Perion Network Ltd. Q1 FY2025 earnings call

• Perion One is an outcome-driven platform for marketing leaders, delivering better business outcomes at scale.
• The first quarter of 2025 was strong with growth in digital out-of-home, CTV, and retail media. Digital out-of-home grew by 80%, CTV by 31%, and retail media by 33% year-over-year.
• Acquired Greenbids, a cutting-edge AI company, to enhance AI capabilities and expand the total addressable market, particularly in lower funnel performance opportunities on walled garden platforms.
• Took structural steps to optimize cost base, including headcount reduction, expense control, and sales/marketing efficiency improvements as part of the Perion One strategy.

Total revenue for Q1 2025 was $89.3 million. Digital out-of-home grew by 80% year-over-year, representing 19% of total revenue. CTV grew by 31% year-over-year, accounting for 12% of total revenue. Web revenue declined by 28% year-over-year, making up 46% of total revenue. Search revenue was 22% of total revenue, down from 52% in the same quarter of 2024. Adjusted EBITDA for Q1 was $1.8 million, representing 5% of contribution ex-TAC.

• Raised full-year 2025 revenue guidance from $400-420 million to $430-450 million (7% increase at midpoint).
• Raised adjusted EBITDA guidance from $40-42 million to $44-46 million (10% increase at midpoint).
• Greenbids acquisition expected to contribute to growth, with synergies starting to show, and full impact expected to accelerate from 2026 onwards.

Q: Jason Helfstein asked about guidance, stabilization of web revenue, and impact of Greenbids.

A: Elad Tzubery and Tal Jacobson responded that the guidance was raised due to strong Q1 performance, organic growth, and Greenbids synergies; web revenue is expected to stabilize from the next quarter; Greenbids is growing fast and profitable standalone, with synergies starting immediately.

Q: Eric Martinuzzi asked about Greenbids' revenue, EBITDA, and integration timeline.

A: Elad Tzubery said Greenbids had low double-digit revenue and low-single digit EBITDA in 2024 standalone; integration happens immediately, with acceleration in U.S. market penetration expected in the coming quarters.

Q: Andrew Marok asked about CMOs' response to Perion One and Greenbids.

A: Tal Jacobson stated that CMOs are excited about Perion One and Greenbids' custom algorithm solutions, as the unified offering reduces the need to handle multiple platforms and delivers actual results.

Q: Jeff Martin asked about expanded TAM and strategy.

A: Elad Tzubery explained that Greenbids expands into walled gardens like YouTube, Facebook, and Instagram, providing lower funnel and performance capabilities, and the strategy involves leveraging existing customer base and expanding into new platforms to capitalize on the expanded TAM.