10-Q

United States

Securities and Exchange Commission

Washington, D.C. 20549

Form 10-Q

☒ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15 (d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended September 30, 2024

☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15 (d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from to

Commission File Number 000-27517

GAIA, INC.

(Exact name of registrant as specified in its charter)

    COLORADO

    84-1113527

    (State or other jurisdiction of
incorporation or organization)

    (I.R.S. Employer
Identification No.)

833 WEST SOUTH BOULDER ROAD,

LOUISVILLE, COLORADO 80027

(Address of principal executive offices)

(303) 222-3600

(Registrant’s telephone number, including area code)

Securities registered pursuant to Section 12(b) of the Act:



Title of each class	Trading Symbol(s)	Name of each exchange on which registered
Class A Common Stock	GAIA	NASDAQ Global Market

Indicate by check mark whether the registrant: (1) has filed all reports required to be filed by Section 13 or 15 (d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports) and (2) has been subject to such filing requirements for the past 90 days. Yes ☒ No ☐

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files). Yes ☒ No ☐

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act.


Large accelerated filer	☐	Accelerated filer	☐
Non-accelerated filer	☒	Smaller reporting company	☒
Emerging growth company	☐

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). YES ☐ NO ☒

Indicate the number of shares outstanding of each of the issuer’s classes of common stock, as of the latest practicable date:


Class		Outstanding at October 31, 2024
Class A Common Stock ($0.0001 par value)		18,066,942
Class B Common Stock ($0.0001 par value)		5,400,000

GAIA, INC.

FORM 10-Q

INDEX


PART I—FINANCIAL INFORMATION

Item 1.	Financial Statements (Unaudited):	3

	Condensed Consolidated Balance Sheets as of September 30, 2024 (unaudited) and December 31, 2023	4

	Condensed Consolidated Statements of Operations (unaudited) for the three and nine months ended September 30, 2024 and 2023	5

	Condensed Consolidated Statements of Changes in Equity (unaudited) for the nine months ended September 30, 2024 and 2023	6

	Condensed Consolidated Statements of Cash Flows (unaudited) for the nine months ended September 30, 2024 and 2023	7

	Notes to Interim Condensed Consolidated Financial Statements	8

Item 2.	Management’s Discussion and Analysis of Financial Condition and Results of Operations	12

Item 3.	Quantitative and Qualitative Disclosures About Market Risk	16

Item 4.	Controls and Procedures	17

PART II—OTHER INFORMATION		18

Item 1.	Legal Proceedings	18

Item 1A.	Risk Factors	18

Item 2.	Unregistered Sales of Equity Securities and Use of Proceeds	18

Item 3.	Defaults Upon Senior Securities	18

Item 5.	Other Information	18

Item 6.	Exhibits	19

	SIGNATURES	20

PART I—FINANCIAL INFORMATION

Item 1. Financial Statements (Unaudited)

Unaudited Interim Condensed Consolidated Financial Statements

We have prepared our unaudited interim condensed consolidated financial statements included herein pursuant to the rules and regulations of the United States Securities and Exchange Commission (“SEC”). While certain information and note disclosures normally included in annual audited financial statements prepared in accordance with accounting principles generally accepted in the United States of America (“GAAP”) have been condensed or omitted pursuant to these rules and regulations, we believe that the disclosures made are adequate to make the information not misleading. In our opinion, the unaudited condensed consolidated financial statements contain all adjustments necessary to present fairly, in all material respects, our condensed consolidated balance sheets as of September 30, 2024, the interim condensed consolidated statements of operations for the three and nine months ended September 30, 2024 and 2023, the interim condensed consolidated statements of changes in equity for the three and nine months ended September 30, 2024 and 2023, and condensed consolidated statements of cash flows for the nine months ended September 30, 2024 and 2023. Operating results for the three and nine months ended September 30, 2024 and 2023 are not necessarily indicative of the results that may be expected for a full year or any future interim period. The Condensed Consolidated Balance Sheets as of December 31, 2023 were derived from our annual audited consolidated financial statements included in our Annual Report on Form 10-K. These interim condensed consolidated financial statements have not been audited. The unaudited interim condensed consolidated financial statements contained herein should be read in conjunction with our annual audited consolidated financial statements, including the notes thereto, for the year ended December 31, 2023.

GAIA, INC.

Condensed Consolidated Balance Sheets


	September 30,			December 31,
(in thousands, except share and per share data)	2024			2023
	(unaudited)
ASSETS
Current assets:
Cash and cash equivalents	$	4,365		$	7,766
Accounts receivable		5,035			4,111
Other receivables		2,333			2,191
Prepaid expenses and other current assets		2,647			2,015
Total current assets		14,380			16,083
Media library, net		38,956			40,125
Operating right-of-use asset, net		5,666			6,288
Property and equipment, net		26,144			26,303
Equity method investment		—			6,374
Technology license, net		15,752			—
Investments and other assets, net		6,805			3,157
Goodwill		31,943			31,943
Total assets	$	139,646		$	130,273
LIABILITIES AND EQUITY
Current liabilities:
Accounts payable	$	13,573		$	12,038
Accrued and other liabilities		1,906			2,599
Long-term debt, current portion		160			155
Operating lease liability, current portion		824			780
Deferred revenue		17,366			15,861
Total current liabilities		33,829			31,433
Long-term debt, net of current portion (Note 4)		5,680			5,801
Operating lease liability, net of current portion		5,087			5,708
Deferred taxes, net		551			551
Total liabilities		45,147			43,493
Commitments and Contingencies (Note 8)
Shareholders’ equity:
Class A common stock, $0.0001 par value, 150,000,000 shares authorized, 18,066,942 and 17,813,179 shares issued, 18,001,955 and 17,748,374 shares outstanding at September 30, 2024 and December 31, 2023, respectively		2			2
Class B common stock, $0.0001 par value, 50,000,000 shares authorized, 5,400,000 shares issued and outstanding at September 30, 2024 and December 31, 2023, respectively		1			1
Additional paid-in capital		170,822			170,695
Accumulated deficit		(89,625	)		(85,195	)
Total Gaia, Inc. shareholders’ equity		81,200			85,503
Noncontrolling interests		13,299			1,277
Total equity		94,499			86,780
Total liabilities and equity	$	139,646		$	130,273

See accompanying notes to the unaudited interim condensed consolidated financial statements.

GAIA, INC.

Condensed Consolidated Statements of Operations (unaudited)


	For the Three Months Ended September 30,						For the Nine Months Ended September 30,
(in thousands, except per share data)	2024			2023			2024			2023

Revenues, net	$	22,156		$	20,223		$	65,930		$	59,709
Cost of revenues		3,101			2,983			9,684			8,595
Gross profit		19,055			17,240			56,246			51,114
Operating Expenses:
Selling and operating		18,398			16,254			54,854			49,462
Corporate, general and administration		2,013			1,433			5,630			4,726
Total operating expenses		20,411			17,687			60,484			54,188
Loss from operations		(1,356	)		(447	)		(4,238	)		(3,074	)
Equity method investment loss		—			(125	)		—			(375	)
Interest and other expense, net		(144	)		(141	)		(396	)		(375	)
Loss before income taxes		(1,500	)		(713	)		(4,634	)		(3,824	)
Provision for income taxes		—			—			—			—
Net loss		(1,500	)		(713	)		(4,634	)		(3,824	)
Net (loss) income attributable to noncontrolling interests		(308	)		59			(204	)		142
Net loss attributable to common shareholders	$	(1,192	)	$	(772	)	$	(4,430	)	$	(3,966	)

Loss per share:
Basic (attributable to common shareholders)	$	(0.05	)	$	(0.04	)	$	(0.19	)	$	(0.19	)
Diluted (attributable to common shareholders)	$	(0.05	)	$	(0.04	)	$	(0.19	)	$	(0.19	)
Weighted-average shares outstanding:
Basic		23,404			21,154			23,312			20,951
Diluted		23,404			21,154			23,312			20,951

See accompanying notes to the interim condensed consolidated financial statements.

GAIA, INC.

Condensed Consolidated Statements of Changes in Equity (unaudited)



(in thousands, except shares)	Common Stock Shares		Accumulated Deficit			Common Stock Amount		Additional Paid-in Capital		Non-controlling interests		Total Equity
Balance at December 31, 2023		23,148,374	$	(85,195	)	$	3	$	170,695	$	1,277	$	86,780
Issuance of Gaia, Inc. common stock for employee stock purchase plan		7,444		—			—		14		—		14
Issuance of Gaia, Inc. common stock for RSU releases and share-based compensation		4,708		—			—		335		—		335
Net (loss) income		—		(1,045	)		—		—		74		(971	)
Balance at March 31, 2024		23,160,526	$	(86,240	)	$	3	$	171,044	$	1,351	$	86,158
Issuance of Gaia, Inc. common stock for RSU releases and share-based compensation

SEC Form 10-Q filed by Gaia Inc.