Financial Data and Key Metrics Changes - Revenue for the second quarter was $103 million, marking an 8% year-over-year increase in advertising solutions revenue [24] - Adjusted EBITDA was $7.1 million, resulting in a 7% adjusted EBITDA margin and a 15% ex TAC margin [24][29] - Non-GAAP net income was $12 million, resulting in non-GAAP diluted earnings per share of 26 cents [24][30] - Operating cash flow generated was $21.3 million, reflecting the strength of the business model [31] Business Line Data and Key Metrics Changes - Advertising solutions business returned to year-over-year growth for the first time since 2023, driven by strong performance in digital out of home, retail media, and web [20] - Digital out of home revenue increased by 35% year-over-year, now accounting for 17% of total revenue, up from 12% last year [25] - Retail media generated $22.3 million in the second quarter, representing a 27% year-over-year increase [22] - CTV revenue declined by 5% year-over-year, representing 9% of total revenue, attributed to budget shifts to the second half of the year [25][30] Market Data and Key Metrics Changes - The company expanded its programmatic digital out of home footprint in APAC and EMEA, with new partnerships in Korea, Germany, and Italy [11] - The U.S. market for CTV is projected to exceed $36 billion in ad spend by 2026, with the company expecting to capture a greater share [13] Company Strategy and Development Direction - The company is focused on becoming a centralized platform for CMOs, with the Perion One strategy aimed at integrating all technologies and brands under one unified platform [5][8] - The strategic shift towards Perion One has been in planning since late 2023, involving long-term transformation and product evolution [6] - The company aims to improve speed and efficiency while deepening global adoption across brands, agencies, and retailers, unlocking long-term growth and margin leverage [8] Management's Comments on Operating Environment and Future Outlook - Management remains optimistic about CTV growth despite a slight decline, expecting a strong annual performance as budgets shift back [21][49] - The company is confident in its ability to execute and drive long-term shareholder value, operating in a high-growth industry with proven innovation culture [18] - The full-year revenue guidance remains in the range of $430 million to $450 million, with adjusted EBITDA expected between $44 million and $46 million [33] Other Important Information - The company acquired Greenbids, an AI-first company, to enhance its offerings and optimize performance [7][22] - A new performance CTV solution was launched, integrating high-impact technology with performance metrics [12][13] - The company has a strong cash balance of $318.5 million, providing financial flexibility for growth opportunities and capital returns to shareholders [31][33] Q&A Session Summary Question: Regarding the 5% decline in CTV - Management attributed the decline to budget shifts rather than an industry-wide issue, noting that CTV budgets are expected to shift back in the second half of the year [36][39] Question: Changes in campaign lengths among marketers - Management has not observed any major changes in campaign lengths, indicating that business continues as usual despite economic concerns [42] Question: Confidence in CTV growth in the back half of the year - Management expressed confidence in CTV growth, expecting to outpace the market growth of approximately 13% [49] Question: Sales organization alignment with Perion One - Management indicated that the sales organization is being optimized for efficiency, with potential headcount growth expected but not on a large scale [50] Question: Use of cash over the next six months - Management plans to continue share buybacks and is evaluating M&A opportunities while maintaining a balance between growth and capital returns [51][52] Question: Impact of AI search on web revenue - Management acknowledged potential risks from AI search but emphasized a focus on delivering outcomes for advertisers regardless of channel [61][64] Question: Targeting mid-market customers with performance CTV - Management clarified that there are no immediate plans for self-serve features for mid-market customers, focusing instead on larger agencies and holding companies [68]