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]

Core Insights - Taboola reported strong first-quarter results for 2025, exceeding guidance across all key metrics, indicating robust momentum in performance advertising [2][3] - The company aims to continue investing in growth areas, return capital through share repurchases, and solidify its position as a leader in performance advertising beyond search and social [2] Financial Performance - Revenues for Q1 2025 were $427 million, a 3% increase from Q1 2024, driven by a 9% growth in scaled advertisers, despite a 3% decline in average revenue per scaled advertiser [6][13] - Gross profit reached $119 million, up 10% year-over-year, with ex-TAC gross profit at $152 million, reflecting a 9% increase [6][13] - Adjusted EBITDA was $36 million, a significant increase of 53%, with adjusted EBITDA margins expanding to 23.7% from 16.9% [6][13] Guidance for Future Performance - For Q2 2025, Taboola expects revenues between $438 million and $458 million, and for the full year 2025, revenues are projected to be between $1.838 billion and $1.888 billion [3][14] - The company anticipates adjusted EBITDA for Q2 2025 to be between $38 million and $44 million, and for the full year, between $201 million and $209 million [3][15] Cash Flow and Financial Health - Cash flow from operating activities was $48 million, compared to $32 million in the previous year, with free cash flow at $36 million, up from $27 million [6][13] - The company reported a net loss of $8.8 million for Q1 2025, an improvement from a net loss of $26.2 million in Q1 2024 [6][13] Shareholder Returns - Taboola is committed to returning capital to shareholders through share repurchases, reflecting confidence in its long-term growth strategy [2][3]

Core Insights - Taboola has announced an expansion of its long-term partnership with Gannett, enhancing its offerings for performance advertisers [1][2] - The partnership now includes access to display inventory on Gannett properties through Taboola's Realize platform, which utilizes an AI performance engine [2][3] - This collaboration aims to leverage first-party data and AI to optimize advertising campaigns across a wide network of publishers and apps [4] Company Overview - Taboola is a leader in performance advertising technology, reaching approximately 600 million daily active users and partnering with major publishers like NBC News and Yahoo [5] - Gannett is a diversified media company with a national and local presence, operating the USA TODAY NETWORK and focusing on empowering communities through journalism and digital marketing solutions [6] Partnership Details - The partnership between Taboola and Gannett has been in place since 2013, with a focus on audience development, engagement, and monetization [2][4] - Realize, the new platform, allows advertisers to access a broader range of display opportunities, enhancing the effectiveness of their campaigns [3][4]

Core Viewpoint - Taboola is set to release its first quarter 2025 financial results on May 7, 2025, and will host a conference call to discuss these results [1] Group 1: Financial Results Announcement - The financial results for the first quarter of 2025 will be announced on May 7, 2025, at 8:30 a.m. ET [1] - A conference call and webcast will be held to discuss the financial results, accessible via a provided link [1] - The webcast will be available for replay for one year, until May 7, 2026 [1] Group 2: Company Overview - Taboola specializes in performance advertising technology that extends beyond traditional search and social media, focusing on measurable outcomes at scale [2] - The company collaborates with thousands of businesses, utilizing its ad platform, Realize, to reach approximately 600 million daily active users [3] - Major publishers such as NBC News and Yahoo, along with OEMs like Samsung and Xiaomi, leverage Taboola's technology to enhance audience engagement and revenue [3]

Financial Data and Key Metrics Changes - In 2024, the company achieved ex-TAC gross profit of $667 million, representing a 25% growth year-over-year, and adjusted EBITDA of $201 million, more than doubling the previous year's results [13][41] - Free cash flow for 2024 reached $149 million, exceeding the original target of $100 million by 49% and representing nearly three times the free cash flow compared to the prior year [13][46] - The company reported a net income of $33.1 million for Q4 2024, with a full-year net loss of $3.8 million, while non-GAAP net income for the full year was $122.4 million [45][49] Business Line Data and Key Metrics Changes - The enterprise advertising business saw strong growth, contributing to the overall revenue increase, particularly with the onboarding of partners like Yahoo and Apple [42][14] - Adjusted EBITDA margin for 2024 was 30.1%, reflecting strong cost discipline and the benefits of prior investments [44] Market Data and Key Metrics Changes - The company reached 600 million people daily, leveraging first-party data and AI to enhance advertising effectiveness [11][12] - The competitive landscape is shifting, with advertisers increasingly favoring standard display ads over native advertising, which has been identified as a limitation for growth [18][21] Company Strategy and Development Direction - The company is launching a new advertising platform called Realize, aimed at expanding beyond native advertising to capture the full performance advertising market [31][34] - The strategic focus for 2025 includes investing in AI and strengthening partnerships to drive demand and growth [16][24] - The company sees a $55 billion opportunity in performance advertising, particularly as advertisers shift budgets from social platforms due to diminishing returns [25][28] Management's Comments on Operating Environment and Future Outlook - Management acknowledged that projected single-digit growth for 2025 is below historical rates and long-term ambitions, emphasizing the need to lay groundwork for future growth [16][53] - The company is optimistic about the potential of Realize to unlock demand and drive growth, despite current challenges in the native advertising market [89][106] Other Important Information - The board approved an additional $200 million for the share repurchase program, bringing the total authorization to approximately $240 million [50][52] - The company plans to introduce new metrics, including scaled advertisers and average revenue per scaled advertiser, to track growth initiatives [55][56] Q&A Session Summary Question: Concerns about Amazon's new strategy affecting connectivity business - Management views Amazon's strategy as an opportunity for growth outside of walled gardens, emphasizing the potential for retailers to diversify their reach [60][64] Question: Limitations of mobile device ecosystem and CTV growth - Management believes that while CTV is primarily for branding, there is an opportunity for performance advertising outside of traditional channels, positioning the company to fill that gap [66][71] Question: Product changes with Realize and Q1 2025 guidance - Realize aims to provide more demand-side tools and access to a broader range of ad placements, with the guidance reflecting a cautious approach to allow for traction [75][86] Question: Revenue growth expectations and competition with established DSPs - Management acknowledges the competitive landscape but believes that their unique positioning and focus on performance advertising will differentiate them from competitors like Trade Desk and Amazon [96][111]

Financial Data and Key Metrics Changes - In 2024, the company achieved ex-TAC gross profit of $667 million, representing a 25% growth year-over-year, and adjusted EBITDA of $201 million, which more than doubled from the previous year [13][42] - Free cash flow reached $149 million, exceeding the original target of $100 million by 49% and representing nearly three times the free cash flow compared to the prior year [13][46] - For Q4 2024, revenues reached $491 million, with ex-TAC gross profit of $212.7 million, growing 26% year-over-year [40][41] Business Line Data and Key Metrics Changes - The enterprise advertising business saw strong growth, contributing to the overall revenue increase, particularly with the onboarding of partners like Yahoo and Apple [42][14] - Adjusted EBITDA for Q4 was $92.3 million, growing 84% year-over-year, reflecting a 30.1% adjusted EBITDA margin [43][44] Market Data and Key Metrics Changes - The company noted that the native advertising market alone is not sufficient to support its ambitious growth plans, as many advertisers prefer standard display ads over native formats [18][21] - The company identified a $55 billion opportunity in performance advertising beyond search and social, driven by challenges in the EdTech landscape and diminishing returns from social platforms [25][28] Company Strategy and Development Direction - The company announced a strategic shift to expand beyond native advertising into the broader performance advertising market with the launch of its new platform, Realize [31][34] - The focus will be on leveraging first-party data and AI to enhance performance advertising capabilities and meet the needs of advertisers seeking better returns [36][38] Management's Comments on Operating Environment and Future Outlook - Management acknowledged that projected single-digit growth for 2025 is below historical rates and long-term ambitions, emphasizing the need to lay groundwork for accelerated growth [15][16] - The company plans to invest in scaling demand and strengthening partnerships while maintaining a focus on cash generation and shareholder value [15][53] Other Important Information - The board approved an additional $200 million for the share repurchase program, bringing the total authorization to approximately $240 million [50][52] - The company will introduce new metrics, including scaled advertisers and average revenue per scaled advertiser, to track growth in advertiser demand [55][56] Q&A Session Summary Question: Concerns about Amazon's new strategy affecting connectivity business - Management views Amazon's actions as an opportunity for growth in the open web and believes that retailers will continue to seek diverse revenue streams [60][64] Question: Limitations of mobile device ecosystem and CTV growth - Management believes that while CTV is primarily for branding, there is an opportunity for performance advertising outside of traditional channels [66][69] Question: Product changes with Realize and Q1 2025 guidance - Realize aims to provide more demand-side tools and access to various ad placements, while the guidance reflects a cautious approach to allow the new product to gain traction [75][86] Question: Revenue growth expectations and competition with established DSPs - Management is optimistic about the potential of Realize to unlock growth and believes that the company can differentiate itself by focusing on performance advertising [96][104]

Financial Data and Key Metrics Changes - In 2024, the company achieved ex TAC gross profit of $667 million, representing a 25% growth year-over-year, and adjusted EBITDA of $201 million, more than doubling the previous year's results [9][30] - Free cash flow for 2024 reached $149 million, exceeding the original target of $100 million by 49% and growing nearly three times compared to the prior year [9][31] - The company ended 2024 with a net cash balance of $103.9 million, with cash and cash equivalents totaling $226.6 million, surpassing long-term loan obligations of $122.7 million [33] Business Line Data and Key Metrics Changes - The enterprise advertising business saw strong growth, contributing to the overall revenue increase, particularly with the onboarding of Yahoo [30] - Excluding the impact of the Yahoo deal, the company estimates it grew over 10% on an ex TAC gross profit basis in 2024 [30] Market Data and Key Metrics Changes - The company reaches 600 million people daily, providing real-time insights into consumer behavior, which is a competitive advantage [8] - The advertising landscape is shifting, with many advertisers preferring standard display ads over native advertising, which has been identified as a limitation for growth [12][14] Company Strategy and Development Direction - The company is expanding beyond native advertising to capture the full performance advertising market, which is estimated to be a $55 billion opportunity [16] - The new advertising platform, Realize, aims to drive performance outcomes across various formats and placements, moving away from a sole focus on native advertising [20][21] - The company plans to leverage its first-party data and AI to enhance its offerings and meet the evolving needs of advertisers [24][55] Management's Comments on Operating Environment and Future Outlook - Management acknowledges that the projected single-digit growth for 2025 is below historical rates and long-term ambitions, but emphasizes the importance of laying groundwork for future growth [11][36] - The company is optimistic about the potential of Realize to unlock demand and drive growth, despite current challenges in the native advertising market [69][70] Other Important Information - The company has approved an additional $200 million for its share repurchase program, bringing the total authorization to approximately $240 million [33] - The introduction of new metrics, such as scaled advertisers and average revenue per scaled advertiser, will help track progress in driving advertiser demand [37] Q&A Session Summary Question: Amazon's new strategy to pay media companies for traffic - Management views Amazon's strategy as an opportunity for growth in social commerce and believes that retailers will continue to seek ways to diversify their reach [40][42] Question: Concerns about being limited to mobile devices and CTV growth - Management believes there is a significant opportunity in performance advertising outside of traditional channels and aims to fill the gap left by competitors in the performance space [44][46] Question: Details on the Realize platform and its impact on demand - The Realize platform will provide advertisers with more options and ease of use, allowing them to upload existing creatives and access a wider range of ad placements [55][56] Question: Clarification on Yahoo's performance and future growth expectations - Management acknowledges that while the Yahoo deal has provided valuable supply, the expected growth from Yahoo's advertisers has not materialized as anticipated [66][68] Question: Competition with established DSPs like Trade Desk and Amazon - Management believes that the company can differentiate itself by focusing on performance advertising and capturing budgets from social platforms experiencing diminishing returns [73][75]