Perion Network Q2: Retail Media and CTV Bright Spots Amid Overall Weakness

Perion Network Ltd. PERI shares are trading lower after the company reported second-quarter FY24 results.

Revenue declined 39% Y/Y to $108.7 million, beating the consensus of $107.0 million.

Retail Media revenue rose 75% Y/Y to $17.6 million, making up 24% of Advertising Solutions revenue. CTV revenue rose 42% Y/Y to $10.2 million, accounting for 14% of Advertising Solutions revenue.

On a pro forma basis, DOOH revenue rose 41% Y/Y to $13.0 million. Also, Open Web Video revenue fell 66% YY and Search Advertising revenue decreased 57% Y/Y.

Average Daily Searches declined 43% Y/Y to 16.3 million, and the average number of Search Advertising publishers decreased by 40% to 95.

Adjusted EBITDA tumbled 81% Y/Y to $7.7 million, with adjusted EBITDA to Contribution ex-TAC contracting to 15% from 54%.

Adjusted EPS of $0.26 (-69% Y/Y) exceeded the consensus loss of $0.01.

Adjusted Free Cash Flow was negative $11.4 million vs. $47.2 million a year ago. As of June-end, cash and cash equivalents, short-term bank deposits, and marketable securities totaled $407.1 million.

As announced on April 8, Perion’s Board approved expanding its share repurchase program from $50 million to $75 million.

In the second quarter of 2024, Perion repurchased 2 million shares for approximately $20 million.

Outlook: Perion Network reiterated FY24 revenue at $490 million – $510 million, vs. consensus of $499.88 million, and adjusted EBITDA of $48 million – $52 million.

Tal Jacobson, Perion’s CEO, said, “This quarter, our technology has been extended to run on YouTube CTV, the second-largest CTV platform in the US. Perion’s ability to help brands reach valuable audiences allowed us to add world-class brands, including Walgreens, Ford, Burger King, and Direct Energy, to our customer roster.”

“The acquisition of Hivestack is already bearing fruit and aligns well with our short and long-term strategy. This quarter, the DOOH advertising technology, established through the acquisition of Hivestack in December 2023, showed significant growth of 41%.”

“I’m pleased to announce that effective August 1, 2024, our current CFO, Maoz Sigron, will be promoted to COO.”

Price Action: PERI shares are down 2.12% at $8.33 at the last check Wednesday.

Disclaimer: This content was partially produced with the help of AI tools and was reviewed and published by Benzinga editors.