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IZEA Worldwide, Inc. (IZEA)·Q3 2025 Earnings Summary

Executive Summary

  • Q3 revenue was $8.07M, down 9% year over year and down sequentially from $9.13M in Q2; diluted EPS was $0.01, with net income of $0.15M, continuing profitability momentum .
  • Versus S&P Global consensus, results were weaker: revenue $8.07M vs $10.0M estimate, EPS $0.01 vs $0.10 estimate, and EBITDA -$0.21M vs $1.7M estimate; estimates likely to reset lower given the magnitude of misses (values retrieved from S&P Global)*.
  • Managed Services revenue grew 5% year over year excluding divested Hoozu, while bookings fell 44% to $3.6M amid an intentional pivot away from smaller, non-recurring work and macro/tariff-related caution among some customers .
  • Operating discipline drove a 67% reduction in operating expenses ex-COGS, positive cash from operations, and cash/investments of $51.4M with no debt—providing capacity for organic growth and possible M&A .
  • Key narrative catalysts: sustained profitability focus, enterprise account wins (Amazon, GM, Owens-Corning), AI-infused platform enhancements, and an active (though paused in Q3) $10M repurchase authorization .

What Went Well and What Went Wrong

What Went Well

  • Material cost resets and operating discipline: OpEx ex-COGS fell 67% YoY to $4.3M; net income turned positive ($0.15M), marking the second profitable quarter in company history through operating performance .
  • Enterprise focus delivering quality of revenue: Managed Services revenue up 5% YoY excluding Hoozu; CEO highlighted “double- and even triple-digit growth among enterprise accounts” and new wins at Amazon, General Motors, and Owens-Corning .
  • Cash strength and flexibility: Cash and equivalents/investments at $51.4M, no debt; management reiterated capacity to support organic initiatives and pursue accretive M&A .

What Went Wrong

  • Top-line pressure and demand softness: Total revenue declined 9% YoY to $8.07M; Managed Services bookings dropped 44% to $3.6M as IZEA shed unprofitable, non-recurring work and faced cautious spending in some sectors .
  • SaaS contraction: SaaS revenue fell 83% YoY to $0.036M in Q3 as the company deprioritized marketing support for SaaS offerings amid the services pivot .
  • Macro headwinds: CFO cited broader economic uncertainty and tariff impacts as contributing factors to bookings declines and backlog drawdown (backlog fell to $7.1M from $15.5M at the start of the year) .

Financial Results

Summary (YoY and Sequential)

MetricQ3 2024Q2 2025Q3 2025
Revenue ($USD)$8,831,794 $9,133,232 $8,072,380
Diluted EPS ($)($0.52) $0.07 $0.01
Net Income ($USD)($8,768,319) $1,205,068 $147,745
Cost of Revenue ($USD)$5,210,104 $4,386,612 $4,152,375
Cost of Revenue (% of Revenue)59% 48% 51%

Profitability (GAAP and non-GAAP)

MetricQ3 2024Q2 2025Q3 2025
Adjusted EBITDA ($USD)($3,441,432) $1,326,460 $353,017
Operating EBITDA as % of Revenue(39.0)% N/A4.4%

Segment/Type Breakdown

Revenue TypeQ3 2024Q3 2025
Managed Services (Total) ($USD)$8,625,924 $8,036,430
Managed Services (On-Going Operations) ($USD)$7,671,221 $8,036,430
Hoozu ($USD)$954,703 —
SaaS Services ($USD)$205,870 $35,950
Total Revenue ($USD)$8,831,794 $8,072,380

KPIs and Operational Metrics

KPIQ1 2025Q2 2025Q3 2025
Managed Services Bookings ($USD)$7,500,000 $5,600,000 $3,600,000
Contract Backlog ($USD)$14,900,000 $11,500,000 $7,100,000
Cash & Equivalents/Investments ($USD)$52,200,000 $50,600,000 $51,400,000
Shares Repurchased (Cumulative)401,480 523,268 561,950
DebtNone None None

Guidance Changes

MetricPeriodPrevious GuidanceCurrent GuidanceChange
RevenueFY/Q4 2025No formal guidance No formal guidance reiterated; growth expected but uneven Maintained
Gross MarginFY 2025Stable within a range (qualitative) Stable within a range (qualitative) Maintained
OpExFY/Q4 2025Permanently lowered cost structure; add prudently as revenue scales Maintain disciplined OpEx; marketing spend paused at low rate Maintained
Capital AllocationOngoingUp to $10M buyback announced (2024–2025) Program ongoing; $1.4M cumulative repurchases, no Q3 purchases Maintained

Earnings Call Themes & Trends

TopicPrevious Mentions (Q1 & Q2 2025)Current Period (Q3 2025)Trend
AI/Technology InitiativesQ1: Simplifying product offerings; campaign management enhancements; deprioritize SaaS marketing . Q2: Workflow/analytics/TikTok API improvements .Infused platform with AI-powered features for strategic insights and performance; more announcements forthcoming .Increasing emphasis on AI capabilities .
Go-to-Market: Enterprise FocusQ1: Fortify/simplify/focus; America-first; enterprise account management; EVP Sales & Marketing hire . Q2: Shift to larger, recurring accounts; bookings timing variability .Enterprise accounts growing double/triple digits; EVP Account Management hire; VP Marketing & RevOps hire .Strengthening enterprise orientation .
Macro/Tariffs & DemandQ1: Clients pausing amid uncertainty; creator economy seen as flexible spend . Q2: Cautious spend; tariff impacts cited .Continued caution among some enterprise/agency clients; tariff impacts; bookings/backlog down .Persistent headwind .
Product Performance (SaaS)Q1: SaaS down due to marketing pause . Q2: SaaS down 67% YoY .SaaS down 83% YoY as focus remains on services .Downtrend continues .
Capital Allocation (Buybacks)Q1: Announced tender to complete buyback; strong cash . Q2: $1.3M repurchases cumulative .$1.4M repurchases cumulative; no Q3 purchases; liquidity strong .Ongoing program; activity variable .
Regional StrategyQ1: America-first; reduced international exposure . Q2: Continued US fortification .Emphasis on US operations reiterated .Stable focus .

Management Commentary

  • CEO: “Q3 marks our third consecutive quarter of financial improvement… Managed services revenue grew 14% year-to-date, expenses decreased drastically, net income grew again, and operations generated cash versus a multi-million dollar loss last year.” .
  • CEO: “Our strategy has been to fortify, simplify, and focus—strengthening our U.S. operations, refining our go-to-market, and prioritizing enterprise clients with recurring, high-growth potential… adding AI-powered insights to enhance client performance.” .
  • CFO: “This marks only the second quarter in the company’s history in which profitability was achieved through operating performance… Adjusted EBITDA for the third quarter of 2025 was $0.4 million.” .
  • CFO: “Managed services bookings… declined 26% YTD to $18.2 million… backlog decreased from $15.5 million at the beginning of the year to $7.1 million at quarter end… reflecting focus on higher quality recurring accounts and cautious marketing spend amid broader economic uncertainty, including tariff impacts.” .

Q&A Highlights

  • There were no analyst questions on the Q3 call; the operator closed the session without Q&A .
  • Management reiterated liquidity and discipline to support growth and potential M&A despite uneven demand patterns .

Estimates Context

  • S&P Global consensus for Q3 2025: Revenue $10.0M*, EPS $0.10*, EBITDA $1.7M*; actuals: Revenue $8.07M, EPS $0.01, EBITDA -$0.21M*; significant misses across all three metrics (values retrieved from S&P Global)* .
  • Target Price Consensus Mean and actual listed at $10.00* (limited coverage); Consensus Recommendation not available* (values retrieved from S&P Global)*.
  • Given the magnitude of variance, Street models likely adjust lower for near-term revenue/EBITDA while embedding improved cost structure and profitability trajectory (values retrieved from S&P Global)* .

Actuals vs S&P Global Consensus

MetricConsensus (Q3 2025)*Actual (Q3 2025)
Revenue ($USD)$10,000,000*$8,072,380
Primary EPS ($)$0.10*$0.01
EBITDA ($USD)$1,700,000*($213,363)*

Values retrieved from S&P Global*.

Key Takeaways for Investors

  • The company is sustaining profitability momentum with positive operating cash flow and a materially reduced cost base, supported by enterprise mix improvements and disciplined OpEx management .
  • Demand indicators (bookings, backlog) are weaker near term due to strategic pruning of lower-value work and macro/tariff caution; expect uneven revenue conversion and timing variability in larger enterprise deals .
  • Q3 results missed S&P Global consensus on revenue, EPS, and EBITDA; near-term revisions are likely while the multi-quarter transformation still strengthens the medium-term earnings power (values retrieved from S&P Global)* .
  • Liquidity is robust ($51.4M, no debt) enabling organic investment (AI-enhanced platform, enterprise account leadership hires) and optionality for accretive M&A when valuations align .
  • The pivot away from SaaS and toward Managed Services is deliberate; SaaS contribution remains subdued, and the narrative centers on services-led enterprise growth .
  • Buyback authorization remains in place ($10M), with $1.4M executed to date and no Q3 purchases; future activity may resume subject to volume/price conditions .
  • For trading: monitor bookings/backlog cadence, enterprise win announcements, and AI feature rollouts as catalysts; near-term sentiment may hinge on the pace of demand normalization versus continued cost-driven profitability .