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Water Tower Research

Research from Water Tower Research

Water Tower Research is a leading equity research firm that provides research on micro, small and mid cap companies.

Water Tower Research was founded by Wall Street veterans after witnessing a fundamental shift in the investment research industry with the result being a declining knowledge base among investors, a lack of awareness and a shrinking pool of fundamental research being conducted on companies across the small-cap and micro-cap spectrum. The same issues are now increasingly occurring in the mid-cap space. This sea change within the investment community is impacting not only the companies themselves but also current shareholders and potential investors. With significantly less active sell-side sponsorship by Wall Street, a substantial information gap has developed between companies and various constituents in the financial community. The net result is fewer channels for insight and information to flow between companies and investors.

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Equity Bottom-Up

<ul><li>Gaia reported strong 1Q24 results, with revenue of $21.7 million (up 11%), 33,000 net member additions for a total membership count of 839,000 (all-time high), and strong operating cash flow of $5.9 million.</li><li>International revenue growth was particularly strong at 20.4%, compared with respectable US growth of 3.7%.</li><li>Member acquisition costs decreased 10%, partly as a result of a focus on direct-to-paid marketing campaigns, whereby free trial periods are replaced by special incentives to lock in longer-term membership commitments at attractive rates. This also fueled healthy deferred revenue growth of $2.0 million during the quarter.</li></ul>

Gaia reported strong 1Q24 results, with revenue of $21.7 million (up 11%), 33,000 net member additions for a total membership count of 839,000 (all-time high), and strong operating cash flow of $5.9 million.International revenue growth was particularly strong at 20.4%, compared with respectable US growth of 3.7%.Member acquisition costs decreased 10%, partly as a result of a focus on direct-to-paid marketing campaigns, whereby free trial periods are replaced by special incentives to lock in longer-term membership commitments at attractive rates. This also fueled healthy deferred revenue growth of $2.0 million during the quarter.

Gaia, Inc. - Solid Top-Line Momentum Continues in 1Q24

<ul><li>Gaia reported solid 4Q23 results, with revenue of $20.7 million, up 6% Y/Y.</li><li>More importantly, the company reported its fourth consecutive quarter of member growth, ending the year with 806,000 members versus 759,000 at the beginning of the year.</li><li>In fact, Gaia resumed member growth in 1Q23 with 7,000 new members. </li></ul>

Gaia reported solid 4Q23 results, with revenue of $20.7 million, up 6% Y/Y.More importantly, the company reported its fourth consecutive quarter of member growth, ending the year with 806,000 members versus 759,000 at the beginning of the year.In fact, Gaia resumed member growth in 1Q23 with 7,000 new members. 

<ul><li>We recently caught up with management to congratulate James Colquhoun on his promotion to CEO.</li><li>We also got a good update on the business as well as some early indications of trends and management focus for 2024.</li><li>As indicated on the 3Q23 earnings call, new member growth is continuing at a healthy clip and management expects to close 2023 at around 800k members.</li></ul>

We recently caught up with management to congratulate James Colquhoun on his promotion to CEO.We also got a good update on the business as well as some early indications of trends and management focus for 2024.As indicated on the 3Q23 earnings call, new member growth is continuing at a healthy clip and management expects to close 2023 at around 800k members.

Gaia, Inc. - Good Momentum Going into 2024

<div><div><div><ul style="list-style-type: disc;"><li><p>Gaia reported sequential revenue growth and increased member count during its seasonally weakest quarter.</p></li><li><p>Revenues were $19.8 million versus $20.7 million in 2Q22, but up sequentially.</p></li><li><p>Member count was up 8,000 to 774,500.</p></li></ul></div></div></div>

Gaia reported sequential revenue growth and increased member count during its seasonally weakest quarter.Revenues were $19.8 million versus $20.7 million in 2Q22, but up sequentially.Member count was up 8,000 to 774,500.

Gaia, Inc. - Reports Continued Member Growth in a Seasonally Weak Quarter

Thematic (Sector/Industry)

<ul><li>Many of the companies that participated in our recent Consumer Products Virtual Investor Conference have been working hard in righting the ship following the post- pandemic hangover that a lot of consumer names have suffered through.</li><li>There were several new management teams with new strategies, and a lot of talk about inflection points.</li><li>Vera Bradley’s CEO, CFO, and CMO have each been there for less than two years, and the company is about to roll out its Project Restoration strategic initiatives next month, which management believes will take the company into the third <span style="font-size: var(--content-font-size);">major stage of its lifecycle.</span></li></ul>

Many of the companies that participated in our recent Consumer Products Virtual Investor Conference have been working hard in righting the ship following the post- pandemic hangover that a lot of consumer names have suffered through.There were several new management teams with new strategies, and a lot of talk about inflection points.Vera Bradley’s CEO, CFO, and CMO have each been there for less than two years, and the company is about to roll out its Project Restoration strategic initiatives next month, which management believes will take the company into the third major stage of its lifecycle.

Consumer Products Conference Recap - June 20, 2024

United States

Gaia, Inc. operates a global digital video subscription services company. The Company offers a digital content library on multiple internet-connected devices. Gaia serves customers globally.

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Gaia (GAIA US)

Gaia, Inc. - Solid Top-Line Momentum Continues in 1Q24

Gaia reported strong 1Q24 results, with revenue of $21.7 million (up 11%), 33,000 net member additions for a total membership count of 839,000 (all...

Water Tower Research

Gaia, Inc. - Encouraging 4Q23 Results

Gaia reported solid 4Q23 results, with revenue of $20.7 million, up 6% Y/Y. More importantly, the company reported its fourth consecutive quarter...

Water Tower Research

Gaia, Inc. - Good Momentum Going into 2024

Gaia’s financial model is cash flow positive at this membership level, which gives the company flexibility and enhanced ability to seize...

Water Tower Research

Gaia, Inc. - Reports Continued Member Growth in a Seasonally Weak Quarter

Gaia reported sequential revenue growth and increased member count during its seasonally weakest quarter. Revenues were $19.8 million versus $20.7...

Water Tower Research

Consumer Products Conference Recap - June 20, 2024

Many of the companies that participated in our recent Consumer Products Virtual Investor Conference have been working hard in righting the ship...

Water Tower Research

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