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Gaia Reports Second Quarter 2017 Results

BOULDER, Colo., Aug. 07, 2017 (GLOBE NEWSWIRE) -- Gaia, Inc. (NASDAQ:GAIA), a conscious media company, reported financial results for the second quarter ended June 30, 2017.

Second Quarter 2017 vs. Same Year-Ago Quarter

  • 64% subscriber growth generated 68% increase in streaming revenues to $6.1 million
  • Total revenues up 56% to $6.6 million
  • Gross margin up 390 basis points to 86.1%

“The momentum in our business has continued to strengthen as we again exceeded our accelerated subscriber growth target, while customer acquisition costs continue to track below plan,” said Jirka Rysavy, Gaia’s CEO. “We also continued to grow our content library, ending the quarter at 8,000 titles.”

Gaia’s special report “Unearthing Nazca,“ part of a new series exploring a rare archeological discovery in Peru, has garnered over 60 million views on Gaia’s website, YouTube and other social channels. While initial discoveries are provided free of charge, this level of views demonstrates the size of the market interested in Gaia’s content.

Gaia’s paying subscriber count increased 64% to 277,800 on June 30, 2017 from 169,500 on June 30, 2016. This follows 58% year-over-year subscriber growth in the first quarter of 2017 and 45% growth in the second quarter of 2016. The company expects to further increase its year over year subscriber growth rate to 70% during the third quarter of 2017.

Second Quarter 2017 Financial Results

Total revenues in the second quarter increased 56% to $6.6 million from $4.2 million in the same year-ago quarter. This was due to 68% growth in streaming revenues, which was driven by the 64% increase in paying subscribers versus June 30, 2016.

Gross profit in the second quarter increased 64% to $5.6 million compared to $3.5 million in the year-ago quarter. Gross margin increased 390 basis points to 86.1% from 82.2% in the second quarter of 2016 due to increased revenues and the related leverage on streaming costs and Gaia’s media library.

Total operating expenses in the second quarter were $12.0 million compared to $6.4 million in the year-ago quarter. The increase was due to the planned increase in marketing expenses associated with the announced acceleration of subscriber growth throughout 2017.

Net loss in the second quarter was $6.3 million or $0.42 per share, compared to a net loss of $2.4 million or $0.10 per share in the year-ago quarter. The 2017 per share amount reflects Gaia’s repurchase of approximately 40% of its outstanding shares in July 2016.

As of June 30, 2017, the company had $36.9 million in cash, an unencumbered corporate campus and no debt.

Conference Call

Gaia is hosting a conference call today, August 7, 2017, beginning at 4:30 p.m. ET (2:30 p.m. MT). The conference call dial-in numbers are (888) 211-9963 (or (719) 325-2354 for international callers), passcode 5339575. Questions will be reserved for analysts and investors. If you have any difficulty connecting with the conference call, please contact Liolios at (949) 574-3860. Following the completion of today’s conference call, a replay will be available until August 21, 2017 by dialing (844) 512-2921 (or (412) 317-6671 for international callers), passcode 5339575.

About Gaia

Gaia is a global video streaming service and online community that provides curated conscious media in three primary channels—Seeking Truth, Transformation and Yoga—to its subscribers in over 150 countries. Over 90% of its 8,000 titles are available for streaming exclusively on Gaia through most devices connected to the Internet and approximately 80% of the views are generated by content produced or owned by Gaia. For more information about Gaia, visit www.gaia.com.

Forward-Looking Statements

This press release includes forward-looking statements relating to matters that are not historical facts. Forward-looking statements may be identified by the use of words such as “expect,” “believe,” “will,” or comparable terminology or by discussions of strategy. While Gaia believes its assumptions and expectations underlying forward-looking statements are reasonable, there can be no assurance that actual results will not be materially different. Risks and uncertainties that could cause materially different results include, among others, history of operating losses, general economic conditions, competition, changing consumer preferences, acquisitions, new initiatives undertaken by us, costs of acquiring new subscribers, subscriber retention rates, and other risks and uncertainties included in Gaia’s filings with the Securities and Exchange Commission. Gaia assumes no duty to update any forward-looking statements.

GAIA, INC.
Condensed consolidated statements of operations
For the Three Months Ended
June 30,
For the Six Months Ended
June 30,
(in thousands, except per share data) 2017 2016 2017 2016
(unaudited) (unaudited)
Net revenues:
Streaming $6,057 $3,610 $11,266 $6,839
DVD subscription and other 501 588 1,076 1,189
Total net revenues 6,558 4,198 12,342 8,028
Cost of revenues
Streaming 844 667 1,585 1,316
DVD subscription and other 67 80 145 144
Total cost of revenues 911 747 1,730 1,460
Gross profit 5,647 3,451 10,612 6,568
Expenses:
Selling and operating 10,562 4,992 21,028 10,847
Corporate, general and administration 1,439 1,426 2,792 2,776
Total operating expenses 12,001 6,418 23,820 13,623
Loss from operations (6,354) (2,967) (13,208) (7,055)
Interest and other (expense) income, net 44 (117) 88 (153)
Loss before income taxes (6,310) (3,084) (13,120) (7,208)
Income tax expense (benefit) - 1 (629) 2
Loss from continuing operations (6,310) (3,085) (12,491) (7,210)
Loss from discontinued operations, net of tax - 646 - (2,854)
Net loss $(6,310) $(2,439)$(12,491) $(10,064)
Income (loss) per share—basic and diluted:
Continuing operations $(0.42) $(0.13)$(0.82) $(0.29)
Discontinued operations 0.03 (0.12)
Basic and diluted net loss per share $(0.42) $(0.10)$(0.82) $(0.41)
Weighted-average shares outstanding:
Basic and diluted 15,157 24,580 15,155 24,555


GAIA, INC.
Condensed consolidated balance sheets
June 30, December 31,
(in thousands, except share and per share data) 2017 2016
(unaudited)
ASSETS
Current assets:
Cash $36,861 $54,027
Accounts receivable 788 554
Prepaid expenses and other current assets 1,360 1,303
Total current assets 39,009 55,884
Building and land, net 16,575 16,896
Media library, software and equipment, net 16,593 12,861
Goodwill 10,609 10,609
Investments and other assets 11,001 10,946
Total assets $93,787 $107,196
LIABILITIES AND EQUITY
Current liabilities:
Accounts payable and accrued liabilities $4,674 $6,672
Deferred revenue 3,178 2,434
Total current liabilities 7,852 9,106
Deferred taxes 553
Contingencies
Equity 85,935 97,537
Total liabilities and equity $93,787 $107,196

Contacts Paul Tarell Gaia, Inc. (303) 222-3330 Paul.Tarell@gaia.com Cody Slach Liolios Investor Relations (949) 574-3860 GAIA@liolios.com

Source:Gaia, Inc.