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ORLANDO, FL (May 22, 2018)IZEA, Inc. (NASDAQ: IZEA), operator of IZEAx, the premier online marketplace connecting brands and publishers with influential content creators, reported its financial results for the first quarter ended March 31, 2018.

Q1 2018 Financial Highlights Compared to Q1 2017

  • Revenue was $3.9 million in Q1 2018, down 19%, compared to $4.8 million in Q1 2017.
  • Revenue from Managed Services decreased 19% to $3.8 million, compared to $4.7 million.
  • Bookings from Managed Services decreased 10% to $5.7 million, compared to $6.4 million.
  • Total costs and expenses were $5.8 million, compared to $7.5 million.
  • Net loss was $(2.0) million, compared to a net loss of $(2.7) million, an improvement of $674,000 or 25%.
  • Adjusted EBITDA was $(1.8) million, compared to $(2.0) million, an improvement of $(0.2) million or 9%.

Q1 2018 Operational Highlights

  • Began expansion of IZEA partnership sales team, focused on increasing adoption of IZEAx
  • A global top ten public relations agency became an IZEAx licensee
  • Executed campaigns for two of the top five largest internet companies

Management Commentary

“IZEA saw a decrease in fourth-quarter 2017 contractual commitments as several large customers pushed their annual contracts to the 2018 calendar year. In addition, smaller, faster running campaigns made up less of the sales pipeline throughout 2017. That in turn had an impact on first-quarter 2018 revenue and Gross Billings, which were both off in the quarter,” said Ted Murphy, IZEA’s Chairman and CEO. “We began to see a rebound in contractual commitments in first-quarter 2018 as our bookings for Managed Services increased to $5.7 million compared to $4.0 million in the fourth-quarter of 2017.  However, we remain off pace from last year, when we had $6.4 million in bookings for Managed Services in the first quarter of 2017. We believe it will take us two to three quarters to begin to see a meaningful impact from our customer diversification strategy, which is designed to reduce the effects of larger customers as a percentage of revenue.”

Q1 2018 Financial Results

Revenue in the first quarter of 2018 was $3.9 million, a 19% decrease compared to $4.8 million in the same year-ago quarter. The Managed Services portion of our revenue, accounting for 97% of total revenue, decreased by approximately $887,000. Managed Services decreased primarily due to slow sales in fourth-quarter 2017, which resulted from lower initial annual commitments from larger customers, along with a fewer number of smaller customers running short-term campaigns.  Nearly $200,000 of the decrease in Managed Services revenue is due to the change in the timing of revenue under the new accounting standard, ASC 606, which the Company adopted in January 2018. Content Workflow revenue for self-service transactions on our platforms, accounting for 2% of total revenue, decreased 38% by approximately $39,000 to $63,000 in Q1 2018, compared to $102,000 in the same year-ago quarter. Self-service use of our platform for content-only production by the large publishers and news agencies is continuing to decline year over year, as expected, due to the ongoing consolidation, cutbacks and operational changes in the newspaper industry.

Our total Gross Billings (a non-GAAP metric management uses to measure total transaction volume, as defined below) were down 24% to $4.7 million in Q1 2018 compared to $6.2 million in Q1 2017, due to the decline in Managed Services commitments and Content Workflow transactions.

Total costs and expenses in the first quarter of 2018 were $5.8 million compared to $7.5 million in the same year-ago quarter. This decrease was primarily due to the decrease in costs of revenue on lower revenue produced, decreases in sales and public relations expense, and decreases in labor and non-cash expenses in general and administrative expense.

Net loss in the first quarter of 2018 was $(2.0) million or $(0.35) per share, as compared to a net loss of $(2.7) million or $(0.49) per share in the same year-ago quarter. The improvement was primarily due to decreased expenses.

Adjusted EBITDA (a non-GAAP metric management uses as a proxy for operating cash flow, as defined below) in the first quarter of 2018 was $(1.8) million compared to $(2.0) million in the same year-ago quarter. The improvement in Adjusted EBITDA was primarily due to reduced expenses. Adjusted EBITDA as a percentage of revenue in the first quarter of 2018 was (47%) compared to (42%) in the year-ago quarter.

Revenue backlog, which includes unbilled bookings and unearned revenue, was $10.3 million at the end of the quarter.

Cash and cash equivalents at March 31, 2018 totaled $2.8 million. At the end of the quarter, the Company had accessed approximately $731,000 of its $5.0 million credit line.

Conference Call

IZEA will hold a conference call to discuss its first quarter results on Wednesday, May 23rd at 5:00 p.m. Eastern time. Management will host the call, followed by a question and answer period.

Date: Wednesday, May 23, 2018
Time: 5:00 p.m. Eastern time
Toll-free dial-in number: 1-877-407-4018
International dial-in number: 1-201-689-8471

The conference call will be webcast live and available for replay here and via the investors section of the company’s website at

Please call the conference telephone number five minutes prior to the start time. An operator will register your name and organization.

A replay of the call will be available after 8:00 p.m. Eastern time on the same day through May 30, 2018.

Toll-free replay number: 1-844-512-2921
International replay number: 1-412-317-6671
Replay ID: 13680424

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