IZEA Worldwide, Inc. (together with its wholly-owned subsidiaries, “IZEA” or the “Company”) is a Nevada corporation founded in February 2006 under the name PayPerPost, Inc. that became a public company in May 2011. In March 2016, the Company formed IZEA Canada, Inc., a wholly-owned subsidiary incorporated in Ontario, Canada.

The Company helps power the creator economy by enabling marketers to engage creators to produce and distribute content across digital channels through technology-enabled managed services that support influencer and content marketing campaigns. The Company’s current focus is on delivering full-service solutions tailored to client needs.

The accompanying unaudited consolidated financial statements of IZEA Worldwide, Inc. and its consolidated subsidiaries have been prepared in accordance with accounting principles generally accepted in the United States (“GAAP”) for interim financial information. In the opinion of management, these unaudited consolidated financial statements include all adjustments, consisting only of normal recurring adjustments, necessary for a fair presentation of the Company’s financial position as of June 30, 2026 and its results of operations and cash flows for the periods presented.

These unaudited condensed consolidated financial statements should be read in conjunction with the Company’s audited consolidated financial statements and related notes as of and for the year ended December 31, 2025 included in the Company’s Annual Report on Form 10-K filed with the Securities and Exchange Commission on March 17, 2026.

The consolidated financial statements include the accounts of IZEA Worldwide, Inc. and its wholly-owned subsidiaries from their subsidiaries’ acquisition, merger, or formation dates, as applicable. All significant intercompany balances and transactions have been eliminated in consolidation.

The preparation of financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities, the disclosure of contingent assets and liabilities at the date of the financial statements, and the reported amounts of revenues and expenses during the reporting period. Actual results may differ from those estimates.

The Company considers all highly liquid investments purchased with an original maturity of three months or less from the date of purchase to be cash equivalents. Deposits made to Company bank accounts are insured by the Federal Deposit Insurance Corporation (“FDIC”) up to a maximum amount of $250,000. The Canada Deposit Insurance Corporation (“CDIC”) insures deposits made to the Company’s bank accounts in Canada up to CAD 100,000. Deposit balances exceeding the various limits were approximately $46.0 million and $50.3 million as of June 30, 2026 and December 31, 2025, respectively.

The Company’s investments in debt securities are carried at either amortized cost or fair value, with the cost basis determined by the specific identification method. Debt securities for which the Company has the positive intent and ability to hold to maturity are classified as held-to-maturity and carried at amortized cost. All other debt securities are classified as either trading or available-for-sale and carried at fair value.

Realized and unrealized gains and losses on trading debt securities, as well as realized gains and losses on available-for-sale debt securities, are included in net income (loss). Unrealized gains and losses on available-for-sale debt securities, net of tax, are included in our consolidated balance sheet as a component of accumulated other comprehensive income (loss).

The Company’s accounts receivable balance consists of trade receivables and contract assets, net of an allowance for credit losses. Trade receivables represent customer obligations arising from standard credit terms, while contract assets reflect revenue recognized but not yet invoiced. As of June 30, 2026, the Company reported net trade receivables of $4.2 million, comprised entirely of accounts receivable, with no contract assets. As of December 31, 2025, the Company had net trade receivables of $3.4 million comprised entirely of accounts receivable, with no contract assets.

Management determines the collectability of accounts receivable by regularly evaluating individual customer receivables and considering a customer’s financial condition, credit history, and current economic conditions. The Company continues to monitor these factors and will adjust credit and collection policies as necessary to address evolving market conditions and potential risks to financial performance. An account is deemed delinquent when the customer has not paid an amount due by its associated due date. If a portion of the account balance is deemed uncollectible, the Company will either write off the amount owed or provide a reserve based on its best estimate of the uncollectible portion of the account. The Company assesses collectability risk both generally and by specific aged invoices. The Company’s loss history informs a general reserve percentage, which is applied to all invoices less than 90 days from the invoice due date, currently 1% of the outstanding balance. The general reserve, which is updated periodically, recognizes that some invoices will likely become a collection risk. When an invoice is 90 days past its due date, the Company considers each invoice to determine a collectability reserve based on prior history and recent communications with the customer. Generally, the Company’s reserve for such aged invoices will approach 100% of the invoice amount.

The Company’s allowance for credit losses was approximately $0.1 million as of June 30, 2026, unchanged from December 31, 2025. Management continues to monitor the collectability of accounts receivable and believes the allowance is adequate as of the reporting date. The Company did not recognize any bad debt expense in the three and six months ended June 30, 2026 and 2025.

Concentrations of credit risk with respect to accounts receivable have typically been limited because a large number of geographically diverse customers make up the Company’s customer base, thus spreading the trade credit risk. The Company controls credit risk through credit approvals, credit limits, and monitoring procedures. The Company performs credit evaluations of its customers but generally does not require collateral to support accounts receivable. The Company had three customers that accounted for 11.0%, 18.6%, and 19.8%, respectively, of total accounts receivable as of June 30, 2026 and two customers that accounted for 12.4% and 12.5%, respectively, of total accounts receivable as of December 31, 2025. The Company had two customers that accounted for 16.2% and 18.5%, respectively, of its revenue during the three months ended June 30, 2026, and three customers that accounted for 11.3%, 12.0%, and 15.7%, respectively, of its revenue during the three months ended June 30, 2025. The Company had two customers that accounted for 14.7% and 15.3% of its revenue during the six months ended June 30, 2026, and two customers that accounted for 13.1% and 16.9% of its revenue during the six months ended June 30, 2025.

In accordance with Accounting Standards Codification (“ASC”) 350-40, Internal Use Software, the Company capitalizes certain internal-use software development costs associated with creating and enhancing internally developed software used to support its managed services and internal operations. Software development activities generally include a research and planning stage, an application and development stage, and a post-implementation stage. Costs incurred in the research and planning stage and in the post-implementation stage of software development are expensed as incurred, while costs incurred in the application and development stage, including significant enhancements and upgrades, are capitalized.

The Company reviews the software development costs for impairment when events or changes indicate the carrying amounts may not be recoverable. Impairment losses, if any, are recognized in the unaudited consolidated statements of operations. Additional information regarding software development costs is provided in “Note 4 — Software Development Costs of the Notes to the Unaudited Consolidated Financial Statements.”

Accounting Standards Update (“ASU”) No. 2016-02, Leases (Topic 842), established a right-of-use model that requires a lessee to record a right-of-use asset and a right-of-use liability on the balance sheet for all leases with terms longer than 12 months. Leases are classified as either finance or operating, with classification affecting the pattern of expense recognition in the income statement. The Company does not record leases on the balance sheet with a lease term of 12 months or less at the commencement date.

The Company generates revenue primarily from Managed Services when a marketer (typically a brand, agency, or partner) engages the Company to provide custom content, influencer marketing, amplification, or other campaign management services (“Managed Services”). The Company also generates limited revenue from access to certain platform features and related fees.

The Company recognizes revenue in accordance with Accounting Standards Codification Topic 606, Revenue from Contracts with Customers (“ASC 606”). Under ASC 606, revenue is recognized based on a five-step model as follows: (i) identify the contract with the customer; (ii) identify the performance obligations in the contract; (iii) determine the transaction price; (iv) allocate the transaction price to the performance obligations in the contract; and (v) recognize revenue when (or as) performance obligations are satisfied. Revenue is recognized when the control of the promised goods or services is transferred to customers in an amount that reflects the consideration to which the entity expects to be entitled. The Company applies this guidance only to contracts for which it is probable that the Company will collect the consideration to which it is entitled.

The Company evaluates whether it acts as an agent or a principal for each identified performance obligation. For transactions in which the Company acts as a principal, revenue is reported on a gross basis and reflects the amount billed to the customer, with amounts it pays to third-party creators as a cost of revenue.

The Company enters into contractual arrangements with marketers and content creators, typically through master agreements or terms of service, supplemented by statements of work that define the specific services and pricing. Transaction prices are generally fixed. Customers may prepay for services or be granted credit terms, with standard payment terms of 30 days from the invoice date. Amounts billed in advance of services performed are recorded as contract liabilities and recognized as revenue as the related performance obligations are satisfied. The delivery of custom content represents a distinct performance obligation that is satisfied at a point in time when each piece of content is delivered to the customer. The Company assesses collectability based on customer creditworthiness, payment history, and transaction history.

The Company’s costs to obtain customer contracts consist primarily of sales commissions and related payroll costs. The Company has elected the practical expedient under ASC 340-40 to expense incremental costs of obtaining a contract as incurred when the expected amortization period is one year or less. Accordingly, the Company does not capitalize costs to obtain customer contracts.

Managed Services are generally accounted for as a single performance obligation that is satisfied over time as customers simultaneously receive and consume the benefits of the services. Revenue is typically recognized using an input method based on costs relative to total expected costs. Services are generally performed over periods ranging from one day to one year.

Deferred income taxes are accounted for using the balance sheet approach under ASC 740, which requires recognizing deferred tax assets and liabilities for the expected future consequences of temporary differences between the financial reporting basis and the tax basis of assets and liabilities. A valuation allowance is established when, based on available evidence, it is more likely than not that some or all of a deferred tax asset will not be realized.

The Company evaluates uncertain tax positions in accordance with applicable accounting guidance and recognizes the impact of uncertain tax positions when it is more likely than not that the position will be sustained upon examination by the relevant taxing authority. Unrecognized tax benefits, if any, are recorded as a liability on the consolidated balance sheet. The Company has not recognized a liability for uncertain tax positions. Interest expense and penalties related to unrecognized tax benefits, if any, are recognized in interest expense and operating expenses, respectively.

The Company’s tax years subject to examination based on the statute of limitations by the IRS are generally three years; however, tax years in which net operating losses were generated may remain subject to examination to the extent that such losses are utilized in future periods. The Company’s tax years subject to examination by the Canadian Revenue Agency is generally four years.

The Company’s financial instruments are recorded at fair value. Fair value is defined as the exchange price that would be received for an asset or paid to transfer a liability (an exit price) in the principal or most advantageous market for the asset or liability in an orderly transaction between market participants on the measurement date.

The valuation techniques are classified and disclosed according to a fair value hierarchy that prioritizes the inputs used in valuation techniques. Observable inputs reflect readily obtainable data from independent sources, while unobservable inputs reflect certain market assumptions. There are three levels of inputs that may be used to measure fair value:

The fair value estimates discussed herein are based upon certain market assumptions and pertinent information available to management. As of June 30, 2026, the Company holds only cash and cash equivalents and no marketable securities. Additional information is provided in “Note 2 – Financial Instruments of the Notes to the Unaudited Consolidated Financial Statements.”

Stock-based compensation for options granted under the 2011 Equity Incentive Plan and the 2023 Inducement Plan is measured at the grant date fair value and recognized on a straight-line basis over the requisite service period. Fair value is estimated using the Black-Scholes model.

The valuation of stock options requires the use of subjective assumptions, including the expected term of the option, expected stock price volatility, the risk-free interest rate, and the expected dividend yield. The Company applies the simplified method to estimate the expected term, assuming even exercise between vesting and expiration, and uses the grant-date closing stock price as the fair value of common stock. The Company uses the risk-free interest rate implied by the current yield on U.S. Treasury issues with an equivalent remaining term approximately equal to the expected life of the award. The expected dividend yield is zero, as the Company has never paid cash dividends and does not anticipate paying any in the foreseeable future.

The Company estimates forfeitures and revises such estimates over the requisite service period to reflect actual and expected forfeiture activity. Changes in estimated forfeitures are recognized through a cumulative catch-up adjustment, which is recognized in the period of change, and a revised amount of unamortized compensation expense to be recognized in future periods.

The Company may issue restricted stock or restricted stock units (“RSUs”) that vest over time or upon achievement of specified performance conditions. These awards are recorded at fair value on the grant date and expensed on a straight-line basis over the vesting period. Additional information regarding the Company’s equity compensation plans is provided in “Note 8 - Stockholders’ Equity of the Notes to the Unaudited Consolidated Financial Statements.”

Segment Reporting: Improvements to Reportable Segment Disclosures: In November 2023, the FASB issued ASU No. 2023-07, Segment Reporting (Topic 280): Improving Reportable Segment Disclosures. This update is intended to improve reportable segment disclosure requirements, primarily through enhanced disclosures about significant expenses. The ASU also requires all annual disclosures currently required by Topic 280 to be included in the interim periods. The update is effective for fiscal years beginning after December 15, 2023, and interim periods within the fiscal years beginning after December 15, 2024, with early adoption permitted and requiring retrospective application to all prior periods presented in the financial statements. The adoption did not have a material impact on the unaudited consolidated financial statements.

Income Taxes: Improvements to Income Tax Disclosures: In December 2023, the FASB issued ASU No. 2023-09, Income Taxes (Topic 740): Improvements to Income Tax Disclosures, which requires enhanced disclosures of income tax components affecting the rate reconciliation and income taxes paid, disaggregated by applicable taxing jurisdictions. The Company adopted this ASU effective January 1, 2025. The adoption of this ASU did not have an impact on the Company’s consolidated financial statements; however, the ASU resulted in expanded income tax disclosure requirements.

Disaggregation of Income Statement Expenses: In November 2024, the FASB issued ASU No. 2024-03 (Subtopic 220-40), “Disaggregation of Income Statement Expenses,” which requires entities to provide enhanced disclosures related to certain expense categories included in the income statement. The amendments in this ASU are effective for fiscal years beginning after December 15, 2026, and interim reporting periods within fiscal years beginning after December 15, 2027. The amendments may be applied on either a prospective or retrospective basis, and early adoption is permitted. The Company is currently evaluating the impact this ASU may have on its unaudited condensed consolidated financial statements.

Intangibles - Goodwill and Other - Internal-Use Software: In September 2025, the FASB issued ASU No. 2025-06, "Targeted Improvements to the Accounting for Internal-Use Software" ("ASU 2025-06"), which eliminates the previous stage-based model for software development and introduces a principles-based framework for determining when capitalization of internal-use software costs is appropriate. The ASU also incorporates guidance on assessing significant development uncertainty and relocates the website development guidance from Subtopic 350-50 to Subtopic 350-40. The amendments in this ASU are effective for annual reporting periods beginning after December 15, 2027, including interim reporting periods within those annual reporting periods. Early adoption is permitted as of the beginning of an annual reporting period. The amendments may be applied using a prospective transition approach, a modified transition approach based on the status of the project and whether software costs were capitalized before the date of adoption, or a retrospective transition approach. The Company is currently evaluating the impact this ASU may have on its unaudited condensed consolidated financial statements.

Interim Reporting (Topic 270): Narrow-Scope Improvements: In December 2025, the Financial Accounting Standards Board ("FASB") issued ASU No. 2025-11, "Interim Reporting (Topic 270): Narrow-Scope Improvements," which clarifies the scope and applicability of interim reporting guidance and certain interim disclosure requirements. The amendments in this ASU are effective for annual reporting periods beginning after December 15, 2027, including interim reporting periods within those annual reporting periods. Early adoption is permitted. The amendments may be applied using either a prospective or retrospective transition approach. The Company is currently evaluating the impact this ASU may have on its unaudited condensed consolidated financial statements.