Financial Data and Key Metrics Changes - Taboola's current gross revenue run rate is just under $2 billion, while the performance advertising market opportunity is estimated at over $55 billion [1][9] - The company has seen a 17% growth in scaled advertisers, which represent about 75-80% of its revenue, over the last two years [40][41] Business Line Data and Key Metrics Changes - Taboola is focusing on performance advertising, particularly in the open web, which is seen as a significant growth area due to diminishing returns in social media advertising [5][9] - The company has launched the Realize platform, which allows advertisers to pay on a CPC basis for display ads, enhancing the ease of use and performance tracking [21][24] Market Data and Key Metrics Changes - The performance advertising market is segmented, with approximately $25 billion from open web performance advertising and $30 billion from diminishing returns in social media [9][10] - 75% of advertisers are experiencing diminishing returns on their social media spend, indicating a shift in advertising strategies [16] Company Strategy and Development Direction - Taboola aims to capture a larger share of the performance advertising market by leveraging unique first-party data and AI capabilities [7][39] - The company is focusing on verticals such as travel, financial services, and direct-to-consumer products, where it has seen lower churn rates and higher spending growth [18][19] Management's Comments on Operating Environment and Future Outlook - Management believes that the shift towards performance advertising will continue due to macroeconomic challenges and the saturation of search and social media advertising [4][5] - The company is optimistic about its growth potential, particularly with the Realize platform, which is expected to contribute meaningfully to the business by 2026 [40][41] Other Important Information - Taboola has access to a unique dataset of 600 million daily active users and over a trillion monthly recommendations, which enhances its advertising effectiveness [35][39] - The company is committed to maintaining a conservative approach to guidance, allowing for potential upside as it executes its strategy [63] Q&A Session Summary Question: Can you walk us through the performance advertising opportunity? - The performance advertising market is estimated at over $55 billion, with significant potential in open web advertising and diminishing returns in social media [1][9] Question: How does the Realize platform enhance advertiser engagement? - Realize allows advertisers to pay only for clicks, improving transparency and performance measurement [21][24] Question: What metrics will be used to track Realize's client adoption? - The company will track scaled advertisers spending over $100,000 annually, which has grown 17% over the last two years [40][41] Question: What is the outlook for potential M&A opportunities? - Management is open to small, synergistic acquisitions but is focused on executing its current strategy without dilutive events [65][66]

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] - Investing in bargain stocks with recent price momentum may be a safer approach [2] Group 2: Taboola.com Ltd. (TBLA) Analysis - TBLA has shown a price increase of 15.1% over the past four weeks, indicating growing investor interest [3] - The stock gained 8.7% over the past 12 weeks, demonstrating its ability to deliver positive returns over a longer timeframe [4] - TBLA has a beta of 1.21, suggesting it moves 21% higher than the market in either direction [4] - The stock has a Momentum Score of A, indicating a favorable entry point for investors [5] - TBLA has a Zacks Rank 1 (Strong Buy) due to upward revisions in earnings estimates, which attract more investors [6] - The stock is trading at a Price-to-Sales ratio of 0.61, indicating it is reasonably valued at 61 cents for each dollar of sales [6] Group 3: Investment Opportunities - TBLA appears to have significant potential for growth at a fast pace, alongside other stocks that meet the 'Fast-Paced Momentum at a Bargain' criteria [7] - There are over 45 Zacks Premium Screens available to help identify winning stock picks based on various investing styles [8]

Group 1 - Moretus Research provides high-quality equity research focused on U.S. public markets, aiming to deliver clarity, conviction, and alpha for serious investors [1] - The research framework identifies companies with durable business models, mispriced cash flow potential, and intelligent capital allocation, emphasizing a structured and repeatable approach [1] - Valuation methods are based on sector-relevant multiples tailored to each company's business model and capital structure, prioritizing comparability, simplicity, and relevance [1] Group 2 - Research coverage focuses on underappreciated companies experiencing structural changes or temporary dislocations, where disciplined analysis can yield asymmetric returns [1] - Moretus Research aims to elevate the standard for independent investment research by providing professional-grade insights and actionable valuation [1]

Core Viewpoint - Taboola.com Ltd. (TBLA) shows a significantly improving earnings outlook, making it a solid investment choice as analysts continue to raise earnings estimates for the company [1][2]. Earnings Estimate Revisions - The upward trend in earnings estimate revisions indicates growing analyst optimism regarding Taboola's earnings prospects, which is expected to positively impact its stock price [2]. - The current-quarter earnings estimate of $0.09 per share reflects a remarkable change of +1000% compared to the previous year, with a 100% increase in the Zacks Consensus Estimate over the last 30 days [5][6]. - For the full year, the earnings estimate stands at $0.38 per share, representing a +3900% change from the year-ago figure, with a 20% increase in the consensus estimate over the same timeframe [6][7]. Zacks Rank and Performance - Taboola.com has achieved a Zacks Rank 1 (Strong Buy) due to strong agreement among analysts in revising earnings estimates upward, which has historically led to significant outperformance [3][8]. - Stocks with a Zacks Rank 1 (Strong Buy) and 2 (Buy) have shown a tendency to significantly outperform the S&P 500 [8]. Stock Performance - The stock has increased by 21.9% over the past four weeks, driven by strong estimate revisions, suggesting potential for further upside [9].

Summary of Taboola.com (TBLA) FY Conference Call - May 13, 2025 Company Overview - **Company**: Taboola.com (TBLA) - **Industry**: Performance Advertising - **Core Business**: Taboola is a leading global performance advertising platform that helps businesses place performance ads across the open internet, leveraging unique data and AI to target ads effectively [7][8][9]. Financial Projections - **2025 Revenue Projection**: Expected to achieve approximately $1.9 billion in revenue [10]. - **EBITDA Margin Target**: Aiming for 30% EBITDA margins, translating to about $211 million to $212 million in adjusted EBITDA [10]. - **Free Cash Flow Conversion**: Targeting a conversion rate of 50% to 60% of adjusted EBITDA to free cash flow, with expectations to be closer to the 60% end [10]. New Product Launch - **Realize Platform**: Introduction of a new advertising platform that expands beyond native advertising to include display ads and vertical video ads, allowing performance advertisers to achieve their goals across various media formats [11][12]. Market Position and Strategy - **Addressable Market Expansion**: The company aims to capture a larger share of the display ad market, which is three times larger than the native ad market [13]. - **Performance vs. Branding**: Emphasizes the difference between performance advertising (specific goals like CPA and CPL) and branding advertising, noting a gap in the market for automated performance advertising solutions [14][15][16]. - **Unique Data Advantage**: Taboola's data is derived from being hard-coded on publisher pages, providing a unique targeting capability that competitors may struggle to replicate [28][29]. Competitive Landscape - **End-to-End Solution**: Taboola operates as both a Demand-Side Platform (DSP) and Supply-Side Platform (SSP), providing a competitive edge in the open internet space [26][27]. - **Response to Competitors**: Acknowledges competition from other DSPs and SSPs but believes its unique data and direct relationships with advertisers and publishers provide a significant advantage [27][30]. Generative AI and Technology Integration - **Generative AI Utilization**: The company is integrating generative AI to enhance internal productivity and improve customer experience through tools like Abby, a self-service generative AI assistant for advertisers [70][72][123]. - **Deep Learning AI**: Continues to invest in deep learning AI to optimize ad targeting and improve revenue per ad spot [118][120]. Capital Allocation and Financial Strategy - **Share Buybacks**: The primary focus for excess cash flow is on aggressive share buybacks, with over $90 million repurchased in the first quarter and a half of the year [105]. - **M&A Strategy**: Plans to pursue smaller, tuck-in acquisitions rather than large-scale mergers, while also considering debt repayment as a lower priority following a recent refinancing [106][107]. Yahoo Integration and Performance - **Impact of Yahoo Deal**: The acquisition of Yahoo has significantly increased adjusted EBITDA and free cash flow, although some expected demand sources have not materialized as quickly as anticipated [94][96]. - **Brand Advertiser Engagement**: The company has successfully transitioned several large brand advertisers to its platform, although some have opted to remain exclusive to Yahoo supply [96][97]. Future Outlook - **Focus on Incremental Demand**: Plans to bring in new forms of demand and verticalize the sales team to better serve specific industries [48][49]. - **CTV Opportunities**: Exploring potential in Connected TV (CTV) advertising, particularly in connecting video ads to performance outcomes [36][37]. Key Takeaways - Taboola is positioning itself as a leader in performance advertising by leveraging unique data and AI technology to meet the evolving needs of advertisers. - The company is focused on expanding its market reach, improving profitability through technology, and maintaining a strong financial position through strategic capital allocation.

Financial Data and Key Metrics Changes - The company reported Q1 revenues of $427 million, representing a 3% year-over-year growth, with ex-TAC gross profit of $152 million, which is 9% higher than last year [9][21] - Adjusted EBITDA for Q1 was $36 million, reflecting a 53% year-over-year growth, with margins significantly expanding [9][27] - Free cash flow for the quarter was $36 million, growing 35% year-over-year [9][27] - The net loss for the quarter was $8.75 million, while non-GAAP net income was $25 million [26] Business Line Data and Key Metrics Changes - The number of scaled advertisers grew by 9% year-over-year, reaching 1,996, while the average revenue per scaled advertiser declined by 3% [22][38] - Revenue growth was broad-based, including positive growth in the core native business, Taboola News, and Bidded Supply [23][24] Market Data and Key Metrics Changes - The company has seen a 1% decrease in advertising spend related to tariffs, primarily affecting its China business, which now accounts for around 5% of total Q2 revenue [10][52] - The macroeconomic environment is being closely monitored, but no material impact has been observed on the business so far [19][66] Company Strategy and Development Direction - The company is focused on capturing a $55 billion market opportunity in performance advertising outside of search and social channels [7] - The launch of the Realize platform is a significant step forward, offering new ad formats and a CPC pricing model, which is expected to unlock previously inaccessible advertising budgets [14][16] - The company aims to drive incremental ad spend through Realize's new capabilities and is focusing on verticalizing its sales organization [12][13] Management's Comments on Operating Environment and Future Outlook - Management remains cautiously optimistic about the future, emphasizing the importance of performance-driven advertising as advertisers seek measurable outcomes [6][46] - The company has reiterated its full-year guidance for 2025, expecting revenues between $1.84 billion and $1.89 billion [31][33] - Management is confident in the strength of the business and continues to prioritize cost discipline while investing in key growth initiatives [19][30] Other Important Information - The company has a strong balance sheet with a net cash balance of $89.7 million and cash equivalents totaling $216.2 million [29] - A new $270 million revolving credit facility was established, allowing for more proactive management of working capital [29][30] Q&A Session Summary Question: Progress on verticalizing the sales force and scaled advertiser growth - Management indicated that the restructuring of the sales teams is complete, and early returns are positive, with a 9% growth in scaled advertisers [36][38] Question: Yield improvements and sustainability - Management noted that there were no one-time benefits in Q1, and they expect to continue growing yield going forward [40][41] Question: Impact of Google’s AI initiatives on publisher traffic - Management acknowledged some effects on search traffic but emphasized that supply is not a concern, focusing instead on demand growth [96][98] Question: Financial impact of the LINE partnership - The LINE partnership is seen as a potential gateway to a new universe of publishers, although no material financial impact is expected this year [86][87] Question: Future hiring trends and cost management - Management expects limited additional investment in sales and marketing, with a focus on ramping R&D for the Realize platform while maintaining cost discipline [88][90]

Financial Data and Key Metrics Changes - The company reported revenues of $427 million for Q1 2025, representing a 3% year-over-year growth [9][22] - Ex-TAC gross profit reached $152 million, a 9% increase year-over-year [9][22] - Adjusted EBITDA was $36 million, reflecting a 53% year-over-year growth, with an adjusted EBITDA margin of 24% [9][27] - Free cash flow for the quarter was $36 million, growing 35% year-over-year [9][28] - The net loss was $8.75 million, with non-GAAP net income at $25 million [26] Business Line Data and Key Metrics Changes - The number of scaled advertisers grew by 9% to 1,996, while the average revenue per scaled advertiser declined by 3% [23][38] - Revenue growth was broad-based, with positive contributions from the core native business, Taboola News, and Bidded Supply [24][25] Market Data and Key Metrics Changes - The company noted a 1% decrease in advertising spend related to tariffs, primarily affecting the China business, which now accounts for about 5% of total Q2 revenue [10][55] - The macro environment is being closely monitored, but no material impact has been observed on the business [9][20] Company Strategy and Development Direction - The company is focused on performance advertising, targeting a $55 billion market opportunity outside of search and social channels [6][11] - The launch of the Realize platform aims to drive incremental ad spend and improve advertiser engagement through new capabilities [12][14] - The company is pursuing partnerships with unique data supply partners and expanding its inventory through collaborations with Microsoft and Gannett [19][88] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the strength of the business and reiterated full-year guidance despite macro uncertainties [20][32] - The company is optimistic about the potential of the Realize platform to capture new advertising budgets and drive growth [17][63] Other Important Information - The company has a strong balance sheet with a net cash balance of $89.7 million and cash equivalents of $216.2 million [29] - A new $270 million revolving credit facility was established to enhance liquidity and reduce interest expenses [30] Q&A Session Summary Question: Progress on verticalizing the sales force and its capacity - Management indicated that the restructuring of the sales teams is complete, and early returns are positive, but it is still early in the process [36][38] Question: Relationship between scaled advertisers and average revenue - Management clarified that while the number of scaled advertisers increased, the average revenue per scaled advertiser declined, but historical averages remain strong [38][39] Question: Impact of Google’s AI initiatives on publisher traffic - Management noted some effects on search traffic but emphasized that supply is not a concern, focusing instead on demand growth [99][102] Question: Future revenue impact from the Realize platform - Management expects Realize to start impacting revenue meaningfully in late 2025 and into 2026, but it is still early to forecast specific financial impacts [61][62] Question: Resilience of different business components in uncertain macro environments - Management believes that performance advertising is well-positioned to withstand macroeconomic changes, as it focuses on direct outcomes rather than branding [68][70]

Financial Data and Key Metrics Changes - The company reported Q1 revenues of $427 million, representing a 3% year-over-year growth, with ex TAC gross profit of $152 million, which is 9% higher than last year [8][21] - Adjusted EBITDA for Q1 was $36 million, reflecting a 53% year-over-year growth, with margins expanding significantly [8][25] - Free cash flow for the quarter was $36 million, growing 35% year-over-year [8][25] Business Line Data and Key Metrics Changes - The number of scaled advertisers grew by 9% year-over-year, reaching 1,996, while the average revenue per scaled advertiser declined by 3% [12][22] - The core native business saw positive growth, and the company completed its format testing with Yahoo, which had a marginal revenue reduction impact [23][24] Market Data and Key Metrics Changes - The company noted a 1% decrease in advertising spend related to tariffs, primarily affecting its China business, which now accounts for around 5% of total Q2 revenue [9][53] - The company is seeing positive trends in Taboola News and other parts of the business, supporting its decision to maintain full-year guidance [9][10] Company Strategy and Development Direction - The company is focused on capturing a $55 billion market opportunity in performance advertising outside of search and social channels [6][10] - The launch of the Realize platform is a significant step forward, offering new ad formats and a CPC pricing model, which is expected to unlock previously inaccessible advertising budgets [13][14][15] - The company aims to drive incremental ad spend through Realize's new capabilities and is focusing on verticalizing its sales organization [11][12] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the strength of the business despite macroeconomic uncertainties, emphasizing cost discipline and investment in growth initiatives [19][20] - The company reiterated its full-year guidance for 2025, expecting revenues between $1.84 billion and $1.89 billion [30][31] Other Important Information - The company has a strong balance sheet with a net cash balance of $89.7 million and cash equivalents totaling $216.2 million [28][29] - The company repurchased approximately 16.2 million shares at an average price of $3.3 during Q1, with an additional 15.1 million shares repurchased since then [30][31] Q&A Session Summary Question: Progress on verticalizing the sales force and the impact on scaled advertisers - Management indicated that the restructuring of the sales teams is complete and early returns are positive, with the number of scaled advertisers growing by 9% [34][36][38] Question: Impact of Google news on the ad tech industry - Management noted that the shift towards privacy and the potential reduction of cookies could benefit companies with first-party data, positioning them well in the market [45][46][48] Question: Performance of different business components in uncertain macro environments - Management stated that the performance advertising space is well-positioned, and they have not seen material impacts from macroeconomic changes so far [64][66][68] Question: Guidance for the second half of the year - Management explained that the expected decline in ex TAC revenue in the second half is due to conservative guidance and the impact of prior testing with Yahoo [69][72] Question: Future hiring trends and cost management - Management indicated that while there will be some ramp in R&D hiring, overall cost increases will be limited, focusing on productivity improvements through AI [88][90]

Company Performance - Taboola.com Ltd. reported quarterly earnings of $0.07 per share, exceeding the Zacks Consensus Estimate of $0.01 per share, compared to a loss of $0.08 per share a year ago, representing an earnings surprise of 600% [1] - The company posted revenues of $427.49 million for the quarter ended March 2025, surpassing the Zacks Consensus Estimate by 2.30%, and showing an increase from year-ago revenues of $414.01 million [2] - Over the last four quarters, Taboola.com has surpassed consensus EPS estimates two times and topped consensus revenue estimates three times [2] Stock Outlook - Taboola.com shares have declined approximately 15.3% since the beginning of the year, while the S&P 500 has decreased by 4.7% [3] - The current consensus EPS estimate for the coming quarter is $0.07 on revenues of $448.62 million, and for the current fiscal year, it is $0.36 on revenues of $1.86 billion [7] - The estimate revisions trend for Taboola.com is mixed, resulting in a Zacks Rank 3 (Hold) for the stock, indicating expected performance in line with the market in the near future [6] Industry Context - The Computers - IT Services industry, to which Taboola.com belongs, is currently in the top 39% of over 250 Zacks industries, suggesting a favorable outlook compared to the bottom 50% [8] - Empirical research indicates a strong correlation between near-term stock movements and trends in earnings estimate revisions, which can be tracked by investors [5]

Investor Presentation First Quarter 2025 May 2025 Forward-Looking Statements - Disclaimer Certain statements in this presentation are forward-looking statements, including our Q2 2025 and full-year 2025 guidance and our expectations for Realize, our new performance advertising platform. Forward-looking statements generally relate to future events including future financial or operating performance of Taboola.com Ltd. (the "Company"). In some cases, you can identify forward-looking statements by terminology ...