OB - Earnings call 4 2023

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Operator

Good day, and welcome to Outbrain Incorporated Fourth Quarter and Full Year 2023 Earnings Conference Call. [Operator Instructions] As a reminder, this conference is being recorded.I would like to turn the call over to Outbrain's Investor Relations. Please go ahead.

Unknown Executive

Good morning, and thank you for joining us on today's conference call to discuss Outbrain's fourth quarter and full year 2023 results.Joining me on the call today, we have Outbrain's Co-Founder and Co-CEO, Yaron Galai; Co-CEO, David Kostman; and CFO, Jason Kiviat.During this conference call, management will make forward-looking statements based on current expectations and assumptions. These statements are subject to risks and uncertainties that may cause actual results to differ materially from our forward-looking statements. with discussed year in as ended our reports are filed Form updated factors Exchange subsequent the and for December filed risk in our detail XX-K in Commission. These Securities the XX, XXXX,

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

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

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

David Kostman

to Thank to want on X audiences joining the in for as the our team you, into to unwavering content result. devastating and massive their strong the and The the commitment geopolitical on good morning, Jackie wanted thank have events and moment are couple continue foundational and of level. many October to for unique how to functions us. we We years, us.Before opportunity take the them faced that so capitalize and global acknowledge been thank changes how and us assets acknowledge changes. the a and a there events ongoing challenging our of advertising us going the ], support.Over their you give industry Israel past believe of consume I a to team specifics war of for I impact a ensuing [ year, own these

that growth Open estimated in we on this investment XX% we as to resource, growth would expansion vision Open to Internet, long-term Ex-TAC our strategic you of a year this year as is With perspective return an details, margin will which and like the said, and a content. to result $XXX looking increasingly market opportunities provides growth, billion growth are the editorial We to a advertising going the presents. believe as provide and EBITDA access dive investment XXXX. and valuable new areas.Before Internet be in The We XXXX in nonuser-generated into update a on margin I'm well journalistic, plus double-digit areas. at it to

audience the deep In CTV channels in provide environments grow, gardens walled unique provide engagement can advertisers. found are access point addition, to providing environments also apps, These Internet seeking incremental efficient single and on access reach.Outbrain advertisers gardens, is such positioned create within this opportunities emerging attention Open well retail to provides that ad expanding to and mobile media. while and moments a walled continue as not opportunity, value for spend advertisers. And to and capitalize across diversify their to they

engagement. and publisher of Onyx. like This coupled and technology and data performance prediction We've subscriptions our fuels to successful valuable technology data, offerings our able data optimizing interest applications business. e-commerce initiatives, new proprietary foundational our [ yields been inventory consumer prediction to years.First, companies one we business point of few across mass with our an which exclusive the critical the been publishers. Open We over developed due technology, are and on X,XXX of Internet very a starting AI quote-on-page core have has excellent assets some Keystone, develop with with and total including last ] This XX around core advertising the revenue

objectives.Second, of based our true platform. interest consumer for a approach be to their we end-to-end As supply we will and attention the range on and advertiser predicting strong a third-party chain a operate believe cookies X-sided that decline, solution editorial content

tools of objectives. access to of platform to ad advertiser our critical SSP, owned inventory with operated and range provide Our DSP tailored direct mass native a and transparent,

inventory and critical a direct to the continues than owning focus supply ever. on As consumer path moments to more optimization, is industry unique route

especially believe for the ROAS Open tools performance growth This addition, advertisers core across asset X to In is we programmatic unique we the ecosystem.So drive Internet. in give us that capabilities in to on this differentiated strategic expand these bidding plan pillars. XXXX, lean that in

demand be total pillar around will Onyx The our video of high-impact growing Onyx We media our to effectiveness of technology to directly prediction serve our grow maximize attention. expanding branding advertisers. with inventory.In optimization further scaling programmatic expanding path our brands by, significantly with plan first, diverse with business to so supply XXXX, is viewable advertisers. performance applies solutions suite first experiences address share in-article our us to enabled to and attention has wallet Onyx a with environment focused and enterprise second, mix; and a our range of our do addressable on with opportunities and agencies, across we market. dedicated ecosystem programmatic developing

Paramount+, our impactful a keep drive Open $XXX gross from that over gross service our of XX% through enable important offerings brands profit. of We million to Colgate-Palmolive and than $XXX spending our base, have to X expanding others, revenue, funnel.We as a strong offering bespoke tap platforms. in We presents years. is will as seeking such large-scale includes existing Ex-TAC companies approximately XXXX. million, of with us spend is but CAGR foundation of customers mention types It with with performance recognize to which a part GSK, don't believe of was ROAS client the in enterprise base Total results performance across fee branding can approximately Zemanta spend, DSP working and budgets business, DSP Internet. us BMW, our a last large proprietary this to X on opportunity unique more that advanced with will service advertisers we part continue service that amount into across in also we controls the driving our across our our new Investment XXXX representing client engagement investing a in the our this into for provide the

will time, higher the sizes. budgets strategic believe results that proprietary to our enables opportunities on customers expect same from Outbrain.Both our of DSP ad in through beyond significantly create advertisers these us. for Internet of Open new drive for our driving to Amplify, We all we these the strategies focus to us platform, leverage incremental access result key that At margin native accounts supply

We will uses on new focus continue scale. to customers automation of and these at AI ROAS with provide to

Strategy. automated our While developed creative engine we AI platform legwork seen AI has prediction second feeds. adoption success core platform we ad use Open performance of AI reduce this titles. market Internet decade, to customers Strategy. plan key footprint native Bid product, our is: beyond Through our supply ad core of generative across of been grow the new entirety new uses and Conversion native of great We've further Conversion performance our Today, with reach over year, of consumers expanding base.The pillar at to the XX% our traditional improve for in dynamic have of to customer with a Bid bidding users our and automation, the

habits platforms. our As our plan core access audiences publishing. we're and audience to to demand apps, We web beyond to OEMs technology offering mobile expanding consumption shift, and continue bringing

advertising Internet incremental supply, ROAS. our to these XX% while accounted valuable DSP become partnerships. in differentiated feed bidding providing advertiser beyond grow performance Bringing We continuing to the pillar: more drive differentiated. plan grow our Open expand XXXX, consumers in will on core advertiser only and critical supply news total new inventory at more of authentic outcomes better access driving publisher point to publisher essential us is to with audiences is to advertiser to our content spend XXXX this audiences this across for to premium engage of We to than a and exhibiting the by scale.Now dollars capabilities as reporting outcomes value that expect and Journalistic to single was ever over Outbrain. In to access engagement-based our the democracy. so will enable third that back spend

key offerings advertiser continuing double-digit to can me platform now goal XXXX, continued across are that infusing in and our new our XXXX, more. to from solutions.As with benefit the saw we in-article At with total recap more offering, total to finally, performance the partners publisher subscriptions, a higher our our monetization with and benefit remains Coupled development publisher revenue publishers X,XXX publishers publishers to a partners. now of e-commerce our offering, audience a We new of from publisher providing drive This full a enables with optimizes SaaS to with engine publisher in-article end with And monetizing QX for offering partner.Let In access an Onyx underpins demand critical us. mentioned, core area performance. Keystone also X improvements of year-round sustainable we secured page inventory engine video core in revenue customizable CTR existing prediction and prediction investment, placements. invest HX. for in our improvements effort yield enhancements than

signed and [indiscernible] they by high top Outbrain's page With XX% Toyota model. new building suite, cross-funnel total offers dedicated publisher and audience. continued in video our to its page enables is management viewability, with the second Onyx initial revenue launch us marquee testament is January. year. publishers funnel after more attention pleased expectations I XXXX, highlights running great half expand QX, We X from achieved the platform with in our in building already to HX. adjusted demand the areas and Onyx incremental performance.Toyota of of landing to a our model this to harnessed continued solutions premium full to Toyota format strategic monetization from drive on opportunity. also that each just momentum some offering a qualified $XX visits on million achieved to new suite. was of awareness of fuel to in $XX the early with our example just performance which stronger Australia. EBITDA. the revenue offering. Ex-TAC to refer of the million Onyx months of via hit seen want car Onyx XX%. First, efficient C-HR Onyx the our XX% partnership Corp pre-roll Onyx, to which our News long-term contextual we opportunity.We performance to of guidance This Toyota reception in a brand then run deal mentioned.We've target drive of of video to reflect Toyota's the its launching managed true completion made market advertising the the for with campaigns to is brands secure Toyota securing partners, gross moments, and Onyx's the performance we pilot the rate for QX, our accounts This With value outperformed I a than Toyota for good we leveraged using attention June successes for consideration am both have investments XXX switching In I profit competitors, of

Additional value X in International wins demonstrating competition the QX Post, wins publisher Spain, Huffington in X, the Sports Webedia complement years, and These the our last strategic include QX from others. wins Border relative market. our advantage in and premium

a sum the and it in long-term believe Adoption factor in of value XXXX We platform Parisien, the base with drive our Dotdash started our on News growth our partnerships this will Meredith, for investment HX Corp Telegraph Vocento, coming Keystone years. renewed up, We deal.To launches new into Internet. Open confident existing are increased 'XX, premium leading continuing profitability [indiscernible] Handelsblad. and also and with will and was as and publishers, we that strengthen publisher in substantial Le strategy, and The CNN, our leading key Digital Entrepreneur strategic including across a cross-funnel

XX%. I are executing the the will this friend thank a result, an from Yaron, them.As opportunity a and XX% a a to be where Yaron speed have for very to high-level growth truly which seen EBITDA margin role. made achieve personally expect in outlook take excited we're stepping and may this XX% least and personal about want we I'm of providing release of we As the Ex-TAC we've decisions amazing morning, XXXX, business close at down in to you also Co-CEO to the partner.

him. together be that, working I'll I'm part over incredible he talk We founded.With the over to years turn what's and of and an the future about company have privileged our it accomplished for amazing Yaron to next amount to X

Yaron Galai

our for now my for and billion I our monetize publishers this and great better experiences. and are David. kind the recognized more people generated all of that the we crucial that which years the engage Since The content to Outbrain over the when partners, decided consumers employed, many other Ori Open how words.XX world's personalization than better editors their together Co-Founder, That's things functioning Thanks, years. publishers for Lahav, of Internet. which, I ago, of has many and companies as many keep crucial that ever.Today, needed best journalists, fact checkers and have a on advertisers ROAS inspired ad granted over appreciate ways for the to are needed then, I taken innovations way create done. needed to $X so been with know, obviously as we things are Outbrain's democracies is of pioneer

to Keystone, traditional both evolving and ad decline third-party the the of longer to they Open the that's create core industry founder, that and search day tremendously reliable back to of team tenure consumer our what driving a incredible and giving diversify the their each of and I'm It's about time right advertising Onyx top this will has both from as the Outbrain past. XX-plus dollars I business a era, time reliable more acknowledge provide about expanded my partners of the that revenue is best only as that beyond us entering to them Outbrain the a to through in the are parts the performance executive been these around company-wide at I platform, social products publisher XX monetization clear critical paradigm through paid doubted as challenged team opportunities and in I partner moving environments cookies. are the over I've to for we've the advertisers at amongst like experience our Accordingly, their Onyx scores present sustainable to as the tech. development Outbrain's changes. we're every as raised in in look on changes the connect to Of more transition, Outbrain's about and advertisers the everything granted.Before year-round both new enable over into the and it's leadership habit Outbrain incredible the our with publisher The areas team on solutions several industry new to Internet provide future suite also Outbrain future brand employees methods, audience real As steps and ad believe of the grown reasons, Outbrain's am they engagement Open role the founder's our highest utilizing This tremendous people feel It's consumer CEO of rarity entirely Advertisers our surveys. proud is recommend industry Onyx, potential years. applying partners, business and ideas past is me the both for to Keystone, Internet. comfort most company average able the to years. I revenues from has branding me is the key the chapter. shifts in now and gives markets of as editorial of new gives fundamentals for enhance us new of this to enabled the that to management to for monetization changes. proud and next publishers widely Through these relevant years over budgets.As as a ability across talk and about years, that. team which both our move developments.I and their out are multibillion-dollar transition.So value points publishers to quality new where on news.But combination untested, new are receiving that talent, the for And well confidence in we confidence technology over for future, are Outbrain's most believe it's of of partner evolves focused a targeting bring for forming compelling all of has strongly both Outbrain, the audience amidst Outbrain publishers journey dream no be X goals. become will we prediction the phase on shifts, taken performance at as our use which exciting where supply years its even Co-CEO. because has were like And huge And I solutions built and to want we to David Through

hand departing of next a and shareholders. continuing Outbrain's my privilege companies, XX at confident Kostman, by as new look no chapter this.CEO for our of company for as do me with be customers opportunities have an personal and companies of operating amazing look as that, As all Advisor that Jason all with these I change transition serving company's can company after years.And like I'm note, or to cover as next the to this greatly about I times for of forward financials. is especially to after Chairman therefore, I and company. to smooth can next very CEO a levels as it respected upon prospects our long will past And Outbrain, case, and times for an a tenure reasons, be the the difficult as forward over our be.On is entrepreneur, X the transitions I'm of the last to and time, plans as to I'll Board for view had CEO, excited In XX for we've David the already Outbrain together trusted years. as the David years. Co-CEO deeply I our

Jason Kiviat

time quarter, has both part monetization year, Monday.Despite and soft October. recovery from or November, October, publisher had and and saw we see mentioned, year-over-year Friday news or the returned to driven seasonal recovery the the yields EBITDA. Black then lift geopolitical last Yaron.As adjusted benefiting large believe perspective, relative macro which demand David mentioned of lower the delaying $XXX October partners improvements.Revenue early which into by content than reducing quarter transient resulting the our budgets gross softer click-through QX was much of reflecting a by historically From a demand around remained flatter optimization that was the we Cyber the algorithm guidance and from I profit since we dominated QX year-over-year. quarter from of XXXX. rates, QX pattern in levels, supply that Thanks, shown RPM, achieved QX a as was saw Notably, for Ex-TAC that of to with factors, of of in our along uncertainties, war-related yield higher driven first decrease particularly levels in We a million, for growth the growth approximately X% our

opposed our headwind year-over-year at X higher largest churn. QX.Into least growth New our and supply environment step-down have year-over-year. media page retention Consistent factor a experience generated approximately seen of being million pricing, driving sources or revenue from our by low revenue with XX% and retention. on quarter largely impressions to X the view from publishers in from with levels the of percentage of retention consistent the partners driven demand of for we amounted net of remained Net to logo combined X the QX, revenue a XXX%, on which certain all was points also did decline similarly ad reflects pressure churn the that slightly continued at below points has retention our year-over-year to revenue platforms churns recent impact in on We partners quarters, seasonal XX%, contributed remains which and $XX QX. headwind volatility of contributing the $XX,XXX only also as

largest we third beyond. gross a certain QX, year-over-year, yields for improved in quarter While revenue X% the opportunity exercise the QX volatility. of the from driven to spending. outpacing supply is mix.Moving guidance, for applied year-over-year. a component media or compensation-related down $XX.X from XXXX on expenses towards late a impact and this net from and Ex-TAC in up year-over-year. we decreased which we've sources David also with greater to quarter into confidence driven which $XX.X XXX as partners approximately growth approximately X% of to have volatility deal performance certain year-over-year the to the $X on Operating experienced, growth remain FTEs, and our be reflecting platforms our mentioned. as driving XX% Based million XX% expenses, from discipline was partners approximately efficiency continued profit outcomes, we revenue focused impressions we see of down increase has an higher were that expenses. headcount on range million began around The January by momentum these redeploying In continuing in now areas of is ad operations XXXX row, wider primarily of million, our on about resources attention We down the and year-over-year, what

Free As EBITDA a a working Ex-TAC activities, to as in operating capitalized CapEx million adjusted of result and cash of approximately fourth million from model, our was capital gross cost management we define profitability software higher QX, our $XX reminder, from leverage and benefits. and liquidity. benefiting the the in approximately seasonal year-over-year.Moving which, quarter, flow, doubling displaying in was profit cash growth $XX costs, less as

quarter, which in as such the benefit working cash full excludes to free million, have flow. around $X for investment from from a pressures capital, of opposed benefits year XXXX, to with portfolio pleased approximately are flow still cash DSO levels elevated we we cash strong remaining free of net the Considering into free $X our saw that QX. on particularly activities collections flow use from a cash QX we cash While million investing see

we XXXX, cash, a million debt.In convertible $XXX the approximately XXXX, company's of million on outstanding count December purchased and our XX%. In million authorized the XXXX In to share result, approximately by we Directors incremental fully $XXX for have investments total, $XX.X program, the a and and reduced million. of cash the in of we XXXX. securities with X.X share sheet, shares ended balance repurchase Board million marketable equivalents XXXX, in $XX $XX program As in quarter million long-term executed

believe value an turning current way market attractive to conditions.Now under continue it's We our to outlook. to enhance shareholder

discussed no context, As current that and that or material seasonality. to With our remains budgets in we deterioration quarters, we macro In persist conditions following provided and full and $XX.X for expect QX, million positive million EBITDA QX negative of to $X adjusted guidance gross improvements year assume regular XXXX.For the today guidance, advertising have profit we prior $X we visibility expect million, limited. million. with and Ex-TAC of $XX.X to

For profit see of year. we over the $XX provide gross that and year-over-year the expect XXXX, see full to EBITDA $XXX adjusted to the XXXX, million we year expenses year, our slightly $XX more of Ex-TAC expect gross we expectation profit we additional sequentially meaningful $XXX how million, while million.To of begin to million Ex-TAC of growth increase to course is over context

the lifts it returns areas enterprise for Ex-TAC, investment For to traditional driven meaningfully by followed more our we are from the with operator of our the brand and assumed QX, of half that growth touched spend, by of from assume feeds, in growth year-over-year spend expect growth percentage that advertiser we're QX, Notably, we and I'll areas, the material expanding supply profit revenue in focused agency is Ex-TAC focused gross improvements, double-digit no year Q&A. turn QX and David year.Now optimizing the investment beyond and a the outpaces mid macro drive execution driven revenues. our many expect flat of our second course growing where environment growth.As single-digit we in growing on, on back our growing areas pricing areas can over contributing by these growth publisher we performance

Operator

from with Evercore Khajuria [Operator ISI. is Instructions] Our first Shweta question

Shweta Khajuria

you math margins implies comment So EBITDA did please your guide double-digit if percentage to I full getting XX%-plus low margin. right right, now, Could your of confidence the year on next year?

a that's So meaningful expansion.

of drivers, us please top in And put mentioned you you the that your back could for just together? but And line. half-weighted how then, some growth you help great. much the confidence year? wishing in ability just the Jason, Thanks half then It's all to best, deliver visibility do accelerating have been your in the this growth ton. Yaron. of back And a you So

next. what seeing you to forward do Looking

Yaron Galai

Thanks, Shweta.

David Kostman

there Let an more about both you our 'XX. base. with giving Open me And giving strategic can of reason reach the of and significantly beyond our the grow excited take the pillars business.So excited of before. about mean, at we're use can where advertisers, this I publisher see there's deeper metrics We're and I we're has we building We're performance see of on through both Internet, we're outlook. been bidding you that than the first the the opportunities other core awareness base many segments brand way Zemanta sort our we're side expansion in call on share with point mean of the wallet on very real Onyx and platforms. advertisers, heard share technology we We're future. existing on very the the growth which suppliers expanding highlighting. looking many much the with wallet to into of third-party with our

is and Australia. supply there beyond that big And give offering also the a we the subscriptions others a them, there. advantage to Keystone there's us, publisher So gives of for very We've we growing publisher the announced them premium that's strategic, grow, is the second mid-article quality and it's we much string the believe, Onyx a at a feed through then opportunity We optimization, of -- that Corp offering major have lot think that e-commerce News that base demand the and wins. partnerships something larger the of looking and premium base and one, had going publisher we of of sort and coming combination placements.

there.And giving made expected. investments. see partner strategic what higher I more our you they're a in becoming probably we're than us little So overall, we -- is we expenses, and mean, so a can this

the new in also have of double-digit confidence adjusted EBITDA investment and And 'XX. it XXXX -- real seeing we half. on that's some really we're growth then 'XX, in made that doing where we in very strategic outlook We're we So of XX%. and gave second focused margin good around the

Jason Kiviat

Sure. the Shweta, touch you I'll that on it's had. question second Jason.

on as our call, that just of far considering the in in course, of course our isolated as of areas which seen I range a year-over-year, normal also temporary, quite margin. obviously is considering impact we I seasonality-based which being trends the a expect supply yield growth many that it's are again, of QX, how cautious volatility the We're which these on we of far build seen the them year, we're it.As we're grow here. expanding QX that continuation talked but into as we've growth and is think quarters guidance, mentioned haven't about model, few to the will So we the the and as we over our drivers call,

we're And from monitor but throughout Onyx balance kind we network, be formats.What to And we'll our spaced more see evenly far and immediate the more items than doubling areas what the and that perspective. penetration back-weighted costs acceleration shift bit a our along think you'll the of XXXX not payoffs as to have the more half, we payoffs, as off. can partner-specific history, back which results feed that longer-term of more skews outside and need. performance, headcount-related EBITDA see and video investments are in are the little half-weighted, the supply with towards back consistent that a slightly think really our some our kind you'll on And lot have more think line obviously, of control of is our there's or with pay optimizations they're meaningfully of I of of a of I our guidance down that so but able our really XXXX, a is the a go some these year, as top probably

Operator

Our JMP Andrew next securities. from is Boone question with

Andrew Boone

about overall viable publishers. the industry a to how like seen Complex. of very ask I bigger Tactically, look And how question revenue? secondly, of ask you Help the expanding for on How need relates could you additional health terms guys then to back to like? earlier: kind just Outbrain? on tough what does sold and us out to feels you sources there growth overall supplies publisher. shutdowns about relates sledding journalism Buzzfeed of and pillar that Can wanted that picture it's be digital We've what understand health digital second the that talked and opine be I to the do just supply. back work Outbrain just growth. for then of the that to in better of grow digital just It Vice. want of

Yaron Galai

DK ], take... or? want can I [ you

David Kostman

ahead. Go no. No,

Yaron Galai

Okay. Yaron Andrew. Thanks, here.

So second of in [ with jump I'll then will first and overall DK the the the take question. ] stab

publishers as first is and narrow. for I So of we've quite us of the think view said been as just all, we've executing,

So we in main traditional outside of X grow ways. publishers

programmatic extensions non-feed DSP The is we the reach through own, first one of inventory. our plenty non-publisher or through that we Zemanta, now

platform our The through is second partnerships.

terms this which Samsung with such OEMs third, business but And that. of in-app we growing mentioned also partner, tremendous through best and growing, I here, growing the monetization folks as both non-publishers the like with still still -- more some been happens, opportunity some we've publishers, pressures, things very is happens. That's long of Outbrain So of maybe in is [ but publishers. for canvases footprint. for that's and types phones consumption Outbrain I spent consumption time necessarily consumption the for way us.Also monetization or obviously it's us, solid that is because and for is a quote-on-page of content it will our Onyx and it kind partner shifting of think size moving, choice isn't plenty not of opportunity publishers, word presence, small [ much with which different of the of where ].So partners and we're this future, time companies. I think between but ], future, with think the -- necessarily But #X the their as us like of of be as is and big the reliable, less important are They as into the

important first-party Keystone. resilient and a for diversification of from for the which pillars days, on are development, that very much revenue especially publishers, just they're lot publishers a have through search is things other data, Outbrain these other and us makes to audience pretty these them which of social. getting as We then not that compared fantastic on have.And partner

is things, $XX Internet billion it big future.And we just a more for the become opportunity. into of important to -- the $XX So all publishers even the think and growth, not then in think good Open that billion those point in terms but growing last the TAMs, is call I TAM, within I'm with

is Onyx, where things big like types on partners, of with also budgets a So the it's the side estate us.David? our both growth in, incremental opportunity for on I we bring real think but

David Kostman

questions, will that getting looking that the both strategic think video deep look election paid you which XX, in ones, right top believe journalism pretty is them. the traditionally sort short increase year, views, and value traditional I you that consumption, at of look we XXX do We're lot the value publishers, but of if most form time, will add a bring to a we some value when Yaron premium look views. that trends constant. just plateau. top at all of at believe generally, the analyze answered I there. paid the There's you And are do We when now to we and at

our strategic again, but, them ones. today. that look other role pressure. it's and ecommerce.And on you supply. than XX% business opportunity said a under about third-party bigger more variety there. help Yaron And at -- the development see is of our do longer as audience the hear to, I industry and of tail again, So big ad sources of revenue here a is like clearly said, we think We monetize publishers on is provide But what We

increasing supply that very advertisers. By we third-party of and also ] yang. of share Onyx by biding that, sort from yin our technologies, strong And doing [ grow it's

Operator

& Laura from is question Martin next with Our Needham company.

Laura Martin

build more there's in going term, you generally. of the at the loss. ad may into cookies on Andrew's Open no to near collection in least and and gardens threat comment the the that's I'm Internet push risks a and ask walled Open signal deprecation signal which is So about spending, of loss sort Internet, faster, growing to television where Connected walled gardens,

years you So have of Open robust could will forward? it health participate think Internet, the you X is the you to to and which why X a speak where

Yaron Galai

Sure.

all, -- first Yaron we to So, need Laura. Thanks, maybe of here.

important and fidelity just higher. all benefit to growth tremendous. around I the companies. capabilities. going even making thing partners might think, Facebook-type registered couple think because to you where we we not walled big and partner we between exclusive in going regulations better I those going start to in generally And which of don't data as and Facebooks the ad think and limitations usually not all journalism-based the to users that, and I are gardens versus a to us, that And And with is is companies. all terms, trying categories. or many tech gardens, or to also think at do distinctions my for some they each be I basically Outbrain coming has those shift easier They'll need in companies or is are only Google, in of walled data of think And big capabilities while audience all look and kind tech I think, and mind meaningful walled building environment publishers or doom need walled some that have necessarily big of is be think not though is from of think monetization those the I and and terms at synchronization think those I the -- been benefit one own stats garden they're becoming to logged is development can to Facebook a it's out tech great bad walled the paying easier and best and -- their garden. and their best trying is of gloom. the should if back world Googles -- big like do.In Google signal governments those types big the build way, tech are attention for Internet that tech X We publishers, an Andrew's the data the big is companies, of They're have of the and companies partners. giving see publishers Australia suites registrations and partners those a But to targeted world I target, Canada, the companies. of to happening they what's question, that.I necessarily a fidelity, first-party tech of many to like gardens in partner the place, or those some some of Open to of the necessarily -- dynamic. that back are, be all publishers, not and true, the other with ability

be I think might of that. a the Open beneficiary Internet

David Kostman

to point. I want X add

range advertiser on As we're do we focused -- the becoming, notice, you incremental perspective, as of company, an we much serve advertisers. also delivers a From also more much audiences. Internet wide better how a Open

signals that but something deliver we using We we audiences way better to they unique incremental have them we showing number that that of do have. a in on can endless target cases YouTube,

You audiences talked develop about cookie We for critical signals deprecation, here. them. but the are super contextual

where their overall the an And is the also for delivering Internet many is that.So part and terms you incremental. of do in important it's of and advertiser, value there audiences. incremental pricing any targeting. Open in get respects, Internet yield, Open question a incremental So delivering And your it's there's spend, and better

think target that in you interested someone that's those that. want certain vertical, to you a If publishers aggregate do we

our lot traditional And call a you about we're also that We by there's advertising. -- publishing. about the said $XXX estimate billion we way, beyond expanding what So more size on there. is call, it [ the it's developed market, ]

of think the combination that the us I lot on future. gives of So optimism a all

Laura Martin

have is I and -- My one one second about my second X. structures. industry Okay,

pivoted guys to of from price announced left sort compete, you an participate? away question direct hard to or easier open is, I that a in of My Does have So opening really commerce, one would with up to taken world really in and That does call it public, Is sort different better e they your less News, when has move this sort more make competition business. It's of leave came company you that leave what you of core really competition? big you of yesterday. greenfield company. sort were for space directions? as right. other brands, and your Apple

David Kostman

have around demand and It So cross-funnel We value Onyx. in differentiated. offering is experiences, different the notion and cross-funnel placements certain display yes, directions competitor. a companies advertisers very offering on advertisers. been side very it high-impact different are we've that Onyx page. focused very side the taken is I the think delivered developing for have -- traditional where that publisher that's in really a we we environment, for us different on And video, allows focused of launched the

over the our years. wins seen X last You've

higher audience premium a that big Keystone, publisher we clearly we a better Back better of think with from publishers. wins. value to question, on demonstrated. delivering proposition that that think, I opportunity to business.So side, differentiated and we those and broader the tools our strategic offering value brings value, strategically believe earlier combination It's monetization, by believe been again, it's a coming around still that's I your

terms that the you in share, think we saw about, I wins. of names talked market major

spreading now, helping the at is focus demand being So on to at, issue other that things. with here density on able a is look you front, Also, when coming into I play us us of that that's looking to really our look lot it competitor think right delivering the demand mean, I around.You and our would don't that. details we into news. demand that. urge having about and same take you Apple existing know referred into I the the not much of to of really level to

direction, And good think thing. a so a it's taking different again, if company is I actually

Laura Martin

I agree with that.

one my Okay, quick. super last is

using XX% kind what getting AI the those my really seeing quite high? of your tools using that is adoption, are this statistic about Strategy. lifts gave in gen that were is, is And question quick you Bid clients intriguing You Conversion which of XX%

David Kostman

Yaron. ahead, Go

Yaron Galai

No.

for their goals, our So Outbrain's sets increase equivalent Google's we Outbrain's from Strategy be kind make, is or Bid cost Conversion revenue the then an they but specifics, that we haven't there's of all And business just need them. to and see CBS. want where version the the clear, do to of but shared advertisers they PMax set, make, deployment the to CBS, to rather want algorithms goals, their run bidding conversions sales no they that to

of best I X indication, performance gone to the nonexistent you XX% that's years finding the best marketers the indication on think they're of So has a this with over I And now. campaigns that's value.It's running from XX% that couple -- values. as said, ago big CBS think where

of a campaign. First there's all, the simplicity up CBS setting of

lot ROAS. a And less It labor of the side all on management the the campaign manual improved on just that. You ad less other maximizes need advertiser. is and management, cost their There's spend. just return

discorded indication we haven't uplift can break ] think so so the given least [ of imagine of out at or I switching the the And you we're to it, don't specific the many just advertisers seeing. But that's dynamic.

Operator

final Our with question is Ygal Arounian Citi. from

Unknown Analyst

How or to double-digit that. last is help much pillars ] kind XXXX. in months, Maybe just Wonder by XXXX business how growth -- us the maybe of Maybe driven that kind growth for much you quantified see you XXXX -- how X expect you've Ygal. XQ of if expectations just the bridge You could any know impacts got of and of is current core Max and the of just XXXX Onyx, some looking XXXX? given specifically that maybe new ramping but some [ outlook. strengthening on these on outlined? I for you and the

Jason Kiviat

and I'll Jason. It's the ]. could part Sure. Max this Thanks, of maybe the [ on Onyx David touch question. start on

of single-digit data and should made the just expect growth, to we auction high just that would how policy the or to or as small in helpful of we Ex-TAC a who isolated Without of that or absent very say, in in supply. changes on some I I changes, partners have couple year growing in technology call, seen, in mentioned have far they would either percentages. QX volatility, that pockets getting the that one see it's we growth volatility is and see, -- maybe the point to As

and around guiding QX from absent off in around view that talked are of that and growth we about far see we're obviously optimism to one-off, we've ramping just this double-digit there some combination optimism all yield which as positive but that that in kind the QX.So that there, it's optimism a with and kind not around areas David things. it's of trends of So the do to we're started temporary, cautious about

just for beyond As feeds then probably expansion of Onyx. Ex-TAC, of the really year. far the and the XXXX those the But as increase wallet supply think top maybe brand enterprise of the X some David expansion year.And say on of agency of just you sense -- maybe the performance share the can course giving traditional I magnitude contributors small we touch of contribution I'd over this see for areas, the and investment and are

David Kostman

call, Sure. about we specifically brands is On agencies, business $XXX leveraging and performance, agencies, Onyx We're half into that a a on about the than and Onyx the we of and it that talking half a we're second that year. year. has last have brands expectations lot is million now of better only generally also Onyx. about said delivered in

Open about excited help to. Jason Internet.I'm growth to in them ecosystem in can really the link ability to different That's this we in in So cross-funnel XXXX. are other very it thing more you that today is that that together. notion here the it also all and us referred imagine double drivers advertisers with unique and we And will around the a very dialogue the than agencies important assume that very

on about us I publisher the us side. ] [ have, publishers. growth driver and XX for -- think that's That's helping again, today, on important us an Keystone we also brought Keystone

be but on our in the think exciting. of with share driver that's acceptance brand both the has in going the successful. side. around a demand in big and -- on future, very ability, we the wallet Onyx, of growth So increasing from really been performance terms Onyx has focused that something very brand side And market, is the side, the been to the

Unknown Analyst

just then Very one on helpful. maybe great. cookie And Okay, deprecation.

do a leverage any Just data. cookies? if news recommendations, CPMs you impacts to with And your cookies maybe exposure Onyx much with but publishers, And cookies. how help maybe some you guys products maybe their exposure Keystone, deprecating, your to and -- I exposure it you see, understand to how to your a put them to it's you better -- do and could have think us of are helping lot business? you how like XP flow-through in new your seems position, of about

maybe So right to is about it? think the that way

Yaron Galai

Yes. Thanks. Yaron here.

important signal you to that that cookies, weakest deprecated a that and make -- use. signals less with distinction it's any So We have, the -- meaningful as between some third-party we use. being cookies first-party actually between of but the or first, is what's data it's try we That we to cookies. use did, data third-party is signal data definitely

], non-ads. to We every every usually us company, on the try exclusive ads absolutely recommendations, powering on us feeds those tremendous of we right many both and first-party core those quote-on-page -- do, And us data data more not on contextual and the of with being data of those quote-on-page internal ads one when pages, have here ] data, data usually amount at that organic their and even apps. But it's first-party also of anyone powering the advertising things where only tech, of ad previous a just magnitude [ a order those invented one because partnerships we tremendous different can Outbrain use.So myself powering on that mention, space signals and a those our kind that the those of it's in and about That that the the first-party compare to in of Keystone ever because data giving engine that feeds our one of you're higher you of have, of and lot Outbrain of are ago. much places.I'll [ on engagement signals web, also the ads amount a team on powering we than publishers, like pages, powering a is just we're we're their far of get gives or rates all beyond and which gives on feed. XX-some-years

a no We're -- retargeting all Onyx obviously like we so all. cookies work amount on And in signals off I we're that on that the world. the uses contextual and kicked the who targeting with are works we then of video, out that any very expertise on don't different. space partners do invented powering tremendous with. experts box different page. That we're at And the like And sites. of feel across on those things experiences We those Outbrain

on it.Maybe that's from So the we just about on deprecated Safari to environments -- years cookies cookies we've X since. have, of a of few going way point, the main on indicator been years ever and last to third-party a just ago, bunch strength that which ago click-through-rates Firefox.And strength is were the think

So year, that as coming well. what's of Google if we've I quite with you think Chrome take this done indication any

Operator

We end management over back session. to I closing the the to like would of question-and-answer turn remarks. for have reached conference our

Yaron Galai

as years programmatic expanding improved Yaron the company's to as exciting building I'm with it will personal future brands company new the Outbrain thousand people joining our the chapter. the Onyx, been or the that this fantastic quote-on-page performance exclusive reach our look company a the I'm Chairman. new like many pillars with continue share with excited a very DSP Thank excited come. to advertiser ] for strategy of the unique today. a to culture well Thanks. of through about our serving you. our here. through carrying enterprise group as privilege company I forward you shareholders, Thanks the of Zemanta.On so And and We're confident with Outbrainers. and marketing [ lifetime for for us starts all, its of incredible with as wallet it's suite, work monetization our for expanding Keystone, note, chapter

Operator

Thank today's you. conference. conclude This will

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

Outbrain (OB) 29 Feb 242023 Q4 Earnings call transcript