Perion Network (PERI) is one of the stocks most watched by Zacks.com visitors lately. So, it might be a good idea to review some of the factors that might affect the near-term performance of the stock.Over the past month, shares of this digital media company have returned -10.9%, compared to the Zacks S&P 500 composite's +3.5% change. During this period, the Zacks Internet - Content industry, which Perion Network falls in, has gained 0.3%. The key question now is: What could be the stock's future direction? ...

Perion Network (PERI) closed at $28.41 in the latest trading session, marking a -1.97% move from the prior day. This change lagged the S&P 500's daily gain of 0.57%. Elsewhere, the Dow gained 0.46%, while the tech-heavy Nasdaq added 0.75%.Coming into today, shares of the digital media company had lost 2.56% in the past month. In that same time, the Computer and Technology sector gained 1.51%, while the S&P 500 gained 3.4%.Investors will be eagerly watching for the performance of Perion Network in its upcomi ...

The latest trading session saw Perion Network (PERI) ending at $29.14, denoting a -1.25% adjustment from its last day's close. This change lagged the S&P 500's 0.34% loss on the day. On the other hand, the Dow registered a gain of 0.03%, and the technology-centric Nasdaq decreased by 0.56%.Heading into today, shares of the digital media company had gained 7.66% over the past month, outpacing the Computer and Technology sector's gain of 1.27% and the S&P 500's gain of 2.56% in that time.The investment commun ...

NEW YORK & TEL AVIV, Israel--(BUSINESS WIRE)--Perion Network Ltd. (NASDAQ and TASE: PERI), connecting advertisers with consumers through technology across all major digital channels, announces today that it will participate in the 26th Annual Needham Growth Conference on January 18 in New York. During the conference, management will host one-on-one meetings with investors. To schedule a meeting with the Company, please contact your representative at Needham. The company will also participate in a fireside ...

This presentation contains historical information and forward-looking statements within the meaning of The Private Securities Litigation Reform Act of 1995 with respect to the business, financial condition and results of operations of Perion. The words "will," "believe," "expect," "intend," "plan," "should", "estimate" and similar expressions are intended to identify forward-looking statements. Such statements reflect the current views, assumptions and expectations of Perion with respect to future events an ...

Financial Data and Key Metrics Changes - Revenue for Q3 2023 increased by 17% year-over-year to $185.3 million, with a two-year CAGR of 24% [32][41] - Adjusted EBITDA increased by 29% year-over-year to $42.7 million, with an adjusted EBITDA margin of 23%, up from 21% in Q3 2022 [34][32] - GAAP net income rose by 28% to $32.8 million, or $0.65 per diluted share, compared to $25.6 million, or $0.53 per diluted share in Q3 2022 [30][32] - Non-GAAP net income increased by 42% to $42.4 million, or $0.84 per diluted share, compared to $29.9 million, or $0.61 per diluted share last year [30][32] Business Line Data and Key Metrics Changes - Display advertising revenue increased by 14% year-over-year to $99.2 million, accounting for 54% of total revenue [28] - Retail media revenue more than doubled, increasing by 112% year-over-year, and accounted for 30% of display advertising revenue compared to 7% in the same period last year [33] - CTV revenue grew by 39% year-over-year, representing 8% of advertising revenue compared to 7% last year [42] Market Data and Key Metrics Changes - The U.S. digital audio ad market is projected to reach nearly $6.8 billion in 2023, with the company's new WAVE solution designed to enhance personalization and engagement [12] - Average daily searches increased by 86% year-over-year, and the number of publishers grew by 60% year-over-year [42] Company Strategy and Development Direction - The company focuses on technological innovation and operational efficiency to drive growth and profitability [6][34] - There is an emphasis on diversifying cash allocation to mitigate risks associated with geopolitical tensions, as nearly 100% of revenue is generated outside of Israel [26] - The company is actively reviewing M&A opportunities to accelerate growth and diversification, particularly in technology that complements its existing portfolio [31] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the company's ability to deliver continuous profitable growth despite macroeconomic headwinds [19][27] - The company reiterated its full-year 2023 guidance, indicating strong expectations for year-over-year revenue and adjusted EBITDA growth [36] - Management highlighted the resilience of the business model and the ability to adapt to changing market conditions [19][27] Other Important Information - The company has successfully directed resources to high-growth areas with higher margins, contributing to a 29% year-over-year growth in adjusted EBITDA [34] - The operational discipline and innovative technology have positioned the company as a unique and competitive player in the industry [31] Q&A Session Summary Question: What is driving the growth in retail media? - The growth is attributed to both new customers and deepening relationships with existing customers through enhanced technologies like WAVE [46] Question: Why is video advertising down while CTV is up? - The decrease in video revenue is due to a strategic shift in inventory from video to display to maximize profitability [42][47] Question: What is the outlook for growth in search and display? - The company expects organic growth to continue in search, retail, and CTV, with ongoing evaluations for potential M&A opportunities [64] Question: How is SORT performing? - SORT is performing well and is seen as a key driver for growth, especially as it does not rely on cookies or IPs, making it resilient to changes in privacy regulations [76]

Financial Performance - Net cash provided by operating activities in Q3 2023 was $40.1 million, a 15.6% increase from $34.7 million in Q3 2022[1] - Cash and cash equivalents, short-term bank deposits, and marketable securities totaled $523.6 million as of September 30, 2023, up 21.9% from $429.6 million as of December 31, 2022[1] - Total revenue for Q3 2023 was $185.3 million, a 16.8% increase from $158.6 million in Q3 2022[12] - Net income for Q3 2023 was $32.8 million, a 28.3% increase from $25.6 million in Q3 2022[12] - Diluted earnings per share for Q3 2023 were $0.65, up 22.6% from $0.53 in Q3 2022[12] - Total assets as of September 30, 2023, were $940.1 million, an 8.0% increase from $870.2 million as of December 31, 2022[14] - Retained earnings as of September 30, 2023, were $148.8 million, a 110.2% increase from $70.8 million as of December 31, 2022[14] - Revenue increased by 17% year-over-year to $185.3 million in Q3 2023, with a total of $509.0 million for the first nine months of 2023[21][30] - Adjusted EBITDA grew by 29% year-over-year to $42.7 million in Q3 2023, reaching $115.2 million for the first nine months of 2023[21][30] - Non-GAAP Net Income increased by 42% year-over-year to $42.4 million in Q3 2023, reaching $114.4 million for the first nine months of 2023[30] - Net cash from operations increased by 16% year-over-year to $40.1 million in Q3 2023, totaling $105.2 million for the first nine months of 2023[30] - Revenue increased 17% to $185.3 million in Q3 2023 from $158.6 million in Q3 2022[35] - GAAP net income increased by 28% to $32.8 million in Q3 2023 compared to $25.6 million in Q3 2022[36] - Non-GAAP net income was $42.4 million, or 23% of revenue, in Q3 2023, compared to $29.9 million, or 19% of revenue, in Q3 2022[37] - Adjusted EBITDA was $42.7 million, or 23% of revenue (and 55% of Contribution ex-TAC) in Q3 2023, compared to $33.0 million, or 21% of revenue (and 51% of Contribution ex-TAC) in Q3 2022[38] Advertising Revenue - Display advertising revenue in Q3 2023 was $99.2 million, up 14.3% from $86.8 million in Q3 2022[12] - Search advertising revenue in Q3 2023 was $86.1 million, a 19.9% increase from $71.8 million in Q3 2022[12] - Retail Media revenue surged 112% year-over-year to $13.0 million in Q3 2023, accounting for 13% of Display Advertising revenue[29] - CTV revenue increased by 39% year-over-year to $7.9 million in Q3 2023, representing 8% of Display Advertising revenue[29] - Search Advertising revenue rose by 20% year-over-year to $86.1 million in Q3 2023, with a total of $230.5 million for the first nine months of 2023[30] - Display Advertising revenue increased 14% YoY, accounting for 54% of total revenue, driven by a 112% YoY increase in Retail revenue to $13.0 million and a 39% YoY increase in CTV revenue to $7.9 million[35] - Search Advertising revenue increased 20% YoY, accounting for 46% of revenue, with an 86% increase in Average Daily Searches and a 16% increase in the number of publishers[35] Costs and Expenses - Traffic acquisition costs and media buy in Q3 2023 were $108.0 million, a 15.3% increase from $93.6 million in Q3 2022[12] - TAC amounted to $108.0 million, or 58% of revenue, in Q3 2023, compared to $93.6 million, or 59% of revenue, in Q3 2022[36] Guidance and Forecast - Perion reiterates its annual revenue and adjusted EBITDA guidance for 2023[31] - 2023 revenue guidance is $730-$750 million, representing a 16% YoY growth[32] - 2023 Adjusted EBITDA guidance is $167+ million, representing a 26% YoY growth[32] - Adjusted EBITDA to Revenue is expected to increase to 23% in 2023 from 21% in 2022[32] Operational Metrics - Average Daily Searches increased by 86% year-over-year to 31.3 million, with Search Advertising publishers growing by 16% to 164[29] Innovation and Product Development - The company launched WAVE, a generative AI-powered dynamic audio advertising solution, targeting Retail, QSR, automotive, and travel verticals[23][26]

1 Forward Looking Statements Non-GAAP Measures Non-GAAP Operating Expenses and Cost of Revenue is defined as Total Costs and Expenses excluding traffic acquisition costs and media buy, depreciation, amortization of acquired intangible assets, stock-based compensation expenses, retention and other acquisition-related expenses and gains and losses recognized with respect to changes in fair value of contingent consideration. Adjusted Earnings Before Interest, Taxes, Depreciation and Amortization ("Adjusted EBI ...

Financial Data and Key Metrics Changes - Revenue for Q2 2023 grew by 22% year-over-year to $178.5 million, reflecting strong continued growth [20][59] - Adjusted EBITDA for the quarter increased by 45% year-over-year to $41.2 million, with an adjusted EBITDA margin rising from 19% to 23% [41][20] - GAAP net income increased by 10% year-over-year to $21.4 million, with non-GAAP diluted EPS growing by 65% year-over-year to $0.84 per diluted share [20][22] - Cash and cash equivalents increased from $436 million at the end of Q1 to $483 million at the end of Q2 2023 [23] Business Line Data and Key Metrics Changes - Search Advertising revenue grew by 21% year-over-year to $79.1 million, accounting for 44% of total revenue, with average daily searches increasing by 68% year-over-year to 28.6 million [9][20] - Retail Media business accelerated, growing 63% year-over-year and accounting for 10% of Display Advertising revenue [21] - Video revenue increased by 14% year-over-year, representing 41% of Display Advertising revenue [21] - CTV revenue more than doubled compared to Q2 2022, representing 7% of Display Advertising revenue [21] Market Data and Key Metrics Changes - The company continues to outperform the digital advertising industry, capturing shifts in advertising budgets while maintaining high margins [8][17] - The contribution excluding TAC for the quarter grew by 27% year-over-year to $77 million, representing 43% of revenue [20][60] Company Strategy and Development Direction - The company aims to maintain agility and capture market share in core activities while exploring new markets [16][35] - A focus on technology and AI is emphasized, with investments in both supply and demand sides of digital advertising [34][35] - The strategic diversification business model is highlighted as a key driver for growth and flexibility in response to market changes [35][39] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the company's ability to grow despite economic headwinds, raising the 2023 annual guidance for revenue and adjusted EBITDA [23][58] - The company is committed to innovation and efficiency measures to enhance profitability and margin expansion [39][56] Other Important Information - The company has a strong cash position and effective cash management, generating $5.2 million in financial income in Q2 [61] - The company is exploring M&A opportunities to accelerate growth, particularly in CTV and Retail Media [51][93] Q&A Session Summary Question: What are the goals for Search over the next two to three years? - The company aims to grow the number of publishers and searches while continuously seeking strategic partnerships [43][44] Question: What is the incremental value of Retail Media compared to other solutions? - Retail Media is seen as a data-driven solution that is stickier and expected to continue growing [75] Question: How does international market growth compare to North America? - The majority of business remains in the U.S., but there is significant activity in Europe due to new agreements [85] Question: What is the outlook for cash and potential acquisitions? - The company is looking for M&A opportunities to sustain growth, but share buybacks could be considered if suitable targets are not found [50][51] Question: How does the company view the impact of Generative AI? - Generative AI is recognized as a future driver for the internet and advertising, but it is still early to assess its full impact [100]

[Q2 2023 Earnings Release Overview](index=1&type=section&id=Q2%202023%20Earnings%20Release%20Overview) Perion reported robust Q2 2023 results with significant revenue and Adjusted EBITDA growth, driven by strategic diversification and leading to an upward revision of annual guidance [Q2 2023 Performance Summary](index=1&type=section&id=Q2%202023%20Performance%20Summary) Perion reported strong second-quarter 2023 results, demonstrating consistent outperformance with significant year-over-year growth in revenue and Adjusted EBITDA, driven by a strategic focus on profitability, efficiency, innovation, and diversification in digital advertising - Perion delivered strong results with a **22% year-over-year increase in revenue** and **45% growth in Adjusted EBITDA**[1](index=1&type=chunk)[2](index=2&type=chunk) - The company's performance is attributed to focusing on profitability, margin expansion, efficiency, innovation, and a diversification strategy powered by technology investment[2](index=2&type=chunk) [Q2 2023 Business Highlights](index=1&type=section&id=Q2%202023%20Business%20Highlights) Key business segments experienced substantial year-over-year growth in Q2 2023, with CTV revenue more than doubling, Retail Media and SORT® showing strong double-digit increases, and Search Advertising expanding its reach through increased daily searches and publisher numbers Q2 2023 Business Segment Growth | Metric | Q2 2023 Growth (YoY) | % of Display Ad Revenue (Q2 2023) | % of Display Ad Revenue (Q2 2022) | | :-------------------------- | :------------------- | :-------------------------------- | :-------------------------------- | | CTV revenue | +104% | 7% | 4% | | Retail Media revenue | +63% | 10% | 8% | | Video revenue | +14% | 41% | 44% | | Average Daily Searches | +68% | N/A | N/A | | Search Advertising publishers | +28% | N/A | N/A | | SORT® revenue | +84% | 21% | 14% | - The methodology for measuring CTV activity changed from campaigns to channels, with the growth trend remaining consistent under both approaches[4](index=4&type=chunk) [Q2 2023 Financial Highlights (Summary Table)](index=2&type=section&id=Q2%202023%20Financial%20Highlights%20Table) Perion's Q2 2023 financial performance demonstrated robust growth across key metrics, including total revenue, Contribution Ex-TAC, Non-GAAP Net Income, and Adjusted EBITDA, both for the quarter and the six months ended June 30, 2023 Q2 2023 and Six-Month Financial Performance Summary | Metric (in millions, except per share data) | Three months ended June 30, 2023 | Three months ended June 30, 2022 | % Change (YoY) | Six months ended June 30, 2023 | Six months ended June 30, 2022 | % Change (YoY) | | :---------------------------------------- | :------------------------------- | :------------------------------- | :------------- | :----------------------------- | :----------------------------- | :------------- | | Display Advertising Revenue | $99.4 | $81.6 | +22% | $179.3 | $150.2 | +19% | | Search Advertising Revenue | $79.1 | $65.1 | +21% | $144.4 | $121.8 | +19% | | **Total Revenue** | **$178.5** | **$146.7** | **+22%** | **$323.6** | **$272.0** | **+19%** | | Contribution Ex-TAC | $77.0 | $60.7 | +27% | $142.3 | $115.0 | +24% | | GAAP Net Income | $21.4 | $19.5 | +10% | $45.2 | $35.0 | +29% | | Non-GAAP Net Income | $42.1 | $24.5 | +72% | $72.0 | $45.2 | +59% | | Adjusted EBITDA | $41.2 | $28.5 | +45% | $72.5 | $51.1 | +42% | | Adjusted EBITDA to Contribution Ex-TAC | 54% | 47% | +7pp | 51% | 44% | +7pp | | Net Cash Provided by Operating Activities | $47.4 | $25.7 | +84% | $65.2 | $49.3 | +32% | | GAAP Diluted EPS | $0.43 | $0.41 | +5% | $0.91 | $0.74 | +23% | | Non-GAAP Diluted EPS | $0.84 | $0.51 | +65% | $1.45 | $0.95 | +53% | [2023 Annual Guidance Update](index=2&type=section&id=2023%20Annual%20Guidance) Perion raised its annual revenue and Adjusted EBITDA guidance for 2023, reflecting increased profitability and margin expansion, building on the strong performance achieved in the first half of the year 2023 Annual Guidance Comparison | Metric (in millions) | 2022 Actual | Prior 2023 Guidance | Current 2023 Guidance | YoY Growth % (Current Guidance Midpoint) | | :------------------- | :---------- | :------------------ | :-------------------- | :------------------------------------- | | Revenue | $640.3 | $725-$745 | $730-$750 | 16% | | Adjusted EBITDA | $132.4 | $155+ | $167+ | 26% | | Adjusted EBITDA to Revenue | 21% | 21% | 23% | N/A | | Adjusted EBITDA to Contribution Ex-TAC | 49% | 50% | 54% | N/A | - The company does not provide an outlook for GAAP Income from operations or a reconciliation of Adjusted EBITDA guidance to GAAP Income from operations due to the variability and complexity of certain reconciling items, such as stock-based compensation and amortization from future acquisitions[9](index=9&type=chunk) [Detailed Financial Performance (Q2 2023)](index=3&type=section&id=Financial%20Comparison%20for%20the%20Second%20Quarter%20of%202023) This section provides an in-depth analysis of Perion's Q2 2023 financial results, detailing revenue growth drivers, margin expansion, profitability metrics, and cash flow performance [Revenue Breakdown and Growth Drivers](index=3&type=section&id=Revenue) Total revenue increased by 22% year-over-year, driven by strong growth in both Display Advertising (22% increase, primarily from CTV and video) and Search Advertising (21% increase, fueled by higher average daily searches and publisher expansion) - **Total Revenue increased by 22% to $178.5 million** in Q2 2023 from $146.7 million in Q2 2022[10](index=10&type=chunk) - Display Advertising revenue increased **22% YoY**, accounting for **56% of total revenue**, primarily due to a **14% YoY increase in video revenue ($40.9 million)** and a **104% YoY increase in CTV revenue ($7.2 million)**[10](index=10&type=chunk) - Search Advertising revenue increased **21% YoY**, accounting for **44% of total revenue**, driven by a **68% increase in Average Daily Searches** and a **28% increase in the number of publishers**, with RPM also gradually increasing QoQ[10](index=10&type=chunk) [Traffic Acquisition Costs and Margin Expansion](index=3&type=section&id=Traffic%20Acquisition%20Costs%20and%20Media%20Buy%20(%22TAC%22)) Traffic Acquisition Costs (TAC) as a percentage of revenue decreased, indicating margin expansion, primarily due to an optimized product mix and enhanced media buying strategies leveraging data and buying power Traffic Acquisition Costs (TAC) Overview | Metric | Q2 2023 (in millions) | Q2 2022 (in millions) | | :----- | :-------------------- | :-------------------- | | TAC | $101.5 | $86.0 | | TAC as % of Revenue | 57% | 59% | - The margin expansion was primarily due to an improved product mix and media buying optimization, enabled by leveraging data and buying power[11](index=11&type=chunk) [GAAP and Non-GAAP Profitability](index=3&type=section&id=GAAP%20Net%20Income) GAAP Net Income increased by 10% year-over-year, influenced by a significant fair-value adjustment, while Non-GAAP Net Income and Adjusted EBITDA saw substantial increases of 72% and 45% respectively, highlighting strong operational performance Q2 2023 Profitability Metrics | Metric (in millions) | Q2 2023 | Q2 2022 | YoY Change | | :------------------- | :------ | :------ | :--------- | | GAAP Net Income | $21.4 | $19.5 | +10% | | Non-GAAP Net Income | $42.1 | $24.5 | +72% | | Adjusted EBITDA | $41.2 | $28.5 | +45% | | Adjusted EBITDA as % of Revenue | 23% | 19% | - GAAP net income in Q2 2023 includes a **$14.6 million fair-value adjustment** of contingent consideration payable for the Vidazoo acquisition due to overachievement and an amendment to the share purchase agreement[12](index=12&type=chunk) [Cash Flow and Net Cash Position](index=3&type=section&id=Cash%20Flow%20from%20Operations) Net cash provided by operating activities significantly increased by 84% year-over-year in Q2 2023, with the company's overall net cash position growing to $483.3 million by quarter-end Net Cash Provided by Operating Activities | Metric (in millions) | Q2 2023 | Q2 2022 | YoY Change | | :------------------- | :------ | :------ | :--------- | | Net Cash Provided by Operating Activities | $47.4 | $25.7 | +84% | Cash and Equivalents Position | Metric (in millions) | June 30, 2023 | December 31, 2022 | | :------------------- | :------------ | :---------------- | | Cash and cash equivalents, short-term bank deposits and marketable securities | $483.3 | $429.6 | [Company Overview and Financial Disclosures](index=4&type=section&id=About%20Perion%20and%20Non-GAAP%20Disclosures) This section provides an overview of Perion's business, defines its non-GAAP financial measures, and includes important disclaimers regarding forward-looking statements [Company Profile](index=4&type=section&id=About%20Perion%20Network%20Ltd.) Perion Network Ltd. is a global multi-channel advertising technology company providing synergistic solutions across search, social, display, video, and CTV, integrated through its intelligent HUB (iHUB) for brands and publishers - Perion is a global multi-channel advertising technology company delivering synergistic solutions across search advertising, social media, display, video, and CTV advertising[18](index=18&type=chunk) - These channels converge at Perion's intelligent HUB (iHUB), which connects demand and supply assets, providing significant benefits to brands and publishers[18](index=18&type=chunk) [Explanation of Non-GAAP Financial Measures](index=4&type=section&id=Non-GAAP%20Measures) This section defines Perion's non-GAAP financial measures, including Contribution Ex-TAC, Adjusted EBITDA, Non-GAAP net income, and Non-GAAP earnings per share, explaining adjustments and their utility for assessing ongoing business performance - Non-GAAP financial measures include Contribution Ex-TAC, Adjusted EBITDA, Non-GAAP net income, and Non-GAAP earning per share, which are GAAP measures adjusted to exclude certain items[19](index=19&type=chunk) - Contribution Ex-TAC is revenue reduced by traffic acquisition costs and media buy, reflecting core business performance without direct pass-through costs[20](index=20&type=chunk) - Adjusted EBITDA, Non-GAAP net income, and Non-GAAP EPS exclude various non-cash and non-core items such as stock-based compensation, amortization of acquired intangibles, and changes in fair value of contingent consideration, to provide a clearer view of operational results[21](index=21&type=chunk)[22](index=22&type=chunk)[23](index=23&type=chunk) [Forward-Looking Statements Disclaimer](index=5&type=section&id=Forward%20Looking%20Statements) This section provides a standard disclaimer regarding forward-looking statements, emphasizing that actual results may differ materially from projections due to various risks and uncertainties, including those related to acquisitions, market dynamics, competition, and regulatory changes - The press release contains forward-looking statements subject to risks and uncertainties, and actual results, performance, or achievements may differ materially[25](index=25&type=chunk) - Factors that could cause differences include the failure to realize anticipated benefits of acquisitions, integration risks, diversion of resources, potential litigation, intense market changes, loss of key customers, competitive pressures, and changes in laws and regulations[25](index=25&type=chunk) [Investor Relations Contact](index=5&type=section&id=Contact%20Information) Contact information for Perion Network Ltd.'s Investor Relations department is provided for inquiries - Investor Relations contact: Dudi Musler, VP of Investor Relations, dudim@perion.com, +972 (54) 7876785[26](index=26&type=chunk) [Consolidated Financial Statements](index=6&type=section&id=Consolidated%20Financial%20Statements) This section presents Perion's official consolidated statements, including operations, balance sheets, and cash flows, for the reported periods [Consolidated Statements of Operations](index=6&type=section&id=CONSOLIDATED%20STATEMENTS%20OF%20OPERATIONS) The consolidated statements of operations detail Perion's revenues, costs, and expenses, leading to net income for the three and six months ended June 30, 2023 and 2022, showing overall growth in total revenue and net income Consolidated Statements of Operations (in thousands) | Metric (in thousands) | Three months ended June 30, 2023 | Three months ended June 30, 2022 | Six months ended June 30, 2023 | Six months ended June 30, 2022 | | :-------------------- | :------------------------------- | :------------------------------- | :----------------------------- | :----------------------------- | | Total Revenue | $178,470 | $146,656 | $323,620 | $271,971 | | Income from Operations | $19,886 | $21,872 | $44,390 | $38,378 | | Net Income | $21,406 | $19,500 | $45,191 | $34,966 | | Diluted EPS | $0.43 | $0.41 | $0.91 | $0.74 | [Condensed Consolidated Balance Sheets](index=7&type=section&id=CONDENSED%20CONSOLIDATED%20BALANCE%20SHEETS) The condensed consolidated balance sheets present Perion's financial position, including assets, liabilities, and shareholders' equity, as of June 30, 2023, and December 31, 2022, indicating an increase in total assets and shareholders' equity Condensed Consolidated Balance Sheets (in thousands) | Metric (in thousands) | June 30, 2023 | December 31, 2022 | | :-------------------- | :------------ | :---------------- | | Total Current Assets | $644,314 | $603,458 | | Total Assets | $903,514 | $870,218 | | Total Current Liabilities | $250,731 | $234,608 | | Total Liabilities | $267,022 | $287,084 | | Total Shareholders' Equity | $636,492 | $583,134 | [Condensed Consolidated Statements of Cash Flows](index=8&type=section&id=CONDENSED%20CONSOLIDATED%20STATEMENTS%20OF%20CASH%20FLOWS) The condensed consolidated statements of cash flows illustrate cash generated from operating, investing, and financing activities for the three and six months ended June 30, 2023 and 2022, highlighting strong operating cash flow and a net increase in cash and equivalents Condensed Consolidated Statements of Cash Flows (in thousands) | Metric (in thousands) | Three months ended June 30, 2023 | Three months ended June 30, 2022 | Six months ended June 30, 2023 | Six months ended June 30, 2022 | | :---------------------------------------------------- | :------------------------------- | :------------------------------- | :----------------------------- | :----------------------------- | | Net cash provided by operating activities | $47,372 | $25,721 | $65,151 | $49,275 | | Net cash provided by (used in) investing activities | $4,994 | $(7,347) | $(44,446) | $(43,399) | | Net cash provided by (used in) financing activities | $125 | $(8,745) | $(11,068) | $(7,797) | | Net increase (decrease) in cash and cash equivalents and restricted cash | $52,499 | $9,482 | $9,722 | $(2,098) | [Reconciliation of GAAP to Non-GAAP Results](index=9&type=section&id=GAAP%20to%20Non-GAAP%20Reconciliations) This section provides detailed reconciliations of GAAP financial measures to their corresponding non-GAAP counterparts, including Contribution Ex-TAC, Adjusted EBITDA, and Non-GAAP Net Income [Contribution Ex-TAC Reconciliation](index=9&type=section&id=Contribution%20Ex-TAC) This section reconciles total revenue to Contribution Ex-TAC by deducting traffic acquisition costs and media buy, providing a clearer view of revenue generated before direct pass-through costs Contribution Ex-TAC Reconciliation (in thousands) | Metric (in thousands) | Three months ended June 30, 2023 | Three months ended June 30, 2022 | Six months ended June 30, 2023 | Six months ended June 30, 2022 | | :-------------------------------- | :------------------------------- | :------------------------------- | :----------------------------- | :----------------------------- | | Total Revenue | $178,470 | $146,656 | $323,620 | $271,971 | | Traffic acquisition costs and media buy | $101,482 | $85,956 | $181,357 | $156,930 | | **Contribution Ex-TAC** | **$76,988** | **$60,700** | **$142,263** | **$115,041** | [Adjusted EBITDA Reconciliation](index=9&type=section&id=Adjusted%20EBITDA) This section reconciles GAAP Income from Operations to Adjusted EBITDA by adding back non-cash and non-core expenses, including stock-based compensation, acquisition-related expenses, fair value changes, amortization, and depreciation Adjusted EBITDA Reconciliation (in thousands) | Metric (in thousands) | Three months ended June 30, 2023 | Three months ended June 30, 2022 | Six months ended June 30, 2023 | Six months ended June 30, 2022 | | :---------------------------------------- | :------------------------------- | :------------------------------- | :----------------------------- | :----------------------------- | | GAAP Income from Operations | $19,886 | $21,872 | $44,390 | $38,378 | | Stock-based compensation expenses | $3,100 | $2,701 | $6,502 | $5,129 | | Retention and other acquisition-related expenses | $250 | $679 | $257 | $1,230 | | Changes in fair value of contingent consideration | $14,602 | $- | $14,602 | $- | | Amortization of acquired intangible assets | $2,992 | $2,812 | $5,955 | $5,601 | | Depreciation | $413 | $396 | $811 | $792 | | **Adjusted EBITDA** | **$41,243** | **$28,460** | **$72,517** | **$51,130** | [Non-GAAP Net Income and EPS Reconciliation](index=10&type=section&id=Non-GAAP%20Net%20Income) This section reconciles GAAP Net Income to Non-GAAP Net Income and Diluted EPS by adjusting for various non-cash and non-recurring items, including stock-based compensation, amortization, acquisition expenses, fair value changes, and related tax effects Non-GAAP Net Income and EPS Reconciliation (in thousands, except per share data) | Metric (in thousands, except per share data) | Three months ended June 30, 2023 | Three months ended June 30, 2022 | Six months ended June 30, 2023 | Six months ended June 30, 2022 | | :----------------------------------------- | :------------------------------- | :------------------------------- | :----------------------------- | :----------------------------- | | GAAP Net Income | $21,406 | $19,500 | $45,191 | $34,966 | | Stock-based compensation expenses | $3,100 | $2,701 | $6,502 | $5,129 | | Amortization of acquired intangible assets | $2,992 | $2,812 | $5,955 | $5,601 | | Retention and other acquisition-related expenses | $250 | $679 | $257 | $1,230 | | Changes in fair value of contingent consideration | $14,602 | $- | $14,602 | $- | | Foreign exchange losses (gains) associated with ASC-842 | $(81) | $(548) | $(198) | $(745) | | Revaluation of acquisition-related contingent consideration | $147 | $129 | $292 | $261 | | Taxes on the above items | $(289) | $(771) | $(574) | $(1,212) | | **Non-GAAP Net Income** | **$42,127** | **$24,502** | **$72,027** | **$45,230** | | **Non-GAAP diluted earnings per share** | **$0.84** | **$0.51** | **$1.45** | **$0.95** |