IZEA Worldwide, Inc.

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•risks associated with doing business internationally;

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•risks associated with doing business internationally; and

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•the other risks and uncertainties described in the Risk Factors section of this Quarterly Report and in our Annual Report on Form 10-K for the fiscal year ended December 31, 2023, as filed with the SEC on April 1, 2024.

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•the other risks and uncertainties described in the Risk Factors section of this Annual Report.

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IZEA Worldwide, Inc. (“IZEA”, “Company,” “we”, “us” or “our”) is a leading innovator in the creator economy, specializing in providing advanced software solutions and professional services that connect brands with a broad spectrum of social influencers and content creators. The Company’s mission is to champion the creators, empowering individuals to monetize their creativity, content, and influence. IZEA made a significant mark in the industry by launching the first influencer marketplace, PayPerPost, in 2006, setting a precedent for the evolution of digital marketing platforms. Today, the Company caters to a diverse range of clients, including independent creators and Fortune 10 brands, offering services in influencer marketing, customer-generated content, and custom content creation. IZEA operates through managed services and self-service software tools, accommodating the varying needs of its clientele and ensuring mutually beneficial collaborations within its ecosystem.

Current wording

IZEA made a significant mark in the industry by launching the first influencer marketplace, PayPerPost, in 2006, setting a precedent for the evolution of digital marketing platforms. Today, the Company caters to a diverse range of clients, including independent creators and Fortune 10 brands, offering services in influencer marketing, customer-generated content, and custom content creation. IZEA provides tech-enabled managed services and self-service software tools, accommodating the varying needs of its clientele and ensuring mutually beneficial collaborations within its ecosystem.

Previous wording

IZEA Flex is the Company’s flagship enterprise solution for influencer marketing, designed to meet the industry's evolving demands and users’ feedback for more flexibility and customization. IZEA Flex, which has succeeded IZEAx, empowers marketers to conduct influencer collaborations across any platform with enhanced operational organization and data tracking capabilities. The platform boasts a suite of core modules, including Discover, ContentMine, and ShareMonitor, which together provide a comprehensive toolkit for optimizing influencer marketing campaigns. IZEA Flex is distinguished by its ability to quantify the ROI of marketing efforts at scale, complemented by the introduction of AI-powered tools that streamline content customization and creative campaign ideation.

Current wording

IZEA Flex is a robust suite of tools that enhance IZEA’s ability to manage influencer marketing at scale. Beyond enabling seamless campaign execution, Flex empowers IZEA’s internal teams to measure influencer marketing performance with precision. The platform boasts a suite of core modules, which together provide a comprehensive toolkit for optimizing influencer marketing campaigns. Flex is distinguished by its ability to quantify the ROI of marketing efforts at scale, complemented by the introduction of AI-powered tools that streamline content and creative campaign ideation.

Previous wording

We generate revenue from four primary sources: (1) revenue from our managed services when a marketer (typically a brand, agency, or partner) pays us to provide custom content, influencer marketing, amplification, or other campaign management services (“Managed Services”); (2) revenue from fees charged to software customers on their marketplace spend within our platforms (“Marketplace Spend Fees”); (3) revenue from license and subscription fees charged to access our software platforms (“License Fees”); and (4) revenue derived from other fees such as fees charged to users of our platforms (“Other Fees”).

Current wording

We generate revenue primarily from our managed services, when a marketer (typically a brand, agency, or partner) pays us to provide custom content, influencer marketing, amplification, or other campaign management services (“Managed Services”). Additionally, we generate revenue from subscription fees charged to access our software platforms, license and transaction fees from self-service customers, and fees from such as inactivity fees, early cash-out fees, and other miscellaneous fees charged to users of our platforms (collectively, “SaaS Services Revenue”).

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Our cost of revenue consists of direct costs paid to our third-party creators who provide the custom content, influencer marketing, or amplification services for our Managed Service customers, where we report revenue on a gross basis. It also includes internal costs related to our campaign fulfillment and SaaS support departments. These costs include salaries, bonuses, commissions, stock-based compensation, employee benefit costs, and miscellaneous departmental costs related to the personnel responsible for supporting our customers and ultimately fulfilling our obligations under our contracts with customers.

Current wording

Our cost of revenue consists of direct costs paid to our third-party creators who provide the custom content, influencer marketing, or amplification services for our Managed Service customers, where we report revenue on a gross basis. It also includes internal costs for our campaign fulfillment and SaaS support departments. These costs include salaries, bonuses, commissions, stock-based compensation, employee benefit costs, and miscellaneous departmental costs related to the personnel responsible for supporting our customers and ultimately fulfilling our obligations under our contracts with customers.

Previous wording

Our general and administrative (“G&A”) expense consists primarily of salaries, bonuses, commissions, stock-based compensation, employee benefit costs and miscellaneous departmental costs related to our executive, finance, legal, human resources and other administrative personnel. It also includes travel, public company, investor relations expenses, accounting, legal professional services fees, leasehold facilities and other corporate-related expenses.

Current wording

Our general and administrative (“G&A”) expense consists primarily of salaries, bonuses, commissions, stock-based compensation, employee benefit costs, and miscellaneous departmental costs related to our executive, finance, legal, human resources, and other administrative personnel. It also includes travel, public company, investor relations expenses, accounting, legal professional services fees, and other corporate-related expenses.

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G&A expense also includes current period gains and losses on our acquisition costs payable and gains and losses from the sale of fixed assets. When impairments occur on fixed assets, intangible assets, and goodwill, they are included as part of G&A expense presented separately in our consolidated statements of operations and comprehensive loss when deemed material.

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G&A expenses include current period gains and losses on our acquisition costs payable and gains and losses from the sale of fixed assets. Impairments on fixed assets are included as part of G&A expenses presented separately in our consolidated statements of operations and comprehensive loss when deemed material.

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Depreciation and amortization expense consists primarily of amortization of our internal-use software and acquired intangible assets from our business acquisitions. To a lesser extent, we also have depreciation and amortization on equipment used by our personnel. Costs are amortized or depreciated over the estimated useful lives of the associated assets.

Current wording

Depreciation and amortization expenses consists primarily of amortization of our internal-use software and acquired intangible assets from our business acquisitions. To a lesser extent, we also have depreciation and amortization on equipment used by our personnel. Costs are amortized or depreciated over the estimated useful lives of the associated assets.

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Interest Expense. Interest expense is primarily related to the payment plans for the purchase of computer equipment.

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Interest Expense. Interest expense is primarily related to the payment plans for purchasing computer equipment.

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Other Income. Other income consists primarily of interest income for interest earned on investments.

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Other Income. Other income consists primarily of interest income earned on investments, as well as realized gains and losses on foreign currency exchange transactions, primarily related to the Canadian and Australian Dollar.

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SaaS Services revenue is generated by the self-service use of our technology platforms by marketers to manage their own content workflow and influencer marketing campaigns. SaaS Service revenue increased to $705,564 during the nine months ended September 30, 2024, compared to $362,822 in the same period of 2023. The increase is primarily due to a growing number of licensees but at a lower cost per license.

Current wording

SaaS Services revenue is generated by the self-service use of our technology platforms by marketers to manage their own content workflow and influencer marketing campaigns. SaaS Service revenue decreased to $60,953 during the three months ended March 31, 2025, compared to $0.3 million in the same period of 2024. The decrease is due to our shift away from SaaS products, including reduced marketing efforts and limited availability for new sign-ups

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The cost of revenue for the three months ended September 30, 2024 increased by $0.5 million, or approximately 11%, compared to the same period in 2023. The increase is primarily driven by higher costs associated with increased revenues from our recurring customer base this quarter.

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The cost of revenue for the three months ended March 31, 2025 increased by $0.4 million, or approximately 11%, compared to the same period in 2024. The increase is primarily driven by higher costs associated with increased revenues from our recurring customer base this quarter which has a higher mix of lower margin customers.

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Sales and marketing expense for the three months ended September 30, 2024 increased by $179,019, or approximately 7%, compared to the same period in 2023. This increase is related to overall compensation costs, partially offset by lower spend on marketing programs.

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Sales and marketing expense for the three months ended March 31, 2025 decreased by $1.9 million, or approximately 63%, compared to the same period in 2024. This decrease is primarily due to lower payroll and related costs, following our

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Depreciation expense on property and equipment was $26,821 and $26,583 for the three months ended September 30, 2024 and 2023, respectively.

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Depreciation and amortization expense for the three months ended March 31, 2025 decreased by $43,834, or approximately 21%, compared to the same period in 2024. Depreciation expense on property and equipment was $22,955 and $26,557 for the three months ended March 31, 2025 and 2024, respectively. Amortization expense was $0.1 million and $0.2 million for the three months ended March 31, 2025 and 2024, respectively. Amortization expense related to internal use software developments costs was $0.1 million and $0.1 million for the three months ended March 31, 2025, and 2024, respectively. Depreciation and amortization expense decreased compared to the prior-year quarter primarily due to lower depreciation on computer equipment that became fully depreciated during the first quarter of 2025. Additionally, amortization expense declined due to the absence of expense related to legacy platforms that were sunset in 2024, for which amortization was accelerated in the fourth quarter of 2024.

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Interest expense totaled $5,654 during the nine months ended September 30, 2024, related to fewer acquisitions of laptop computers in 2024, compared to $6,373 in the prior year period.

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Interest expense totaled $1,654 during the three months ended March 31, 2025, compared to $2,001 in the prior year period.

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Other income, net, totaled $605,644 during the three months ended September 30, 2024, a decrease of $54,212 compared to the same period in 2023, primarily from investment portfolio interest income.

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Other income, net, totaled $0.5 million during the three months ended March 31, 2025, a decrease of $0.2 million compared to the same period in 2024, primarily from investment portfolio interest income.

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Net loss for the three months ended September 30, 2024 was $8.8 million, compared to the net loss of $2.0 million for the same period in 2023. The increase in net loss was a result of the changes discussed above.

Current wording

Net loss for the three months ended March 31, 2025 was $0.1 million, compared to the net loss of $3.3 million for the same period in 2024.

Previous wording

Managed Services Bookings is a measure of all sales orders received during a time period, less any cancellations received, or refunds given during the same time period. Sales order contracts vary in complexity with each customer and range from custom content delivery to integrated marketing services; our contracts generally run from several months for smaller contracts up to twelve months for larger contracts. We recognize revenue from our Managed Services contracts on a percentage of completion basis as we deliver the content or services over time, which can vary greatly. Historically, bookings have converted to revenues over a 6-month period on average. However, since late 2020, we have received increasingly larger and more complex sales orders, which, in turn, has lengthened the average revenue period to approximately 9-months, with the largest contracts taking longer to complete. During the latter half of 2023, the time between bookings and revenue improved to an average of 7.5 months. For this reason, Managed Services Bookings, while an overall indicator of the health of our business, may not be used to predict quarterly revenues and could be subject to future adjustments. Managed Services Bookings is useful information as it reflects the number of orders received in one period, even though revenue from those orders may be reflected over varying amounts of time. We use the Managed Services Bookings metric to plan operational staffing, to identify key customer group trends to enlighten go-to-market activities, and to inform its product development efforts. Managed Services Bookings for the three months ended September 30, 2024 and 2023 was $7.9 million and $7.1 million, respectively. Managed Services Bookings for the nine months ended September 30, 2024 and 2023 was $19.6 million and $20.5 million, respectively.

Current wording

Managed Services Bookings is a measure of all sales orders received during a time period, less any cancellations received, or refunds given during the same time period. Sales order contracts vary in complexity with each customer and range from custom content delivery to integrated marketing services; our contracts generally run from several months for smaller contracts up to twelve months for larger contracts. We recognize revenue from our Managed Services contracts on a percentage of completion basis as we deliver the content or services over time, which can vary greatly. Historically, bookings have converted to revenues over a 6-month period on average. However, since late 2020, we have received increasingly larger and more complex sales orders, which, in turn, has lengthened the average revenue period to approximately 9-months, with the largest contracts taking longer to complete. During the latter half of 2023, the time between bookings and revenue improved to an average of 7.5 months. For this reason, Managed Services Bookings, while an overall indicator of the health of our business, may not be used to predict quarterly revenues and could be subject to future adjustments. Managed Services Bookings is useful information as it reflects the number of orders received in one period, even though revenue from those orders may be reflected over varying amounts of time. We use the Managed Services Bookings metric to plan operational staffing, to identify key customer group trends to enlighten go-to-market activities, and to inform its product development efforts. Managed Services Bookings for the three months ended March 31, 2025 and 2024 was $7.5 million and $9.3 million, respectively.

Previous wording

You should not consider Adjusted EBITDA in isolation or as a substitute for an analysis of our results of operations as under GAAP. All companies do not calculate Adjusted EBITDA in the same manner, limiting its usefulness as a comparative measure. Moreover, Adjusted EBITDA has limitations as an analytical tool, including that Adjusted EBITDA:

Current wording

You should not consider Adjusted EBITDA in isolation or as a substitute for an analysis of our results of operations as under GAAP. Not all companies calculate Adjusted EBITDA similarly, limiting its usefulness as a comparative measure. Moreover, Adjusted EBITDA has limitations as an analytical tool, including that Adjusted EBITDA:

Previous wording

•does not include interest expense and other gains, losses, and expenses that we believe are not indicative of our ongoing core operating results, but these items may represent a reduction or increase in cash available to us.

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•does not include non-operating activity, such as interest income and other gains, losses, and expenses that we believe are not indicative of our ongoing core operating results, but these items may represent a reduction or increase in cash available to us.

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The following table sets forth a reconciliation from the GAAP measurement of net loss to our non-GAAP financial measure of Adjusted EBITDA for the three and nine months ended September 30, 2024 and 2023:

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The following table sets forth a reconciliation from the GAAP measurement of net loss to our non-GAAP financial measure of Adjusted EBITDA for the three months ended March 31, 2025, and 2024:

Previous wording

The Company’s primary cash needs have historically been funding the development and integration of our technology platforms used in its business, marketing expenses, and G&A expenses including salaries, bonuses, and commissions. The Company has incurred losses and negative cash flow from operations for most periods since inception, primarily the result of costs associated with third-party creators, salaries, bonuses and stock-based compensation, and other G&A expenses, including technology and development costs, which has resulted in a total accumulated deficit of $99.7 million as of September 30, 2024. While we have not achieved profitability, we believe we have sufficient resources to fund operations and planned investments for at least the next twelve months.

Current wording

The Company’s primary cash needs have historically been funding the development and integration of our technology platforms used in its business, marketing expenses, and G&A expenses including salaries, bonuses, and commissions. The Company has incurred losses and negative cash flow from operations for most periods since inception, primarily the result of costs associated with third-party creators, salaries, bonuses and stock-based compensation, and other G&A expenses, including technology and development costs, which has resulted in a total accumulated deficit of $104.4 million as of March 31, 2025. While we have not achieved profitability, we believe we have sufficient resources to fund operations and planned investments for at least the next twelve months.

Previous wording

We had cash and cash equivalents of $46.0 million as of September 30, 2024, as compared to $37.4 million as of December 31, 2023. This increase of $8.5 million is the result of the maturing of certain investments, offset by cash used to fund operating activities.

Current wording

We had cash and cash equivalents of $50.6 million as of March 31, 2025, as compared to $44.6 million as of December 31, 2024. This increase of $6.0 million is the result of the maturing of certain investments, supplemented by cash provided by operating activities.

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Net cash used for operating activities was $8.7 million during the nine months ended September 30, 2024, primarily due to the continued use to cover operating losses. Net cash provided by investing activities was $17.6 million during the nine months ended September 30, 2024, primarily due to the maturity of marketable securities and acquisitions. Net cash used for financing activities during the nine months ended September 30, 2024 was $482,085, which consisted of payments on shares withheld for taxes.

Current wording

Net cash provided by operating activities was $2.0 million during the three months ended March 31, 2025, primarily due to a decrease in accounts receivable. Net cash provided by investing activities was $4.7 million during the three months ended March 31, 2025, primarily due to the maturity of marketable securities. Net cash used for financing activities during the three months ended March 31, 2025 was $618,804, primarily due to payments for shares withheld for taxes and the repurchase of treasury stock.

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We anticipate that our operating expenses will increase in the foreseeable future as we continue to pursue the expansion of our business. We currently believe that we have adequate cash and long-term investments to fund our business growth for the next twelve months; however, should additional capital become necessary, we expect these funds would be financed predominately through proceeds from future equity, equity-based, or debt offerings, unless and until our operations are profitable and sustain our ongoing capital needs. As a result, our business success could depend, to a significant extent, upon our ability to obtain the funding necessary to support our operations.

Current wording

We anticipate that our operating expenses will increase over time to support higher levels of revenue and required working capital financing as we continue to pursue the expansion of our business. We currently believe that we have adequate cash and long-term investments to fund our business growth for the next twelve months; however, should additional capital become necessary, we expect these funds would be financed predominately through proceeds from future equity, equity-based, or debt offerings, unless and until our operations are profitable and sustain our ongoing capital needs.

Previous wording

The Company has recorded operational losses to date. Alongside recent management and Board changes, we are conducting a comprehensive analysis of our business and exploring strategic alternatives. The Board of Directors established a Strategic and Capital Allocation Committee to, among other assignments, collaborate with management to review business strategies and formulate a plan to achieve sustainable and consistent profitability. This review is in process, with no final decisions reached as of November 14, 2024. While our core business remains solid, recent declines in managed service bookings have presented challenges. Collectively, these factors may adversely impact our future business performance, operational results, and financial position.

Current wording

The Company has recorded operational losses to date. Alongside recent management and Board changes, we are conducting a comprehensive analysis of our business and exploring strategic alternatives. The Board of Directors established a Strategic and Capital Allocation Committee to, among other assignments, collaborate with management to review business strategies and formulate a plan to achieve sustainable and consistent profitability.