Perion Network Ltd. Q4 FY2025 earnings call

Tal Jacobson mentioned 2025 was a defining year for Perion, redefining mission, strategy, etc. Perion One is now an AI-native execution infrastructure with Outmax AI execution agent getting into more channels. Launched partnerships with Amazon, Walmart and Mastercard. Elad Tzubery discussed Q4 and full year financial results, growth engines outpacing market, strong cash generation, adjusted EBITDA growth, margin expansion, and plans for 2026 and 2028 targets. Focus on unifying advertising solutions under Perion One strategy, introducing new solutions and Outmax, and building foundations for growth.

In Q4, main growth engines CTV, Digital Out-of-Home and Retail Media delivered double-digit Y/Y growth. Revenue Q4 grew 6% Y/Y to $137.1M. Contribution ex-TAC Q4 grew 19% Y/Y to $65.2M. Adjusted EBITDA Q4 was $24.3M, up 53% Y/Y. Full year 2025 revenue $439.9M, contribution ex-TAC $203.4M, adjusted EBITDA $45.2M. CTV revenue Q4 59% Y/Y growth, full year 42% to $62.1M. Digital Out-of-Home revenue Q4 28% Y/Y growth, full year 36% to $94.9M. Retail Media revenue Q4 42% Y/Y growth, full year 36% growth. Advertising solutions revenue Q4 up 7% Y/Y, CTV and Digital Out-of-Home collectively 44% of Q4 revenue and 36% of full year 2025 revenue. Web declined 17% Q4 Y/Y and 13% full year Y/Y. Contribution ex-TAC margin Q4 48%, full year 2025 46%. Adjusted EBITDA Q4 37% of contribution ex-TAC and 18% of total revenue.

For 2026, expects contribution ex-TAC $215M - $235M and adjusted EBITDA $50M - $54M. Project Perion One spend to grow at least 25% CAGR through 2028. Target Perion One pro forma spend CAGR at least 25%, contribution ex-TAC CAGR at least 20%, and adjusted EBITDA margins reaching 28% of contribution ex-TAC by 2028. Growth driven by growth engines, market shift to performance advertising, and land and expand business model.

Q: Can you walk us through the 2026 guide low end vs high end and acceleration into 2027-2028?

A: Elad Tzubery discussed market dynamics, shift from search to Perion One platform.

Q: Saw integration with Amazon DSP, did see wallet share gains?

A: Tal Jacobson said integration with Amazon DSP was requested by customers, just launched, opening up opportunity.

Q: Heard integration with Amazon DSP, what about advertiser prioritization of using Perion One vs legacy DSP?

A: Tal Jacobson said not trying to replace other DSPs, but to be a layer above to optimize cross channel based on advertiser goal.

Q: Talk about Outmax adoption and selling cycles?

A: Tal Jacobson said strong adoption, sales cycle shorter as focus on holistic outcome.

Q: Strong 28% EBITDA margin guide for 2028, what underpins confidence?

A: Elad Tzubery said progress in efficiency, Q4 margin improvement, will continue investing in efficiency measures.

Q: Web down 17%, fundamentals?

A: Elad Tzubery said due to shutting down low tech/low-margin legacy activities and channel agnostic play.

Q: Shift in customers with Perion One?

A: Tal Jacobson said same type of customers, but more holistic approach.

Q: Market share gains in core growth areas and sustainability?

A: Elad Tzubery said growth engines outpaced market, power of value proposition to customers around those channels.