Core Viewpoint - Outbrain Inc. (OB) shares have significantly underperformed, dropping 39.2% over the past three months, contrasting with the 8.1% decline in its industry and the 7.5% fall in the Zacks S&P 500 Composite [1][4]. Group 1: Performance Comparison - Outbrain's performance is notably worse than its industry peers, Amadeus IT Group, S.A. (AMADY) and Katapult Holdings, Inc. (KPLT), which have seen gains of 10.5% and 72.6% respectively over the same period [4]. Group 2: Strategic Acquisitions and Partnerships - The acquisition of Teads enhances Outbrain's global reach, leveraging over 50 partnerships with premium brands like Apple, Visa, and McDonald's, which generate $5-$20 million annually on average [5][6]. - Outbrain is focusing on strengthening its relationships with premium media owners, renewing agreements with key partners in various countries and securing new partnerships [7][8]. Group 3: AI Integration and Customer Engagement - Over 70% of Outbrain's customer base utilized its AI-based Creative Automation suite in Q4 2024, which optimizes customer engagement through predictive insights [9][10]. - The anticipated increase in AI usage is expected to expand Outbrain's customer base by enhancing efficiency and results [10]. Group 4: Valuation and Financial Prospects - Outbrain shares are currently undervalued, trading at 9.9 times forward 12-month earnings per share, significantly lower than the industry average of 37.4 times [11]. - The trailing 12-month EV-to-EBITDA ratio for Outbrain is 3.8 times, well below the industry average of 41 times [13]. - The Zacks Consensus Estimate projects Outbrain's 2025 revenues at $600.2 million, indicating over 100% year-over-year growth, with earnings expected to turn around to 36 cents per share from a loss in the previous year [16]. Group 5: Liquidity Position - Outbrain's current ratio stands at 1.2, which, while lower than the industry average of 2.1, still indicates the company can manage its short-term debt obligations [17]. Group 6: Investment Recommendation - Given Outbrain's extensive global reach, strategic acquisitions, strong partnerships, commitment to AI, and favorable liquidity position, it is considered an opportune time for investors to buy the stock to leverage its long-term growth potential [18][19].

Part I [Item 1. Business](index=6&type=section&id=Item%201.%20Business) The company operates as a leading omnichannel advertising platform following the acquisition of Teads - On February 3, 2025, Outbrain Inc. completed the acquisition of TEADS for approximately **$900 million**, consisting of **$625 million in cash** and **43.75 million shares** of Outbrain's common stock; the combined company will operate under the name Teads[23](index=23&type=chunk) - The combined company operates a two-sided marketplace, connecting global advertisers with media owners to provide an end-to-end advertising solution across the Open Internet[28](index=28&type=chunk)[29](index=29&type=chunk) - The company's strategy focuses on providing a unified, full-funnel solution, deepening partner relationships, and investing in innovation, particularly in high-growth areas like CTV[62](index=62&type=chunk)[63](index=63&type=chunk)[64](index=64&type=chunk) [Our Offerings](index=6&type=section&id=Our%20Offerings) The company provides a two-sided marketplace with distinct solutions for advertisers and media owners - Advertiser solutions include multiple buying methods like a CPC performance platform and CPM-based managed/self-service platforms, designed to drive outcomes from branding to performance[32](index=32&type=chunk)[33](index=33&type=chunk) - The company partners with over **10,000 media owners**, including premium publishers and CTV/Smartphone OEMs, providing them with advertising revenue and engagement technology; Outbrain's top 20 media partners have an average tenure of 7 years[35](index=35&type=chunk) - Agreements with media partners typically involve revenue sharing, programmatic bidding for inventory, or guaranteed minimum payments to secure access to inventory[36](index=36&type=chunk) [Industry](index=8&type=section&id=Industry) The company operates in the growing digital ad market, driven by video, AI, and regulatory shifts - The digital advertising market for online video, static display, and CTV is projected to grow from **$140 billion in 2023 to $192 billion in 2027**, representing an **8% CAGR**[38](index=38&type=chunk) - Consumer time spent on the Open Internet increased from **51% in 2017 to 61% in 2023**, while time on social/walled garden platforms decreased, indicating a shift in user behavior that benefits the company's ecosystem[43](index=43&type=chunk) - The industry is seeing increased use of AI for content and ad creation, alongside growing regulatory scrutiny on privacy and antitrust, which may favor Open Internet platforms[42](index=42&type=chunk)[45](index=45&type=chunk)[46](index=46&type=chunk) [Our Strengths](index=10&type=section&id=Our%20Strengths) Key strengths include significant scale, a full-funnel offering, and exclusive publisher relationships - The company is one of the largest Open Internet advertising platforms, with over **$1.7 billion in advertising spend in 2024**, operating across more than 50 markets[47](index=47&type=chunk)[50](index=50&type=chunk) - Teads maintains strategic Joint Business Partnerships (JBPs) with major brands like Apple and LVMH, representing an average of **$5 million in annual spend per JBP** as of December 31, 2024[50](index=50&type=chunk)[51](index=51&type=chunk) - The company has high retention rates with its partners; in 2024, Teads retained approximately **90% of its top 500 publisher relationships**, and Outbrain retained about **98% of publishers** generating over $10,000 quarterly[57](index=57&type=chunk) - The company's innovative CTV offering is a significant growth driver, with integrations with leading OEMs like LG and VIDAA, offering exclusive ad inventory on CTV home screens[53](index=53&type=chunk) [Human Capital Resources](index=14&type=section&id=Human%20Capital%20Resources) The company employs approximately 1,800 people globally with a focus on employee development - The company has approximately **1,800 employees**, with a significant presence in Israel (18%), France (16%), Slovenia (6%), and the United States (13%); the remaining 47% are distributed across other global offices[81](index=81&type=chunk) [Regulatory Environment](index=15&type=section&id=Regulatory%20Environment) The company navigates a complex global regulatory landscape, particularly concerning data privacy - The company must comply with major regulations like the EU's Digital Services Act (DSA), which became enforceable in February 2024, and the General Data Protection Regulation (GDPR), which carries significant penalties for non-compliance[86](index=86&type=chunk)[89](index=89&type=chunk) - Data transfer mechanisms, such as the E.U.-U.S. Data Privacy Framework (DPF), are critical for operations but face ongoing legal challenges, creating uncertainty for transferring personal data from the E.U. to the U.S[91](index=91&type=chunk) - The company actively participates in self-regulatory bodies like the Network Advertising Initiative (NAI) and Digital Advertising Alliance to adhere to industry standards for responsible data collection and use in digital advertising[93](index=93&type=chunk) [Item 1A. Risk Factors](index=18&type=section&id=Item%201A.%20Risk%20Factors) The company faces significant risks related to acquisition integration, operations, and regulations - A summary of principal risks includes the ability to **successfully integrate Teads**, realize synergies, manage unexpected costs from the acquisition, and handle potential litigation[102](index=102&type=chunk) - Operational risks include **high dependence on overall advertising demand**, intense competition from both large tech platforms and smaller companies, and the potential loss of large media partners[134](index=134&type=chunk)[144](index=144&type=chunk)[150](index=150&type=chunk) - Significant legal and regulatory risks stem from evolving data privacy laws like **GDPR and CCPA**, limitations on data collection (e.g., cookie deprecation), and compliance with international advertising standards[220](index=220&type=chunk)[222](index=222&type=chunk) - Geopolitical risks, particularly the **ongoing conflict in Israel** where a material part of operations and key personnel are located, could adversely affect operations and business continuity[162](index=162&type=chunk)[164](index=164&type=chunk) [Item 1B. Unresolved Staff Comments](index=49&type=section&id=Item%201B.%20Unresolved%20Staff%20Comments) The company reports no unresolved staff comments from the Securities and Exchange Commission - None[274](index=274&type=chunk) [Item 1C. Cybersecurity Risk Management and Strategy](index=49&type=section&id=Item%201C.%20Cybersecurity%20Risk%20Management%20and%20Strategy) The company maintains a comprehensive cybersecurity program overseen by the Board's Audit Committee - Outbrain utilizes the COBIT framework and holds ISO 27001, 27017, and 27032 certifications; Teads utilizes the NIST framework and maintains SOC2 Type 2 certification[276](index=276&type=chunk) - The Board's Audit Committee provides oversight for cybersecurity risk, receiving quarterly reports from management and briefings from the Chief Information Security Officer (CISO)[280](index=280&type=chunk)[281](index=281&type=chunk)[282](index=282&type=chunk) - Following the acquisition, Teads' legacy information systems are maintained separately but are being evaluated for operational integration into the company's overall cybersecurity strategy[285](index=285&type=chunk) [Item 2. Properties](index=50&type=section&id=Item%202.%20Properties) The company leases office and technology facilities globally, with key locations in New York and Israel - Corporate headquarters are located in New York, NY, in a **23,000 sq. ft.** office[286](index=286&type=chunk) - Major technology and development centers are located in Netanya, Israel (**60,000 sq. ft.**) and Ljubljana, Slovenia (**16,000 sq. ft.**)[287](index=287&type=chunk) - The legacy Teads business is headquartered in Paris, France, with a significant technology presence in Montpellier, France[288](index=288&type=chunk) [Item 3. Legal Proceedings](index=50&type=section&id=Item%203.%20Legal%20Proceedings) Details regarding legal proceedings are referenced in the notes to the financial statements - Details on legal proceedings can be found in **Note 11** of the financial statements[290](index=290&type=chunk) [Item 4. Mine Safety Disclosures](index=50&type=section&id=Item%204.%20Mine%20Safety%20Disclosures) This item is not applicable to the company's business - Not applicable[291](index=291&type=chunk) Part II [Item 5. Market for Registrant's Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities](index=51&type=section&id=Item%205.%20Market%20for%20Registrant's%20Common%20Equity%2C%20Related%20Stockholder%20Matters%20and%20Issuer%20Purchases%20of%20Equity%20Securities) This section covers the company's common stock, dividend policy, and share repurchase program - The company's common stock trades on Nasdaq under the symbol **"OB"**; following the Teads acquisition, the combined company is expected to operate under the name Teads[293](index=293&type=chunk) - The company has **never declared or paid cash dividends** and does not intend to in the foreseeable future, prioritizing reinvestment into the business and debt obligations[295](index=295&type=chunk) Share Repurchase Activity (Q4 2024) | Period | Total Shares Purchased | Average Price Paid | Approx. Dollar Value Remaining ($ thousands) | | :--- | :--- | :--- | :--- | | October 2024 | 15,846 | $4.61 | $6,615 | | November 2024 | 1,268 | $5.04 | $6,615 | | December 2024 | 21,140 | $6.19 | $6,615 | | **TOTAL** | **38,254** | **$5.50** | **$6,615** | [Item 7. Management's Discussion and Analysis of Financial Condition and Results of Operations](index=53&type=section&id=Item%207.%20Management's%20Discussion%20and%20Analysis%20of%20Financial%20Condition%20and%20Results%20of%20Operations) Management analyzes Outbrain's pre-acquisition financial performance, liquidity, and key business drivers - On February 3, 2025, Outbrain completed the acquisition of Teads; the financial statements in this report **do not include Teads' results** as the acquisition occurred after the fiscal year-end[303](index=303&type=chunk)[304](index=304&type=chunk) - In connection with the acquisition, the combined company announced a restructuring plan on February 3, 2025, involving a workforce reduction and estimated charges of **$20 million to $25 million**[318](index=318&type=chunk) - To finance the acquisition, the company secured new credit facilities and subsequently issued **$637.5 million in 10.000% senior secured notes due 2030** to refinance the initial bridge loan[321](index=321&type=chunk)[323](index=323&type=chunk)[324](index=324&type=chunk) Outbrain Financial Performance Summary (FY 2024 vs. FY 2023) | Metric | FY 2024 | FY 2023 | Change | | :--- | :--- | :--- | :--- | | Revenue | $889.9M | $935.8M | -4.9% | | Gross Profit | $192.1M | $184.8M | +4.0% | | Ex-TAC Gross Profit (Non-GAAP) | $236.1M | $227.4M | +3.9% | | Net (Loss) Income | ($0.7M) | $10.2M | -106.9% | | Adjusted EBITDA (Non-GAAP) | $37.3M | $28.5M | +30.9% | [Results of Operations](index=62&type=section&id=Results%20of%20Operations) Revenue declined 4.9% to $889.9 million, while gross profit grew 4.0% to $192.1 million in 2024 - Revenue decreased by **$45.9 million (4.9%)** year-over-year, attributed to an **88% net revenue retention rate** on existing media partners, offset by approximately **6% growth** from new media partners[371](index=371&type=chunk) - Traffic acquisition costs (TAC) decreased by **7.7% to $653.7 million**, and as a percentage of revenue, TAC improved to **73.5% from 75.7%** in the prior year[373](index=373&type=chunk) - Operating expenses increased by **$11.3 million**, primarily due to **$14.3 million in acquisition-related costs** for the Teads transaction[377](index=377&type=chunk) Consolidated Statements of Operations (In thousands) | | Year Ended December 31, 2024 | Year Ended December 31, 2023 | | :--- | :--- | :--- | | **Revenue** | **$889,875** | **$935,818** | | Traffic acquisition costs | $653,731 | $708,449 | | **Gross profit** | **$192,102** | **$184,798** | | Total operating expenses | $204,740 | $193,437 | | Loss from operations | ($12,638) | ($8,639) | | **Net (loss) income** | **($711)** | **$10,242** | [Non-GAAP Reconciliations](index=64&type=section&id=Non-GAAP%20Reconciliations) This section reconciles GAAP metrics to non-GAAP measures like Ex-TAC Gross Profit and Adjusted EBITDA Reconciliation of Gross Profit to Ex-TAC Gross Profit | | Year Ended Dec 31, 2024 | Year Ended Dec 31, 2023 | | :--- | :--- | :--- | | **Gross profit (GAAP)** | **$192,102** | **$184,798** | | Other cost of revenue | $44,042 | $42,571 | | **Ex-TAC Gross Profit (Non-GAAP)** | **$236,144** | **$227,369** | Reconciliation of Net (Loss) Income to Adjusted EBITDA | | Year Ended Dec 31, 2024 | Year Ended Dec 31, 2023 | | :--- | :--- | :--- | | **Net (loss) income (GAAP)** | **($711)** | **$10,242** | | Adjustments (Interest, Taxes, D&A, etc.) | $20,898 | $32,954 | | Stock-based compensation | $15,461 | $12,141 | | Merger and acquisition costs | $14,256 | $0 | | Severance costs | $742 | $3,509 | | Gain related to convertible debt | ($8,782) | ($22,594) | | **Adjusted EBITDA (Non-GAAP)** | **$37,300** | **$28,455** | [Liquidity and Capital Resources](index=66&type=section&id=LIQUIDITY%20AND%20CAPITAL%20RESOURCES) The company maintains liquidity through cash, investments, and credit facilities, securing new financing for the Teads acquisition - On February 11, 2025, the company's subsidiary completed a private offering of **$637.5 million in 10.000% senior secured notes due 2030** to refinance the bridge loan used for the Teads acquisition[414](index=414&type=chunk) - As of December 31, 2024, **$6.6 million remained available** for repurchases under the company's $30 million share repurchase program[420](index=420&type=chunk) Sources of Liquidity as of Dec 31, 2024 (in thousands) | Source | Amount | | :--- | :--- | | Cash and cash equivalents | $89,094 | | Short-term investments | $77,035 | | Revolving Credit Facility | $58,125 | | **Total** | **$224,254** | Summary of Cash Flows (in thousands) | | Year Ended Dec 31, 2024 | Year Ended Dec 31, 2022 | | :--- | :--- | :--- | | Net cash provided by operating activities | $68,561 | $13,746 | | Net cash provided by investing activities | $67,153 | $69,640 | | Net cash used in financing activities | ($117,702) | ($117,068) | [Item 7A. Quantitative and Qualitative Disclosures About Market Risk](index=74&type=section&id=Item%207A.%20Quantitative%20and%20Qualitative%20Disclosures%20About%20Market%20Risk) The company is exposed to market risks including foreign currency, interest rate, and inflation - The company is exposed to foreign currency risk as a majority of its revenue and expenses are in U.S. Dollars and Euros, with significant operating expenses also in New Israeli Shekels[448](index=448&type=chunk) - A hypothetical **10% adverse change** in weighted-average exchange rates would result in a **$10.5 million unfavorable change** to operating loss for the year ended December 31, 2024[450](index=450&type=chunk) - Interest rate risk primarily affects the company's cash, cash equivalents, and investment portfolio; a **100 basis point change** in interest rates would alter the portfolio's fair value by about **$0.2 million**[453](index=453&type=chunk) [Item 8. Financial Statements and Supplementary Data](index=76&type=section&id=Item%208.%20Financial%20Statements%20and%20Supplementary%20Data) This section contains the company's audited consolidated financial statements for fiscal year 2024 Consolidated Balance Sheet Summary (As of Dec 31, 2024) | | Amount (in thousands) | | :--- | :--- | | **Total Current Assets** | **$343,131** | | Total Assets | $549,213 | | **Total Current Liabilities** | **$289,471** | | Total Liabilities | $317,870 | | **Total Stockholders' Equity** | **$231,343** | Consolidated Statement of Operations Summary (Year Ended Dec 31, 2024) | | Amount (in thousands) | | :--- | :--- | | Revenue | $889,875 | | Gross Profit | $192,102 | | Loss from Operations | ($12,638) | | **Net Loss** | **($711)** | Consolidated Statement of Cash Flows Summary (Year Ended Dec 31, 2024) | | Amount (in thousands) | | :--- | :--- | | Net cash provided by operating activities | $68,561 | | Net cash provided by investing activities | $67,153 | | Net cash used in financing activities | ($117,702) | | **Net increase in cash** | **$18,646** | [Item 9A. Controls and Procedures](index=118&type=section&id=Item%209A.%20Controls%20and%20Procedures) Management concluded that disclosure controls and internal controls over financial reporting were effective - Based on an evaluation as of December 31, 2024, the CEO and CFO concluded that the company's **disclosure controls and procedures were effective** at a reasonable assurance level[672](index=672&type=chunk) - Management concluded that the company's **internal control over financial reporting was effective** as of December 31, 2024, based on the COSO 2013 framework[677](index=677&type=chunk) - The report does not include an auditor's attestation on internal control over financial reporting, as permitted for emerging growth companies under the JOBS Act[680](index=680&type=chunk) Part III [Item 10. Directors, Executive Officers and Corporate Governance](index=120&type=section&id=Item%2010.%20Directors%2C%20Executive%20Officers%20and%20Corporate%20Governance) Information on directors and governance is incorporated by reference from the 2025 Proxy Statement - Information required by this item will be included in the **2025 Proxy Statement** and is incorporated herein by reference[684](index=684&type=chunk) [Item 11. Executive Compensation](index=120&type=section&id=Item%2011.%20Executive%20Compensation) Information on executive compensation is incorporated by reference from the 2025 Proxy Statement - Information required by this item will be included in the **2025 Proxy Statement** and is incorporated herein by reference[686](index=686&type=chunk) [Item 12. Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters](index=120&type=section&id=Item%2012.%20Security%20Ownership%20of%20Certain%20Beneficial%20Owners%20and%20Management%20and%20Related%20Stockholder%20Matters) Information on security ownership is incorporated by reference from the 2025 Proxy Statement - Information required by this item will be included in the **2025 Proxy Statement** and is incorporated herein by reference[687](index=687&type=chunk) [Item 13. Certain Relationships and Related Transactions, and Director Independence](index=120&type=section&id=Item%2013.%20Certain%20Relationships%20and%20Related%20Transactions%2C%20and%20Director%20Independence) Information on related transactions is incorporated by reference from the 2025 Proxy Statement - Information required by this item will be included in the **2025 Proxy Statement** and is incorporated herein by reference[688](index=688&type=chunk) [Item 14. Principal Accountant Fees and Services](index=120&type=section&id=Item%2014.%20Principal%20Accountant%20Fees%20and%20Services) Information on accountant fees is incorporated by reference from the 2025 Proxy Statement - Information required by this item will be included in the **2025 Proxy Statement** and is incorporated herein by reference[689](index=689&type=chunk) Part IV [Item 15. Exhibits and Financial Statement Schedules](index=121&type=section&id=Item%2015.%20Exhibits%20and%20Financial%20Statement%20Schedules) This section lists the financial statements, schedules, and exhibits filed with the report - This item provides an index to the company's financial statements and lists all exhibits filed with the Form 10-K, including key agreements related to the Teads acquisition[692](index=692&type=chunk)[693](index=693&type=chunk) [Item 16. Form 10-K Summary](index=124&type=section&id=Item%2016.%20Form%2010-K%20Summary) The company indicates that no Form 10-K summary is provided - None[699](index=699&type=chunk)

Shares of Outbrain Inc. (OB) have been struggling lately and have lost 18.4% over the past week. However, a hammer chart pattern was formed in its last trading session, which could mean that the stock found support with bulls being able to counteract the bears. So, it could witness a trend reversal down the road.The formation of a hammer pattern is considered a technical indication of nearing a bottom with likely subsiding of selling pressure. But this is not the only factor that makes a bullish case for th ...

Outbrain (OB) Q4 2024 Earnings Call February 27, 2025 07:45 PM ET Company Participants None - ExecutiveDavid Kostman - CEO & DirectorJason Kiviat - CFOAndrew Boone - Managing DirectorJames Heaney - SVP - Equity ResearchYgal Arounian - Director - Internet Equity Research Conference Call Participants Laura Martin - Managing Director, Senior Internet & Media Analyst Operator Good day, and welcome to Outbrain Incorporated Fourth Quarter and Full Year twenty twenty four Earnings Conference Call. At this time, al ...

Financial Data and Key Metrics Changes - For Q4 2024, the company reported revenue of approximately $235 million, reflecting a decrease of 5% year-over-year [29] - Ex TAC gross profit was $68.3 million, an increase of 7% year-over-year, continuing a trend of acceleration and outpacing revenue growth for the seventh consecutive quarter [31] - Adjusted EBITDA grew 21% year-over-year to $17 million, indicating consecutive margin improvement [33] Business Line Data and Key Metrics Changes - The Outbrain DSP saw a growth of 45% in advertiser spend in 2024, driven by superior performance across various formats [11] - Revenue generated from supply beyond the traditional feed represented approximately 30% of revenue in Q4 2024, up from 26% in Q4 2023 [12] - The company successfully renewed agreements with key publishing partners and secured new business partnerships, demonstrating the value proposition offered to premium publishers [15] Market Data and Key Metrics Changes - Total ad spend was materially flat year-over-year during Q4 but increased year-over-year on a full-year basis [29] - Net revenue retention of publishers was 86%, reflecting downward pressure on ad impressions from a key supply partner [30] - The company has over 2 billion unique users and proprietary data signals through exclusive content partnerships with premium media properties [21] Company Strategy and Development Direction - The merger with Teads aims to combine branding and performance capabilities, enhancing the company's position in the open Internet advertising space [7] - The company plans to leverage AI to create a seamless consumer journey across various platforms, enhancing the effectiveness of advertising campaigns [17] - The focus on expanding beyond traditional feeds and enhancing performance capabilities is expected to drive future growth [49] Management's Comments on Operating Environment and Future Outlook - Management expressed optimism about the integration of Teads and the potential for significant synergies, estimating an annual impact of $65 million to $75 million on adjusted EBITDA [36] - The company anticipates a return to overall pro forma growth by the second half of the year, with positive trends observed in the legacy Teads business [75] - Management highlighted the importance of CTV as a growing segment within performance marketing, with expectations for increased advertiser interest [84] Other Important Information - The company completed the acquisition of Teads on February 3, 2024, and will operate under the Teads brand moving forward [6][100] - The company ended Q4 with $166 million in cash and no debt, indicating a strong liquidity position [34] - The company does not intend to repurchase shares in the near term due to the recent acquisition [35] Q&A Session Summary Question: Transition of publishers and advertisers onto the combined platform - Management is focused on unifying teams and cross-selling, with a clear roadmap for integration and performance capabilities delivery [46] Question: Demand for native advertising - Management noted ongoing growth in performance solutions and a shift towards performance-driven advertising [50] Question: Drivers of growth in Outbrain DSP - The growth is attributed to enhanced bidding technology and the ability to broaden the share of wallet from performance advertisers [55] Question: Progress of revenue outside traditional feeds - Management expects continued investment in this area, viewing it as a growth driver [63] Question: Performance of legacy Teads business - Management reported a recovery in performance and positive trends in January and February following the merger [72] Question: Synergies from the merger - Management estimates $60 million in cost synergies and $5 to $15 million in revenue synergies, with a focus on optimizing traffic acquisition costs [90][96] Question: Future of the Teads brand and ticker symbol - The company will operate under the Teads name and plans to change the ticker symbol over time [100] Question: Funding for news advertising - Management sees early positive trends in advertising spending on news, although it remains a small part of the overall inventory mix [103]

Reports another quarter of accelerated growth and profitability, achieved Q4 guidance on Ex TAC gross profit and Adjusted EBITDA, and generated strong cash flow Closed acquisition of Teads in February 2025; Combined company operating under the name Teads NEW YORK, Feb. 27, 2025 (GLOBE NEWSWIRE) -- Outbrain Inc. (Nasdaq: OB), which is operating under the new Teads brand, announced today financial results for the quarter and full year ended December 31, 2024. Fourth Quarter and Full Year 2024 Key Financial Me ...

Core Viewpoint - Outbrain Inc. is expected to report fourth-quarter 2024 results on February 27, with revenue estimates suggesting a 7.1% growth year-over-year, but earnings are projected to be at breakeven compared to 9 cents per share a year ago [1][2]. Financial Performance - The Zacks Consensus Estimate for revenues in the upcoming quarter is $68.3 million, indicating a 7.1% increase from the previous year [2]. - Outbrain has a history of earnings surprises, having beaten the Zacks Consensus Estimate in the last four quarters with an average surprise of 144.6% [3]. - The company currently has an Earnings ESP of 0.00% and a Zacks Rank of 1 (Strong Buy) [4][5]. Partnerships and Growth Drivers - In Q3 2024, Outbrain renewed key agreements with publishing partners like Huffington Post and expanded partnerships with competitors, enhancing its premium inventory and performance data [6][7]. - The company’s revenue from supply beyond traditional feeds accounted for nearly 28% of total revenue in Q3 2024, up from 26% in Q3 2023, indicating consistent growth in this area [15]. Stock Performance and Valuation - Outbrain's stock has increased by 46.3% over the past year, underperforming its industry’s 58.3% rise but outperforming the S&P 500's 19.1% increase [8]. - The stock is currently trading at a trailing 12-month price-to-earnings ratio of 15.7X, significantly lower than the industry average of 42.1X, suggesting it is undervalued [12]. Financial Position - As of Q3 2024, Outbrain had $131 million in cash and no outstanding debt, providing a strong financial position to invest in technology and market expansion [14]. - The company has demonstrated sustainable growth with positive free cash flow for five consecutive quarters and has consistently exceeded adjusted EBITDA expectations [16][17]. Investment Considerations - Outbrain is well-positioned for future success due to its premium media partnerships, diversified offerings, and strong balance sheet, making it an attractive investment opportunity this earnings season [17][18].

Core Viewpoint - Momentum investing focuses on "buying high and selling higher," contrasting with traditional strategies of "buying low and selling high" [1] Group 1: Momentum Investing Strategy - Momentum investing can be risky as stocks may lose momentum when their valuations exceed future growth potential [1] - A safer approach involves investing in bargain stocks that exhibit recent price momentum, identified through the Zacks Momentum Style Score [2] Group 2: Outbrain Inc. (OB) Analysis - Outbrain Inc. (OB) has shown a price increase of 4.2% over the past four weeks, indicating growing investor interest [3] - OB has gained 33.5% over the past 12 weeks, demonstrating its ability to deliver positive returns over a longer timeframe [4] - The stock has a beta of 1.4, suggesting it moves 40% more than the market in either direction [4] - OB has a Momentum Score of A, indicating a favorable time to invest [5] - The stock has a Zacks Rank 1 (Strong Buy) due to upward revisions in earnings estimates, which attract more investors [6] - OB is trading at a Price-to-Sales ratio of 0.37, indicating it is reasonably valued at 37 cents for each dollar of sales [6] Group 3: Additional Investment Opportunities - Besides OB, there are other stocks that meet the criteria of the 'Fast-Paced Momentum at a Bargain' screen, suggesting further investment opportunities [7] - Zacks offers over 45 Premium Screens tailored to different investing styles, aiding in stock selection [8]

Group 1 - Outbrain Inc., now operating under the Teads brand, successfully closed a private offering of $637.5 million in senior secured notes due 2030 at an issue price of 98.087% [1][2] - The size of the offering was increased from the previously announced $625.0 million [2] - The proceeds from the offering were used to repay and cancel the indebtedness incurred under the senior secured bridge facility related to the acquisition of Teads [3] Group 2 - Outbrain and Teads combined on February 3, 2025, creating a new omnichannel outcomes platform for the open internet [4] - The new Teads focuses on driving full-funnel results for marketers by leveraging predictive AI technology and connecting quality media with brand creative [4] - The company partners with over 10,000 publishers and 20,000 advertisers globally, employing nearly 1,800 people across 36 countries [4]

Core Viewpoint - Outbrain Inc., now operating under the Teads brand, will release its Q4 and full year 2024 results on February 27, 2025, followed by a conference call to discuss the results and business outlook [1]. Group 1: Company Announcement - The company will announce its financial results before the market opens on February 27, 2025 [1]. - A conference call is scheduled for 8:30 a.m. (Eastern Time) on the same day to discuss the results [1]. Group 2: Conference Call Details - The conference call can be accessed by dialing 1-877-497-9071 for U.S. callers and 1-201-689-8727 for international callers [2]. - A replay of the call will be available two hours after it concludes, accessible at 1-877-660-6853 for U.S. callers and 1-201-612-7415 for international callers, with a passcode of 13750872 [2]. - The replay will be available until March 13, 2025 [2]. Group 3: Company Background - Outbrain Inc. and Teads merged on February 3, 2025, and are now operating under the Teads brand [4]. - The new Teads serves as an omnichannel outcomes platform for the open internet, focusing on delivering full-funnel results for marketers [4]. - The company partners with over 10,000 publishers and 20,000 advertisers globally, employing nearly 1,800 people across 36 countries [4].