CRTO - Earnings call transcript Q1 2018

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Operator

Good morning, and welcome to the Criteo First Quarter 2018 Conference Call. All participants will be in listen only mode. [Operator Instructions] After today's presentation there will be an opportunity to ask question. [Operator Instructions] Please note this event is being recorded. I would now like to turn the conference over to Edouard Lassalle, Vice President and Head of Investor Relations. ahead. go Please

Edouard Lassalle

Good quarter Nicole. Co-Founder, and to Benoit welcome and Thank earnings morning, call. first Fouilland. CFO, and XXXX JB are With Criteo's CEO you, Rudelle: everyone, us Chairman today

to uncertainties Actual materially call, this by of projected the or assumptions. other market risks, any certain future demand update plans, include forward-looking events statements. results or predicted products obligation of timing course various and services, results are the statements. the management undertake any forward-looking make Such statements investment and These financial results strategies, forward-looking timing business do such metrics, and anticipated may from implied required anticipated contained law. not or to forward-looking will statements as We herein, operating and opportunities may differ statements. anticipated subject by expansion During or and except

considered Also, measures of earlier indication Definitions to addition, in not an and the financial directly of reported the measures release earnings the non-GAAP provided as today. discuss reconciliations most performance. be comparable future our such will metrics GAAP should results were of In published performance. we

JB? the otherwise With now the growth all unless made of call over prior comparisons the against CEO turn Finally, call Criteo. this that, Rudelle, are same in of the stated, in will period course year. I JB to

JB Rudelle

having been than the good Ed, more and from morning, everyone. here I away you, after to operations Thank business years. glad of am day-to-day two for the be

as his Eric commitment over as special CEO. growing advisor. this to lead last Directors and asked our transition years. me to love, my in contribution the the great Eric opportunity Eichmann again in company, take of know, this I will like Board for have you to thank the business As assist I'd me

better-than-expected said, Criteo ability are respect significant the fact headwinds to in This that must Despite that say, chapter expanding those am a Given our our be there while external pretty I the to always grew shocks. with done first I'd of delivering believe significantly super excited happy with its revenue growth state. coverage, the adjusted to coming of shareholders. needs I Criteo constant This healthy flow. our trust for would next EBITDA in illustrate said, of create results At have good facing business and we dealing that lot we to resilience the is solid our why are XX%. somehow convince team, Edouard, strongly the regain rest prepare changes is also them be not growth. the this our so many in and the challenge. user that positive quarter, for we of to report recognize to reaccelerate in our stress I explaining happening industry, am the done currency, ex to And and cash growth, job task of our X% a years. believe with and much TAC the today when like a has Criteo we a to Benoit, potential value past investors profitability with I I the

currency, and increased XX% in with particularly In TAC clients Americas, dynamic revenue added those and constant healthy in difficult at XX% we of unique data Built the data ex Shopper TAC East reflecting, the this. suite the constant EMEA progress our and currency, TAC, partners Japan. you some our business products revenue mid-market Criteo know, large some we Africa. continued our to despite, quarter, more driven of at business the Identity I and coverage driver this, We driven solid as driven strength to Graph, and all our X% clients revenue our market proprietary collectives, ex details the region. received around which our region. results I'd was user Latin in meaningful negatively growth at by increasing particularly well is drove XXXX. think, at technology is grew in Revenue One by with grew largely that our by on all Brazil, With Middle limitations, Map, currency, our market of growing clients, includes constant condition during APAC, Offsetting same-client provide key and Interest made we Measurement performance Graph, and growth Looking scale in underlying by our ex stable in our at Network. impact have on U.S. by Germany, assets, ex-TAC America, across In the X%, in efficiency, collectives like business. the three globe. the large

With scale Identity This operate our identifier and about graph, world. speak and graph creates across the of massive consumers about in allows largest Graph. in coverage worldwide individual billion industry. we of user us our let's to X.X globally. offer comprehensive apps the First, users a offline a the devices, browsers, already This one unique anonymized graphs clients

result, a also R&D are resources. improve of and we focus a advantage. competitive source all key significant a there of area allocating environments. in promising technologies in sustainable other area is We user This making to progress believe for our developing a as in coverage And long-term is us, our

Secondly, our Map. Interest

through not data way, we purchasing friends. as within making technology By as remind our So our views retailers. such to Clients to across already highly intent IDs. and that or gender, collect, nearly give the half players, Interest process personal product of TAC. do age, data, revenue process political our relevant or permission Interest other on store like basis the Map Based sensitive aggregated some anonymized this us to anonymous an who likelihood recommendations, represent ex Map, shopping opposed to engagement. participating consumer I'd create on organizes maximizing do on focuses data shopping We

mobile in is am app our the grow across to growth XX%. TAC vision. believe and over design offline report offer the with expand pleased to potential our world, new ex allows our In increased ad environment. we on new to continues Thirdly, and now, sales that Overall, to lot to measure allow capabilities sales revenue and solutions. attribution to and not available we bidding unlock deploying this I to sites really us as core typically is based this This grow retailer differentiates network. we from building road value-added advertisement more believe our is Measurement in Network. by in improvements there brands a Overall, for flexibility down and permission-based This Shopper our app our traditional retailer layout Graph brands

the this future, best I'll a key position This the result, to one come invest in inventory this to to possible take As is in-app plan exciting be to is we that. want very advantage trend. the where and of of growing quickly, we areas, back and in

brands retailers Products, Criteo our Regarding we Sponsored marketplace. signing are and making in more progress onto more nice

recall, proud our, the revenue markets. client with we Match our would customers. say for Audience we is clients of I to exciting are powerful rates reconnect organic acquisition HookLogic. the This as one a this is the to might market was acquisition like long-term of XX overall the will existing the our clients believe in In our encouraging with results growing key generate the reengage the this foundation complement an contact to new their now named future. parallel, our to helps Graph, client of and the to of of are rates pursue you Sponsored -- business and Customer with our through pleased to this important strategy match beta expand diversification assets months adoption part customer these that the us a typically mix, component Product best-in-class offer with Acquisition As business is I'd allow of products, Furthermore, success online be our sustainability ago to uploading into very Audience Identity growth we Thanks that business. said, Match. of that our in integration good high-quality to lists. customers of best match

more new market, getting alive is Second know, of their to expand robust deliver beta in Interest it in leverage the This Customer XX new acquire in quarters. program countries, encouraging. head we're Map the be countries results our footprints. you coming Acquisition, significant This still interest to from huge rest expand continue as beta Overall, this customer first those our is two now entirely and to customers. we planning clients are beta the clients the business, they to product, though revenues a products, and our to -- compared

our its proprietary In by with than direct its rapid the side. worldwide. are we The Now already in encouraged Direct parallel, bidder supply solution now earlier year as earlier, of And technology, developing direct I mentioned in our one is one are market, app results. moving for key premium less to over header-bidding With growth than accelerating continues apps our adoption. Bidder, on bidder more is priorities. a and publishers X,XXX deployed mobile our Criteo

the at a all of the quarter XX% prior quarters. to maintaining side. over now clients, in close with level client client Moving We to increase client XX,XXX closed XXX our -- an This across is retention products. rate than retention lower clients, while net

go-to-market As to implementing optimize announced, we our are previously specific plans strategy.

smaller and developing a in large scalable We a efficient platform clients are focusing manage way. on now mid-market clients, fully more to mid-market self-service more

manage As similar this transition, we we remain additions this year, at to fairly level new our through net client XXXX. expect

reacceleration client -- course addition clients, be year. further with future platform next a that our in see smaller targeting new self-service rollout of of the will we to of hope However,

data let words about me a say closing, few Before privacy.

am fact, generating to As GDPR consent privacy, industry. focused, concern lot comes are where of fully a questions is upcoming it we aware of a and is management. that when really in I matter the the

damage no very to this control a feature this than there believe better embrace At has and our badly people because without to sustainable we consumer one remember to trend. historical to companies banner. a words, this have this of back this a regulation. thought to do business. some trend crazy likely As standard I collection a remember usage by directly U.S. is management of expertise something believe and end to in strong Consent impose to into a an world position embedded better company, data our in all data manage related counterparts consensus in. user are business. embrace opt-out more it. giving I other of clients and is would in resist we first is we that In to And have the it's the offering I Today, to to consumer massive built the link XXXX, choices proud we trust, major, market see time, we I were indeed new become am every European than our that were many

Specifically, world. data thoughtful we we agencies CNIL, closely French the very the Protection the and CNIL is Data one protection the in with the influential work Authority, and on, rely most of

We not supply side, solid management. aligned have field. the totally in to on are This plans on the GDPR particular ecosystem, the in with consent guidelines in players said, other for CNIL this implement how yet appear to

As in us all stakeholders opportunities help consent result, to including also decide management to our a processes our This for create users. to manage that expertise apply user potential partners. consent to but for interesting only situation create end they the might could friction, not ecosystem, transitory leverage may some friction

Looking XXXX. year now for full the

key priorities. three have We

with leadership to coverage consent invest area, on to in position Graph First, reinforce our Criteo in particular user this and continue Shopper to management. a the focus

going and footprint retailer in the as want brands onto to our we Sponsored in-app bring fast-growing third, expand to marketplace. Product mobile market. more said, And our we're Second, I

results through results our financial this, this am the our I take and I in and further well now with will And upcoming think pleased priorities the closing, quite Benoit year. first guidance detail. in with in for friction quarter. So the track With the

Benoit Fouilland

walk and guidance JB, to quarter are QX XXXX. morning, see by constant increased our Revenue that investing everyone. you, good our clients with our flow, million. QX apps We through we margin points solutions. new another currency, improved Thank sizes to grew partners key clients business across you am impact TAC ex of was in XXX and profitability driven cash metric key by for X% charged for strong the by across region well expanding we get at to XX.X%, and share introduced monitor a as will XXXX. that for pleased I performance our growth, delivered to while driven Revenue Revenue various future. inventory. TAC, good largely off I in existing supply as $XXX how positively ex start basis and changes and performance, mobile

anticipated. changes, that represented basis engine XXXX, on of driven X,XXX a impact driven Switching expenses X%, We to cost largely these computing other revenue as in rising to XXX Operating growth. are hosting expenses. revenue normalize about was tailwind increase higher by working X% to The levels result, Compared a prior margin have servers grew higher time. the three headcount a driven increase ex-TAC number drivers the close slower will changes ForEx by We the ended in slightly revenue with to than a ex-TAC our to over QX with our anticipate points and worldwide. growth, to by increase in our of of adapt a explain capacity headcount. to and euro quarter employees, mostly

about Predictive January for of employees. combined Search Criteo in HookLogic of the activity of travel the of sale restructuring reduction XXXX accounted with XX a the First,

transformation of a the our comes of model resources. go-to-market reshuffling Second, with

some XX% hiring particular, the in represented OpEx. of delays, expenses had mid-market. we GAAP in Headcount-related Third,

sale of was This despite to business employee partly X,XXX, Search. $XXX grew and a in non-GAAP in including headcount after XXX XXX decrease driven we are expenses, employees. the employees R&D and X% grew a to our headcount operating in of On OpEx plans. over grew and driven headcount Sales flat X% the Our and the X% expenses plans by Product. line by restructuring operation X% slightly quota-carrying XXX basis the function, On R&D non-GAAP over increase largely XX% travel in HookLogic investment increase by million. G&A the to in below XX% employees with expenses to

a from disposal approximately X%. of the the travel Excluding business gain of expenses G&A million, HookLogic grew $X

targeted to management, which hiring. majority expectations, we in savings investment to million trend employee our the effective about While and expense relate incur expense $X of the continues did demonstrate growth compared to delayed temporary of

savings, After well scalability savings. EBITDA at adjusted improved Adjusted temporary of with margin operating XX%, points was and $XX our basis ex-TAC. to from currency, our basis XXX still to revenue EBITDA profitability. revenue excluding by constant Adjusted point the XX% gain ex-TAC awards disposal and up model. gains our as to temporary compensation as from Moving growth million, driven well of XX% margin remaining and on Equity long-term about expense XX%. XXX disposal track highlighting improved increased EBITDA

XX% XXXX with million the Criteo net line operation, loan S.A.'s no before amortization recording accounted lower intangible items represented about with foreign sheet of tax in rate to relating discrete Depreciation purchase XX% as XX% balance equity a the our HookLogic The XX%, $XXX as the in exposure. equity fiscal acquisition, of have Excluding of expense or Corp hedging while grant hedging income we a discrete excluding revenue for the longer connection Since cost. to in onetime for January ex-TAC. XXXX, in a Criteo after X% of awards tax after the investment price ForEx ForEx the end revaluation year and result reported HookLogic. are increased rate XX% effective ForEx decreased was of amortization items. projected accounting Financial expense intragroup of

stock in changes per profitability strong the grew as increased $X.XX. by As were XX% discrete a exercised and $XX income Cash well large fact, part timing payables from cash capital as income the were of flow million, to as growth time. A publisher positive matter EBITDA due not of operations XX%, working in XX% Easter options around items driven adjusted to contribution, approximately million. quarter. of quarter account And the was in this operating positive of and significant to exceptional net Net diluted operations adjusted favorable $XX from invested was share additional in increased capital. positive flow XX% working change into to we or Transformation large above patterns, expectation in improvement increased in XX% on capital. offices. leasehold CapEx as servers after made excluding XXX%, working the historical some some few

a to free Even change million, adjusted in working XX% excluding cash increased As $XX exceptional than a tripled more the flow free representing ratio from still flow conversion result, after XX%. cash capital, EBITDA.

I provide Finally, expectation, equivalents X, of second reflect guidance to now million quarter May The statements increased for and following as our our million. XXXX. cash XXXX. and $XXX forward-looking will $XX cash the today,

XXXX X% be implies million. constant from points. the million. to I And a QX we assumes that currency This for ex-TAC to that expect year-over-year to EBITDA QX standpoint, the point QX growth XXXX X% our $XXX expect We revenue $XXX lowest positively $XX quarter by seasonality business of be and of minus and overall basis between is out million $XX will changes million between growth year business. to typically and plus adjusted reported Forex about XXX impact want

we addition, the have the various cautiousness, changes level taken industry. In of given in some happening

expectation X% currency. have our for at XXX impact XX% constant also for maintain XXXX EBITDA revenue For ForEx will revenue margin XXXX, and basis changes XXXX. of between and growth both we be between ex-TAC. on positive maintain adjusted of assume our that in And of expectation our we growth to We X% reported a ex-TAC about XX% a points of

highlight underlying closing, results growth, As that guidance the delivering with the These earlier usual, quarter release the assumption performance. scalability our the flow of strong our we and model. sustained increased pleased strong for and QX earnings ForEx in are cash am second strengths profitability included I In today. published and once XXXX again our

I that, now will with questions. take your So

Operator

first Thornton Please comes Our SunTrust. of Matthew Instructions] from [Operator ahead. question go

Matthew Thornton

JB, welcome back.

for strategy bullets your guess, a predecessor? couple missed the client might bring of the kind bit, this, Maybe versus Benoit. I two for accomplishing but view bullets your seems trajectory. one of that? GDPR I maybe full-circle also you would charged that is sales. that one Can direction you're couple including just actually last here. you forward, it of under three maybe driving kind same or what's to and change just moving in of So how ex helpful. was client give and talked mean, And then I be a rate up Benoit, on the your sustainable with helpful. of were and of sales ITP. kind modest apologize, if housekeeping same come JB, obviously, what bring then back JB, full-circle question to there quarter it I comments kind opening all little and of is Your about upward a Take items. And have board

on you for if that an the wondering Just had quarter? number update

JB Rudelle

much. you very Thank

seize to it new Whenever just GDPR the and things at guess is probably we what -- color to implied challenge, my seen other to people into things, to need was this, me, and to the board and and bit seeking you to to give look the return. more from see mindset more opportunities. that's or So know, And -- could depressing as I at of a educate are is opportunities. my angle of Europe of on at forefront my consumers, market. different way embrace kind or with know challenges interact you entrepreneur to look an you -- as try try to concern, things, be this it's the you can a from

it. do an for comes best quickly when of But it sure opportunity, company. we that is strategy, see specifically, on the not more what's my to to it. plan to change changing to the make the when want I move So strategy for we I want sake

the in to bit focus on And the sometime and term of to opportunities. to and going going organization right in into one slow assessing be new too have future opportunities, we mindset my probably move after a the in of put new been it's faster the past,

Benoit Fouilland

question. your to respect with So

likely year-over-year to ex-TAC First the right, XXX compared I rev It take on XXX quarter. so rate, was basis in improved point margin prior and point quarter. the you're basis higher mean,

we supply largely for key So more that driven this by were how is mobile inventory. partners that changes in apps introduced positively charged by impact ultimately get

to to have working So these changes. adapt engine on we are to our

to we revenue that at seen we in assume respect the fact, level stay we've in users same to XX% recent I would to, client will around ex-TAC, limitation. we ex-TAC client not normalizing should historical quarters. over -- should growth, the you I time, and closer the With despite had those the So we that levels, margin rev say, see think same maintained coverage

line in is this our pretty with expectations. much Now

to impact the of would user is So figures without recompute increasingly and now, this. to these try into our coverage embedded numbers be meaningless it

Operator

from comes of question KeyBanc. next Hargreaves Our Andy

Andy Hargreaves

to could of client in wanted just retailer little causing sort growth what that update the sparked a in I wonder give I guys ask And transition, a there? specifically just around secondly, that you I acquisition say if and what drafting implementing. bit on is and slowdown more are approach? about change you guys any then that couple what strategy stands, if expectations the could the on just where process ePrivacy, during wonder us you are your

Benoit Fouilland

maybe quickly is remind our what strategy to So transformation there. go-to-market and just

to XXXX our and become we So strategic profitable to want the it's a efficient globally, maximize mid-market. more We us, have for be large key to transformation. three objectives for and in we want to priority -- already more this and commercial clients, around subjects three opportunity

are going And the be across this strategy the -- year. implemented the to is behind these entire objectives implemented So is strategy.

volume the mid-market net add a rebound of point the then until to self-service year, we see in have number mid-market able And lower transition quarter, scalable we should a of have and that's mid-market. of highlighted this mid-market, by on larger last the of scalable end driven the particular, why you of a of phase During we which during a in would our the focusing the during net platform. are already in developed should solution, transition, the clients by the the the are reason have period self-service -- we that and come will the in add see we high fully number until fully

JB Rudelle

as it comes this regulation, know, still is ePrivacy discussion. when you in So to

pieces lot So in there moving of this. are

day, of into this where the hard at understand So to user-friendly to wants consent have I think management same and easy we the end are the transparent promoting is for something how end to our time. interruption because the you something, be as all about translate and thing, the as not user, bothering the everyone which possible, view point a

So chance this that to fair into be will the of there playing it's for all And consent, consideration agenda. favor a are big think, portable new going drafting The -- to is regulation the small. make this we're point and make ability think field confident players, very and view we the equal important our taken to particular sure make that is into so too a the are in we what is call do we taking universal all that promote a the trying of I is trying the idea the to consent drafting. given industry, another size. consent able to of use for able -- give I this doesn't be mindset for the right Commission usage to be view players the consideration of once is spirit. in much specific website. players sure website opportunity into to That's on And this is biggest that is And to a it's this to on European

Operator

Douglas Our go next JP Morgan. Anmuth question of ahead. Please comes from

Douglas Anmuth

and to cash cap. force of now pushing approaching market just you balance a is in think large million, have the JB. so back a is Products I I want brands here close among retail disruptive they $XXX I the Criteo under commerce take back get ask to And marketing your about with Amazon, XX% then advertisers, business. Amazon your Sponsored on wanted already how ecosystem? secondly, and as Welcome advertising to

about to to exogenous just as factors Just authorization company these wanted a particularly an the has not in back get how put the in you're of potentially susceptible M&A versus stock? of been thinking sense past? And buying some place why

JB Rudelle

Amazon will I and address M&A. then So first,

which as individual they So the of a random because basket, growing way now you has ability ability offer level. very know rather big consumers for doing way to by years, than coverage, is dialogue a business all brands consumers, target why been for has the successful down so this brands to have brands granular to dream is Amazon with doing been on their precisely This the have the air years. offering been very shopping XX the

a as for Sponsor fact, So plans exactly matter of Product. are our this

are is those in we on a educating brands glad way that capabilities. the Amazon new So

shopping So but basically, Criteo independently, very with in combined for touch brands, is to the world world, style, the each the thousands we has many very develop extremely for players. of it's Amazon not thousands retailers, but thank one hard ecommerce the monopoly. are same god, much And thing, but the doing pretty And is -- have And the program rest offer diversified core to to right with something to of high-quality and point be all an engagement of Amazon from the exactly would them it consumer. attractive. position -- have the which is we

of this lot key in priorities are and see focus this this validating Sponsored of offer why Amazon there So a of we and of potential investing -- year. And this the lot that Product for is a on it's space. putting this one our -- I is success is

are Criteo learning is, ability our connected And business. HookLogic, acquisition. a ours. lot biggest new know, M&A we the businesses it's that into in as to of an expand And things today, you and know other And was, you know, as been a to plans into So what markets. part our two we've terms and regarding our have of you efficient acquire in way integrate growing

to it's for a assets, cash of definitely us our organic clearly, pursue. but to something success always this pursue we our further tool the this the encouraging strategy. in And HookLogic with great growth way, strategy a is complement is in company quality acquisition, integration So a disciplined

Operator

of Our next question comes Simon from Berenberg. Sarah

Sarah Simon

that or And the one Is do just earlier to grew opportunities out not two the on is just what do saying, indication us you of react. being Products Criteo on? quarter? during give with products is, you Sponsored fast missed question enough organically, M&A probably how new I fast had second to about your you I any could to guess, whether developing were maybe with questions. comments from

JB Rudelle

either So one the or new other not M&A. product it's or

much things. less the think and doing business three technologies, existing there make to and coverage specific cookies, strengthening It's more like resilient, our based it into push we Shopper user I it's make Graph, dependent our on are a all our -- and particular. on on to solid in is it this big

So business there very there to sustainable. very big much a for I more sustainability important our resilient is make the long-term effort this a of is it think and and

aggressive M&A organization side, approach. one-product of biggest being things of we've new moving our years, And been why from into term to us M&A. change it's that in we've also approach, because Once in company, more developing better to our to put scale M&A, and go-to-market a to be products the a it's have new completely on lot it opportunities are for your been and a in to last do that's harder organization. you probably you're reason position much and the the single-product company and had you much right changing a single-product multi-product opens is this the when multi-product as sales buy are go-to-market fit We directly then company a Criteo the

Operator

go Our of next Please question ahead. from Arete Kramer comes Richard Research.

Richard Kramer

a could the mentioned, linked go through business. comments on question, issues, And coverage much bit you Brazil. how but bit to in -- Americas First made more just little you I on and a was There issues know that's some you ITP slowdown don't your more comments. if of and user directly think, I the

more or then could there's go a more industry the you discussion detail And a maybe on remarketing. Can talk of about JB, to that spend on measurement if you in into in where the you and seems bit prove a incrementality maybe could incrementality wider very little since And that? for a bit talk you still are lot about of retargeting if your improve question, through efforts to proving measurement? So contentious clients be issue? it

Benoit Fouilland

Americas. let's So with maybe start the

market. Americas contrasted by rev the grew there but region X% are dynamics ex-TAC, So

market especially Brazil, difficult In been fact, where grew U.S. the has America, Latin X%, some we've facing decreasing, pretty and condition. in been

on while with -- of continuous performance. seen traction the the go-to-market the transition more the impact which a mid-market in clients, the the impact, the the transformation in So is impact temporary or U.S., size mid-market on maybe in an mid-market of transformation U.S. bit into the color good had a We've existing

JB Rudelle

this very thousands, you measurement if incrementality a way specific at new running we've when what's the of the questions the legitimate very been Why you Criteo, of ask. is our them I very is was that which got So So since they this? audience, question, very Because a question of in back, XXXX against probably that's ask that XXXX. would lot I their value in first course, way clients But the for come it to question. matter? goes that are explain When pitching not clients it's going question, back of of is, tests engaging they that's people think something, hundreds, is Intuition, in good the incremental? reengage the intuition. will a to I the with heart is to speaking about with because pay incrementality, is which there and, that brands beginning something which nothing question be a and and a first should

matter do very be to to manner in a right prove in sure specific As details, And design controlled a the A/B thing. group to protocols in the dedicated the devil a is you the need measure you that incrementality. R&D those right of we fact, have test to

people to the And an budget it's more to are renew why glad aware of rate. So it's it's where of do otherwise incremental, what expertise, I of am that area sustainable and would you is that they very lot your put and this. we proving clients basic advertising, really a a more

Operator

Bedouelle comes of Charles Our Please Exane. question ahead. go from next

Charles Bedouelle

if I may. Two questions,

what one little can you any first GDPR, you like The it you how a characterize more is and supposed very explain probably clearly the be but is to were little to could If can you what have last? maybe going around on long is, bit is, the reasonable it question The to second think a you've if due question we here the look friction in QX the a or views for you the explained year, deduct explain you that? And us maybe, year's the moment, Benoit, is, second I outcome Can so outcome? say, discussed we maybe part clearly, other of broader very of portability. of consent terms what very the range performance, options conservative. cautious the seems potential would of full third QX can ePrivacy at have, maybe are mentioning

So is on that are because the of Or longer? is bit friction, you conservative side always guiding? mentioned, could last a just you it the because

JB Rudelle

this law. the going believe before And experience is, where more said, and interruptive, ease on will that anything this spirit is as think be plan aligned What very the more poor. about at decide consumer. law, approach the is know, about is this user-friendly of users intention specifically, want law standout control interpretation. that use there's coming not that result, thing, the browsing and the getting the we this where -- discussing you their their is of obtained not consent. bit rigid the and of spirit the making length it's French because unlikely you cannot implement legislature, law been to industry we've not about. specific So transparency And is they in not completely bothering of there is is that to to and with there do some We the by obtaining might go the the very the such approach CNIL, become as a publishers to CNIL, a hard GDPR, be a for law very This a

browsing to friction that their for because those it's players. terms Now do friction, publishers friction this this decide to might some kind experience, interruptive, more of we hard would going And decide don't the opt-in. many it in this could and difficulties create ecosystem the said, for control would to the of end-user create those because connectivity damage how implement across of

how So going we implement this. players clarity to need those are some more on

right a may offer working expertise a We think our opportunity not way we effort way what direct-bidder we're the that's hopefully, is guys. implement with some And in reengage consent promote our implement today management are even said, big the to the in and to to we for those solution directly. think to publishers with law, us, doing us with opportunity some

any as are an as middleman direct favoring with we much in And because, this us a for go removing know, and publishers, so to interesting we creates as you is publishers between opportunity can and way this and us.

So it's think going in to educate be ways on We the and new a management the do this should to embrace long is those consent everyone right to everyone way. future, business. battle

has them. so discussed now I aspects. of this different Regarding one ePrivacy,

interesting, stated this website Another in may think publishers balanced to to well-informed of goes that to is and latest the publisher be is is my And advertising, a value-added way do work you very right more, to right together. what content, respect a which conditional pragmatic acceptance access have access to to into can one, direction, to draft, of allow made on not goes and won't things, access I cookie, it a while work you access which site? is latest the the the access the or once user which we think, grounds let their -- the progress that draft need

the approach the prevail still work So that going pragmatic to European we but in once progress, more are level. at this very is is confident

Benoit Fouilland

implementation on information mean, you feel the of think year that the can around with changed this be context, and effect of to seems the this we our to that on the way the respect the balanced that your supply and with So we that all GDPR discussion at not as full in see the implementation We transition full have for the realistic year, today, have I we of side, guidance we market. point. on potential questions and in the the guide hand

still as some you to current react not of going are players a as in how lot say, the characterize as it, would to the questions I of necessarily So is environment. conservative. There

Operator

Our Nollen go ahead. next Please of Tim comes question from Macquarie.

Tim Nollen

I'd come of to well, like the on guidance, again, to please. question as

just May Facebook perhaps some some bring obviously, been as there Facebook, guidance seems concerns Your moves effect the saying, about as the in, guidance given to to reaction they've you understand ahead comes Google, big comments in you're modeled just us bold to for particular, little to a what we situation bit your data what had to year friction QX and to yet remain any been and gardens, coming access it the can yet quite the maybe, wonder if to of and advertiser on seems hearing might So you. making a QX power comments forth, walled GDPR perhaps to seem seeing? of you want about through, any has year? given you're be is supplying guidance from advertising your GDPR those which strong Amazon pretty then and your but on And please? is we're could what the you unchanged. so All into going relatedly, garden, advertiser's perspective think, I GDPRs? yet say like different similarly which I And versus full and spending, if cautious your doesn't on Facebook full more XX. well walled talk three about GDPR

JB Rudelle

about Do you to the speak want guidance?

Benoit Fouilland

the guidance. speak Yes, about can briefly I

strong as savings around described, temporary are comes those we hiring have you when the some to to going guidance and on delay, we think what our we've I hiring referring say probably catch fully in where, in up is QX you not EBITDA, delays are QX. and

our in reflected is guidance. that So

to demand top that the With point. always with affairs. philosophy and on have certain view top advertisers, of have, implement the minus terms cautious growth supply the advertisers to that a many you still the And knowledge in we large with line reflects guidance, that to consent With we are at of plus reminding point GDPR. where at We've going to this still from in reflects That to the constant are management. players to the we busy there are being line at said, advertisers, as the one number adapting current a looking marks I respect of side, to same best respect relatively that question of reaction the not be think state strong how on are seen want of this currency. the one the we as

JB Rudelle

it they limitation gardens yes, a creates opportunities some creates clients, understand very tight can also of least course, is in regarding on walled have are them question players which walled fully what's walled going a bit own so your behind big seen and at for and a all a way But interesting advantage our with that in way consumers. there's some they of us, way data. data that gardens. as their don't because frustrated the part second are control very the called they So -- the for of And in gardens,

We have open our data this actionable a very different for and make we clients. where approach

across and resonates well is it's where garden, has our walled to specifically nobody going footprint partners for to manage our benefit very together on this all our a based clients on, something in this this, as which -- the have which data ability their we this them very of obviously, terms think We know, than different management, partners. has open And consent, on when from consent pool of consent philosophy allow to you coop partners. lot effect is and where value clients. the come approach, our view, on our with And I different of XXX% this, to network

relationship way, in aspect. some than deepen we walled pros There our some are our we those a and on different and a see a given this with where our philosophy to gardens. and opportunities lot philosophy open cons, So clients, have of strengthen

Edouard Lassalle

is We conclude you, day. to may like question good of that for I'd everyone you have. The team attending. available our IR This very for JB. thank follow-up Thank wish earnings a would end call. now any you

Operator

now today's presentation. has Thank you conference for concluded. This attending

lines. You may your disconnect now

Criteo (CRTO) 2 May 182018 Q1 Earnings call transcript