Snap Interactive Reports Results for the Quarter Ended March 31, 2016

NEW YORK, NY--(Marketwired - May 9, 2016) - Snap Interactive, Inc. ("SNAP," the "Company," "we," "our" or "us") (OTCQB: STVI), a leading online dating provider, today announced financial and operational results for the quarter ended March 31, 2016.

Highlights:

• Total revenue for the first quarter of 2016 of $2.7 million was approximately flat as compared to revenue of $2.7 million for the quarter ended December 31, 2015. Bookings of $2.5 million were slightly higher in the first quarter of 2016 than the $2.4 million achieved in the fourth quarter of 2015;
• Total revenues decreased 16.0% for the first quarter of 2016 relative to the comparable period in 2015, primarily driven by a decrease in the number of active subscribers, which we believe is the result of a decrease in advertising expense for FirstMet of 33.3%;
• Advertising revenue increased by $113 thousand, or 199.6%, for the first quarter of 2016 when compared with the same period in 2015;
• Total expenses were reduced by $1.2 million in the first quarter of 2016 as compared to the same period in 2015, a 28% decrease;
• Net cash used in operating activities was approximately $281 thousand for the three months ended March 31, 2016, representing an improvement of $772 thousand as compared to the same period in 2015; and 
• Adjusted EBITDA for the three months ended March 31, 2016 was a loss of approximately $138 thousand, an improvement of approximately $474 thousand as compared to the same period in 2015.

Financial Highlights

		Three Months Ended
		March 31,								%
Statement of Operations and Cash Flow Results (unaudited)		2016				2015				Change
	Subscription revenue	$	2,507,148			$	3,129,310			(19.9	)%
	Advertising revenue	$	170,119			$	56,773			199.6	%
Total revenue		$	2,677,267			$	3,186,083			(16.0	)%
Sales and marketing expense		$	1,292,164			$	1,781,506			(27.5	)%
Total expenses		$	3,006,022			$	4,168,858			(27.9	)%
Net loss		$	(1,501,004	)		$	(1,219,179	)		23.1	%
Net cash used in operating activities		$	(281,188	)		$	(1,052,770	)		(73.3	)%
Non-GAAP Results (unaudited)
Bookings		$	2,500,751			$	3,157,566			(28.8	)%
Adjusted EBITDA		$	(138,466	)		$	(612,465	)		(77.4	)%

	March 31,			December 31,
	2016			2015
Balance Sheet Results (unaudited)	(unaudited)
Cash and cash equivalents	$	1,824,642		$	2,131,262
Deferred subscription revenue	$	1,499,465		$	1,505,862
Non-GAAP Results (unaudited)
Active subscribers (at period end)		81,600			84,000

Management Commentary 

Growth and New Initiatives

In the first quarter of 2016 we achieved important milestones in growth and new initiatives, including:

• Growth in Bookings - First sequential increase in bookings since 2014, reflecting business stabilization and potential for future growth;
• Rebrand of Core Product - Rebranded AYI to FirstMet in March;
• Board of Directors - Appointed an independent director to our Board of Directors in March;
• Reengaged Users - Reactivated 621 thousand users from the AYI database via targeted email campaigns; and
• Mobile App Relaunch - Relaunched iPhone and Android apps with new, more efficient technology.

SNAP's Chief Executive Officer, Alex Harrington, said, "Q1 was an important quarter for SNAP, during which we reinitiated topline growth, with the first sequential bookings growth since 2014. By stabilizing total revenue and driving bookings growth once again, we believe the Company is turning the corner and is well positioned for future growth. In addition, we achieved several milestones, including a rebrand of our core product to FirstMet, which we believe to be a superior brand that has long term prospects of lower customer acquisition costs and greater retention. Accompanying the rebranding, we initiated email winback programs to reactivate users in our large database, resulting in 621 thousand inactive users engaging with the service again in the first quarter. Looking forward, we expect to continue to derive value from the user database through the release of a new product in the third quarter of 2016. As the next logical step in our portfolio strategy, we are optimistic that the new product will be a meaningful contributor to revenue."

Mr. Harrington added, "Another important initiative was the relaunch of our iPhone and Android apps. The newly launched apps now have a consistent feature set and presentation, but most importantly, they can now be developed in the same programming language as the web properties, lowering the overhead required for maintaining and improving the apps. Usage on mobile platforms already represented approximately 56% of user activity on FirstMet in the first quarter of 2016, and we have big plans to make mobile a larger emphasis at the Company going forward."

Mr. Harrington continued, "We are also thrilled to have added Judy Krandel to the Board of Directors this March. Judy's background as an investment analyst and portfolio manager provides a critical perspective that has made her a tremendous asset to the Board. I believe her knowledge of, and deep relationships with, the small and micro-cap ecosystem will help the Company achieve its strategic objectives."

Liquidity and Cash Flow

• Cash Balance: We ended the first quarter of 2016 with approximately $1.8 million of cash and cash equivalents on our balance sheet;
• Expense Reductions: Total expenses were reduced by $1.2 million in the first quarter of 2016 as compared to the same period in 2015, a 28% decrease ; and
• Cash Used in Operating Activities: Net cash used in operating activities was $281 thousand for the three months ended March 31, 2016, representing an improvement of $772 thousand as compared to the same period in 2015.

Mr. Harrington concluded, "Capital efficiency and cost controls have been a big focus, and we were pleased to realize a 28% quarterly expense reduction year-over-year. The first quarter is typically our most cash and expense intensive quarter, and though the Company consumed $281 thousand of cash from operating activities, this was an improvement of $772 thousand over 2015. A high priority now is seeking financial or strategic alternatives to refinance or retire the Company's convertible debt. However, with $1.8 million of cash resources, we believe the Company has sufficient funds to pursue our previously announced new product launch and other growth initiatives in 2016."

About Snap Interactive, Inc.

Snap Interactive, Inc. develops, owns and operates dating applications for social networking websites and mobile platforms. The Grade is a patent-pending mobile dating application catering to high-quality singles. SNAP's flagship brand, FirstMet (formerly AYI.com), is a multi-platform online dating site with a large user database of approximately 30 million users.

For more information, please visit http://www.snap-interactive.com.

The contents of our website is not part of this press release, and you should not consider the contents of this website in making an investment decision with respect to our common stock.

Facebook is a registered trademark of Facebook Inc. Apple, iTunes and iPhone are registered trademarks of Apple Inc. and App Store is a registered service mark of Apple Inc. Android and Google Play are registered trademarks of Google Inc. FirstMet and The Grade are trademarks and AYI.com is a registered trademark of Snap Interactive, Inc.

Forward-Looking Statements

This press release contains "forward-looking statements." Such statements may be preceded by the words "intends," "may," "will," "plans," "expects," "anticipates," "projects," "predicts," "estimates," "aims," "believes," "hopes," "potential" or similar words. Forward-looking statements are not guarantees of future performance, are based on certain assumptions and are subject to various known and unknown risks and uncertainties, many of which are beyond the Company's control, and cannot be predicted or quantified and consequently, actual results may differ materially from those expressed or implied by such forward-looking statements. Such risks and uncertainties include, without limitation, risks and uncertainties associated with general economic, industry and market sector conditions; the Company's ability to meet its current and future debt service obligations; the Company's ability to institute corporate governance standards or achieve compliance with national exchange listing requirements; the Company's future growth and the ability to obtain additional financing to implement the Company's growth strategy; the ability to increase or recognize revenue, decrease expenses and increase the number of active subscribers, new subscription transactions or monthly active users; the ability to enter into new advertising agreements; the ability to diversify new user acquisition channels or improve the conversion of users to paid subscribers; the ability to anticipate and respond to changing user and industry trends and preferences; the intense competition in the online dating marketplace; the ability to release new applications or derive revenue from new applications; and circumstances that could disrupt the functioning of the Company's applications. More detailed information about the Company and the risk factors that may affect the realization of forward-looking statements is set forth in the Company's filings with the Securities and Exchange Commission ("SEC"), including the Company's most recent Annual Report on Form 10-K and Quarterly Reports on Form 10-Q. Investors and security holders are urged to read these documents free of charge on the SEC's web site at http://www.sec.gov.

All forward-looking statements speak only as of the date on which they are made. The Company undertakes no obligation to update any forward-looking statement or statements to reflect events or circumstances after the date on which such statement was made, except to the extent required by applicable securities laws.

SNAP INTERACTIVE, INC.
CONDENSED CONSOLIDATED BALANCE SHEETS
		March 31, 2016				December 31, 2015
		(unaudited)
Assets
Current assets:
	Cash and cash equivalents	$	1,824,642			$	2,131,262
	Credit card holdback receivable		156,049				165,853
	Accounts receivable, net of allowances and reserves of $61,170 and $55,468, respectively		222,425				206,547
	Prepaid expense and other current assets		82,141				108,871
Total current assets			2,285,257				2,612,533
Fixed assets and intangible assets, net			359,174				387,617
Notes receivable			81,123				81,123
Long term security deposits			279,410				279,410
Investments			200,000				200,000
Total assets		$	3,204,964			$	3,560,683
Liabilities and stockholders' deficit
Current liabilities:
	Accounts payable	$	1,246,790			$	1,065,662
	Accrued expenses and other current liabilities		150,710				367,018
	Deferred subscription revenue		1,499,465				1,505,862
	Convertible note payable, net of discount		1,936,696				-
Total current liabilities			4,833,661				2,938,542
Deferred rent, net of current portion			106,147				99,595
Convertible note payable, net of discount			-				1,636,585
Derivative liabilities			1,220,000				473,425
Capital lease obligations, net of current portion			55,410				75,560
Total liabilities			6,215,218				5,223,707
Commitments and Contingencies
Stockholders' deficit:
Preferred stock, $0.001 par value, 10,000,000 shares authorized, none issued and outstanding			-				-
Common stock, $0.001 par value, 100,000,000 shares authorized, 50,017,826 and 50,007,826 shares issued, respectively, and 39,692,826 and 39,682,826 shares outstanding, respectively			39,693				39,693
Additional paid-in capital			13,128,183				12,974,409
Accumulated deficit			(16,178,130	)			(14,677,126	)
Total stockholders' deficit			(3,010,254	)			(1,663,024	)
Total liabilities and stockholders' deficit		$	3,204,964			$	3,560,683

SNAP INTERACTIVE, INC.
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(Unaudited)
		Three Months Ended
		March 31,
		2016				2015
Revenues:
	Subscription revenue	$	2,507,148			$	3,129,310
	Advertising revenue		170,119				56,773
Total revenues			2,677,267				3,186,083
Costs and expenses:
	Cost of revenue		435,658				450,346
	Sales and marketing expense		1,292,164				1,781,506
	Product development expense		445,548				629,775
	General and administrative expense		832,652				1,307,231
Total costs and expenses			3,006,022				4,168,858
Loss from operations			(328,755	)			(982,775	)
	Interest expense, net		(425,674	)			(236,404	)
	Change in fair value of derivative liabilities		(746,575	)			-
Loss before provision for income taxes			(1,501,004	)			(1,219,179	)
Provision for income taxes			-				-
Net loss		$	(1,501,004	)		$	(1,219,179	)
Net loss per share of common stock:
	Basic and diluted	$	(0.04	)		$	(0.03	)
Weighted average number of shares of common stock used in calculating net loss per share of common stock:
	Basic and diluted		39,692,826				39,413,824

SNAP INTERACTIVE, INC.
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
(Unaudited)
		Three Months Ended March 31,
		2016				2015
Cash flows from operating activities:
Net loss		$	(1,501,004	)		$	(1,219,179	)
Adjustments to reconcile net loss to net cash used in operating activities:
Depreciation and amortization			36,515				60,819
Lease obligation interest expense			-				7,778
Stock-based compensation expense			153,774				229,863
Loss on disposal of fixed assets			-				79,628
Amortization of debt issuance cost			38,743				21,023
Amortization of debt discount			261,369				133,589
Change in fair value of derivative liabilities			746,575				-
Changes in operating assets and liabilities:
	Credit card holdback receivable		9,804				432,846
	Accounts receivable		(15,878	)			(28,390	)
	Security deposits		-				(110,511	)
	Prepaid expenses and other current assets		26,730				(16,352	)
	Accounts payable, accrued expenses and other current liabilities		(37,971	)			(683,598	)
	Deferred rent		6,552				4,099
	Deferred subscription revenue		(6,397	)			28,256
	Deferred advertising revenue		-				7,359
Net cash used in operating activities			(281,188	)			(1,052,770	)
Cash flows from investing activities:
Purchase of property and equipment			(8,072	)			(26,192	)
Proceeds from sale of fixed assets			-				6,000
Notes receivable			-				(634	)
Net cash used in investing activities			(8,072	)			(20,826	)
Cash flows from financing activities:
Payments of capital lease obligations			(17,360	)			(22,734	)
Repayment of promissory notes			-				(400,000	)
Payment of financing costs			-				(314,249	)
Proceeds received under Securities Purchase Agreement			-				3,000,000
Net cash (used in) provided by financing activities			(17,360	)			2,263,017
Net (decrease) increase in cash and cash equivalents			(306,620	)			1,189,421
Balance of cash and cash equivalents at beginning of period			2,131,262				1,138,385
Balance of cash and cash equivalents at end of period		$	1,824,642			$	2,327,806
Non-cash investing and financing activities:
Compound embedded derivative under the Note and Securities Purchase Agreement recorded as derivative liabilities (See Note 5)		$	-			$	1,748,000
Warrants issued under the Advisory Services Agreement as additional consideration for the Note and recorded as derivative liabilities (See Note 5)		$	-			$	342,000
Common stock issued under the Advisory Services Agreement as additional consideration for the Note		$	-			$	30,000

SNAP INTERACTIVE, INC.
RECONCILIATION OF GAAP TO NON-GAAP RESULTS
(Unaudited)
	Three Months Ended
	March 31,							December 31,
	2016				2015			2015
Reconciliation of Subscription Revenue to Bookings
Subscription revenue	$	2,507,148			$	3,129,310		$	2,571,374
Change in deferred subscription revenue		(6,397	)			28,256			(149,484	)
Bookings	$	2,500,751			$	3,157,566		$	2,421,890

		Three Months Ended March 31,
		2016				2015
Reconciliation of Net loss to Adjusted EBITDA:
	Net loss	$	(1,501,004	)		$	(1,219,179	)
	Interest expense (income), net		425,674				236,404
	Loss on disposal of fixed assets		--				79,628
	Depreciation and amortization expense		36,515				60,819
	Change in fair value of derivative liabilities		746,575				--
	Stock-based compensation expense		153,774				229,863
Adjusted EBITDA		$	(138,466	)		$	(612,465	)

Non-GAAP Financial Measures

The Company has provided in this release certain non-GAAP financial information including bookings and Adjusted EBITDA to supplement the condensed consolidated financial statements, which are prepared in accordance with generally accepted accounting principles in the United States ("GAAP"). The Company defines Adjusted EBITDA as net loss adjusted to exclude interest income (expense), net, depreciation and amortization expense, gain (loss) on change in fair value of derivative liabilities, loss on disposal of fixed assets and stock-based compensation expense. The Company calculates bookings as subscription revenue recognized during the period plus the change in deferred subscription revenue recognized during the period.

Management uses these non-GAAP financial measures internally in analyzing the Company's financial results to assess operational performance and to determine the Company's future capital requirements. The presentation of this financial information is not intended to be considered in isolation or as a substitute for the financial information prepared in accordance with GAAP. The Company believes that both management and investors benefit from referring to these non-GAAP financial measures in assessing our performance and when planning, forecasting and analyzing future periods. The Company believes these non-GAAP financial measures are useful to investors and others to understand and evaluate the Company's operating results and it allows for a more meaningful comparison between the Company's performance and that of competitors.

Some limitations of bookings and Adjusted EBITDA as financial measures include that:

• Bookings does not reflect that we recognize subscription revenue from subscription fees over the length of the subscription term and subscription revenue from micro-transactions over a two-month period;
• Adjusted EBITDA does not (i) reflect cash capital expenditure requirements for assets underlying depreciation and amortization expense that may need to be replaced or for new capital expenditures; (ii) the Company's working capital requirements; (iii) consider the potentially dilutive impact of stock-based compensation; (iv) reflect interest expense or interest payments on our outstanding indebtedness; and (v) reflect the change in fair value of warrants; and
• Other companies, including companies in our industry, may calculate bookings or Adjusted EBITDA differently or choose not to calculate bookings or Adjusted EBITDA at all, which reduces their usefulness as comparative measures.

Because of these limitations, you should consider this non-GAAP financial information along with other financial performance measures, including total revenues, subscription revenue, deferred revenue, net income (loss), cash and cash equivalents, restricted cash, net cash used in operating activities and our financial results presented in accordance with GAAP.

IR Contact:
Snap Interactive, Inc.
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