Criteo SA Q1 FY2025 earnings call

• Platform Strategy: Early momentum behind platform strategy with major enterprise clients like Office Depot using the Commerce Media Platform. Expanding global agency partnerships and leveraging synergies across products.
• Driving Demand: Deepening agency and API partnerships in Retail Media, rolling out 70 Commerce GO! in Performance Media for AI-powered automation.
• Brand Performance: Focus on helping brands build actionable awareness across the buyer journey, with success in capturing budgets from traditional upper-funnel DSPs.
• AI Innovation: World-class AI capabilities with investments in addressability and Privacy Sandbox, driving automation and performance in both Retail Media and Performance Media.
• First Quarter Performance: Solid results with Retail Media media spend up 21% Y/Y and Performance Media showing sequential growth in media spend growth excluding AdTech services.

Retail Media: Activated $335 million in media spend, up 21% year-over-year from over 3,800 brands globally. Revenue was $59 million, and contribution ex-TAC grew 18% at constant currency to $59 million. Performance Media: Revenue was $392 million, and contribution ex-TAC was $206 million, up 4% at constant currency. Contribution ex-TAC for Retail Media was driven by continued strength in onsite and traction for offsite campaigns, while Performance Media growth was led by Commerce Audiences and the Commerce Grid SSP.

• 2025 contribution ex-TAC expected to grow low-single digits at constant currency, with growth in both segments.
• Retail Media 2025 growth revised to low-to-mid single digits at constant currency, reflecting macro challenges and scope changes with largest client.
• Performance Media ex-TAC expected up low-single-digits in 2025, laps tough comps from 2024 AI enhancements.
• Adjusted EBITDA margin anticipated to be 33%-34% in 2025.
• Q2 2025 contribution ex-TAC expected $272 million-$278 million, down 2% to flat at constant currency, with adjusted EBITDA between $60 million-$66 million.

• Near-term impact from largest Retail Media client discontinuing managed services and curtailment of brand demand sales services, affecting Retail Media growth rates.
• Macro-economic uncertainty impacting ad budgets, especially in discretionary categories.
• Delays in certain retailers’ tech roadmaps affecting Retail Media growth.

Q: On Retail Media, with the largest client, what percent of demand were you generating versus in-house before the change?

A: We don't generally comment on specific client details, but we focus on increasing the number of brands globally and serving the mid-to long-tail.

Q: On Uber Eats relationship, how did the dynamics play out?

A: We were disappointed, but continue global partnership with Uber Advertising. Clients make decisions based on perceived synergies with other providers.

Q: On self-service tools, how does Criteo's sophistication compare to Meta or Google?

A: Criteo is on a journey with Commerce GO!, designed to offer parameter management and transparency, differentiating from previous solutions.