–       Q1 2015 revenue increases 51.7% year-over-year and 8.3% sequentially fueled by SaaS, recurring-revenue model

–       Q1 2015 average revenue per customer increases 14% year-over-year as growing customer base now includes nearly 100 advertisers using the Company’s CAKE technology platform 

NEWPORT BEACH, Calif. – May 12, 2015 – Accelerize Inc. (OTCQB: ACLZ) (OTCBB: ACLZ), a leader in marketing technology solutions, today announced financial results for its fiscal first quarter ended March 31, 2015.

Company Highlights for Q1 2015

• New Customer Acquisition and Recurring Revenue Success: First quarter revenues of $5.2MM were driven by CAKE, its digital marketing software division, recently recognized as a “Vendor to Watch” in the Gartner Digital Marketing Hubs report. During the quarter the Company significantly extended the CAKE SaaS platform into larger market opportunities through CAKE for Advertisers, its new multi-channel digital marketing hub that enables advertisers to accurately track, attribute and optimize advertising spend. By the end of Q1 2015, the Company increased its customer roster to include nearly 100 advertisers, with an average revenue per customer increase of 14% year-over-year.
  • International Sales Growth and Diversification across Industry Groups: The Company achieved significant global diversification with 26% of overall revenue being derived outside the U.S. in Q1 2015, up from 19% in Q1 2014. During the first quarter, the Company added new clients from across the globe, including Europe, Israel, Australia, Brazil and India. New client wins also spanned major industry groups, including finance (Acorns), dating (Mate1 Dating), web development marketing (The Control Group), mobile (Komli Media, Purify Digital) and digital advertising (Indexa Network).
  • Sales and Marketing Expansion: In order to capitalize on increasing international demand, the Company established a local sales presence in two new geographic areas in the quarter – Australia and India. Additionally, the Company upgraded its enterprise sales force and marketing team in the U.S. and U.K. through the strategic hiring of seasoned professionals with experience at Adobe, AOL, Amazon, DoubleClick, OpenX, Responsys and Xactly.
  • Extending Ecosystem with Key Partnerships and Integrations: The Company established partnerships with leading companies in the advertising technology landscape, offering integrations with organizations such as Marketo, Google Adwords, Bing Ads and DoubleClick. It also strengthened existing partnerships with Neo@Ogilvy, the Horizon Group and Tipalti.

“We continue to build momentum on a number of business fronts which is only beginning to be evidenced in our financial performance. The first quarter marked Accelerize’s 20^th consecutive quarter of revenue growth, and we are committed to achieving further advancements throughout 2015 and beyond as the demand for our SaaS services has never been greater,” said Brian Ross, CEO and Chairman of Accelerize Inc. “Through our significant investments in R&D we have and will continue to introduce innovative and complimentary software products to extend our leadership position across the dynamic ad tech ecosystem. When coupled with our international expansion and the quality of our new sales team members, we have set the stage to drive growth at Accelerize to the next level in the years to come. In this quarter alone, our CAKE platform tracked more than 15+ billion consumer actions and we look forward to increasing these metrics as we lead the way in this rapidly growing market.”

Financial Highlights for Q1 2015

• Revenues: Total revenues for Q1 2015 reached a record $5.2MM, a 52% increase from $3.4MM recorded in Q1 2014, and an 8% sequential increase from Q4 2014. Revenue growth was largely driven by a 19% increase in the average number of customers and a 14% increase in average revenue per customer year-over-year. Geographically, 26% of revenues in Q1 2015 were derived from outside the U.S. as compared to 19% in Q1 2014 reflecting the success of the Company’s international expansion efforts. The Company expects future revenues from CAKE to be driven by ongoing organic growth, further international expansion and the addition of larger customers using the Company’s enterprise SaaS product, CAKE for Advertisers.
• Operating (Loss) Income:Operating loss for Q1 2015 was $(1.6MM), compared to operating loss of ($364K) recorded in Q1 2014. The loss in Q1 2015 was largely attributed to a $511K increase in sales and marketing expenses to drive customer growth, a $1.6MM increase in general and administrative expenses to bolster its management and support staff, and a $299K increase in ongoing research and development expenses to foster product innovation, partially offset by a $1.8MM increase in revenue.
• Adjusted EBITDA: Adjusted EBITDA for Q1 2015 was ($0.517k). Adjusted EBITDA is a non-GAAP financial measure that excludes stock option and warrant expense and is defined below.
• Cash Flow: Net cash provided in Q1 was $358K, compared to net cash used of $26K during the prior year period. The Company’s total operating expenses in Q1 2015 increased 82% year-over-year to $5.5MM inclusive of $637K of stock option and warrant expense and $403K of depreciation and amortization expense. During Q1 2015 the Company’s investment in ongoing research and development to drive product innovation was $875k, a 52% year-over-year increase. As a result, free cash flow, which amounts to cash flow from operations less capital expenditures, totaled $(644K).
• Balance Sheet: Total cash as of March 31, 2015 was $1.5MM compared to $1.1MM on December 31, 2014. Total current assets as of March 31, 2015 rose to $3.7MM, an increase of 19% compared to $3.1MM on December 31, 2014. Total working capital increased to $1.9MM compared to $1.7MM on December 31, 2014.

Michael Lin, Accelerize’s CFO, added “Our strong recurring revenue model along with low revenue churn provided continued sales momentum in the first quarter of 2015. As we move through the rapid expansion phase of our business, driving sales growth while managing expenses will be critical to our success. We have grown our staff significantly on a year-over-year basis to build for the future and we are now well positioned to drive sustainable growth. As we move through 2015 we intend to make further investments in sales and technology in order to capitalize on the rapidly growing ad-tech marketplace. We remain committed to improving the Company’s visibility and liquidity through a potential up-listing to a major stock exchange, and we continue to evaluate strategies to accomplish this goal in the best possible way for our Company and its stockholders.”