• Revenue: $451 million for Q1 2025.
• Contribution ex-TAC: $264 million, with a 7% year-over-year growth at constant currency.
• Retail Media Revenue: $59 million, with an 18% growth at constant currency.
• Performance Media Revenue: $392 million, with a 4% growth at constant currency.
• Adjusted EBITDA: $92 million, up 30% year-over-year.
• Net Income: $40 million, compared to $9 million last year.
• Diluted EPS: $0.66, compared to $0.12 last year.
• Adjusted Diluted EPS: $1.10, up 38% year-over-year.
• Operating Cash Flow: $62 million.
• Free Cash Flow: $45 million.
• Total Liquidity: $810 million as of the end of March.
• Share Repurchases: $56 million deployed, including 1.5 million shares repurchased.
• Adjusted EBITDA Margin Outlook: Approximately 33% to 34% for 2025.
• Q2 2025 Contribution ex-TAC Outlook: $270 million to $278 million, down 2% to flat at constant currency.
• Q2 2025 Adjusted EBITDA Outlook: $60 million to $66 million.

• Warning! GuruFocus has detected 4 Warning Signs with CRTO.

Release Date: May 02, 2025

For the complete transcript of the earnings call, please refer to the full earnings call transcript.

Positive Points

• Criteo SA (NASDAQ:CRTO) reported solid first-quarter results with a 7% year-over-year growth in contribution ex-TAC at constant currency.
• The company activated $335 million in media spend for Retail Media, marking a 21% increase year-over-year.
• Criteo SA (NASDAQ:CRTO) has expanded its partnerships, now working with 70% of the top 30 retailers in the US.
• The company is seeing success with its AI-powered Commerce Go tool, which has increased campaign volume by 45% quarter-over-quarter.
• Criteo SA (NASDAQ:CRTO) continues to innovate with new product offerings, including on-site video and outcome-based native display, enhancing its Retail Media capabilities.

Negative Points

• A major retail media client will discontinue managed services, impacting growth rates for the Retail Media business starting in Q4 2025.
• The company faces a challenging macroeconomic environment, with softness in certain verticals like beauty and fashion.
• Criteo SA (NASDAQ:CRTO) revised its 2025 growth outlook downwards due to macroeconomic headwinds and specific client changes.
• There is a significant impact from the reduced scope of services for two major clients, expected to result in a $25 million negative impact in 2025.
• Despite strong execution, the company acknowledges that it has not yet realized its fullest potential and needs to reaccelerate growth.

Q & A Highlights

Q: Can you explain the impact of your largest retail partner pulling back and how it affects your competitive positioning in Retail Media? A: Michael Komasinski, CEO, explained that some retailers are opting to own the sales and demand front end of their Retail Media network while continuing to use Criteo's technology. This shift is not seen as a continuing trend, and the company remains confident in its competitive positioning. Sarah Glickman, CFO, added that the change involves the removal of certain services, but the long-term relationship and use of Criteo's technology by the client will continue.

Q: What macroeconomic trends did you observe in April, and how are they affecting your business? A: Sarah Glickman, CFO, noted a soft macro environment in April, with mixed performance across sectors. While travel and classifieds showed strong growth, sectors like beauty, fashion, and US retail department stores were down. Despite this, Criteo's performance business remains resilient, with no category down more than 10%.

Q: How are you managing operational expenses while still investing for growth? A: Sarah Glickman, CFO, stated that the company is focusing on a self-service platform and leveraging AI to drive efficiency. They are not halting high ROI investments but are optimizing resource allocation, particularly in hiring and operational processes, to maintain growth and profitability.

Q: Can you discuss the potential of CTV and video in your long-term strategy? A: Michael Komasinski, CEO, highlighted that CTV is the second fastest-growing area in digital advertising and offers brand-building opportunities with measurable outcomes. The company is in the early stages of assessing how CTV fits into their strategy, aiming to integrate it into a full-funnel, cross-channel approach.

Q: How do you plan to enhance your self-service tools to compete with other platforms like Google Performance Max? A: Michael Komasinski, CEO, emphasized that Criteo is on a journey to improve its self-service capabilities with the rollout of Commerce Go. The platform is designed to offer AI automation with critical parameter controls, aiming to provide transparency and differentiation in the market.

For the complete transcript of the earnings call, please refer to the full earnings call transcript.