OB - Earnings call transcript Q4 2021

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Operator

Good morning, and welcome to Outbrain's Fourth Quarter and Full Year 2021 Earnings Conference Call. Today's call is being recorded, and we have allocated 1 hour for prepared remarks and Q&A. At this time, I'd like to turn the conference over to Jason Kiviat. Thank you. Please go ahead.

Jason Kiviat

you Outbrain's us year fourth thank call today's XXXX and discuss to quarter morning, for on joining conference results. Good and full

Co-Founder Co-CEO, on Co-CEO, Elise me the today have Joining call Garofalo. Yaron Kostman; David Outbrain's Galai; and CFO, we and

Form conference that forward-looking based During from results differ may expectations as are XX-Q XX, filed factors These cause call, our discussed ended on the to in our subsequent commission. subject our the in will statements materially September These for actual assumptions. are risk XXXX, management forward-looking risks Securities current detail quarter make and updated reports this with filed statements the Exchange with and and Commission statements. uncertainties to in

the not we of any date, Forward-looking references to also update only call's undertake statements. duty non-GAAP statements do Today's presentation to such includes as and any measures. original financial speak

in for non-GAAP fourth the should information company's measures. quarter refer of reconciliations the and release contained earnings measures GAAP information financial the to comparable You to definitional

be release that, With investors.outbrain.com website, News under the earnings our IR found Events. Our me over to and turn call David. let on can

David Kostman

thank and to that, a for we joining you us. report performance closed financial I'm record strong expected, pleased Outbrain and of quarter. fourth all as year business Jason, a Thanks, with

provided EBITDA gross was quarter. adjusted $XX.X $XX.X XX% grew up guidance last our profit Ex-TAC and to we Our exceeding XX% to from XXXX million, QX million, the

year gross year-over-year. full the gross exceeded XX% profit Ex-TAC For our by our revenue up billion $X XXXX, was and

than result, nearly our million. to a EBITDA more doubled As adjusted $XX

before. partners more and as grow to we business Our with work media advertisers ever than continued

Bids our providing monetization, quality engagement higher and for media with Conversion like media Strategy continued platforms leveraging growth capabilities, web and Real We Bidding open advertisers. platform for Rime and by Smartlogic on owners better our focusing unique stronger

the Let's side. start with supply

Scripps, our with relationships an Orange, the Sky News, deepen to partners, X more Japan, others, than among with BuzzFeed CNN, our average years. long-term of existing deals media continue Liquide premium We extending for

share with at publishers, in U.K.'s competitive momentum While we largest coming weeks. XXXX, anticipate in significant such wins wins Olympia the as into some local of same and continues Heute and win partnerships material The growing Austria. Germany new market of and our in XXL, the Verlag time group

Let's tailoring the a market, predefined talk the Smartlogic. about the minute that user helping the personalization, every of the feed to new old proprietary everyone us changes taste a serving of experience game for solution technology world of feed a to in the publishers experience some world from of user. This taking is win ground-breaking to of

and about deployment. We have to beginning mobile web date desktop feeds deployed Smartlogic on are our of XX% our

offering extend media a win to more in market has partners experiences. see personalized share particularly factor it as is average. audiences, driving in with as partners deciding significant Our on been lift are deals offer audiences, our It the younger value looking yield to continue we how existing double-digit this publishers and

and noted Head to worked at and a Smartlogic monetization a FUNKE’s users monetization. mobile preferences page have cited us Technology they driving Media FUNKE As the Monetization of is increased of in an customization to higher in Germany the example, engagement He seen with increase the Ad XX% implement result. and as optimize

website. You many case on can this in our see studies more

replacement. our us media with from supply to our such Zemanta. This our incremental expanding access the to on on building relationships expand Header high-yielding superior partners programmatic We Bidding their are more we launched native inventory, allows real with gaining foundation of estate native a in-market properties. our our growing addition, In business solution by by bidding to technology partners strong solution, as

rates. It publishers a Our our long data [code] optimization many this bidder to page that takes on important of to from leverage to is on win ability time. mention bidders here unique angle of improve is the the these our

pipes. have supply programmatic to accessing experience years of We

of In has Microsoft the programmatic our partners, Exchange. fact, Open MSN, a top on grown of supply one relationship over the years last to couple

are addition, advertisers to news Outbrain will us third-party Google with and Publisher access media diverse Bidding we've drove the environment continue Outbrain's users. exciting network, traditional more partnerships apps. significant partners growth doubled We in to aggregator supply of to and millions integrated to and QX, Outbrain supply recently in these which of give than via seen SSPs extended environments from new such to year-over-year and Revenue new In Huawei also our signed dozens optimize as in top line access publishers. grow new our with such connect advertisers We reach XX% Vivo platforms. and In enables on Services we beyond new types and expected Open different partners these QX, supply as of integrations revenue. that Amazon of

Let's switch to demand the side.

our positive of Advertisers Outbrain had from high-end number QX, momentum. record advertisers. agencies. our the to on more some we outcome-based directly and in campaign using walled-gardens. market from brand More campaigns contrast continues ad platform shipping to demand running advertisers realize on than reach on experiencing open Our comes of to see brand the increasing We they average are opportunities business business XX% our In a the and an per spend web number benefits their goals. increasingly and budgets grow and the highest grow of customers limitations of to

digital leveraging video we the business growth service with our promoting of increased that Disney+ For budget same This X X spend to well consumers also embracing open streaming a Further, the supporting media survey optimism by as on their recommendations continue found Europe. Amazon consumers increasing for found subscribers herbicides media. native Prime us, on formats. across our the to and just in our plan special a reinforces consumer reported on experiences time that consumer More find recommendations with those their example, was it grew company, conducted opportunity Amazon as to survey by in businesses direct digital are the and more over trust sell research budget. These news, social in third-party customer social are the more of examples. XX% interest market content than to grow the less our significantly on in web. months. they The and next

operational highest we investing people infrastructure support in team and building We are Israel were hubs XXX our our growth We growth. XXXX, our the in where R&D nearly to grew and our Slovenia, regions. by have

to are video premium intelligence with video investment accelerate through offering in video vi of the the solution, very contextual short. We our acquisition pleased strategic or

year-over-year publisher CTV. and the the the up, particularly in of in are It years. benefits of growth our We launched accelerate by plan investments able us profit having in desirable we seeing With made already which the the the the our have To to Ex-TAC to synergy for we vi's deep XX% are relationships. brands. accelerate QX. in vi, Outbrain’s came the we value video, XXXX of entry in-stream some an publishers few global of gives because last sum large for are of growth gross to over We very also part point growth on offering several is realizing footprint our advertisers, in market leveraging large business

details around in machine provide content and which invest to to on world. uses specifically personalize more our recommended to learning core AI the billion technology, deep ads Elise continue over will in will and guidance. users We our engine X

rate well lapping on driven XXXX, for expansion very with pandemic softer as and opportunities. some news see QX will You by factors strong growth an impact a political heavy optimization, on in and QX consumption as timing

to of grow. Ex-TAC an anticipate see to remainder the growth acceleration expect of We year. We of over lot headroom the a

I'm role the a So and very we in future of overall, optimistic free our business supporting and about play journalism open Internet. and the

it Yaron. hand I'll to Now over

Yaron Galai

Thanks, David.

I switch situation my remarks, prepared to wanted acknowledge the in to Before I Ukraine.

the team entire the Ukraine. now We want expect we today on a cover the more intelligence to cookie, demise a Ukraine optimization, supply the also of The talk events peace the earlier for third-party about announced on people video team part talk a our wishing is of and don't few our return about The from leading impact supporting detail important year, in colleagues based for As and is Ukraine. the R&D any change all taking in have normalcy how I'll imminent to business path our directions small in negative Operating we're and acquisition speedy material we of way the is in today or industry innovating and we're those. I Kyiv. SPO.

had the meet to remain Now browsers future. in that those their cookie unintended they tracking and almost intended a XXXXs started and ad-targeting hack uses, consequences as while the of in the will in legacy early

immensely first-party valuable. a When Now are site on cookies they not specific bad. cookies, themselves are as what's called used

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to couple leverage in that come. as pushing been years we to product ways of competitive a recent are for years we've on Here technology forward advantages and these ensure trends market

the use of know, Internet pioneers technologies Outbrainers a my at is team current interested myself the of the previous As text targeting to In articles, were all the cookies the don't contextual and may target context advertising world any adds contextual in. at user on of you company. core and and

third-party of that us XXXX, are capabilities any the we've contextual Now likely video adds cookies intelligence, as but us at Outbrain without specifically of vi for to video partners beyond highly also for some our and use user to and exciting video. to acquisition be on come browsers. allows serve XXXX remaining cookies targeting deep the us and will to for adds in relevant technologies with complemented all. These content in end vi very or which their for paramount

demise past We progression technology technology pace Bid example these skill can Bid of on the return or bidding a to CBS, been is innovating want afforded on at automatically are the called capabilities Strategy used by for spend. to old and using for one Engagement on recently automate which of targeting advertisers we tremendous of few a EBS Both us is Strategy while we've Over announced that campaigns, year on technologies achieve a ad called the the to couple also third-party here. share ROAS optimizing short. designed fierce their of By the built I cookie. or EBS, opportunities a Conversion advertisers or technologies, their Outbrain. thousands Outbrain’s advertisers. by months,

believe capabilities, innovation Switching science several is that gears et cetera, highly Adobe, it advertisers on stages and the excited analytic the automatically pushing head we approach EBS advanced has based Instead, about Then forward. and it. this cookie Supply with use early is to Our EBS systems, unique from Path all. we using another the that form here in to the right that aggregate in Google should on give does not is people's as pulls technology connects technology innovation on been of that users. Analytics, us our EBS a dozen topic them. minds start our Optimization at advertisers’ data world breakthrough SPO. of We're to keep data ads cookie-less great as it targets EBS engaging lately any its is or be insights

through would but heard acronym from Desk. it that serving the also recent Trade Desk You it, stop open many this the currently driving the SSPs ads skirmish have you the of of move where announced heard specifically, recently from are of affect demand have Trade bidding. that This could might may Google's resulting not

marketplace ads of our There very is without in operating path companies. relative that for is One model typically an partners advertisers, there's our our ad tech is strengths reason you any the all the see spaghetti the end-to-end we between supply that between only of X duelling and of the company, that are world our media no simple path supply Outbrain. optimization these simple:

partners, business, maximize return of but our full pocket. also to on up of spend directly. of our its advertisers insurer we and that each both only majority in the for is with is $X.XX used sides not partners' our dollar marketplace ad transparency the that advertiser dollar This about For our work vast ends

daily leverage other For of of which SSPs we business, and change big investing happening, There we or time. rely any currently areas changes. in don't DSPs our several about are this to on in expect are other or links XX% over

to the users shift capitalize registered the revenue on. many example, on keen to form subscriptions revenue, which many the publishers and or For of or in are of rise e-commerce-related known publishers reader

our acquisition Outbrain the who vi, trends for working our forward And as Elise our EBS on more for rely on these with big to we on of with more and I'm in market-leading hand to over about innovations it are about sharing results innovations to and As in that, Outbrain's our partners quarters. innovation at market looking technologies. financial future detail. tremendous we're I'll looking opportunities talk

Elise Garofalo

Great. financial our Thanks, strong of performance, Yaron. We beating delivered guidance profit another and Ex-TAC quarter gross for QX. EBITDA both

adjusted people innovation products saw and investment and EBITDA We margins drive our in healthy very continued continued our also market again to leadership. despite

metric. the the saw a stack quarter, cycle. For or to which, existing from U.S. quarter retention reminder, X-year COVID million came from $XX grew QX basis, of net came as XX% from despite XX% XX year-over-year lapping sales the is a X-year million. a growth versus and revenue yields QX $XXX million growth highest benefits This very grew of approximately XXXX, same-store points or revenue of supply growth a to our $XX elections a base, which generating XXXX, On XXXX. volume steep recovery QX higher equivalent strong

years. acquisition from media to of addition exceeded million addition points in profit source total cost a paying we which X in This devices us of the gross $XX of or partners. grew new to growth we QX traffic to compared million. past the has XXXX retention the for steady QX, In fourth revenue increased growth, X the our million quarter. been or over by approximately Mobile as revenues to supply Ex-TAC year-over-year also is partners, XX% keep revenue XX% $XX after $XX our

investment of to increase operating quarter. million our global teams, fourth to continued $XX Moving in was in the $X million nearly We saw $XX higher from an expenses. costs, people million adding in Approximately personnel-related XXX XXXX. reflecting

comes points in QX, higher costs over facility EBITDA. year-over-year being to XX% seeing operations. our $X.X have XX% more X this addition, of despite are back marketing, public increased million unfavorable currency expenses with period Ex-TAC measure foreign In of gradually of to T&E approximately in Adjusted EBITDA, as on profitability we and associated gross and quarter, profit primary $XX.X which headwinds or normal is higher activity the our million

valuation recorded on P&L. deferred a benefit on allowance the the related tax through our just million comment the Now, a final tax a onetime majority of likely our it triggered than we income U.S. that of tax profitability. In expense fourth valuation quarter, to This will we $XX.X assets. in tax our deferred is a conclusion U.S. release of by our not ongoing that is now assets the as realize more the release of result

this You through in other increase our can see an as assets. well on impact balance sheet

in use cash server of deliveries. less of cash versus was to a and moving operating define in was Free of due of as business to CapEx of we the from cash well a software, in and a jump cash the net result The mix earlier liquidity. flow, the year million. as timing period as of use timing flows the Now activities CapEx $XX which provided cash cap

share will in flow Board's $XX and the and free million matters. cash be and in and closed was our full year of continuing healthy share ‘ January, buyback prospects our capital. any our of repurchase opportunity Outbrain’s our growth M&A We $XX at million our not meaningful convertible Of this market while confidence representing and price, plan provides cash on at with we the program guidance. showcasing for light the The and back believe us equivalents the $XXX to midpoint year million conditions, to factors. positive and approximately shares XX. other Ex-TAC course, December and million, for an vi of value so the profit IPO, of strong growth. growth discretion of in a EBITDA acquisition balances, We're and legal gross between million approximately requirements included or midpoint, to shareholders the allows repurchase and while $XX program amount XX. our XXXX, on expectations stewards invest believe seen growth our million cash and onetime a note, drive adjusting be value Last $XXX balance million nonrecurring continued with impact stock In to is $XXX XX% expected introducing balance strategy of and consistent sheet cash reflects margins. depend when applicable at February of other year debt timing healthy management's For $XXX Board and the generation, of the to that repurchases our to year-end is XXXX. to to long-term at authorized sheet Ex-TAC year-over-year but The XXXX in EBITDA adjusted in price million ability the to on of We our approximately there turning $XXX misalignment million or year-over-year XX% will, program thus $XX XX% ended

We in note. growth are few of our XXXX. factors A for confident

and new strong for the scale the expansions we including site We the And planned which XX of win. into second through Bidding, the publisher 'XX. expected continue will top half over year, visibility have sizable Header expected QX article have in into supply to of course placements an

our to also ongoing Smartlogic acquisition importantly investment continued tech yield And through and vi. algo and of of We last, advancements. in the for adoption course, and expect and us, drive is

As market, to receptivity very access we publishers initial video immediate throughout to by scaling Integration video with our a XXXX. reminder, the and gained underway drive vi, the expect are increasing our invest and significantly from TAM. we in-stream is encouraged and

half the in low overall, the of is high contribution-wise. XXs XXs will spread half the percent that expectation in the for Ex-TAC year over be and contribution-wise So X percent Ex-TAC share our X

$XX.X year-over-year million expect in investment given to first our profit $X adjusted respect of X% to cost we of becoming our growth lower $XX.X EBITDA expectations the year-over-year midpoint. and of at approximately to which quarter, or gross growth public. the $X million the And million million, is Ex-TAC For with Ex-TAC and

QX, QX drove cycle due to For a a 'XX last we COVID partners. and news versus Recall, pages comp strong our political lapping had year. very strong for higher very which vaccines are events,

facing headwinds few additional we're the in addition, quarter. In a

have growth of from impact we're as mix revenue notable opportunities the First, foreign in certain expansion currency. headwinds we existing And optimizations on and period. well, unfavorable publishers, timing experiencing in unfavorable last, an the partners on media from moves of

data X EBITDA as headwind we an points of I Ex-TAC on And XX continued a saw points of and this QX, the in point review January, February As movements for over early of saw suggest headwinds in earlier. some quarter. We on mentioned growth. in FX

So the many our outlined touched growth of continue year for QX, to David we'll today. in with areas even summary, in in this and expectations in lower confident invest and opportunity we're the Yaron both upon as

the operator to Now I'll for turn Q&A. it back

Operator

the Securities. [Operator Instructions] JMP question first Andrew Our line comes with from Boone of

Andrew Boone

on is The first just Microsoft.

back share to So their about you with mean then kind now secondly, Taboola of of a and Can guys you for Can in score, where testing going year any you that think strategy. the guys agreement And you early help talked that? longer-term initiative bidding a results. are us Outbrain? and updated just change talk does what And kind on about Microsoft unpack in the last I quality began XXXX. and

David Kostman

question. I'll the Thanks. Microsoft take David. It's

them working couple And in years last years for been environment. the worked have So now. XX very Microsoft we've we the for of closely with programmatic with over on Microsoft, already

areas that And collaborated So beyond of in the we Exchange. MSN. the similar years, over heard strategic Microsoft with on on last closely couple Open announcement goes and you've the relationship very specifically have Microsoft way we,

the and very last it's bidder scaling couple expertise work on we've leveraging revenue capabilities. is years. supply to a with continuous that exchange So in been deep them bidding the closely improve third-party we really This effort. continuously our long-term And and of our for

the lead the certain advantages end this the the out to -- have last obviously inventory open of of in exchange new change in will it significant In on available at the the change announced, auction. pleased it with eliminated we players year, XXXX. terms basically were And that very could with that other was

-- of it, good And for and we in been these years. bidding developing this of a bidder that's believe a it's share and we so a it have improving since And environment long takes that chance winning -- time. impressions we've

and to partner with us. further So growth this, very a Microsoft, take think will you about strategic which to excited want question? we Yaron, this is do that for the second lead

Yaron Galai

Yes. Thanks, Yaron Andrew. here.

the in a past, of algorithms. quality and rating, be So multi-quarter this product lot It parts effort. to regards as of said in will our a touches we've

So rating. the of the going the we were to U.S. Last up lot data U.S. on we working currently is enabled have work quality the for in first of the hood. publishers. We're under the on signals quarter, a which data X on shared major phase rating, that there's XX required publishers publishers with that signals those quality enabling

And roll keep to done, a future There's to we be we'll this on progress continue as more and it. so we lot go. updating quarters out and work in

Operator

of Shweta Our the line next from comes Khajuria with question Evercore.

Shweta Khajuria

Okay.

year guide try then talk me please supply are top margin growth else addition partners? could line full is going driving but there in that, perhaps you help strategy the is understand please. One guess, 'XX? in headwinds certain both media and guide I the I us long-tail forward to, headwinds perhaps year and QX and X, you contraction for you from some in to second from for of saw there terms verticals EBITDA. and full the that And Let growth pointed anything EBITDA that question with your why about is,

David Kostman

and Elise. David. the turn then first one, it's Shweta, I'll to I'll take

the supply. to. normally on the and have refer this in here, have So a referred supply very some Elise I strong to also premium We that we've so of material them relationships, we regarding announce few the expansion, first, pipeline highlighted a in quarter, we momentum

publishers. and So share about gaining with obviously we good existing feel market deepening and very premium extending relationships

of year, mid those. of long what and hubbing did, tail, last the in terms the affected we, have we In

operation. generate a effective leads So those. for We we have more much

way them. automated have of an We onboarding

on of signed about, this mobile is growth screens, vector And for again, and others. which one; environment talk new a Huawei, lock that is and So the QX, a Vivo us. big big we in like that, a top carriers, few we

talked tens adopting generally And growth we in of platform existing already So -- this Header we announced.So terms partners, you supply gave supply. good the mean comfortable about on and Bidding. within of our partners Header see new growth existing, I guidance with that that annual Bidding had on we're we very in the we and see we above XX%.

Elise Garofalo

Great. the And on balance Shweta, up I'll pick the of question.

So we course, just higher drivers supply, of on expect mentioned, the and our acquisition. generally the the the year some and the sticking David high of visibility timing and the and, that ramp scaling at product of confidence scaling some based of a as in vi optimization do year of new just the up progresses

expect in In that of year the how we repeating X share spread of we XX% did the is but the contribution have the pans in wise. Ex-TAC, terms be in year for over out, high in will XX% the remarks, half think the worthy here and low prepared X I contribution-wise

right, margin. so Now this we QX we is for the period CapEx, people in QX the line. outlined, and they for the have them COVID where to plus a I pressure that they made few but return in public an plus the expected talking a about XX% quarter. None are remember headwinds some FX last company we've on year the steadily lapping This, been because costs, are are QX unfavorably that But factors spoke weren't. of healthy of on under new. quarters, combined expenses. expenses these investment also important the with year, still about the EBITDA top But converging of We've

see I we be for ramping the at probably in believe EBITDA think year. XX% our again, margins do forecast and than again, EBITDA you'll steeply to it But more Ex-TAC. So embedded

Shweta Khajuria

If level follow help in year. Okay. on growth that, up your us accelerating quickly can confidence I through the with

guide? You you talked the of some about Give gives confidence visibility. bit with little sense what us a

David Kostman

Okay. I'll maybe take that.

it? take to want you Elise, Sorry,

Elise Garofalo

can off I Go ahead, and on any -- top

David Kostman

supply in, have we have in sizable with we mean see into wins. visibility I -- So coming new some strong -- a QX we that's

very we to changer. desktop expansion see be seeing a we and We're talked an Smartlogic of just adoption adoption have mean, the deploy -- started this of a We are placements. We in-article to again, it environment. we -- increasing trajectory of also I year good game about seeing in continues in mobile, the

vi, So January advancements. then the we to integration. access of with We're it in we video. the see deal mean, year, just I closed starting And this in-stream us those and gives

We partners a have already deploying. more handful of are from our that publishers than

We are excited about very that. so

good main So really that the confidence. think, factors these I are give us

Operator

comes Our Barclays. Ross from next question of the line Sandler with

Ross Sandler

A question for publishers recently you, headlines Yaron. We've a AMP. X Tier of that lot Google's seen some ditching are

guys folks. work I of think even these may with some you

folks the publisher you picking of into as to you And So change as on Google any potential going thoughts the those some on as as was inventory far up display their do from do water services? business, the landscape exchange view -- just move view away how in an given opportunity gotten hot additional 'XX? think you that has share good But how do on pick color on third-party up cookies this earlier.

Yaron Galai

Ross. Thanks,

So one We've were of Google the AMP first question, the AMP. there. an been first that's the partner. early We to Google launch

And with media does support that recommendations are so typically include work have, powering do we every and publishers they format, We that AMP. and Google on Outbrain. we for the that

to the interface, back publishers, take I with over they amount is their that some recommendations back by they content want publisher's AMP control, be those just kind the as to sovereignty place there. not between ditch in think to user split and they're the of are you the on of Google tied mentioned, of to starting and opportunity Google. going The ads, all the those now going to prescribed be template things

revelations that those think inventory regulatory they're not Google ecosystem ads made quite publishers grow there of out up to auction. surprising. the Google kind I -- the our necessarily partners pick different goes before. sides getting so in that in an -- comments were the from of prices And the that to I that scrutiny different with amount So we think advertisers I on In from the serve to question is And There's regards the the that Google I back Google found the some what the is second a many mobile think and undergoing, opportunity way on they're to paying. that. just of more I environment, that definitely the think are

end-to-end transparency. publisher and single media player only the the marketplace us that between and an advertiser are or We with provides with owner great partners a the our

are the exactly XX%. paying tech every system make of think tech they partners it's that's why advertisers generally compare the an we that a make what percentage their ad and cut. to dollar more. broader advertiser about of on a spends they XX% So And know while our I lot assume ad when about basis, the also get They

Outbrain. I have which And so more comfort real think too, been new revelation, that, in is with even running estate a more

Operator

comes Our next Martin line with from the question Laura of Needham.

Laura Martin

rise a you that e-commerce big Great start I -- big you the trend business, and revenues, for see a a Congratulations. more to Let's I reader shift this in talked that you is talk if trend. how comments, Outbrain give to is that love market that big us revenue, about you about affecting on hear of you it you more would see? trend numbers it would guys. there. your the Yaron, and love little subscription Could

Yaron Galai

Laura. Thanks, Sure.

walls, else up few at looking into et and putting putting revenue, registration obviously, the many are those a subscription trends us. efforts publishers cetera. And there think, are this as we're everyone their ways diversifying seeing I that So affect wall,

it does on them revenue, of make the from it suddenly buyers. level, are turns now that also benefiting So potential into some reader publishers most these immediate

Now traffic and on Amplify tracking and side become user they in because from our of can their drive the suddenly acquisition get those start buyers costing can efforts consumers. they they're audiences acquisition that they our LTV costs

it in to is experience you that thing for readers. you the to second when I provide players a general means very Outbrain have which The a just healthy revenue, is, think the user great recommendation need like thing reader

kind just them properties, it. them paywall that You to your slap engaging very engaged on and of a need keep hope provide for pay a can't people with you content,

publishers We've it goes important pages sort about It's operating so software, hitting of be. our beyond that operating paywalls, this recommendation engagement, And especially that metered the serves. the since kind Outbrain have. the IPO. It's about experience ads. for been not their to may is being they their the people the recommendations. paywall increase talking feed user the of their is those most publisher our more user managing system partner articles, consume own but for important everything ads to getting about our the it's recommends: way And that tool business, really And of have the e-commerce whatever piece an and of of core videos, it that system just

we're trends this the that I'll So sign really we these here, in see kind of more, R&D. Again, beyond we great to that going too as about leverage And how ad a just a in share to about real talk in market. quarters, we're investing opportunity the estate to future early take. lot but the

David Kostman

May be it's Laura, I'll add. David.

e-commerce, I on mean, specifically on e-commerce. Just

different placements very in So currently places than have pages. publisher e-commerce on LC we strong a demand

categories So we're is demand, biggest adding friendly, are -- it features out, for break direct-to-consumer but one growth better and that mean we of the don't capabilities allowing the I of brand. buyers. more e-commerce

believers we want to that So are big we ensure quality.

is use publishers. and they way, prefer the and with also the look it heard with direct direct the important go advertisers mean, by that I from we directly us, relationship for build others retailers actually at those, large other to them. and have also relationship. they relationships try platforms direct when they to publishers directly So and And

demands, very a channel we believe have of necessarily demand and kind, to of like that's front. we're offering. need don't all little we integrating business own again, we we a a for strong types that, So better more e-commerce generate them, of performance And but intent in future, to data focusing also the drive e-commerce on the on bit a more but sort

Laura Martin

line it Or perfect I'm your is XXXX? interested I'm great. how vi, is My in that products? primary question That's about you year-end what growth XXXX? you piece question you the just integrates my because And January. idea final is excited it's vi revenue question big very do of want paper, by in which situation, is accomplish closed My if right? this, helpful. with Super is to clean old in -- the second understand new the it the But And driver. picture growth, essentially that drives into a think product TAM I you -- is stand-alone growth very that it and

David Kostman

that. take I'll

fruits that. us. synergy the are potential January. early we already of closed with very we We're So about Again, the excited seeing

all that on it's fronts the mentioned. actually, you it's So

the bring the So integrating the publishers feed for good offering lot another another themselves have our The investing leveraging offer video. are have of could opportunities. card, we and them into our a Then monetization they first, really what video to connected relationships now a their more contextually-relevant they in-article into with than CTV leveraging of TV. then to And content team around buyers, in footprint, We their global we resources are we alternative as cross-channel foothold and have publishers. brand contextual bring CTV. them growing very -- experienced stage, both relevant done there. of to right a see it's top is into digital It's it we call platform

expansion of So we're CTV. current think about global our the TAM, into entrance it. it's, We and excited very again, relationships, presence leveraging

that single mean our excited terms very of and digits In but to value come. I sort the low growth very the in didn't about it's we can guidance, that I contribution, the But disclose the expect years will we're of numbers, it tell provide year. you strategic in this the we low,

Laura Martin

assume IAB when not is CTV over right? word, is as you by what the I XX-inch And mean the that you by screens. CTV defined use Okay.

Yaron Galai

sort CTV into there. by they're your are that and Google TV this applications on of hope Plus, answers selling contextually on TVs mean ads I place relevant question. connected relevant I display TV Samsung to are they using technology contextually

Laura Martin

Yes, yes, yes.

Operator

Brent comes question Jefferies. of next from the Thill Our with line

Unidentified Analyst

James and your end December my the Omicron slowed of any, from hitting investors did at is down again slowdown should But your that guide repurchase next And of is You've announced at impacting strategic impact, that verticals few any second years? is And That's materially? cash some you all? done be you in ad QX plans over on question. medium first This the see What uses Brent. if for into how and that January, there to about your prioritizing can short you're the the thinking M&A. of my us just remind big one term? Were

David Kostman

it's the first James, one. I'll David. take

very leads the of a auto overall and the impact, have network. some mix balanced. it I of category, We've us. It's is Even seen we've the a On impact in in visit advertisers. seen I auto the in X good see the quarter, very last doesn't good generate I who world, come in top vertical said it really in we people mean, the we mean impact a verticals, we in an brands mean, dealership. if categories certain there's cars. and lot for and we slowdown want less for been us to

really spent have us. impact less not any did it create leads to dealerships, but trying money So on to on visit

entertainment We're around trends verticals financial these following very strong are We others. very in and health, are diversified. we but

want to really not you cash? impact. it so Elise, the take And have did any

Elise Garofalo

James. Sure.

continued a cash, impact a in we capital our for think right, -- buyback we with initiatives us. program. at it's time. sheet It's But details $XX growth healthy did is generation, fairly on cash modest prudent and our share and We this So any few expected around you things. doesn't balance use this with of and of million One, course, think program. the

we're the being manage said recent we I M&A past And that, assess acquisition. very the we're I thoughtful mean very just the over front. that vi pipeline. on you to quarters, and shareholder mean technology we We we'll a continue Beyond We're think saw of growth keen, like many attractive well. as product value, M&A we ours. and through is see. do how strategic for visits partner accelerating at of looking -- drive opportunities the drive strength and an few

So to we'll that at on this but nothing continue to announce. active front, stage be

Operator

in to for hand questions to like further I'd no are the closing remarks. There management the call queue. back

Elise Garofalo

we operator, the thought inquiry some be offline, and Sure. want with maybe respect FX. it drivers, this to to We QX point make on would investor of just had some clarifying And we share X group. beneficial to with specifically

the talked from addressing guidance, headwinds currency. QX foreign in we So about

So on we're on the about EBITDA. it way seeing we're think seeing and ex-TAC to that,

it's constant in QX So comparing very we to when at XXXX, basis. results, on them QX look common currency to a things we're and look at

year, to this we that translate Just of had dollars, be about profit, If see okay? million $X this I at If so headwind. growth And $XX moves we we look percentage FX when it points quarter, we Ex-TAC QX X along. gross XXXX constant Ex-TAC. year, would less, last currency reported of to million

of So on a be same anything This year, currency without would that's if pronounced. Last but we on we being more headwind $XX different. a reported, EBITDA, And $XX constant thing, had million million year, EBITDA. it basis.

or $X less headwinds. million of XX So points growth

on So it putting headwind business. a our is

multiple currencies. global. are operate We We in

euro these happen so mainly pressure on the quarter, this all things converging the puts and the year-over-year on it's and producing There's way comps. often. time. And takes the notable The shekel is

course, With for that some Yaron put for the color additional for follow-up available we're remarks. it So group. closing If not, I'll any that, of we hope helps. questions to

Yaron Galai

Thanks. Elyse. Thanks,

QX next the EBS, We're time Thank for our you results. want excited the new the record-breaking looking our vi we progress as sharing breakthrough as over and to Bidding forward well really thank on we're our Smartlogic, products, months, integration today. with So year as with to you, full XXXX everyone. CBS, all the Header making We're innovative such and you partnerships.

Operator

gentlemen, does your Ladies for you participation. teleconference. this Thank and conclude today's

a lines have this wonderful disconnect your day. and time, may You at

Outbrain (OB) 1 Mar 222021 Q4 Earnings call transcript