GAIA, INC

Previous wording

This report contains forward-looking statements within the meaning of the federal securities laws. All statements other than statements of historical fact are forward looking statements that involve risks and uncertainties. When used in this discussion, we intend the words “anticipate,” “believe,” “contemplate,” “continue,” “could,” “estimate,” “expect,” “future,” “hope,” “intend,” “may,” “might,”

Current wording

This report contains forward-looking statements within the meaning of the federal securities laws. All statements other than statements of historical fact are forward looking statements that involve risks and uncertainties. When used in this discussion, we intend the words

Previous wording

“objective,” “ongoing,” “plan,” “potential,” “predict,” “project,” “should,” “strive,” “target,” “will,” “would” and similar expressions as they relate to us to identify such forward-looking statements. Our actual results could differ materially from the results anticipated in these forward-looking statements as a result of certain factors set forth under “Risk Factors,” “Management’s Discussion and Analysis of Financial Condition and Results of Operations” and elsewhere in this Form 10-Q and under “Risk Factors” in our Annual Report on Form 10-K for the year ended December 31, 2025.

Current wording

“anticipate,” “believe,” “contemplate,” “continue,” “could,” “estimate,” “expect,” “future,” “hope,” “intend,” “may,” “might,” “objective,” “ongoing,” “plan,” “potential,” “predict,” “project,” “should,” “strive,” “target,” “will,” “would” and similar expressions as they relate to us to identify such forward-looking statements. Our actual results could differ materially from the results anticipated in these forward-looking statements as a result of certain factors set forth under “Risk Factors,” “Management’s Discussion and Analysis of Financial Condition and Results of Operations” and elsewhere in this Form 10-Q and under “Risk Factors” in our Annual Report on Form 10-K for the year ended December 31, 2025.

Previous wording

We operate a global digital video subscription service with a library of over 10,000 titles, with live communications and live events with a growing selection of titles available in Spanish, German and French that caters to a unique, underserved member base. Our digital content is available to our members on most internet-connected devices anytime, anywhere, commercial-free. Through our online

Current wording

We operate a global digital video subscription service with a library of over 10,000 titles, with live communications and live events with a growing selection of titles available in Spanish, German and French that caters to a unique, underserved member base. Our digital content is available to our members on most internet-connected devices anytime, anywhere, commercial-free. Through our online Gaia subscription service our members have unlimited access to a library of inspiring films, cutting edge documentaries, interviews, yoga classes, transformation related content, live events, and more – 90% of which is exclusively available to our members for digital streaming on most internet-connected devices.

Previous wording

Our core strategy is to grow our subscription business domestically and internationally by expanding our unique and exclusive content library, enhancing our user interface, extending our streaming service to new internet-connected devices as they are developed and creating a conscious community built around our content.

Current wording

Our core strategy is to improve our subscription business by expanding our unique and exclusive content library, enhancing our user interface, extending our streaming service to new internet-connected devices as they are developed and creating a conscious community built around our content.

Previous wording

Selling and operating expenses. Selling and operating expenses stayed flat at $20.0 million during the three months ended March 31, 2026, compared to $20.0 million for the three months ended March 31, 2025. As a percentage of net revenues, selling and operating expenses decreased to 82.3% for the three months ended March 31, 2026 compared to 84.0% for the three months ended March 31, 2025.

Current wording

Selling and operating expenses. Selling and operating expenses increased to $21.6 million during the three months ended June 30, 2026, compared to $20.6 million for the three months ended June 30, 2025, which is primarily due to change in marketing strategy. As a percentage of net revenues, selling and operating expenses increased to 92.6% for the three months ended June 30, 2026 compared to 83.8% for the three months ended June 30, 2025.

Previous wording

Corporate, general and administration expenses. Corporate, general and administration expenses increased $0.4 million to $2.3 million for three months ended March 31, 2026 from $1.9 million for three months ended March 31, 2025. As a percentage of net revenues, these expenses increased to 9.6% for the three months ended March 31, 2026 from 8.0% for the three months ended March 31, 2025. The increase was primarily driven by legal fees, accounting and audit fees, and higher incentive compensation costs during the three months ended March 31, 2026.

Current wording

Corporate, general and administration expenses. Corporate, general and administration expenses decreased $1.4 million to $1.5 million for three months ended June 30, 2026 from $2.9 million for three months ended June 30, 2025. As a percentage of net revenues, these expenses decreased to 6.5% for the three months ended June 30, 2026 from 11.8% for the three months ended June 30, 2025. The decrease was primarily due to a decrease in incentive compensation during the three months ended June 30, 2025.

Previous wording

Cost of revenues. Cost of revenues increased $0.5 million or 16.1% to $3.4 million during the three months ended March 31, 2026, compared to $2.9 million during the three months ended March 31, 2025, which primarily relates to the increase in revenues and revenue mix. Gross profit margin declined during the three months ended March 31, 2026 to 86.0% from 87.7% for the three months ended March 31, 2025. The three months ended March 31, 2026 benefited from a one-time adjustment in royalty expense.

Current wording

Cost of revenues. Cost of revenues increased $0.6 million or 9.8% to $6.8 million during the six months ended June 30, 2026, compared to $6.2 million during the six months ended June 30, 2025. Gross profit margin declined during the six months ended June 30, 2026 to 85.7% from 87.2% for the six months ended June 30, 2025. The decrease was primarily attributable to lower revenue while content-related costs remained relatively consistent. The six months ended June 30, 2025 benefited from a one-time adjustment in royalty expense.

Previous wording

Our revenues and results of operations have fluctuated in the past, and will likely continue to fluctuate, on a quarterly basis. Such fluctuation is the result of a seasonal pattern that reflects variations when consumers are typically spending more time indoors and, as a result, tend to increase their viewing, similar to those of general video streaming services. This drives quarterly variations in our spending on member acquisition efforts and affects the net subscriber change each quarter but does not result in a corresponding seasonality in net revenue. As we continue to expand internationally, we also expect regional seasonality trends to demonstrate more predictable seasonal patterns as our service offering in each market becomes more established and we have a longer history to assess such patterns.

Current wording

Our revenues and results of operations have fluctuated in the past, and will likely continue to fluctuate, on a quarterly basis. Such fluctuation is the result of a seasonal pattern that reflects variations when consumers are typically spending more time indoors and, as a result, tend to increase their viewing, similar to those of general video streaming services. This drives quarterly variations in our spending on member acquisition efforts and affects the net subscriber change each quarter but does not result in a corresponding seasonality in net revenue. We also expect regional seasonality trends to demonstrate more predictable seasonal patterns as our service offering in each market becomes more established and we have a longer history to assess such patterns.

Previous wording

On December 19, 2025, Boulder Road and Westside (collectively, the “Borrower”) entered into a business loan agreement with KeyBank National Association (“KeyBank”), as lender, providing for a mortgage loan in the principal amount of $11.4 million (the “2025 Mortgage Loan”). The promissory note evidencing the 2025 Mortgage Loan bears interest at a fixed rate of 5.090% per annum, matures on December 19, 2030, and is secured by a deed of trust on our corporate campus, a portion of which is owned by Boulder Road and Westside as tenants-in-common and the remainder of which is owned by Boulder Road. The loan proceeds from the 2025 Mortgage Loan were used to refinance the 2020 Mortgage Loan. Westside and Boulder Road each received 50% of the proceeds and are each responsible for 50% of the monthly installments. The 2025 Mortgage Loan contains customary affirmative and negative covenants (each with customary exceptions) for loans of this type, including limitations on the Borrower’s ability to incur liens or debt, make investments, or engage in certain fundamental changes, and is fully guaranteed by Gaia. Additionally, the 2025 Mortgage Loan requires Boulder Road, LLC maintain a Net Operating Income to Debt Service Coverage Ratio of not less than 1.25 to 1.00. The 2025 Mortgage Loan has a remaining balance of $11.2 million as of March 31, 2026.

Current wording

On December 19, 2025, Boulder Road and Westside (collectively, the “Borrower”) entered into a business loan agreement with KeyBank National Association (“KeyBank”), as lender, providing for a mortgage loan in the principal amount of $11.4 million (the “2025 Mortgage Loan”). The promissory note evidencing the 2025 Mortgage Loan bears interest at a fixed rate of 5.090% per annum, matures on December 19, 2030, and is secured by a deed of trust on our corporate campus, a portion of which is owned by Boulder Road and Westside as tenants-in-common and the remainder of which is owned by Boulder Road. The loan proceeds from the 2025 Mortgage Loan were used to refinance the 2020 Mortgage Loan. Westside and Boulder Road each received 50% of the proceeds and are each responsible for 50% of the monthly installments. The 2025 Mortgage Loan contains customary affirmative and negative covenants (each with customary exceptions) for loans of this type, including limitations on the Borrower’s ability to incur liens or debt, make investments, or engage in certain fundamental changes, and is fully guaranteed by Gaia. Additionally, the 2025 Mortgage Loan requires Boulder Road, LLC maintain a Net Operating Income to Debt Service Coverage Ratio of not less than 1.25 to 1.00. The 2025 Mortgage Loan has a remaining balance of $11.1 million as of June 30, 2026.

Previous wording

We intend to invest approximately 15%-20% of our revenues each year to support continued investment in our content library and technology platform. This spending is entirely discretionary in nature with no contractual commitments and due to our in-house production capabilities, we can scale our content investment based on the cash flows generated from operations if necessary to ensure we have sufficient liquidity to operate our business into the future. As of March 31, 2026, our cash balance was $13.1 million.

Current wording

We intend to invest approximately 15%-20% of our revenues each year to support continued investment in our content library and technology platform. This spending is entirely discretionary in nature with no contractual commitments and due to our in-house production capabilities, we can scale back our content investment based on the cash flows generated from operations if necessary to ensure we have sufficient liquidity to operate our business into the future.

Previous wording

Operating activities. Cash flows provided by operations increased approximately $0.2 million during the three months ended March 31, 2026 compared to the same period in 2025. The increase was driven by changes in earnings and the timing of working capital.

Current wording

Operating activities. Net cash flows from operating activities decreased approximately $7.7 million during the three months ended June 30, 2026 compared to the same period in 2025. The decrease was driven by the timing of working capital, changes in earnings and deferred revenue.

Previous wording

Investing activities. Cash flows used in investing activities increased approximately $0.8 million during the three months ended March 31, 2026 compared to the same period in 2025. The increase was primarily driven by purchases related to other fixed assets during the three months ended March 31, 2026.

Current wording

Investing activities. Cash flows used in investing activities increased approximately $0.9 million during the three months ended June 30, 2026 compared to the same period in 2025. The increase was primarily driven by purchases related to fixed assets due to Igniton-related capital spend during the three months ended June 30, 2026.

Previous wording

Financing activities. Cash flows provided by financing activities decreased $7.0 million during the three months ended March 31, 2026 compared to the same period in 2025 due to proceeds from the issuance of common stock during the three months ended March 31, 2025.

Current wording

Financing activities. Net cash flows from financing activities decreased $7.2 million during the six months ended June 30, 2026 compared with the same period in 2025 due to proceeds received from the issuance of common stock during the six months ended June 30, 2025.