TBLA - Earnings call transcript Q3 2024

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Operator

Good day, and thank you for standing by. Welcome to the Taboola Third Quarter 2024 Earnings Conference Call. [Operator Instructions] Be advised that today's conference is being recorded. I would now like to hand the conference over to your first speaker today, Jessica Kourakos, Head of Investor Relations.

You Steve,

Jessica Kourakos

morning good and you everyone. Thank Taboola's And call. XXXX conference quarter welcome to earnings third I'm and before Taboola's, Walker, Singolda, the here Adam with Taboola's of Founder they available company website. earnings Investors section and Taboola's issued CEO, materials market, today the are in CFO. The Steve and

SEC those currently including to update described in available subject statements. quickly by discussion not duty release. and They cover information, and anticipated. today, facts limitations Harbor. These we from could also material earnings future the uncertainties undertake for law. them, filings. and Certain no Safe I'll expectations to events to based our is periods, statements subject risks materially are are Future in required except and Now statements forward-looking press the as are differ Today's adversely on the our statements are forward-looking

will During and GAAP to non release this defined call earnings we in the refer measures. use financial terms

and the to For that, the definitions please Adam. GAAP call our over press I'll posted earnings tables website. With turn to refer on non the release reconciliations to GAAP in

Adam Singolda

morning beating Good QX. represents million, financial for big guidance return you continues raising a as guidance you and and than XXXX. XXXX strong and year this in which $XXX metrics ex-TAC our level us. XXXX for for growth all positive more see the yield EBITDA. rate we've our us, than what target quarter run revenues, free into can adjusted for profit With flow a in to generated our our gross and more midpoint are heading Xx our cash strong be reiterating to another in and everyone, performance we QX was to for we joining momentum thank quarter, all seen QX

our both to future, publisher out offering building our advertiser is executing As our to aim the delight continue and towards and we look partner.

the number continue focus needs meeting Taboola. spend their advertisers' of making strength with growing throughout be much advertisers includes of is us. with to our entire on supply, Given technology our This and the of will the our sure journey

As engagement a publisher advertisers audience, reminder, performance, sites publishers and their Taboola's core is consumers while reach revenue. on also grow and helping helping driving business

look growth there business, I are our into exciting worth of that potential are As the noting. core opportunities X

and us a in have First, meaningful grow the drive a go of great and a adopt and platform generating differentiation to little. to home way. in user personalization which growth too way Most drive just personalizing Today, reads visit, is average use and the adoption to more our publisher engagement. and X article AI. publishers should With that engagement. This AI publisher about pages pages beyond opportunity AI and help for number yet as revenue per more is publishers pages X fully

This diversify have that leads growth Second, new and engagement those editorial more. publishers' to Publishers sources traffic the in from don't. the clout channels. base, our come we which from of to ability take OEMs more distribution revenue apps feeds social drive our advantage like others. And trust subscription and we Taboola e-commerce, users seeing things and networks looking includes growth their visiting per search they Today, see driven third, to in and most increase of like are rise user traffic, sites to to traffic to with social. and We're see and through and news revenue have publishers new the adoption integrating they in utility News user. streams a of their publishers

our quality a predictable for advantage base of are long-term inventory for agreements exclusive Taboola Our a advertisers. provide high competitive significant and

for become bigger advertisers like commerce and widgets, is publisher for great our great AI, newsroom You, stronger. For adopt our base Homepage Taboola. As network supply and This increasingly and

is advertisers we're a our as greatest on result. for you We believe As growth more advertiser successful to of very know, it Taboola's base yield to is advertisers growth users. see encouraging opportunity A making given advertisers by AI our yields lot spend growing returning globally. growing from quarter. our It this is by focused and budget in to investment growing huge getting access and laser and driven

year. spend strides markets grow with continuing by China, the this global where quarter in seeing second a are versus spend row This in their we're we where to We trend. make saw Xx growing international like advertisers ad last us is important

major how strong You we can performance is company a as them that had ramping scale. One learnings to see unique spending Tier we a great is with our out we've prove ramped year at shareholder of Apple. for e-commerce Yahoo! is the with X the ago, about attract and letter year, opportunity years how deliver started Chinese drive it example this Microsoft in to thing performance. this and It can as rolled meaningfully we advertisers

X be on premium Tier by others, attract their is more X Tier Select. voice. is see initiatives advertisers recommendations. us experience that that that. by It example ads CNBC, to love own on our USA advertisers on is beautiful ESPN, premium Tier XXX% it work even only they X on a surrounded of page these are editorial nice It not like have but can where an premium, Taboola this you performed. is of where that rendering and us One to A also with publishers share Yahoo!, is where advertisers can called and Today

are with car and seeing carriers traction insurance good We manufacturers, major health chains. food

being of to as Taboola safe, creating brand known commitment our mentioned to Select to also Apple reinforcing Media MFA learning advertisers. I safe partnered Tier environments for Microsoft, big Yahoo! Made and also We Jounce is free X that to our advertisers. with Advertising, for contributors certify attract

bit of Microsoft we is We've partnership Now, those. decade nearly with how doing is even working Microsoft about where and about our more we're further Xandr underway, by premium feel how with we integration a share QX, now, let expect the growing a additional technical from now. expanded onboard me been our for it with and year, this good to progressing end is inventory

our inventory, performance X of mail mail. will to Outlook advertisers email onboarding now in the to provide about excited advertisers providers the drive This as Outlook adoption more and specifically focused access particularly with has are Mail the largest email potential with Yahoo world, We on marketing.

showing sales is speaking budgets formats Yahoo!, to on Now, expand as is with for good Taboola. advertisers about X of expected ad results our test focus progressing both The Tier Yahoo! new well. and progressing and Yahoo!

Taboola to very we small represent term working advertiser of but omni Taboola. does focused it were to continue on This now, test currently be We Yahoo! concluded longer for Yahoo! the spend network. on very is Tier area as of with opportunity growing the and rest the are expect X, an in first, on

July Finally, growth in on all enablement advertisers comparing for core QX seeing when on potential. excited Apple with traction, some September, why significant in our sales these our focus spending is over are inventory Xx business reasons Apple, and numbers of the the to growth about we're

Next growth drivers our to core I move and want focusing beyond to News on e-commerce. Taboola

with original with announced presence This one our For the enhance the Taboola News renewed touch an smartphone and in collaboration, markets X of for leading QX beyond each agreement world's years. expansion device. Xiaomi, our of in new our goes us additional more brands, allowing points we to partnership on

we we a special happy it's XX a top channel that rolling not new partnership their access send creates X driver is we global to but also quarter, meaningful like day can really a while shared our a last News our with advertisers, users signed people name, October. publishers, we more for distribution Taboola say out about but Taboola grow addition, our publishers a we than have lot. It publishers. News traffic now And to started mentioned new to small in to million OEM. In yet a I'm I where a of as to as still

to Turning E-commerce great to is e-commerce. place a be.

to when growth to and witness a through new influence come pick in and people channels, with love impressive especially Retailers commerce our continue paid they like they drive social content. offering. create is can is accessed they and us, get content in creator about conversion. are product passionate social it, where This This ShopYourLikes up authentic. We

year QX free seeing and good EBITDA demand companies social in raising activity and quarter working seeing acquisition remain is and strong our the XXXX and search today. To with e-commerce from are their value of higher our laser-focused amount wrap up, success. happy to Taboola performance, purchasing I'm ad lot side-by-side addition, driving in with ex-TAC our big beating revenue target. China for improving guide a on spend and spend of advertiser coming the this In growth guidance, customer We flow cash we a to reiterating in drive things our adjusted

even excited an Day future. We're new Maximize Conversions Abby, efforts, AI Our the are innovations many, more technologies to near where in alongside share we're to Investor next Ad investments developments like is announce our have to our and many central in which we with intend and year, Maker partners. to early going

tuned stay more. So for

do turn inspirational pride in our take a I Now before it to spirit. on Taboola Steve, express for world, call work the witness want is everything me in over and With to resilience, to to team. is my I moment the global that employees' hard going

INNOCEAN. We finalist a Conversions native of were a our a for big XXXX industry so of us, efforts advertising case in Technology for proud Publisher of QX. best the is the including at these with in AdExchanger leading our All the are strong named also and with The category highlighting a for Digital collaboration Best Use into a win Hyundai and year study for recognition, Independent. By Technology in up Awards Maximize and execution, showing of numbers Award our I'm a platform,

to our a forward looking the to more let and call and guidance are to that, detail. financials the on strong to delivering year. With Steve review very our close pass outlook me having in We

Stephen Walker

everyone. Thanks, and morning, good Adam,

mentioned, momentum quarter, the build positioned we've quarter. Adam another this we strong to had in on As are fourth and well

metrics. ex-TAC This financial reflecting ex-TAC primarily dive since XX% year-over-year. year. continued $XXX while let's from premium increased key and of So amount of QX growth in our showcasing million XX% the agencies grew results brands of QX a significant were across year-over-year particularly all of million, into of last reached by and supply strong $XXX.X profit X performance. QX driven the increase, was advertiser spending, Tier by growth addition details a gross Revenues strong,

have in relatively is in this approximately year-ago $X million loss year-over-year of expectations XXX% expense Note operating Yahoo!, previously million. a at from deferred had at to before our benefited to was adjusted the free margin. long-term a over of positive of there is cost case, with tax limited $X.X non-GAAP conversion primarily no rate. QX would growth which favorable $XX.X timing publications. Net other our reflected EBITDA income and net of of was with cash we volatility income million arises of discussed, areas expenses XX% quarter at was leverage positive income quarters, business. $X.X Free end a quarter of this new flow versus Apple conversion million growth million. and the been from million for adjusted that change of our and Headcount We that supply new operating X income the and was coming adjusted The As up premium publishing tax taxes XX%, EBITDA a XX% partners. $XX.X EBITDA period. impact. Adjusted $XXX.X approximately In expenses cash charge increases from $XX.X high to the has were note million trailing any provisions. to flow quarters. up cash our the tax high due I in XX% our were the between EBITDA coming

million including on loss $XX.X expense approach discipline. included prepayment, is I note EBITDA net the year-over-year $X.X $X.X focus this QX net should commercial The EBITDA adjusted significantly would as Our of Connexity taken have our the net from agreement long-term cost of a the continued growth you million $XX.X the GAAP the we full going $XX.X asset GAAP of share-based sheet. or almost but for is million of demonstrates Yahoo! the listed million for strong to several XX% items. ongoing amortization expectations, related expenses on discipline margin we for GAAP adjusted asset of million. charge narrowed noncash balance agreement included of noncash-based that latter XXXX. year. The for This loss of intangibles, It Yahoo! we included the XX% of will QX the to compensation margin of which asset continue target With our commercial expenses to also improved holdback first that expect and our prepayment, amortization strong forward. and expect amortization of compensation the acquisition loss time see

guidance $XX.X items, for million Excluding net non-GAAP quarter. within our was income the range and was those our noncash

approximately in million. generation, million cash net flow of prepayments, cash of debt, flow terms $XX.X In $X.X interest which and we $XX.X contributed flow million. our operating cash long-term free million QX on had which and to includes cash in publisher This used $X.X payments

balance the sheet. to Turning

Our net loan million, We $XX.X very net totaled with equivalents $XXX.X robust. remaining cash above balance of balance cash million. QX our Cash positive ended $XXX.X remains of position long-term cash a million. and

Regarding share have $XXX repurchase $XX we our bought under previously million approximately repurchases, QX. remaining announced in million still $XX shares back million program. of share We

were end compared share shares QX XXXX, set that by at to shares announced buyback so the have goal. the program, As you down of counts XXXX dilution At of the QX the share we originally end know, we to when our of million our XXXX, and we end exceeded outstanding goal maintain X.X offset levels. QX

share While XX% close to to are prices, we use believe approval our cash which current of we share absent exception, shareholder the buybacks Israeli stake. that Yahoo!'s an limiting current continue of given constrained ownership ownership regulations to is best are by

share offset to primarily our Given long-term and we dilution, used this down be cash constraint, paying will also buybacks our excess will debt flow. consider with

contingent repurchase working paydown the upon As share are always, availability program sufficient debt of the capital. and both the

believe lines in on to team's and and out I accelerated We've Looking ahead, will of our drive we ability year. had strong continue X our about I'm quarters to momentum close we the and build growth. optimistic as business sustained XXXX, the trend our

expectations strong the reflects guidance fourth Our for quarter.

adjusted scale, to us, reaffirming data for our guidance ex-TAC our profit, non-GAAP annual to initiatives X behind will due to spend are increased Revenues which gross are as strong net improve continue we increases We and continue advertising and at profit and gross monetization profit ramp EBITDA That advertiser projected profit, gross is quarters success revenues, to XX% to performance. With contextual income. due representing our a between the Gross and to billion, be a million to million be million growth $XXX at million $XXX $X.XXX ex-TAC XX% the ex-TAC increase is billion between $X.XXX projected guidance midpoint. reflects expected $XXX the midpoint. range. year-over-year $XXX in be to and our

We expect to over for adjusted $XXX to continue EBITDA be million the year.

EBITDA metrics to over raising million. compared for represent performance our free doubling flow cash both Given and flow year-to-date, a These our are to strong targets we roughly $XXX target XXXX. adjusted free cash of

anticipate million we to income of non-GAAP Finally, net million $XX $XXX for the year.

we For the following are the fourth issuing quarter, guidance.

and million We approach EBITDA business million grow from non-GAAP to a million, summary, our and million. In confident $XX we expect million $XXX between revenues are from from $XX and from profit and scale be gross million, income million, million $XXX $XX to our to million net $XXX million profit to $XX ability gross to in spending. while $XXX $XXX $XXX to adjusted maintaining balanced disciplined to ex-TAC

even will profitability in long-term growth. our and that our our our deliver we strategic technology We positively believe which efficiency investments on continue enhancing impact is performance will benefit financial and shareholders. in emphasis as invest advantages, Our to

great last You is can in saw help which us technology business. our more month, Abby our customers productive example and as how of announcement a make of a investments

advancements and Our Operator, rates. our see very into must-buy please to seeking web. With questions? in to move growth QX, on momentum, can open that, a bring with us This worldwide line and strong becoming you year-over-year advertisers technology that open to strong reflected heading to accelerating growth let's the connect closer for momentum can Q&A. consumers you for the is our

Operator

from Our at Zach Riley first Cummins B. question Securities. comes [Operator Instructions]

Ethan Widell

you To Apple progress Widell can contributor? start, in bit your little your a And that revenue talk with about This meaningful Zach for you Cummins. expect relationship? might a calling when to Ethan is become

Adam Singolda

growth X Three, exciting. the much there's of time, multiple in having validation Apple. happy premium we're which So largest of one more leaned chosen for is over to kind that that still there advertisers. to said, Taboola we the one the partnerships such attract partner, on is an more fronts. advertisers as be exciting partners in Taboola of -- no more we premium huge Apple seeing the very Apple we're think could opportunities is to Two, one, industry Select with be premium we company, monetization for that partnership to their kind and is because more engines great. opportunity which the a there's to, advertising, drive marketplace that performance think of It's as of than and larger we Apple our One, part that's the evolving think much We like be our Apple. partnership Apple attracting Tier want is Apple become more offering, into through has

we really well. So for those all it's going think reasons,

Ethan Widell

been adoption speak Max can that using to the far using with offering mix feedback from then you Conversions, And long advertisers so the of what's the a term? advertisers the of solution? little And

Adam Singolda

Yes.

about of mentioned Conversions that XX%, is which the great. we adoption rate is So Max

X,XXX joining the is If you had obviously are direct one compare quarter-over-quarter, advertisers These this quarter which advertisers using we about Max versus before, great. in Conversion.

fantastic. that's the amount when also we're quarter-over-quarter, of thanks XX% you So Max campaigns, seeing And growth to Conversion. compare

key the at work to look drive can and with advertisers I AI companies industry Conversion investment to as big small that. that again, trend element Max performance, wanting do of of is and a our the So

auto kind manufacturers growth an way. growth in enabler some is of able verticals health also mentioned Max good to good care, in coming that as significant performance Conversion that. fairly We and are for a seeing drive China with advertisers of us out seeing such we're like we're And as more. again, And

our kind our I is AI investment a think growth. of overall, to big in contributor So

Operator

comes at Our Dan & Needham from Medina question Company. next

Laura Martin

Medina. Dan in standing Martin, for Laura

One, So I X traffic. things. have

per XX you million X people you're million mean me, a So some time? X over maybe like it that of I kind don't can you per but feels that think traffic. said give day to you driving And for me goal is. million? Could get to lot traffic

traffic growth a interested I'm metric. So as in of

and Trump, China before, Secondly, put he's of on talk right heard said who I've we're big going to president the never about tariffs China. you on new cusp a

did of And demo. give we you your tariffs is is much the at if risk how a Abby, us you start third, putting of number China And could revenue? China? guys then great on So much how

a is product? that's on is curious small self-serve Could those medium I've to Abby actually Can option think exists a going you us tell I how update and So been awareness as great as how tell for you me because Abby product. investors things? like drive an them X advertising. to that you

Adam Singolda

for question. the thanks Laura,

hundreds So business be significant Taboola an company. going driver as think they incremental to of chance News is the access has special do their millions exciting dollars it's and data of very mentioned for of and and browser, we to of ever open it ever growth type I with think revenue only become to before, work really -- not search consumers social. a before become supply can get I a for company and because I a to the that

their before So main dish, first their of products we and offering start journey. content will, to you introducing kind they them and like even are if

driving all not the to publishers love be that search look changed, of and in the to those policies it's consumers. if important, trends becoming So being a significant. financially, as And and and unique at very social industry I with for can is networks and business. things, Two, revenue. a more, Gemini I actually as again, traffic source said I it access

over day people I So that, a time, source to XX% Over X of that driving significant I would over traffic. like of publishers' million number. think with a be is

it top consumers I that Taboola a is the launched growth like food with about do even source the a Google and is search; of from mentioned companies, OEMs, chain just strategies do times opportunity to with many beyond that. of up XX%, world with of is XX% trend whatever kind traffic has then on. And for think aggregator Taboola. the very, to are some great and to XX you look to at actually If when time, from, become like usually utility that OEM be coming in see trying News SEO, and more they're more people you will And source seeing and publishers actual to and today, they engage the publishers expanding, rely perhaps a that like way, get do consumers it for optimize of need news having lot traffic of open I that from for much but and apps all with you us say that sometimes for News XX%, rather as to Analytics double-digit only can SEO or X a partnering anyone over with might app, utility is Taboola I renewing will day. conversations engaging We is insignificant. them very And them be such Xiaomi in than global are that coming not the where a and the their local go want you place. I your coming XX%, X be would And so something to great social. news optimize can offer to is can a rest companies taking

I integrated a we that. Taboola can that So we I many all every rather think and see but beyond take question love just over about with OEMs, might Abby. time, day. There's utilities News use

small, again, an right to only on is Abby to to And way the intuitive such as they feedback that big got about, all, now, for was convincing great was with simplifying the want So they streets we with their journey us me also first have life [ become But and growth drive It serious, advertisers from interact think it phase of walking great. of hope my to onboarding see to the and was enjoyed ] you mainly or not Manhattan. easy as I advertisers, look really the the I fun work business. the are as the CPC sophisticated you even for that what with it's CPM, or strategy, viewable I And most as of years, see to Taboola Google up it complicated industry. the world strongly start a very kind and complicated for X campaign, X while such control suspect businesses, know, advertiser. that and onboard. very, well, to And still next is over CPM, advertisers going providing a to and Laura, making a more we doing ones very, come succeed very lot simple Meta to bidding a an and in which transparency industry

over grow internally I X -- that things had account we're managers, what Obviously, Abby Taboola million make time, million advertisers, But but I advertiser think can to experience. onboard X advertisers will advertisers existing this so And to easy if it again, experience us, phase, the suggest help and maybe then going not just of Taboola kind have? count. would beyond campaign, manage the be one, their have our onboarding was to hope helping even joking that imitate

like many really one you're in again, it's to AI. of Taboola Gen hear that. many, I going So out steps many, investing And step from

Stephen Walker

then And Laura. -- that, sorry regarding about

and Regarding tariffs business potential our about on the of impact your Trump overall. question

which how So could big is an have. good to proxy our your Chinese business, a impact that for point, think, I

Taiwanese -- it's depending of cetera. to that demand the on or supply like. side, how or demand Chinese So supply single-digit probably decent on supply upon it, big a percentages, you Taiwanese demand low portion et X% side, X% is a measure Chinese

not would affected. obviously that So be

what we of of it import kind demand. call Some is

small but U.S. other U.S. X% That's X% Chinese that would countries supply exactly probably broken supply. demand and Chinese business. fairly risk, way, be it's don't So have it it demand be is percentage at a on of max. but that's what our to the Like would out I on

not are that who with that So from retailers lot about but I concerned journey. Google started been of earlier spending we're some Chinese in others, as Facebook that do have think a -- and direct perspective. and the impact with -- who we're we've a there's working

there. revenue risk as don't So again, we at have much

not impact -- a that's think big on it's So us. I

Operator

Our from at next comes Oppenheimer. question Jason Helfstein

Unknown Analyst

This Roman [ Jason is on the line Steve ] for Helfstein.

about then the as from we questions XQ progress And filling asking in, secondly, thinking representative just the update And just we're a are year? inning TAC inventory. any color So X year? is roughly? us. next Yahoo! rate next for One, on What modeling for

Stephen Walker

let me of next expectations. year question So take the kind about

I'll of talk So that. kind generically about

of in February. We'll that were all, going we we want in guide So we guide We're hit happy we've to to that and reiterated everything said thus don't really obviously first guidance. now. we XXXX far, do

So of our excited going to drivers goals have many meet -- we And expect we forward. about year. are all growth we this

the again, what Abby grow opportunity us budgets higher and And among retention advertisers, So is the grow to is, keys business Conversions helps those continued we are our net investments like Max grow the advertiser our algorithms, the do, to thing have to we to That's in lower churn and continue which grow over budgets. continue AI budgets. to that. time. biggest grow They to need our dollar by way, drive advertiser

other with We publishers our great from and in Apple, we've also over expanded grown with supply drivers core growth have Yahoo!, Microsoft, time. that

lot think and supply, an as we future beyond help in then have of So of result that. are e-commerce, well. core, Taboola to opportunity News, a grow think faster us revenue our bidding, drivers we they a the grow can have as believe we that And we all I growth

be specifically Adam want also the where to then good for that a it should I be investing, to plus. that's in excited say, will on our guide, how don't happy and is as long-term And to depth. about more we to would have think to probably Day do XX% growth in I we we're growth opportunity go earlier, think where rate And while to prospects, we're say we're are continue going said a we expect go to opportunity that us So Investor So our I coming in XXXX good work? growth March. from, we going deeper an see

Adam Singolda

laser-focused Yahoo! on advertisers, that, that with front, to that growth as of the and over core us. results, numbers, seeing advertiser of around have I we're of And great our with is migration in Yahoo! just omni partnership say we're that, we and with We're success think more that and the obviously general, success happy becoming are more expanding, our you amazing ecosystem our can partnership good of Yahoo! one, it's and to and -- type we're seeing very Yahoo! the note and kind business happy really Taboola's time. that to just is core really -- one to names part contributing more what as we're partnership progress. On see and see say our about

special think special I exclusive it's we we access access advertisers bring have Apple to that and such has and supply, to having Google to can YouTube, segments and market, contextual others. Amazon Yahoo! data and has unique want. really about unique Twitch, As something

type So we make that opportunity web, the advertisers moving realize with the becoming big to more the going think I strategy it's performance of uniqueness web. about we the of company forward can non-search, the our advertising be open grow of the nonsocial, as in marketplace think a and open part

Operator

Our comes at Boone Andrew from next question JMP Securities.

Andrew Boone

tools. automated outcome more to more the hear guys Adam, I'd of introducing love you about

road I guys update getting that for an XQ? business, as bit are there. advertisers, expect we think and of terms what e-commerce the Like increase broadly, to think budgets spend led on love more seeing across just think product And and hey, the guys there. and then if smaller what's a side about you more Max you of think advertisers? do of Abby well map So as what an reducing than are the beyond? about if robust more we 'XX little And we How contributing outcome I has about the friction that of to as other saying, about for that in then the some drivers other can I'd are

Adam Singolda

Sure.

business. business say our So with first the Abby, let us on what's in the me share, our about it's of for things, impact think and early terms X one days advertiser investors as but to

which means In we want product join, it want terms less we more so for want what to does over time. mean to we -- effect, we of want churn, count want, you advertiser -- easier really which see advertisers the

if far you to those. advertisers I to we us. invest number advertisers, it's -- is majority and and that XX,XXX of direct gives special, spend also about of on sort like Taboola's from time, remarkable coming on Today, advertisers of front, at management situation our That's bring to generating the work to Over I all then be be our think one the and simple more outside journey. be earlier, advertiser invest more that landing can even Google on to advertisers Google, that journey Taboola's Facebook, AI improve it's time, the we successful. Abby landing I join mentioned a as landing for essentially again, and but market. look very vast between pillar more, and and who is that that pages very same most a page an with technology tools us That revenue more it, can to tend create me. and account think able so Taboola, more advertisers. of the have is in We do and the mentioned, Over other entire generative things churn which, think campaigns I as about And and personalized have direct. license XX,XXX page we be on it And could even be to -- of Facebook have AI the in in like with the a agent technology hand, to that AI astonishing success. the can

You like like landing and Steve I on see text. video will pages And you might may like may convert. -- videos experiences, thumbnails help you that you'll like Andrew, might

product will experience one that get each understand will them the help discover own their and things they better, eventually convert. So the like

success, do existing that diversify the wants can be with know, does to have we we'll think I as company continue do no advertiser significantly. we smaller team successful So at will, that smaller now but dedicated the big consumers, advertiser and and because there's have just to just you things does I on by we think can to that do. people even that road drive experience advertiser so, services small. really but think, help intent this, to can. we Abby here which it financial our map And about on is just double to we have advertisers, the great see investing more Taboola doing And the have said, do resources it, like growth. and like with grow for not the I'd can as of can like yield midsize a first, and maybe sort triple And encouraging to invest supply. supply, a advertisers, not but grow to still advertisers, have long that, is I because not

Generative So Abby that's feedback was to we really and it. since and exciting the with launched just AI, regards

Stephen Walker

you kind going where also e-commerce we're of about there. asked So and

So have a that that of e-commerce first, an fourth one It's and the our expect we growth I very in continues big see would I -- the quarter year-over-year accelerating like. the say quarter perform reasons well. and to terms we to guess, of growth in

to And speaking, similar that to and continues we in core is business, it where for -- there then in now think -- investing get think continue I business perform for expanding advertisers. So we're more better invest sales work it to teams to go and well. generally our more making out for in basically the retailers And it's I globally.

time. where that I we're over on growing So kind that's think of focusing business

Adam Singolda

and They it's driving want is web, We're jobs, the segments you, call now what that leaning and which growth One create of to a creators, it's for are only calls but their for creators and that those with more open it. is in is on Taboola actually all they more our letter, or of authentic about, also, that. some real they getting that -- new is, network questions link e-commerce sold largest create offering of I like come that mentioned it passionate of up the use we products networks an like a across Taboola, to pick way actually product within business to a note to growth, one the our that multiple content ShopYourLikes, about channel. being they in I essentially not and content daily about we're are that us they do it, products and era. them social tell from asking quitting retailers can drive their through really conversions nice And financial commerce. what's seeing social

stages, now is new whole access we're to very, a retailers growing. content, early really content. those it's very fast. which good ecosystem So also but growing We're have And then it's that

reach they those them. partner creators, can can out So they to with

within and a it's that everyone. win-win-win supply, growth across of us a happy very new type part we're it's kind I'm I new of So a that And financial that like for again, the e-commerce, type because of ecosystem. of

Andrew Boone

I one you look dollars year? XXXX. been headcount at sneak we about If guys where I think feel guys next we we should levels that any Steve, the as of allocated you very 'XX? in. could you expect have Is do if and in more about staffing have terms How as areas consistent think your P&L, there across about investment

Stephen Walker

Yes.

a sales fact, QX in -- were So in QX, marketing saw I versus you and expenses bit up linearly. and our think that

ideal the bring kind direct-to-consumer we're well think investing of point network, who our sales would especially So we -- to be calling particularly especially more what of customer a customers, customers in and teams, area in profile do internally our of products. more starting of in is that which in

ours, advertiser the Ovens, well who's pizza it a like with that's and us. tends big type they're of of relatively ovens directly to think do that to So Pizza advertiser selling Ooni of consumers,

investing we're more now around sales So in teams that.

is good enterprise still some emerging brand dollars, they're who as necessarily performance, or the the well big on brand branding, more not performance, in them spend they're the and not big advertisers basically other really but areas, biggest -- brand which about larger by way, Internet. As bringing call

So teams as well. we're them to sales more investing in address

So are the to to more quality we've is we and -- sales supply, quality budgets investment but of right after have supply yes, markets amazing identified sales grow basically said, the that's demand. particularly of amount and be when starting effort. which biggest it for on is lucrative budgets, in to get area now, we teams are we've as for those should to good like have need supply the bring more a got is is to the us probably we Because And of able us go you that continue kind investing amazing. business, we you've of

So investing. that's we're where

Operator

James Our next question comes from Kopelman TD at Cowen.

James Kopelman

Adam. for is one first The

it they We've letter big in adopt a yet cases these most for is I publishers them clients disruptive way. say, How like have the you X of education seen are commentary all part new broader seems AI it. tools? in to get Steve. you approaching ad that were, and are publishers admittedly to across probably months comfortable meaningful mentioned in then a educating accustomed And space, follow-up the lot finding similar that and more to some have You AI ago? a a than And are

Adam Singolda

Yes.

looking change, or ever. you seeing the conversation downside general. kind also in lot at like and innovation now is think when create the choose when now same look than to you At of what ecosystem of can you're at if AI I downside you're is more a times, one those leaned to tends much -- upside it the more in moments significant. change innovation, time, And of not it's

their in publishers been we're best why attracting so And because wants doing everyone ago, you're investing And company these in to them machine And because they're a engaged, those as days, we've more technologies And of list years part adoption a the tap think lot pages is -- and a exclusivity that driven ago, change an that But this by wants when a publishers OpenAI is notion time. will company day other I amazing those those we're the even ago, Gemini, of will of and was any and the don't seeing offering around grow than to consumers of pages was we're know growth we be think that be for changing of years and things. and the design year more the such very You the by AI. is a X together. two, to trusted the hour because the solely to vast you're than is that just renewals such positioned of change job the things what seeing world, that seeing the X like that seeing personalized page area into. ludicrous; an will article X other an I For Tier personalized a one, to, TikTok And with fully us, long see obviously it. machine and by fully trust all industry any growth extent I example, home has the have and seeing sensitive

industry So I we're is well it's the positioned of into changing around a think just that. combination then to us, and tap

happens. I So that's think why that

James Kopelman

And the for trends to we the over should broadly, then on performance of of finally, getting yield And advertising? growth? into time were as the as XXXX? you Yahoo! well next work ramp remind yield about head behind your amid couple ahead, what as Steve, trends us key And looking how we in think quarters just the more positive drivers can yield back you dynamics

Stephen Walker

question. good So

had the yield onboarding then Yahoo! we fully end So the this us transitioned to get that the by was we and to we QX. year, had back drivers transitioned positive full had the of it completed then from key think supply and basically, advertisers growth, early I

gave relatively those of time. forward supply to to increased over So growth advertiser budgets is is QX start and us the long in drives as grow that opportunity advertiser stable and what as yield then going budgets the

we a we so to what were and brought the start had stabilized, brought them, us back positive chance think driver was we a I growing that's our now advertisers, had those over to and and key So -- yield. had supply

our to expectation side good we the than intentionally, supply is way, by that, demand our Going growth forward will our because on drive on that have higher we continue that -- looking we supply. side will really of

drive So that yield will positive growth.

to expect it algorithms Conversions as you positive our remain in make work investments it Abby, our automation forward. and for make of that drive And -- do AI positive advertisers with and to, yield part investments in successful. that also a to going Max alluded that continue them like us we So more big to easier and is to as our such

And so yield time. us help those will drive advertising over higher what higher and will with budgets drive are help that investments

the going now is of -- to onboarding core core a the supply do. I grow supply well, should here our as opportunity the we're with by expectation the the ex-TAC my we stable we've done, all business grow have forward, environment, we be to way, gives more in expect yields should margin which which, So to able also over us time

Operator

comes question The Mark Our Company. Zgutowicz from last at Benchmark

Mark Zgutowicz

X sales that how Steve, much Can today? sales maybe you that are limiting you And publishers Tier you other of capacity. over Apple And a curious specific on assume follow-up what there's that also there there ad but you be talk you of that expect Apple-like are sort -- where of to you X probably X to to just X I terms you -- of out sort Tier today the capacity headcount the in address. and where I'm just capacity. question have sales about Tier can fulfilling today need that and all months you is of how to next and factor where the supply a address, that you you

Stephen Walker

Yes.

we've think increased we in that to say our increased from in efforts ROI So drive identified I essence, will but supply. our I us demand do sales limiting our sales performance, think be invest think help yield opportunities per additional drive factor positive wouldn't and it's se, to and teams will necessarily a I specific

doing I direct-to-consumer we're there. investing about, So team, one, sales obviously that. what we're the that's talked And

The to on emerging performance are is kind second internally one, advertisers enterprise, which of mid who larger which we campaigns. also call focusing

investing we're So there.

What they more CPAs, that the dollars. wow, fact seeing go supply is had think now So for we well." just the per of I advertiser definitely phase, time, budgets and returns you then over a becomes them positive basically to "Oh, they're because though, us think, would some have we -- we that, XX "Oh, on well," we're opportunity them. say, I based CPAs, in us. and we've identified months. -- got cost see a huge we've positive When grow advertisers So higher the influx this working existing budgets more is is more ROI that also that X working from from and say cheaper to base big areas this to our wow, from need better that get supply we've over like or drive where ad typically you lower there's and have last And happens invest can initially acquisitions. get

opportunities and part So identified the I around new have in think making of direct-to-consumer there we're the sales we story. -- are and emerging teams the investments we enterprise

to expect of to our productivity. advertisers which part other the best way existing from is higher obviously grow able The of doing existing team, budgets is be the because it we story with that's

we we I guide think said we and about of a think are talk gives you I haven't should I more we flavor when sales teams, XXXX. where we get kind investing So in. to exactly that to on we're where and what that the of think But

Mark Zgutowicz

question, And unrelated. one then last maybe

how trying either next to advertiser contribution would rank of a the then Just those with XX months? terms and these those X of of of new emerging much I of opportunities call relatively new revenue China you expect talked to more Outlook. relationship opportunities, get Could maybe Microsoft You XX the in it over you force about, revenue sense the OEM, X can global X. sort from would maybe top I an call

Stephen Walker

Yes.

would essence, have supply are the So them well, X demand. front are, are them one of way, those them in even that, say -- is opportunity don't frankly, all supply question, I that side side, By all of of of one in good opportunities. of me. I X good-sized X

Chinese -- opportunity. are retailers a that's the demand side So

it X to, The me. in even X, sure we say, have growth significant I'd opportunities of haven't all we meaningful other our I'm X don't front think in them. to be are general, we I But side frankly, opportunities. and But are if all quantified and want more necessarily supply over can not time.

I that. the don't answer, sorry -- for So just have vague we but

Operator

now it the like to session. Singolda I closing remarks. turn would question-and-answer Adam concludes back for This to

Adam Singolda

Thank again, joining you everyone, us for this morning.

strategy, can with happy. Even resilience forward they've be proud as of I free well shown. delivering a seeing work products as happy for the executing going our hard everyone very continue look great. Abby cash our team's launching and ex-TAC new soon. targets. adjusted more, We'll and revenue to you next to raising see, like guidance on as QX We're year. EBITDA our our It's I'm soon XXXX our join As team early flow I'm financial you hope target. on performance, and exceeding very us Investor very and my Speak Day can

Operator

you conference. in This for participation your Thank program. does today's conclude the

disconnect. now may You

Taboola.com (TBLA) 7 Nov 242024 Q3 Earnings call transcript