Outbrain (US:OB)2021-11-11 18:41Financial Data and Key Metrics Changes - Revenue grew 34% year-over-year to approximately $251 million [33] - Ex-TAC gross profit increased 40% year-over-year to $68 million [33] - Adjusted EBITDA rose 56% year-over-year to approximately $20 million [62] Business Line Data and Key Metrics Changes - Net revenue retention was 128%, indicating strong monetization from existing partners [35] - The company added over 100 new digital properties in Q3, including significant renewals with key partners [36] - Video revenue increased to approximately 9% of total revenue, growing faster than other formats [45] Market Data and Key Metrics Changes - Approximately 70% of total revenues came from mobile, with 60% of revenues generated outside the U.S. [56][111] - The company experienced strong growth in various verticals, particularly in health, entertainment, and finance, despite some temporary tightening in automotive budgets [77][118] Company Strategy and Development Direction - The company positions itself as an operating system for publishers, focusing on long-term partnerships and delivering value beyond ad monetization [11][17] - Investments in algorithmic improvements, such as the quality rating algorithm, aim to enhance ad quality and expand user engagement [18][84] - The company plans to deepen relationships with publishers and expand into new ad placements to drive growth [26][40] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the company's positioning amidst privacy changes and the shift towards contextual targeting [29][30] - The outlook for advertising recovery remains strong, with expectations for increased budgets and higher pricing in the digital advertising space [101][102] - The company anticipates continued growth opportunities driven by the shift of advertising dollars to digital and the open web [47][108] Other Important Information - The company raised significant capital through its IPO and convertible notes, enhancing its liquidity position [63][64] - Operating expenses increased due to investments in personnel and costs associated with becoming public [58][60] Q&A Session Summary Question: Impact of cookie depreciation and advertising verticals - Management noted that the company has successfully operated without third-party cookies in certain environments and sees strength in contextual targeting and first-party data [73][75] - Demand remains strong across various verticals, with some temporary tightening in automotive budgets [77] Question: Quality score algorithm and revenue potential - The quality rating algorithm aims to improve engagement with non-engaging users and attract more brand advertisers [84][86] Question: Video revenue growth and publisher placements - Management is focused on expanding video placements and sees significant growth potential in this area [88][89] Question: Competitive landscape and advertiser pricing - The company is experiencing higher pricing in its network, which is driving yield improvements and attracting new advertisers [96] Question: Macro outlook for 2022 - Management believes that advertising recovery will remain strong, with expectations for increased budgets in the second half of 2022 [102][104] Question: International revenue trends and customer count - International revenue continues to outpace U.S. growth, and the advertiser count has increased year-over-year [111][112]