IZEA(US:IZEA)2024-05-15 20:04PART I. FINANCIAL INFORMATION Item 1. Financial Statements IZEA Worldwide, Inc. reported Q1 2024 revenue decreased to $7.0 million and net loss widened to $3.3 million, maintaining a strong cash balance Consolidated Balance Sheet Highlights (Unaudited) | Account | March 31, 2024 ($) | December 31, 2023 ($) | | :--- | :--- | :--- | | Cash and cash equivalents | $39,035,332 | $37,446,728 | | Total current assets | $61,878,930 | $60,351,403 | | Total assets | $76,027,387 | $79,425,466 | | Total current liabilities | $13,039,257 | $13,593,413 | | Total liabilities | $13,525,540 | $14,112,078 | | Total stockholders' equity | $62,501,847 | $65,313,388 | Consolidated Statements of Operations Highlights (Unaudited) | Account | Three Months Ended Mar 31, 2024 ($) | Three Months Ended Mar 31, 2023 ($) | | :--- | :--- | :--- | | Revenue | $6,952,883 | $8,737,722 | | Cost of revenue | $3,967,975 | $5,960,162 | | Loss from operations | ($4,058,655) | ($3,376,861) | | Net loss | ($3,265,850) | ($2,806,339) | | Basic and diluted loss per common share | ($0.20) | ($0.18) | Consolidated Statements of Cash Flows Highlights (Unaudited) | Cash Flow Activity | Three Months Ended Mar 31, 2024 ($) | Three Months Ended Mar 31, 2023 ($) | | :--- | :--- | :--- | | Net cash used for operating activities | ($3,341,872) | ($2,436,879) | | Net cash provided by investing activities | $4,971,123 | $4,023,000 | | Net cash used in financing activities | ($37,233) | ($30,871) | | Net increase in cash and cash equivalents | $1,592,018 | $1,555,250 | - The company adopted ASU 2023-08 for crypto assets early, resulting in a cumulative effect adjustment to retained earnings of $7,632 as of January 1, 2023, and requiring fair value measurement each reporting period495082 Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations Management attributes the 20% revenue decline to $7.0 million due to a customer departure, with Managed Services Bookings increasing Revenue by Type (Q1 2024 vs Q1 2023) | Revenue Type | Q1 2024 ($) | Q1 2023 ($) | $ Change | % Change | | :--- | :--- | :--- | :--- | :--- | | Managed Services | $6,696,542 | $8,502,754 | ($1,806,212) | (21)% | | SaaS Services | $256,341 | $234,968 | $21,373 | 9% | | Total Revenue | $6,952,883 | $8,737,722 | ($1,784,839) | (20)% | - The decrease in Managed Services revenue was primarily due to parting ways with a non-recurring large customer that accounted for approximately $3.5 million in revenue in Q1 2023, while revenue from the ongoing customer base increased by $1.7 million, or 33%, year-over-year183209 - Managed Services Bookings, a key performance indicator, increased to $9.3 million for Q1 2024, compared to $6.1 million in Q1 2023, reaching a seven-quarter high193209 Adjusted EBITDA Reconciliation (Non-GAAP) | Metric | Three Months Ended Mar 31, 2024 ($) | Three Months Ended Mar 31, 2023 ($) | | :--- | :--- | :--- | | Net loss (GAAP) | ($3,265,850) | ($2,806,339) | | Adjusted EBITDA (Non-GAAP) | ($2,755,409) | ($2,187,989) | | Adjusted EBITDA as a % of Revenue | (40)% | (25)% | - The company ended the quarter with $39.0 million in cash and cash equivalents and believes it has adequate resources to fund operations and planned investments for at least the next twelve months205206 Item 3. Quantitative and Qualitative Disclosures About Market Risk This section is not applicable as the company is a smaller reporting company - Disclosure is not required for smaller reporting companies213 Item 4. Controls and Procedures Management concluded the company's disclosure controls and procedures were effective as of March 31, 2024, with no material changes to internal controls - Management concluded that as of March 31, 2024, the company's disclosure controls and procedures were effective216 - There were no changes in internal control over financial reporting during the quarter ended March 31, 2024, that have materially affected, or are reasonably likely to materially affect, internal controls219 PART II. OTHER INFORMATION Item 1. Legal Proceedings As of May 10, 2024, the company is not a party to any legal proceedings with a material adverse effect on its business - The company is not currently party to any legal proceedings or claims that it believes would have a material adverse effect221 Item 1A. Risk Factors No material changes have occurred to the risk factors disclosed in the company's Annual Report on Form 10-K for FY2023 - No material changes have occurred to the risk factors described in the Annual Report on Form 10-K for the fiscal year ended December 31, 2023222 Item 2. Unregistered Sales of Equity Securities and Use of Proceeds This section is not applicable Item 5. Other Information This section is not applicable Item 6. Exhibits This section lists all exhibits filed with the Form 10-Q, including CEO/CFO certifications and XBRL data - The report includes a list of exhibits, such as corporate governance documents, officer certifications (pursuant to Sarbanes-Oxley Act Sections 302 and 906), and XBRL interactive data files228