Earnings call transcript Q1 2023

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Operator

Good morning, and welcome to the Outbrain, Inc.

First Quarter 2023 Earnings Conference Call. At this time all participants are in a listen-only mode. A question-and-answer session will follow the formal presentation.

As a reminder, this conference is being recorded.

turn over to management your like team. I'd the to call Outbrain Now

McKenna Elves

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

Outbrain's the today co-CEO, on Kostman; Jayson CFO, and co-CEO, me Joining David we have Yaron co-founder call Galai; Kiviat. and

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

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

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

Our can and investors.outbrain.com, site, events. our under on earnings IR be news release Web found

to me over the call that, let With turn David.

David Kostman

EBITDA a both usage on and better product controls market side second, the on performance maintaining side you, $X.X is In macro Thank focused addressable we the million and adjusted while of our advertiser in In we to guidance growth million. the extra are McKenna. gross exceeded in on still and our marketplace; technology-led positive and an growing delivering current first, driving provided costs. what profit tight we QX, uncertain focused $XX.X and environment, strategy, of publisher

softness by by continues. seeing outcomes, based enterprise a outlook user in and leveraging encouraged the budget measurable months been to where accelerating why continues focus, trend geographical with contextual perspective, engagement, marketers, increasingly start approach an we've attention brands is attention, perspective, measurable favorable few to cautious data. From versus brands that of in advertisers in the some engagement, more be performance on budgets trends our last more drive making environment industry would are This advertiser results. I in driven accelerating a decisions The From U.S. uncertain. from are enterprise we macro experiences we deeper budgets the and advertising and deliver Europe the for a helping

believe testing that We platform. and well-positioned heritage on brands AI-based unique thanks strength performance. global our our enterprise and deliver our we We've top in it predictive are with on working market this on to been of validating proposition and to the agencies selling some need,

making signs, encouraged are by product several the We coming we'll and this launched weeks. initial be the announcements in regarding

led support has areas, In four the order past our recommendations and new data our who's in who several also to as and we've organizational with appointment the years years. closely CTO officer of for become led science founder, also of for CTO, changes, efforts Maman, Zemanta, engineering department organization chief Andraz these Tori, worked growth our product such past former five and the to announced the Outbrain Yonatan

previously Andraz, hubs business Erlmeier, time us been with areas know-how centralized certain to our international our leadership advertisers in the each generate have in organization with with Alex and We of the teams while changes have also under decades. markets, and over local at same our into on Yonatan, growth led better publishers, them for consolidating efficiencies. serve segments and ensure Alex of announced to cost CRO, who focus right several new the business our

to move side will of I our that, the publisher business. With

of Spain, Monde in emphasis Coindesk. with with The in and experience publishers with continued meaningful deals the the anchor Post, built multi-year end solidify signed Fortune, for a audiences advertisers. in Washington premium QX, on publishers premium publishers We and Italy, including with better new our trust and France. premium is Entrepreneur, Hearst several the and deals an which open ANSA engagement we Vocento to position better several on user renewed believe Le globally. on their in We We publishers with France readers, flywheel We they and including at focused a moments their relationship deep as a remain Internet and Orange for leads to attention financial

which are On architectural the to constant are as reducing product side, logic, widget the to enjoying the revenue. smart such They increase making we latency, our improvements is experiences, expected optimizing of driver also and page. continued optimize or integrations products the on An the on to adoption increase in-article header capabilities to bidding the is growth of performance code properties. additional new publishers their

about added part strategy. which of brand in-article of our we also QX, such important enterprise is integrations, In XX an

us the to such last real-time few our advertiser months, we that drivers, our the supply our also business, platforms, side to as the which On of SmartNews, Flipboard, others, that the includes campaigns expand. partnerships performance. and we one expand we optimize to direct-to-device highlighted capabilities non-publisher of partnerships leveraging And building and engagement enabling continued growth in our Quora, with signed

XX% On valuable partnership Update, partnerships we'll of advertisers. highly app now about In this News] the resisting that our provider. able an (ph), Samsung [Update for QX we also devices with be are revenue. launch XXXX, approximately access of Through the [indiscernible] access in to contributed replacing news our US, excited front, inventory the our these on particularly

platform all platform stable the trends we to year. improve our their outbreak supply access end, core, of to to network. lower the CPCs of marketplace, performance demand our last our Zemanta DSP choice of dashboard. programmatic and network refer can our in resulting extended I than supply or the impacting macro QX, via our the advertisers the we the access our side select continue fully On into advertiser our Amplify but Moving that such integrated through and still to our Zemanta In to

also of in our AI-driven many programmatic into Amplify leveraging are our We the improvements ROAS dashboard marketplace.

the advertisers, our significant stories use core advertisers. and the for our success we of we for promising demand technology scaling some believe from seeing could see further that are We upside

world's for customers, together CBS investment They of suggestions, automatically conversion products strategy, more strategy, technology in Babbel, XX% one Outbrain wanted that scanning Bringing pages by in improvement AI suggested our tool I click-through one improvement. which apps. team. the the resulted of our quality The a conversion in landing of effective rate the bid AI top-selling campaign by used titles alongside results highlight and these conversion an language title brand a and XX% to learning of leads combination average and of powered rate use of dollars Babbel's a resulted

business, XXX in QX, engagement a of born more keys brand out-stream ANSA video product. the few excited attention VI QX, The acquisition have including in and examples one the our the highlighted than we of wins driver Outbrain our SPIEGEL which we Standard innovative growth implementations of and can of in that the product in alongside Another is smart and about includes Italy, power experiences significant driving enterprise Evening strategy. capturing U.K. and VI's new Germany, our placements represent in publishers. and future In in product, saw These impact just existing the [indiscernible] video the video for is with new we do the

publishers, and and headwinds we company, up, offering marketplace QX of generating advertisers are considering technology-led it we of are macro same we particularly flow hosting for the enterprise we XXXX. our cost addressable the cash in stated we discipline our performance growing in sum our for our improvements of brands. market pleased with exceeded our for are and time, positive previously the maintaining At guidance on across consistent caution, are To with the that in objective product focused

I now over to Yaron. hand it

Yaron Galai

Thanks, of we product David. our new and last the inventing areas highlight where this opportunity brought Times innovations innovating AI. and to few perfect algorithms want during are I to a to like platform the the keep quarter. around

with start Let's algorithms.

algorithmic last made our the yield is shared X.X% during algorithms. culminating call, we a our A-B in the of improvement internal On of This side XXXX, based progress testing of on potential. some our I on

they While into demand numbers spring in year's loaded muted the so due last these macro to speak were platform. our improvements to challenges, are

another algorithm which indicates five further we are released A-B quarter, by first internal our the improves new potential X.X%. During a RPM yield updates testing

two Here are examples.

interval, academics and ads. instead Score algorithm efficiency save yielding based system new This ad First, testing what -- our exploration the tests we of impressions ads Wilson serve on to how us strategy released higher for a allows new improves which used that call high previously were ads.

billion Second, of to our the we've doubled in online second. about can per model process parameters predictions prediction the of boosted number X predictions, and algorithm, we throughput

in using previous model. the the is potential that upgrades. while are just two example maintaining efficiency, gears to of we latency these of We've upgrades algorithm innovate another demand a compounding continue is low how QX. done improving five robust, of in of our When advertiser by X.X on processing yield expect examples These results times the recommendations. to released operating we our our of top we're to serving which Switching increase very

intensely been sales our yield capabilities of focused reducing We've maintaining our levels. while cost on in RPM serving

each new cost a less than Microsoft calculates optimize we the serving importantly the in data clouds at needs this operated of more or engineers like more that our on best it reminder, relying efficient our to scale footprint and the potential handling compute to specific center for of majority and allocates efficiency. more real-time QX, that, ad are our control our better much on resources in-house us we architecture a capabilities public based but serve, it In better certain revenue and As by clouds, for on be ability a with for released find framework Azure. dynamically ad. public allows We

are approximately on the started the some ads on We've initial an impact specific XX% RPM. of on and without those we sales results of implementing cost saving on noticeable serve, ads this showing

increase disciplined we fact, allocating with to resources ads time technology while this sales. of cost specific us highest help of believe high RPMs more the on may boost driving by RPMs over staying that compute In potential

very ways are AI focused of leveraging more Lastly, we're detail area this obviously engineers platform. multiple AI on. our exploring and obviously in quarter on is I spoke last an about our

outbrain the our to more for while from a with by previously, mentioned advertisers we've an example I from headline to advertisers creatives better includes successfully creatives. ChatGPT, now April David this headlines that advertiser of We've using to AI one were we mentioned solution As ChatGPT. assist headline been achieve Babbel scaling a robust OpenAI's originating technology solutions is using of built outcomes. suggested about XX% ad and AI

focusing have engineers been AI our predictions efforts ad of is area on viewability. Another

started channels. we within year, last Late our programmatic AI-predicted including viewability

for or As copilot David as solutions solutions They're factor strategy. our building mentioned, viewability creates Overall, of such us is on images testing AI new for evaluating review on opportunities and writing predictions, for ad an with this enterprise excited of PTR inch on the enhancement and areas GitHub business. creation on and with code etc. AI automated vectors that technology code many important we're such our brand as wave very

our to And with over cover hand I'll Jason that, financials. it to

Jason Kiviat

Thanks, Yaron.

for strengthening As demand the we but adjusted early both quarter a we mentioned, of gross demand beat of our QX, fairly QX the in normal with portion guidance both EBITDA. two Europe experienced pattern has US. profit From David a soft the and in The volatile. continued perspective, over course and remained

headwinds in not US start in strength decrease lap basis softer meaningfully was X% yields was via currency by as-reported year was industry. year on affecting year period in decrease more partners. constant our These were The advertising primarily growth a impacted driven on offset the to basis. QX year headwinds we seen a as an X% new Europe. on million, Revenue supply over and approximately partially continue relative by a over the that lower year by of prior demand and a XXX We've

quarter partners XX XXXX and of the year yields, publishers XX%, retention million XXXX. the media New to which of new our decline the year. percentage continued over media of compares in revenue over from year, $XX growth environment reflecting revenue averaged approximately demand contributed of drove impact the growth Net or had seven majority in of which partners on approximately the we was the year favorably points points that

largest our net of retention points by year low four churns total our very standards, remains contributed just and churn QX. in Our year three over headwind revenue

in As logo our QX $XX,XXX least another retention partners all data XX% XXXX. was for that point, generated at

% certain with normal the Ex-TAC ex-TAC and currency seen and new performance XX.X take which a revenue is year versus the an unfavorable was in impacts of quarters optimizing challenged constant partners, partners of with in XX certain past driven XX% profit steeper we've portion of Consistent mix several the and demand rates by gross environment, we're over demand seeing, driven over by headwinds the environment. lower revenue, reported. decline was year by this a decrease of weaker in on than onboarding partners, million, profit basis what media on which as our supply year year of significant impact part the the gross

and X.X variable Moving offset FX personnel-related million decreased by costs to, efforts expenses team. was operating is higher rates, decrease year, to year The that latter lower debt relates and XX.X largely lower our million to severance David organizational to expense compensation. expenses, year bad year some of of the This quarter. driven approximately in by the partially costs, of from first coming over the favorability headcount referred lower the changes of higher to prioritize which over

we we And we to quarters, over the the quarter, in implemented series in to of our remaining flat prior keep a quarters year. essentially expenses as mentioned headwinds. the As cost-reduction plan the efforts adjust business current said of previous

with headcount across and which X the year, we We down of reductions last XXX % FTE, X cost QX year a QX of year. % finished began over since down is in

driving prior headcount quarter, continue accounts our to for operating operations, focus greater We in of and XX% in efficiencies our noted expenses. as the around on

approximately EBITDA a million was QX. adjusted X in As result,

most March. of the Silicon additional reminder, at free use from closure to use hold the until million. capitalized we the set approximately less flow, to week news, payments was software asked with net for meaningfully collections Upon sudden of Moving in we driven cash primarily operating slowdown to we Bank to in period Valley of of over in activities a supplemental customers due a liquidity, were a cash cash as customer and receivables, able by significant as which a up financial of CapEx defined XX costs, operating accounts The cash institutions.

the our bank returned We accounts. to normal of have collections funds all in as over to to new the and have more we regained switch levels at full held April access customers

this the as We reduced estimate and March date. cash from as $XX around other challenges sheet cash operational as and our the sheet of of million on equivalents temporary collections of resulting impact balance impacting balance XX,

levels resolved, issues historical cash normalize to these have balance our expect in and to DSO coming As we been the that months.

our impacted will not on cash QX, for it So, we while it flows a flow our impact do cash expect full-year basis.

the to achieve said, free positive flow year. our we is cash for As objective

$XX.X repurchased XXX amount in cash to on million in with we XXX result, convertible a securities representing accrued and aggregate cash, As approximately of principal the amount principal XX% the balance XXX of of XX, the the we of ended notes. a convertible cash, notes the quarter discount long-term million repurchase for sheet million million debt. equivalents, approximately investments April interest, and including marketable On of

In in that $XX began shareholder though value. balance the of authorized program the in the invest directors share pause that news upon at drive a be debt Review opportunity program further XXXX. December, of repurchase new to the our discount or notes executing cash SBS any due we executed $XX purchase organic repurchase of the a million to can given to opportunistic, the fully portion program, incremental convertible to considerable our opportunities the in share to strength We of temporarily in million closure sheet, a the April. with QX, of the board and repurchases inorganic the balance optionality company's remaining retains

attractive as our value continue to closely and is monitoring conditions. shareholder are normalize, current We to way cash we believe market an collections under enhance

as guidance, regular current as no prior with Now In we remains full-funnel new as material of conditions our improvements, prior expansion turning macro deterioration assume visibility or optimization advertising execution quarters, and new algorithmic drivers of attracting growth to limited. video such today partners, and and improvement, our quarter, outlook, continued our discussed of that to budgets in in our offerings, supply and the noted seasonality, partners. persist

context, that have we guidance. provided following With the

million. $XX previous at at of we profit to million of ex-TAC EBITDA. and of the our of year to QX, and $XXX profit beginning adjusted full-year adjusted gross maintain least XXXX million provided For $X.X the million, million gross EBITDA expect $X.X expect of guidance $XX least of at million $XX we We

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

Operator

Thank ISI. Shweta Please question of from instructions] Khajuria comes with the Our first Evercore you. proceed your question. [Operator line with

Shweta Khajuria

Okay. for provided, quarter that the help Jason, for for growth cadence than EBITDA Thank we in you as questions. the second through would the well EBITDA as lighter guidance came rest us when you've you guidance the year please rates? thought. my taking the have could Specifically, think ex-TAC of to comes it revenue

driving So, thing and Thanks back-half anything lot. growth? top-line you're the call to same in and how a out the about thinking for there profitability

Jason Kiviat

Sure. Shweta. Thanks,

I time to year. on the tried we the quarters cash call if keep last at minus our basis. now back expenses, or just five plan quarter the mentioned So, equals that you'll we've look reiterate of prepared well, you flat think as on expenses been six last And the EBITDA pretty a expenses to that remarks each see our cash meaning just and ex-TAC is on

to million you We've been year. is expenses our around know now pretty in of XX flat this expenses still guidance the over course to keep flat intent cash the XX and our of cash

of the the year from the the is So, the -- really ex-TAC growth toward growth. in coming EBITDA end

to to just our is that what couple we've FX not think improvement And in part growth obviously last through just forecasting calls, for rates, our current a the our have kind flat levers, a do us April, is from which normal are in seasonality QX what but trends so scaling to a assumed supply of for partners. seen is for that moment, which I of growth part new first they deterioration the we normal little so so bit through in talked And on is And the process talk considering QX macro, and here that, first top of far. meaning, not an right? we've and using

of and new exciting talk continuing about to our improvements and of the algorithmic up of some of platforms invest course we're and opening traditional notably expansion and expect there partners miracle to to Obviously, to have David now. and also over that we're see touched as David offerings the And I talked more the video we ourselves think own the kind of your that year. on fruit the some that today. we placements grow full-funnel

the things more So, of That's grow expenses the the expect. those some expect of and that keep flat. year essentially the are back-half we over really to cadence we

Shweta Khajuria

Thanks, ahead. Okay. Jason. Go

David Kostman

higher to I Sure, and maybe the quarter us with we're know add, had numbers, have the sell the our just for but that what specific pretty surprise. way looking for much at mean EBITDA much I internal in the maintaining pretty on a and QX second you we never we're line not guidance We It's of some that plans. is guidance gave is year. plan. for

Shweta Khajuria

Okay, up quantify Thank And terms that's you. to in helpful. follow the me. back-half of prior growth it on of just that's in comment, Thanks, your drivers the any David. contribution? for Jason, to impact way the

Jason Kiviat

Sure.

numbers, branch also video suppliers. if adding strategy maybe of lion's supply is and talked largest. funnel just probably that expansion and combine not would share. that three about, of growth, to but the things order two additional you would So, Number -- new specific enterprise those the really scaling and our the be the that be one upper David biggest listed magnitude, the four I kind But not of

been we've AB environment, see the lifts just four, driver our algo over as the couple we demand it's that impactful as last despite combined. that's in But not in years biggest this tests. then, our of noted number And

of that four now. smallest keeping the the So, right kind as of

Shweta Khajuria

Thanks, David. Thanks, Okay. Jason.

Operator

Thank you.

from comes your Andrew line proceed of Securities. Please question. with Our JMP next Boone with question

Andrew Boone

ask the Hi, questions. taking take to first guys. and to Good for thanks I my just on rates. morning, wanted

in are where You two below the guarantees just take that was there in now of drive out broadly know, Thanks anything given about higher lower last seen else easier? should speaking terms path And then just What you that in there. The of can before? terms a existing the rates that guys levels. XXX%. of we've you in to the you consistently back do rates? years? else just comps contracts just existing so there to couple it's changed being that Is talk Is take getting to XXX% 'XX, guys now publishers call market higher kind this much. maybe think publishers, of anything quarters Is level back had where we been over about 'XX structurally to so

Jason Kiviat

Andrew. Thanks,

So, start. maybe I'll

nothing said revenue to contract around like changed in the I same we've on revenue just the still So, the XX% as those guarantees, it's -- still anything We where been. take has as think that. past as terms as subject far minimum that's or far of our vicinity is rates,

been, things as supply for is headwinds, to it's individually, The obviously, some supply to speak but see it that's been this in continue lap factor the that maybe macro affected different Obviously, exciting to we've and of saying some driven a in quarters the we the to same geographies. segments but have have or thing want, been that we demand not biggest environment. the of few down period continue imbalance the rates at the anything mix by not playing we than the lower

things kind taking will the have Those are Those of are it -- obviously bring the to back new do brought generally. on supply and down. are the things scale. up. -- also time and So, protections downside We it those have these that that

in control these not down levels materially them our go to an at. the and ago, will versus back expect drive couple the risk it take to but they're from So, of a get probably unlimited levels further To years some I there of higher. current definitely are don't to recovery, macro level things there's that

with of the the year margins the of the this year. beginning of higher and the the also higher, which happen to the versus of We tail that higher year, algo the expect take better at rates. have video some end the end expansions do year of the particularly seasonality of rates improvements, year, end in over higher we generally drives Obviously versus us of for segments expansion beginning

As lapping we're kind period. far as retention, again, of challenged this still

we'll as So, of been. the range XX% have kind I be the this not easier and year, back-half we've a comp we think that the expect of to into get same

that some and driven prior XX% this the some versus I really in did I rates quarter, of month XX% seen not rate and improvement of Obviously, pricing, that's also in and We from said improvement Kind see retention. and click-through by largest returns churn-driven it seen. we've QX XX% lower each improvements quarter think improvement we've again click-through quarter. in was combined X%. was pricing under last in

So, of the grow year, to again, will we get more see through toward able be ease think I and as we back-half used and how growth the the cost expand. to we'll

Andrew Boone

Thank you.

Operator

you. Thank

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

Ross Sandler

guys. Hey,

just improvement points David, run XX% how then compete? senior Just new structure you these better And color ad to changes overall or Outbrain more can give data us equips the on two you that this pretty efficiency management for questions; some appointments, interesting. strategy and serving new

broadly, is cost productivity as new the strategy, like it you. how Just stuff quicker just high-level tools engineering efficiency shipping team? this on or product copilot savings Thank a using Just these color and of any that? your or AI is helping with

Jason Kiviat

I'll the good first take Hey, Ross, morning. one.

the right about senior timing about the from what's generally of to management, new on So, positions. promoting talent within about it's

see emphasis an You is there a bit that programmatic. more can little on

algo machine the of strong very and was he CEO and founder learning. So, programmatic Zemanta, been who's AI -- on Andraz,

also it brand the emphasize product more led fund. into for we're focused brand on hard the push than product. wanted business. business that Alex responsibility which international And why the enterprise to him very and more the the organization, our pushing now is and has U.S. This gave we So, we is

we the that the for relationships to few refresh management his time his make So, just agencies, years. right understanding of the in some the brands, generally changes and believe next with and business was

Yaron Galai

I'll take second the Yaron question. Hey, Ross. here.

on to ability, So, our is first, one the serve to we predictive we kind and I for predict the in of time real value publisher. valuable each did that, the of ads point resources. technologies how deploying AI, real that before, deploy to or way us of try about on engineers the made are more time fly based for cost And the I sales what in predicted is less compute we

So, it really in capacity. center affects serving data our actual ad

data more for so And lower that are a ads value, XX% of resources valuable, lower and seen compute use of sales. more cost we've to center those be we And this in we through use that that about for less ads architecture, those we resources. are savings predicted served

So, very predictive exciting of models. AI a we think that's use

robust have engineers in and testing the we AI. you now area on where fast then more say terms of headline terms and see faster mentioned on engineers testing assisted. this be I but on exciting or for something don't is And review. much think all many probably code our an still imagine efficiently are We engineered. soon, have going more of is that engineers anytime for everything deploy being is assisting human in I code pretty writing our much I'd creative else, mention much can where suggestions advertisers. over on software to about briefly, and efficient writing code I AI. that anything and generation, continue more review ad be of that can ad In pretty that generative XX% That's is ChatGPT using code replacing code kind writing think we in -- directions. headline It's different human did of we will software much on engineers

And creative. our -- the more we there ad think deployed and to much but on image there's the we're generative do areas exploring AI we're yet, exploring not for

the of answer all above. is the say I'd So,

Jason Kiviat

Plus, future very us. it embracing weeks a hackathon the I doing infrastructure a across of is like happened for I a to dimensions, engineers competition Yaron And all it's for to of thing. had all exciting ago of picked going Everyone be and be around mentioned, and great ideas. three top a the our it's couple sort you globally and we think

Operator

you. Thank

Needham and with comes your Company. question. Our Laura from Martin next the Please question proceed with line of

Laura Martin

interesting it really there does actually work control just -- quarter, this costly? that? talking Hey, question isn't wrong -- add or generative excellent your this -- cost about but stuff But and doing generative of AI. on that new you're AI I doesn't costs, cost Doesn't you're mean, on. Is about add content to cost continuing in generative AI was the or am you're the savings I it really doesn't it it capabilities

Yaron Galai

of and decides take dedicate how one to [indiscernible] resources or compute first each the much Two, off ads to we processed. that

sales. on that's cost of So,

ChatGPT like the headlines the yields. ads, allows ROI-driven. part which we view the creating about us click generative into that, of and the many drive variations rates higher which feeds things and AI way On algorithms, is to It's the more it like higher

way will So, obviously of is that takes but the it bunch do and return ROI investments, if is a and deploy there really we the based it [indiscernible].

Laura Martin

for then negative worth in that so, one shares. of cash but flow allocation, of I million cash Okay, XX, $X And Jason in your terms is free you interesting. still noticed bought you

since same your the me talk really you base So, at be now. need right business please? Why shareholder the question you for time, about cash is, it like feels to shrinking allocation my cash would

Jason Kiviat

Sure.

and and considering creative conditions was chime anything to a free is we environment the do you the it in it And and, of obviously spent in. if pricing repurchases to weigh Again, of business as that continue Laura, -- share So, of is the we're trends for maybe we add, have context to well, I'll we do. on our just we'll to and which shareholders, everything. have that our market all know, to it -- feel and QX. million actually start you clarify, But on David, feel $X cash

David Kostman

I believe the right was capital. we use Laura, think, it -- is of do it

of We cash our amount balance sheet. significant on have

our to cash according -- are be profitable year. We this plan to flow

right shift the that So, of this I not managed we believe think company. is we shareholders attractive holders sort value equity the And use terms. also paper that very the where back-half buy the of about post to debt are buyback financial we excited at for and into of from

Laura Martin

very guys. Thanks Thanks, much.

Operator

question. proceed with Arounian Please comes [Operator you. the your next Thank Our instructions] of question line from Citi. Ygal with

Ygal Arounian

right? all me hear me hear right? you guys you Can all Can Hello,

Jason Kiviat

hear we Yep, can you.

Ygal Arounian

an us just Okay, trajectory some Keystone, the quickly we great. there? of and has update of little just bit Thanks. could I first a expect progress what the give been on question guess

David Kostman

mentioned that, publishers, and you're EU in on of take our a call we of since Maybe in healthy page last those. three see And code on Japan. we two Keystone I that wrong had I'll more pipeline think that the mono one deployed publishers problematic. the we two on and just I then say we But would

Ygal Arounian

Okay, thanks.

some here. on end. coming it's I Sorry, there's noise hope your background through

next about year changes publisher slowed focused into year to large which Just expand the last the bit of should How this that there you year's versus integrations and little think this of we a be on how how pace sign years. year? thinking ups, looking course about guys are the over

David Kostman

I'll take that one.

it low -- a you've growth. existing the normalized net does low approach brands prior are to we year retention as had having a went was year. year. in a more -- up at coming we better said XXX% going new strong they've growth getting support sort to the this getting into the premium focused side publisher to wins. the of we're very we hopefully of we of market premium on more still years of also now should of So, last And that revenue very, premium hopefully back We're as last we earlier, But enterprise that looking where versus it publishers in in to very soon record because mean, net year hopefully because believe of it more mix double to level new. the couple We retention mix the we're looking closer Jason a of see revenue are and said, you single be back up digits the seen I on digits you'll quarters us from more, to

Ygal Arounian

getting of are the innovation strong and of end ask products. outperformed we've guidance them one to the past. if plus some to bigger-picture quarter. about second got but some they board, things seen not did ad advertisers done tracks. we've I note Thanks, And tail last heard could have in The we're earnings We're just some around our they And market. as seeing the this coming advertisers. for but the question. quarter and across stronger I digital trends from like to We've advantage look was really the on meta, I'm just or notably strong of the as for thinking here

it So, looks some and to headwinds like the we're of levels. those back moving past maybe not way all

into impacts And see the see of bigger business here? impacting things Thank I everywhere, just evolved. how how forward impacting that place. things kind that move that know space, picture your it of we're you how you have but not certainly and you. came All

David Kostman

February, we And volatile mentioned quarter. January, and that trends and improvement. the between and you similar of toward May stabilized I started with April more March end the the saw think what

in outcomes, still their for is uncertainty The trend measurable generally we're very that returns on being on advertisers for we spend. forceful demand. measurable see one that is So, looking

brand because those better campaigns awareness deploy our that. we're delivering on plays can if brand Even we about predictive very much That's for campaigns, this capabilities results focused us campaigns. consideration or well into analytics, are why talking for we predictive

supply We we're the premium that side. That's premium focused also premium why demand. believe on attracts supply

invest. wanted can So, trend this we We're year. the more areas we making I started area, be of amount very from this this investments Keystone last and where on advertisers. right year, in believe would now to significant investing, from I we we that say limited benefit

Ygal Arounian

Thank you.

Operator

I'll floor turn and for gentlemen. the final session. any question-and-answer comments. Thank management our you. concludes Thank This to ladies back you,

David Kostman

David. is this Hi,

forward much to look very us, you Thank thank you for seeing on joining our So, next we and you. call.

Operator

you. conference concludes today's Thank This call.

you at time. for your disconnect participation. lines Thank may your You this

Outbrain (OB) 9 May 232023 Q1 Earnings call transcript