IZEA Worldwide, Inc. Q1 FY2025 earnings call

• Geographically exited international markets to focus on U.S. to insulate from geopolitical, tariff, and currency risks.
• Organizationally implemented new efficient structure and made targeted workforce reductions in December.
• Transformed go-to-market model focusing on high-growth segments and serving top clients better.
• Technologically simplified product offerings and improved campaign management efficiency.
• Hired first EVP of sales and marketing.
• Q1 2025 saw revenue growth, nearly breaking even, and generating cash. Also, announced intention to complete $10M stock buyback via tender offer.

Total revenue for Q1 2025 was approx. $8 million, 14.6% above prior year. Managed services revenue was $7.9 million, growing 18.1% y/y. Managed services revenue from continuing ops (excluding Hoozu) rose 27.6%. Managed services bookings declined to $7.5 million from $9.3 million y/y. SaaS revenue was $60,953 in Q1 2025, down from $256,341 y/y due to reduced marketing support. Managed services backlog was $14.9 million as of March 31, 2025.

• Peter mentioned margins are likely stable through the rest of the year.
• Cost structure is good for the year, may add people in summer/fall but business should rise to cover costs.
• Pipeline is growing, quality of clients increasing, and deal sizes with enterprise customers are bigger.

• Geopolitical, tariff, and currency risks from exiting international markets.
• Uncertainty in the economy potentially affecting advertising dollars.
• Valuation risks in M&A opportunities, needing to be reasonable about not overpaying.

Q: Could you elaborate on gross margins for the remainder of the year?

A: Peter said margins are fairly steady, go up/down within a band depending on mix, and likely stable through rest of year.

Q: Are cost-cutting measures essentially over?

A: Peter said some costs are structural, business is in good position to manage, cost structure is good for year, may add people but business should rise to pay for it.

Q: Any comments on economy affecting pipeline and advertising dollars?

A: Patrick said pipeline is growing, quality of clients increasing, deal sizes bigger, and some clients see this category as better for advertising as it's more controllable.

Q: Elaborate on M&A opportunities?

A: Patrick said not aggressively pursued yet to get organization ready, looking at opportunities, valuations depend on areas, and will be reasonable about not overpaying