately $(5.6) million, reflecting a decrease in earnings of approximately $0.8 million compared to a loss of approximately $(4.8) million for the same period in 2024[438] Customer Metrics - Banzai's customer base grew to over 6,097 customers as of September 30, 2025, with a significant increase in multi-host Demio customers from 14 to 97 since January 1, 2021[316] - The average monthly Net Revenue Retention (NRR) for the nine months ended September 30, 2025, was 96.4%, slightly down from 96.7% in 2024[383] - The average Customer Acquisition Cost (CAC) for the three months ended September 30, 2025, was $1,322, a decrease from $1,569 in 2024[391] - The average monthly revenue churn for the three months ended September 30, 2025, was 3.7%, down from 4.4% in 2024[394] - The average monthly customer (logo) churn for the three months ended September 30, 2025, was 6.9%, compared to 5.3% in 2024[394] - Customer Life increased to 26.7 months for new customers in the three months ended September 30, 2025, up from 22.9 months in the same period of 2024[398] - The LTV (Customer Lifetime Value) for new customers rose to $3,136 in the three months ended September 30, 2025, compared to $2,635 in the same period of 2024[398] - The LTV/CAC (Customer Acquisition Cost) ratio improved to 2.8 for the three months ended September 30, 2025, compared to 1.8 in the same period of 2024[402] - The total average Annual Customer Value (ACV) for the nine months ended September 30, 2025, was $1,590, compared to $1,549 in 2024[387] Acquisitions and Mergers - The company completed the acquisition of Vidello Limited for approximately $2.7 million in cash and 89,820 shares of Banzai Class A common stock, with Vidello generating over $6.5 million in TTM revenue[323][324] - Banzai closed a merger with OpenReel, valued at $19.6 million, which included the issuance of 93,055 shares of Banzai Common Stock and 1,176,950 Pre-Funded Warrants[319][321] - Revenue from OpenReel and Vidello acquisitions contributed approximately $6,123 thousand to the total revenue increase for the nine months ended September 30, 2025[410] Capital Raising and Financing - The company is exploring additional capital raising through private placements to support operations and expansion through acquisitions[331] - The Company raised $11,000,000 through a private placement of senior secured convertible notes on June 27, 2025, with proceeds of $1,725,000 received after discounts and fees[352] - The Company entered into an At The Market Offering Agreement on August 27, 2025, with an aggregate market value of approximately $5.6 million eligible for sale[358] - The Company collected $330,000 in gross proceeds from a private placement in May 2025, selling shares at $6.90 each and prefunded warrants at $3.40 each[363] - The Company raised approximately $4.4 million in net proceeds from a Private Placement, which will be used for general corporate purposes and working capital[370] - The company intends to seek additional funding through various financing arrangements in 2025, including the SEPA and ATM Agreement[444] Debt and Liabilities - Banzai's accumulated deficit increased to $95.7 million as of September 30, 2025, up from $78.3 million at the end of 2024[318] - The Company issued a subordinated secured promissory note on March 31, 2025, with a principal amount of $4,000,000, receiving proceeds of $2,044,105 after fees[342] - The Company issued pre-funded warrants to purchase up to 117,647 shares of Class A common stock at an exercise price of $0.001 per share as part of the Private Placement[367] - The total outstanding principal balance of the 2024 CP BF Convertible Note, along with accrued interest and other obligations, is due on February 19, 2027[458] - The GEM Promissory Note requires the Company to pay $1.2 million in cash and includes a $1.0 million unsecured promissory note payable in monthly installments of $100,000[460] - The company has a GEM commitment fee liability of $2,000,000 recognized concurrent with the close of the merger[508] - Total debt carrying values as of September 30, 2025, amounted to $12,343,000, with accrued interest of $4,104,000, leading to a total of $16,448,000[502] Operational Expenses - Total operating expenses for the nine months ended September 30, 2025, were approximately $21.8 million, an increase of approximately $10.1 million, or 86.3%, compared to $11.7 million for the same period in 2024[413] - Operating loss for the nine months ended September 30, 2025, was $14,178 thousand, an increase of 48.5% from a loss of $9,546 thousand in the same period of 2024[409] - Cost of revenue for the nine months ended September 30, 2025, was approximately $1,680 thousand, a 60.2% increase from $1,049 thousand in the same period of 2024[411] Cash Flow and Working Capital - Banzai's cash balance as of September 30, 2025, was approximately $0.9 million, with a working capital deficit of approximately $23.8 million[442] - Net cash used in operating activities for the nine months ended September 30, 2025, was approximately $13.4 million, compared to $5.4 million for the same period in 2024, representing a 150.2% increase in cash outflow[446] - Net cash provided by financing activities for the nine months ended September 30, 2025, was approximately $15.9 million, an increase of 111.5% compared to $7.5 million for the same period in 2024[450] - Net cash used in investing activities for the nine months ended September 30, 2025, was approximately $2.7 million, related to the acquisition of Vidello[449] Tax and Compliance - The provision for income tax expense for the nine months ended September 30, 2025, was $113 thousand, a significant increase of 1614.3% from $7 thousand in the same period in 2024[416] - The company had no unrecognized tax benefits that would reduce its effective tax rate as of September 30, 2025[419] - Banzai's securities were successfully listed on the Nasdaq Capital Market after demonstrating compliance with listing rules[330] Miscellaneous - A reverse stock split of 1-for-10 was approved and became effective on July 8, 2025[327] - The Company recognized a loss on debt extinguishment of $6,529,402 related to the consolidation of the Old CP BF Notes into the 2024 CP BF Convertible Note[455] - The carrying amount of the Company's OpenReel reporting unit exceeded its fair value, resulting in an impairment loss of $2.7 million at December 31, 2024[431] - The Company recognized a loss on the failed Act On acquisition costs of $1.4 million during the nine months ended September 30, 2025[418] - The company has issued an aggregate of 19,000 shares of Class A Common Stock to GEM in lieu of monthly payment obligations[510]