Document and Entity Information
Document and Entity Information - shares | 3 Months Ended | |
Mar. 31, 2017 | May 03, 2017 | |
Document Information [Line Items] | ||
Document Type | 10-Q | |
Amendment Flag | false | |
Document Period End Date | Mar. 31, 2017 | |
Document Fiscal Year Focus | 2,017 | |
Document Fiscal Period Focus | Q1 | |
Trading Symbol | GAIA | |
Entity Registrant Name | GAIA, INC | |
Entity Central Index Key | 1,089,872 | |
Current Fiscal Year End Date | --12-31 | |
Entity Filer Category | Accelerated Filer | |
Class A Common Stock [Member] | ||
Document Information [Line Items] | ||
Entity Common Stock, Shares Outstanding | 9,753,235 | |
Class B Common Stock [Member] | ||
Document Information [Line Items] | ||
Entity Common Stock, Shares Outstanding | 5,400,000 |
Condensed Consolidated Balance
Condensed Consolidated Balance Sheets - USD ($) $ in Thousands | Mar. 31, 2017 | Dec. 31, 2016 |
Current assets: | ||
Cash | $ 45,380 | $ 54,027 |
Accounts receivable | 765 | 554 |
Prepaid expenses and other current assets | 1,157 | 1,303 |
Total current assets | 47,302 | 55,884 |
Building and land, net | 16,736 | 16,896 |
Media library, software and equipment, net | 14,436 | 12,861 |
Goodwill | 10,609 | 10,609 |
Investments and other assets | 10,969 | 10,946 |
Total assets | 100,052 | 107,196 |
Current liabilities: | ||
Accounts payable and accrued liabilities | 5,215 | 6,672 |
Deferred revenue | 3,059 | 2,434 |
Total current liabilities | 8,274 | 9,106 |
Deferred taxes | 553 | |
Contingencies | ||
Equity | 91,778 | 97,537 |
Total liabilities and equity | $ 100,052 | $ 107,196 |
Condensed Consolidated Statemen
Condensed Consolidated Statements of Operations - USD ($) shares in Thousands, $ in Thousands | 3 Months Ended | |
Mar. 31, 2017 | Mar. 31, 2016 | |
Net revenues | ||
Streaming | $ 5,209 | $ 3,229 |
DVD subscription and other | 575 | 601 |
Total net revenues | 5,784 | 3,830 |
Cost of revenues | ||
Streaming | 743 | 649 |
DVD subscription and other | 77 | 64 |
Total cost of revenues | 820 | 713 |
Gross profit | 4,964 | 3,117 |
Expenses: | ||
Selling and operating | 10,465 | 5,726 |
Corporate, general and administration | 1,352 | 1,478 |
Total operating expenses | 11,817 | 7,204 |
Loss from operations | (6,853) | (4,087) |
Interest and other (expense) income, net | 44 | (36) |
Loss before income taxes | (6,809) | (4,123) |
Income tax expense (benefit) | (629) | 3 |
Loss from continuing operations | (6,180) | (4,126) |
Loss from discontinued operations, net of tax | (3,498) | |
Net loss | $ (6,180) | $ (7,624) |
Loss per share—basic and diluted: | ||
Continuing operations | $ (0.41) | $ (0.17) |
Discontinued operations | (0.14) | |
Basic and diluted net loss per share | $ (0.41) | $ (0.31) |
Weighted-average shares outstanding: | ||
Basic and diluted | 15,153 | 24,531 |
Condensed Consolidated Stateme4
Condensed Consolidated Statements of Cash Flows - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2017 | Mar. 31, 2016 | |
Operating activities: | ||
Net loss | $ (6,180) | $ (7,624) |
Income from discontinued operations | 3,498 | |
Net loss from continuing operations | (6,180) | (4,126) |
Adjustments to reconcile net loss from continuing operations to net cash used in operating activities: | ||
Depreciation and amortization | 1,041 | 923 |
Loss on remeasurement of foreign currency | (945) | |
Share-based compensation expense | 413 | 140 |
Changes in operating assets and liabilities: | ||
Accounts receivable, net | (211) | 66 |
Prepaid expenses and other assets | 125 | 242 |
Accounts payable and accrued liabilities | (2,004) | (1,721) |
Deferred revenue | 625 | 377 |
Net cash used in operating activities – continuing operations | (6,191) | (5,044) |
Net cash provided by operating activities – discontinued operations | 8,048 | |
Net cash provided by (used in) operating activities | (6,191) | 3,004 |
Investing activities: | ||
Additions to media library, property and equipment | (2,456) | (1,845) |
Net cash used in investing activities—continuing operations | (2,456) | (1,845) |
Net cash used in investing activities—discontinued operations | (196) | |
Net cash used in investing activities | (2,456) | (2,041) |
Financing activities: | ||
Drawdowns on line of credit | 2,000 | |
Repayments on line of credit | (2,000) | |
Dividends paid to noncontrolling interest | (1,944) | |
Net cash used in financing activities | (1,944) | |
Effect of exchange rates on cash | 48 | |
Net decrease in cash | (8,647) | (933) |
Cash at beginning of period | 54,027 | 1,266 |
Cash at end of period | $ 45,380 | $ 333 |
Organization, Nature of Operati
Organization, Nature of Operations, and Principles of Consolidation | 3 Months Ended |
Mar. 31, 2017 | |
Accounting Policies [Abstract] | |
Organization, Nature of Operations, and Principles of Consolidation | 1. Organization, Nature of Operations, and Principles of Consolidation Gaia, Inc., was incorporated under the laws of the State of Colorado in 1988 and operates a global digital video subscription service and on-line community that caters to a unique and underserved subscriber base. Our digital content library of over 7,900 titles is available to our subscribers on most Internet-connected devices anytime, anywhere commercial free. Our subscribers have unlimited access to a vast library of inspiring films, cutting edge documentaries, interviews, yoga classes, transformation related content, and more – 90% of which is exclusively available to our subscribers for digital streaming. Our mission is to create a transformational network that empowers a global conscious community. Content on our network is delivered directly to our subscribers through our streaming platform and currently curated into three channels: Yoga, Transformation and Seeking Truth. We curate programming for these channels by producing content in our in-house production studios with a staff of media professionals. This produced and owned content currently represents about 80% of total views. We complement our produced and owned content through long term, predominately exclusive, licensing agreements. We have prepared the accompanying unaudited interim condensed consolidated financial statements in accordance with accounting principles generally accepted in the United States (“GAAP”) and they include our accounts and those of our subsidiaries. Intercompany transactions and balances have been eliminated. The unaudited condensed consolidated financial position, results of operations and cash flows for the interim periods disclosed in this report are not necessarily indicative of future financial results. There have been no material changes in the Company’s significant accounting policies as disclosed in the Company’s Annual report on Form 10-K for the year ended December 31, 2016. Use of Estimates and Reclassifications The preparation of financial statements in accordance with GAAP requires us to make estimates and assumptions that affect the amounts reported in the accompanying financial statements and disclosures. Although we base these estimates on our best knowledge of current events and actions that we may undertake in the future, actual results may be different from the estimates. We have made certain reclassifications to prior period amounts to conform to the current period presentations. Accounting Pronouncements Adopted in 2017 In March 2016, the Financial Accounting Standards Board (“FASB”) issued ASU No. 2016-09, Improvements to Employee Share-Based Payment Accounting, which amends Topic 718, Compensation – Stock Compensation. ASU No. 2016-09 simplifies several aspects of the accounting for share-based payment transactions, including the income tax consequences, classification of awards as either equity or liabilities, and classification on the statement of cash flows. ASU No. 2016-09 is effective for fiscal years beginning after December 15, 2016, and interim periods within those fiscal years. We adopted this guidance effective January 1, 2017. The adoption impact on the consolidated condensed balance sheet was a cumulative-effect adjustment of $0.2 million, increasing opening retained earnings and decreasing paid-in capital. Recent Accounting Pronouncements In January 2017, the FASB issued ASU 2017-04, Intangibles – Goodwill and Other (Topic 350): Simplifying the Accounting for Goodwill Impairment, to simplify financial reporting by eliminating the need to determine the fair value of individual assets and liabilities of a reporting unit to measure goodwill impairment. Under ASU 2017-04, an entity should perform its goodwill impairment test by comparing the fair value of the reporting unit with its carrying amount and recognize an impairment charge for the amount by which the carrying amount exceeds the reporting unit’s fair value, up to the amount of goodwill allocated to that reporting unit. The new guidance effectively eliminates “Step 2” from the previous goodwill impairment test. ASU 2017-04 is effective for fiscal years, and interim periods within those years, beginning after December 15, 2019. Early adoption is permitted for goodwill impairment tests performed on testing dates after January 1, 2017. We have not determined which period we will adopt the new guidance but do not expect the adoption of ASU 2017-04 to have a significant impact on the results of our goodwill impairment testing. In February 2016, the FASB issued ASU No. 2016-02, Leases (Topic 842). The new standard establishes a right-of-use (ROU) model that requires a lessee to record a ROU asset and a lease liability on the balance sheet for all leases with terms longer than 12 months. Leases will be classified as either finance or operating, with classification affecting the pattern of expense recognition in the income statement. The new standard is effective for fiscal years beginning after December 15, 2018, including interim periods within those fiscal years. Based on our preliminary assessment, we do not expect the new standard to have a material impact on our reported financial position or results of operations. In May 2014, the FASB issued ASU No. 2014-09, Revenue from Contracts with Customers (Topic 606). The standard superseded most previous revenue recognition rules, and will become effective for us in the first quarter of 2018. The core principle of the standard is that an entity should recognize revenue to depict the transfer of promised goods or services to customers in an amount that reflects the consideration the entity expects to receive in exchange for those goods or services. Our revenue transactions typically consist of a single distinct, fixed-price performance obligation that is delivered to the customer at a single point in time, or over a subscription period. We are monitoring the evolving interpretations and implementation guidance. Based on our preliminary assessment, we do not expect the new standard to have a material impact on our reported financial position or results of operations. |
Discontinued Operations
Discontinued Operations | 3 Months Ended |
Mar. 31, 2017 | |
Discontinued Operations And Disposal Groups [Abstract] | |
Discontinued Operations | 2. Discontinued Operations On May 4, 2016 we sold our 51.4% equity interest in Natural Habitat, Inc., our eco-travel subsidiary, in exchange for $12.9 million in cash, and recognized a gain of $10.3 million as disclosed in our Current Report on Form 8-K filed May 10, 2016. On July 1, 2016, we sold the assets and liabilities of our Gaiam Brand business in exchange for a gross purchase price of $167 million, subject to closing expenses and post-closing adjustments, as disclosed in our Current Reports on Form 8-K filed May 10, 2016 and July 8, 2016. Our Gaiam Brand business previously constituted the majority of our consolidated revenues and expenses, and consisted of Gaiam branded yoga, fitness and wellness consumer products. The Gaiam Brand business and our interest in our eco-travel subsidiary constituted all the assets and liabilities of our Gaiam Brand segment. The assets and liabilities, operating results, and cash flows of our Gaiam Brand segment are presented as discontinued operations, separate from our continuing operations, for all periods presented in these interim condensed consolidated financial statements and footnotes, unless otherwise indicated. The loss from discontinued operations for the quarter ended March 31, 2016, as reported on our condensed consolidated statements of operations were comprised of the following amounts: For the Three Months Ended March 31, (in thousands) 2016 Net revenue $ 31,497 Cost of goods sold 18,224 Gross profit 13,273 Operating expenses 17,389 Loss from operations (4,116 ) Other income 545 Loss before income taxes (3,571 ) Income tax benefit (12 ) Loss from discontinued operations attributable to the non-controlling interest, net of tax 61 Loss from discontinued operations, net of tax $ (3,498 ) |
Equity and Share-Based Compensa
Equity and Share-Based Compensation | 3 Months Ended |
Mar. 31, 2017 | |
Disclosure Of Compensation Related Costs Sharebased Payments [Abstract] | |
Equity and Share-Based Compensation | 3. Equity and Share-Based Compensation During the first three months of 2017, we issued 704 shares of our Class A common stock under our 2009 Long-Term Incentive Plan to our independent directors, in lieu of cash compensation, for services rendered in 2017. We valued the shares issued to our independent directors at estimated fair value based on the closing price of our shares on the date the shares were issued, which by policy is the last trading day of each quarter in which the services were rendered. During the three months of 2017 and 2016, we recognized $413,000 and $140,000, respectively, of associated stock compensation expense. Total share-based compensation expense is reported in selling and operating expenses and corporate, general and administration expenses on our condensed consolidated statements of operations. There were no option exercises during the first quarter of 2017. |
Net Loss per Share
Net Loss per Share | 3 Months Ended |
Mar. 31, 2017 | |
Earnings Per Share [Abstract] | |
Net Loss per Share | 4. Net Loss per Share Basic net loss per share is computed by dividing the net loss by the weighted-average number of shares of common stock outstanding during the period. Diluted net loss per share is computed by giving effect to all potential shares of common stock, including stock options and restricted stock units, to the extent dilutive. Basic and diluted net loss per share were the same for the three months ended March 31, 2017 and 2016 respectively, as the inclusion of all potential common shares outstanding would have been anti-dilutive. |
Income Taxes
Income Taxes | 3 Months Ended |
Mar. 31, 2017 | |
Income Tax Disclosure [Abstract] | |
Income Taxes | 5. Income Taxes Periodically, we perform assessments of the realization of our net deferred tax assets considering all available evidence, both positive and negative. With the sale of the Gaiam Brand business in 2016, we utilized the majority of our deferred tax assets to offset the associated gains from the sale and released the valuation allowance we had in place. During 2017, we determined the historical operating losses generated by the business, combined with our plans to continue to invest in our revenue growth and generate losses for the next few years, indicated a full valuation allowance on our deferred tax assets was appropriate in 2017. As of March 31, 2017, our gross net operating loss carryforwards were $10.1 million and $0.5 million for federal and state, respectively. |
Contingencies
Contingencies | 3 Months Ended |
Mar. 31, 2017 | |
Commitments And Contingencies Disclosure [Abstract] | |
Contingencies | 6. Contingencies From time to time, we are involved in legal proceedings that we consider to be in the normal course of business. Claimed amounts against us may be substantial but may not bear any reasonable relationship to the merits of the claim or the extent of any real risk of court or arbitral awards. We record accruals for losses related to those matters against us that we consider to be probable and that can be reasonably estimated. Although it is not feasible to predict the outcome of these matters with certainty, it is reasonably possible that some legal proceedings may be disposed of or decided unfavorably to us and in excess of the amounts currently accrued. Based on available information, in the opinion of management, settlements, arbitration awards and final judgments, if any, that are considered probable of being rendered against us in litigation or arbitration in existence at March 31, 2017 and that can be reasonably estimated are either reserved against or would not have a material adverse effect on our financial condition, results of operations or cash flows. |
Organization, Nature of Opera11
Organization, Nature of Operations, and Principles of Consolidation (Policies) | 3 Months Ended |
Mar. 31, 2017 | |
Accounting Policies [Abstract] | |
Use of Estimates and Reclassifications | Use of Estimates and Reclassifications The preparation of financial statements in accordance with GAAP requires us to make estimates and assumptions that affect the amounts reported in the accompanying financial statements and disclosures. Although we base these estimates on our best knowledge of current events and actions that we may undertake in the future, actual results may be different from the estimates. We have made certain reclassifications to prior period amounts to conform to the current period presentations. |
Accounting Pronouncements Adopted in 2017 | Accounting Pronouncements Adopted in 2017 In March 2016, the Financial Accounting Standards Board (“FASB”) issued ASU No. 2016-09, Improvements to Employee Share-Based Payment Accounting, which amends Topic 718, Compensation – Stock Compensation. ASU No. 2016-09 simplifies several aspects of the accounting for share-based payment transactions, including the income tax consequences, classification of awards as either equity or liabilities, and classification on the statement of cash flows. ASU No. 2016-09 is effective for fiscal years beginning after December 15, 2016, and interim periods within those fiscal years. We adopted this guidance effective January 1, 2017. The adoption impact on the consolidated condensed balance sheet was a cumulative-effect adjustment of $0.2 million, increasing opening retained earnings and decreasing paid-in capital. |
Recently Issued Accounting Pronouncements | Recent Accounting Pronouncements In January 2017, the FASB issued ASU 2017-04, Intangibles – Goodwill and Other (Topic 350): Simplifying the Accounting for Goodwill Impairment, to simplify financial reporting by eliminating the need to determine the fair value of individual assets and liabilities of a reporting unit to measure goodwill impairment. Under ASU 2017-04, an entity should perform its goodwill impairment test by comparing the fair value of the reporting unit with its carrying amount and recognize an impairment charge for the amount by which the carrying amount exceeds the reporting unit’s fair value, up to the amount of goodwill allocated to that reporting unit. The new guidance effectively eliminates “Step 2” from the previous goodwill impairment test. ASU 2017-04 is effective for fiscal years, and interim periods within those years, beginning after December 15, 2019. Early adoption is permitted for goodwill impairment tests performed on testing dates after January 1, 2017. We have not determined which period we will adopt the new guidance but do not expect the adoption of ASU 2017-04 to have a significant impact on the results of our goodwill impairment testing. In February 2016, the FASB issued ASU No. 2016-02, Leases (Topic 842). The new standard establishes a right-of-use (ROU) model that requires a lessee to record a ROU asset and a lease liability on the balance sheet for all leases with terms longer than 12 months. Leases will be classified as either finance or operating, with classification affecting the pattern of expense recognition in the income statement. The new standard is effective for fiscal years beginning after December 15, 2018, including interim periods within those fiscal years. Based on our preliminary assessment, we do not expect the new standard to have a material impact on our reported financial position or results of operations. In May 2014, the FASB issued ASU No. 2014-09, Revenue from Contracts with Customers (Topic 606). The standard superseded most previous revenue recognition rules, and will become effective for us in the first quarter of 2018. The core principle of the standard is that an entity should recognize revenue to depict the transfer of promised goods or services to customers in an amount that reflects the consideration the entity expects to receive in exchange for those goods or services. Our revenue transactions typically consist of a single distinct, fixed-price performance obligation that is delivered to the customer at a single point in time, or over a subscription period. We are monitoring the evolving interpretations and implementation guidance. Based on our preliminary assessment, we do not expect the new standard to have a material impact on our reported financial position or results of operations. |
Discontinued Operations (Tables
Discontinued Operations (Tables) | 3 Months Ended |
Mar. 31, 2017 | |
Discontinued Operations And Disposal Groups [Abstract] | |
Loss from Discontinued Operations as Reported on Condensed Consolidated Statements of Operations | The loss from discontinued operations for the quarter ended March 31, 2016, as reported on our condensed consolidated statements of operations were comprised of the following amounts: For the Three Months Ended March 31, (in thousands) 2016 Net revenue $ 31,497 Cost of goods sold 18,224 Gross profit 13,273 Operating expenses 17,389 Loss from operations (4,116 ) Other income 545 Loss before income taxes (3,571 ) Income tax benefit (12 ) Loss from discontinued operations attributable to the non-controlling interest, net of tax 61 Loss from discontinued operations, net of tax $ (3,498 ) |
Organization, Nature of Opera13
Organization, Nature of Operations, and Principles of Consolidation - Additional Information (Detail) $ in Millions | 3 Months Ended |
Mar. 31, 2017USD ($)TitleChannel | |
Restructuring Cost And Reserve [Line Items] | |
Percentage of digital streaming exclusively available for subscribers | 90.00% |
Number of channels | Channel | 3 |
Percentage of produced and owned content of total views | 80.00% |
Accounting Standards Update 2016-09 [Member] | |
Restructuring Cost And Reserve [Line Items] | |
Cumulative-effect adjustment | $ | $ 0.2 |
Minimum [Member] | |
Restructuring Cost And Reserve [Line Items] | |
Number of titles available in digital content library | Title | 7,900 |
Discontinued Operations - Addit
Discontinued Operations - Additional Information (Detail) - USD ($) $ in Millions | May 04, 2016 | Mar. 31, 2017 | Jul. 01, 2016 |
Natural Habitat, Inc. [Member] | |||
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | |||
Percentage of noncontrolling interest in subsidiaries | 51.40% | ||
Gain (loss) on disposal of discontinued operations | $ 10.3 | ||
Gaiam Brand Segment [Member] | |||
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | |||
Disposal date | Jul. 1, 2016 | ||
Gross purchase price of assets and liabilities of discontinued operations | $ 167 | ||
Gaiam Brand Segment [Member] | Natural Habitat, Inc. [Member] | |||
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | |||
Proceeds from sale of subsidiary | $ 12.9 |
Discontinued Operations - Loss
Discontinued Operations - Loss from Discontinued Operations as Reported on Condensed Consolidated Statements of Operations (Detail) $ in Thousands | 3 Months Ended |
Mar. 31, 2016USD ($) | |
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | |
Loss from discontinued operations, net of tax | $ (3,498) |
Gaiam Brand Segment [Member] | |
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | |
Net revenue | 31,497 |
Cost of goods sold | 18,224 |
Gross profit | 13,273 |
Operating expenses | 17,389 |
Loss from operations | (4,116) |
Other income | 545 |
Loss before income taxes | (3,571) |
Income tax benefit | (12) |
Loss from discontinued operations attributable to the non-controlling interest, net of tax | 61 |
Loss from discontinued operations, net of tax | $ (3,498) |
Equity and Share-Based Compen16
Equity and Share-Based Compensation - Additional Information (Detail) - USD ($) | 3 Months Ended | |
Mar. 31, 2017 | Mar. 31, 2016 | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Stock compensation expense | $ 413,000 | $ 140,000 |
Option exercises during period | 0 | |
2009 Long-Term Incentive Plan [Member] | Class A Common Stock [Member] | Independent Directors Compensation Plan [Member] | ||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Issuance of shares for compensation | 704 |
Income Taxes - Additional Infor
Income Taxes - Additional Information (Detail) $ in Millions | Mar. 31, 2017USD ($) |
Federal [Member] | |
Income Taxes [Line Items] | |
Net operating loss carryforwards | $ 10.1 |
State [Member] | |
Income Taxes [Line Items] | |
Net operating loss carryforwards | $ 0.5 |