Gaia, Inc.

Good afternoon, everyone, and thank you for participating in today's conference call to discuss Gaia Inc's financial results for the third quarter ended September 30, 2023. Joining us today are Gaia's CEO, Erika Rossi, COO James Colquhoun, and CFO Ned Preston. Following some prepared remarks, we will open the call for your questions. Before we get started, however, I would like to take a minute to read the Safe Harbor language. The following constitutes the safe harbor statement under Private Securities Litigation Reform Act of 1995. The matters discussed today include forward-looking statements that involve numerous assumptions, risks, and uncertainties. These include but are not limited to our ability to attract new members and retain existing members, our ability to compete effectively, including for customer engagement with different modes of entertainment, maintenance, and expansion of device platforms for streaming. fluctuation in customer usage of our service, fluctuations in quarterly operating results, service disruptions, production risks, general economic conditions, future losses, loss of key personnel, price changes, brand reputations, acquisitions, new initiatives we undertake, security and information systems, legal liability for website content, failure of third parties to provide adequate service, future internet related taxes, our founders control of us, litigation, consumer trends, the effect of government regulation and programs, the impact of public health threats, including the coronavirus, COVID-19 pandemic, and our response to it, and other risks and uncertainties detailed from time to time in our filings with the Securities and Exchange Commission, including our reports on Form 10-K and Form 10-Q. GAIA assumes no obligation to publicly update or revise any forward-looking statements. With that, I would now like to turn the call over to GAIA's CEO, Yurka Rassidi. Please go ahead, sir.

Thank you, and good afternoon, everyone. I'm glad again we can continue reporting positive results. Revenue for third quarter increased to 20.2 million, sequentially up from 19.8 million, and from last year of 19.9 million. During the quarter, our member growth doubled sequentially to about 16,000, ending with 790,500 members, which is above 776,000 we reported last year. So we more than recovered the 22 losses which were caused by the industry-wide post-coffee subscriber contraction. Virtually all the growth in this quarter is coming from our direct members. Our ARPU continuing to grow steady over the last five years and shall be further supplemented by our recent launch of GAIA Marketplace. We have rolled our marketplace in September to less than 5% of our members and generated over 100,000 sales in the first 20 days without virtually any marketing cost. Annualized gross profit per employee improved again during the third quarter to our new all-time high of over $650,000. reflecting our increased efficiencies. Our loss improved to $600,000, or $0.03 per share, down from $2.4 million, or $0.11 per share, and EBITDA increased to $3.9 million from $1.8 million during the quarter of last year. We continue to generate positive free cash flow with the cash on September 30th growing to $11.2 million, from 10.9 million at the end of the last quarter. Now James will cover the marketplace and some other new marketing initiatives, and then Ned will speak more about financial results. James?

Thank you, Juerke. So we rolled out a beta version of Marketplace in September, initially targeting less than 5% of our members, and the results have been truly exciting. Within the first 20 days, we were able to generate over $100,000 in sales, and all of this was achieved with zero paid marketing costs. This achievement is testament to the strong connection we have with our members and the appeal of the marketplace's offerings. It also demonstrates the significant potential for growth that lies ahead of us as we expand our offering into 2024. The launch of Gaia Marketplace is a significant step forward for us. It's not just the new feature, it represents strategic expansion of our platform, and it allows us to diversify our offerings and support the conscious life cycle of our members in a more meaningful way, whilst also improving ARPU, which is a key metric for us to focus on as we move forward. Marketplace will include a carefully curated selection of experiences, retreats, courses, and products that resonate with our audience, which will be offered to members at a discount to the market. to help us create a thriving ecosystem that benefits both our members and Gaia. A key passion and focus for me is improving our marketing efficiency, and I believe there are to be a lot of untapped opportunities for us, especially with our direct-to-consumer marketing campaigns and digital events. Marketplace will play a critical role in this as it will contribute to free cash flow, which we will use to accelerate our growth initiatives as we focus on scaling to 900,000 subscribers as quickly as possible whilst maintaining positive cash flow. Now, Ned will talk more on our financial results.