Executive Summary

Q4 2024 delivered strong financials: Revenue $491.0M, Gross Profit $177.6M, Diluted EPS $0.10, ex‑TAC Gross Profit $212.7M, Adjusted EBITDA $92.3M, Free Cash Flow $51.9M; ex‑TAC margin was ~43% given Yahoo testing and typical Q4 seasonality .
Management launched Realize, an independent performance ad platform expanding beyond native to display and other formats, targeting a $55B opportunity; and expanded share repurchase authorization by up to $200M (total ~$240M) .
FY 2025 guidance: Revenues $1.838–$1.888B, ex‑TAC Gross Profit $674–$690M, Adjusted EBITDA $201–$209M, Non‑GAAP Net Income $122–$128M; Q1 2025 guide Revenues $407–$427M; guidance intentionally derisked to allow Realize to gain traction while maintaining ~30% EBITDA margin .
Wall Street consensus via S&P Global was unavailable due to service limits; estimate comparison is not provided. Management disclosed new KPIs to be reported going forward: scaled advertisers (>$100k spend) and ARPU per scaled advertiser .

What Went Well and What Went Wrong

What Went Well

Free cash flow and profitability inflected: Q4 Adjusted EBITDA $92.3M (+84% YoY) and FCF $51.9M; FY FCF $149.2M (74% conversion of Adjusted EBITDA in 2024; trailing 8‑quarter conversion ~67%) .
Strategic expansion and buybacks: Launch of Realize to capture performance budgets beyond native; Board approved additional $200M buyback (constrained by Yahoo’s 25% cap, with pro‑rata purchases agreed to keep Yahoo just under 25%) .
Strength of supply and data: CEO emphasized unique first‑party data, publisher/OEM reach (~600M DAUs), and AI (Max Conversions, Abby) as durable advantages; Q4 ex‑TAC margin ~43% included benefit from Yahoo testing .

What Went Wrong

Demand scaling lag: Native ad demand alone deemed too niche for large advertisers; Yahoo advertisers spent less across the broader Taboola network than expected (sub‑$15M on bottom‑of‑article native), necessitating Realize pivot .
2025 growth guide muted: FY 2025 guide implies low single‑digit growth in ex‑TAC GP and Adjusted EBITDA, reflecting time needed for Realize adoption and winding down of Yahoo test effects into Q1 .
Investor concerns on competition and cost base: Q&A focused on head‑to‑head versus Trade Desk/Amazon and whether expenses should be cut if Realize traction is slow; management reiterated 30% EBITDA margin target and willingness to reassess costs if needed .

Financial Results

Quarterly progression (oldest → newest)

Metric	Q2 2024	Q3 2024	Q4 2024
Revenues ($M)	$428.2	$433.0	$491.0
Gross Profit ($M)	$114.8	$132.9	$177.6
ex‑TAC Gross Profit ($M)	$149.5	$166.4	$212.7
Adjusted EBITDA ($M)	$37.2	$47.9	$92.3
Non‑GAAP Net Income ($M)	$23.0	$22.2	$73.3
Net Income (Loss) ($M)	$(4.3)	$(6.5)	$33.1
Diluted EPS ($)	$(0.01)	$(0.02)	$0.10
Cash from Operations ($M)	$38.8	$49.8	$61.9
Free Cash Flow ($M)	$26.2	$42.9	$51.9

Year-over-year comparison (Q4)

Metric	Q4 2023	Q4 2024
Revenues ($M)	$419.8	$491.0
Gross Profit ($M)	$138.3	$177.6
ex‑TAC Gross Profit ($M)	$168.5	$212.7
Adjusted EBITDA ($M)	$50.1	$92.3
Non‑GAAP Net Income ($M)	$26.7	$73.3
Net Income ($M)	$0.0	$33.1
Diluted EPS ($)	$0.01	$0.10

Notes:

Management cited Q4 ex‑TAC margin of ~43% due to Yahoo test benefits and seasonality .
FY 2024 totals: Revenues $1,766.2M; ex‑TAC GP $667.5M; Adjusted EBITDA $200.9M; FCF $149.2M .

Estimate comparison

Wall Street consensus via S&P Global was unavailable due to service limits; estimate comparisons cannot be provided. Values would have been retrieved from S&P Global.

Guidance Changes

Metric	Period	Previous Guidance	Current Guidance	Change
Revenues ($M)	Q1 2025	—	$407–$427	New
Gross Profit ($M)	Q1 2025	—	$109–$115	New
ex‑TAC Gross Profit ($M)	Q1 2025	—	$142–$148	New
Adjusted EBITDA ($M)	Q1 2025	—	$22–$26	New
Non‑GAAP Net Income ($M)	Q1 2025	—	$2–$6	New
Revenues ($M)	FY 2025	—	$1,838–$1,888	New
Gross Profit ($M)	FY 2025	—	$536–$552	New
ex‑TAC Gross Profit ($M)	FY 2025	—	$674–$690	New
Adjusted EBITDA ($M)	FY 2025	—	$201–$209	New
Non‑GAAP Net Income ($M)	FY 2025	—	$122–$128	New
Free Cash Flow ($M)	FY 2024	$100M+ (earlier)	$105M+ (raised in Q3)	Raised

Management commentary: Guidance is deliberately derisked to provide flexibility to invest in Realize and regain double‑digit growth; expect ~30% Adjusted EBITDA margin .

Earnings Call Themes & Trends

Topic	Previous Mentions (Q2 2024)	Previous Mentions (Q3 2024)	Current Period (Q4 2024)	Trend
AI initiatives (Max Conversions, Abby)	Max Conversions adoption near 70%; Abby teased; focus on retention/NDR and advertiser success	Positive yield growth, Abby introduced; adoption driving campaign growth; AI central to scaling demand	Ex‑TAC margin ~43% with AI contribution; Realize leverages AI (predictive audiences, simplified creatives); Abby more central in onboarding	Uptrend
Supply partnerships (Yahoo, Apple, Microsoft)	Yahoo advertiser migration complete; Apple rolled out; expanding Microsoft bidder (Outlook, games, M365)	Positive yield after stabilizing supply; Apple advertiser counts up; Yahoo tests progressing	Yahoo test winding down; Realize accesses display/homepage/mail formats; continued engagement with Tier‑1 advertisers	Stable/positive
Demand scaling vs native	Emphasis on premium performance; Taboola Select; need to grow budgets	Need to grow advertiser budgets; yields turning positive; large brand performance	Native deemed too niche; advertisers prefer display/social creatives; Realize expands beyond native to capture budgets	Pivot
E‑commerce/ShopYourLikes	Strong quarter; creators drive social commerce; global expansion	Continued strength; retailers engaging creators; significant growth driver	Commentary on Amazon move seen as open‑web opportunity; e‑commerce demand robust	Uptrend
Macro/geopolitics (China, tariffs)	China demand doubled YoY; diversified exposure	Chinese demand strong; tariff risk limited (China business low single‑digit %; import demand at risk 1–2%)	Maintained posture; no material new macro headwinds disclosed	Stable
Buybacks/Capital allocation	$27M buybacks Q2; remaining $66M authorization	$10M Q3 buybacks; constraints due to 25% cap	Added $200M authorization; pro‑rata with Yahoo; buybacks preferred vs debt paydown; refinancing optionality	Uptrend
New KPIs disclosure	—	—	Will disclose “scaled advertisers” and ARPU per scaled advertiser to track Realize progress	New

Management Commentary

“2024 proved to be a transformative year… Today, we’re excited to announce our expansion into all performance advertising with the launch of Realize… We’ve increased our share repurchase authorization by up to $200 million” — Adam Singolda, CEO .
“For 2025, we’re guiding for 2% ex‑TAC gross profit and 2% adjusted EBITDA growth, maintaining a 30% EBITDA margin… This year is about laying the groundwork for accelerated growth ahead” — Adam Singolda .
“Realize is a major step forward… our ‘Amazon moment’… After many years of success with native ads, it's time to go after all of performance advertising” — Adam Singolda .
“Fourth quarter adjusted EBITDA was $92.3M… operating cash flow amounted to $184.3M, and free cash flow was $149.2M… net cash balance of $103.9M” — Stephen Walker, CFO .
“Board has approved incremental authority of up to $200M for our share repurchase… we will buy 75 shares from the open market and 25 from Yahoo for every 100 repurchased” — Stephen Walker .

Q&A Highlights

Realize adoption and Q1 step‑down: Guidance derisked to give Realize time; advertisers prefer high‑visibility display/email placements rather than traditional native; Yahoo tests unwinding; Q2 onward should normalize ex‑TAC margins .
Competition vs Trade Desk/Amazon: Taboola aims to be the “performance trinity” outside search/social and CTV; expects to capture budgets with CPC into display, improved transparency vs PMax, and diminishing returns on social .
Yahoo contribution and expectations: Baseline revenue is “hundreds of millions,” but advertisers didn’t grow on the rest of the network as expected; deal still “doubled EBITDA” and enables Tier‑1 dialogues; cost base monitored if Realize under‑delivers .
Capital allocation: Buybacks are #1 use of capital; pursuing refinancing to lower debt costs; Q4 buybacks averaged ~$3.57/share for 2.8M shares .
Macro risk (China tariffs): Chinese exposure low single‑digit %; import demand at risk only ~1–2% of business .

Estimates Context

Wall Street consensus via S&P Global was unavailable due to service limits; comparisons to consensus cannot be provided this quarter.
Implications: Street estimates may need to reflect FY 2025 derisked guide (ex‑TAC GP $674–$690M; Adjusted EBITDA $201–$209M) and the timing of Realize adoption; Q1 2025 guide suggests a sequential reset post‑Yahoo test unwind .

Key Takeaways for Investors

Realize broadens TAM and aligns product with large advertisers’ preferred formats (display/email/homepage), a key pivot to re‑accelerate demand; watch early KPI disclosures (scaled advertisers, ARPU) for traction signals .
Cash generation and margin discipline provide downside protection: FY FCF $149.2M, net cash ~$103.9M, with ~30% EBITDA margin targeted even as Realize investments ramp .
Buyback expansion (~$240M total authorization) is an immediate capital return lever; pro‑rata framework with Yahoo resolves the 25% cap constraint operationally .
Near term (Q1 2025): Expect margins to look unusual as Yahoo test carryover unwinds; Q2 onward should normalize; monitor ex‑TAC margins and demand KPIs for inflection .
Medium term: If Realize succeeds, advertiser budgets should migrate to Taboola’s performance platform, driving double‑digit growth potential; failure to gain traction likely prompts cost base reassessment (management indicated willingness) .
E‑commerce/social commerce trends intact; ShopYourLikes and global retail demand remain supportive of performance outcomes across open web .
AI moat via first‑party data and distribution (Apple/Yahoo/OEMs) is strategically significant; Abby/Max Conversions lower friction and support budget scaling .

Sources:

Q4 2024 8‑K and Exhibit 99.1 (press release and financials):
Q4 2024 earnings press release:
Q4 2024 earnings call transcript:
Realize platform press release:
Share repurchase press release:
Q3 2024 press release and call:
Q2 2024 press release and call:

Taboola.com Ltd. (TBLA)·Q4 2024 Earnings Summary