Q1 2024 Criteo SA Earnings Call

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Operator: Good morning, and welcome to Criteo's first quarter 2024 earnings call. All participants will be in a listen-only mode. Should you need assistance, please press the star followed by the number zero on your telephone keypad. After the prepared remarks, there will be an opportunity to ask questions. To ask a question, please press star, then the number one on your telephone keypad. To withdraw your question, please press star again. Please note, this event is being recorded. I would now like to turn the conference over to Melanie Dambre, Vice President of Investor Relations. Go ahead.

Speaker Change: Good morning, and welcome to <unk> first quarter 2024 earnings call all participants will be in a listen only mode.

Should you need assistance. Please press star followed by number zero on your telephone keypad.

Speaker Change: After the prepared remarks, there will be an opportunity to ask questions to ask a question. Please press Star then the number one on your telephone keypad to withdraw your question. Please press star two.

Speaker Change: Note. This event is being recorded I would now like to turn the conference over to Melanie debris.

Melanie Dambre: Vice President of Investor Relations. Please go ahead.

Melanie Dambre: Good morning, everyone, and welcome to Criteo's first quarter 2024 earnings score. Joining us on the call today are Chief Executive Officer, Megan Clarken, and Chief Financial Officer, Sarah Glickman, who are going to share some prepared remarks, and then Chief Product Officer, Will join us for the Q&A session.

Melanie Dambre: Good morning, everyone and what it tells you create it was first quarter 'twenty 'twenty four earnings call.

Melanie Dambre: Joining us on the call today. She says they can keep I'll be sure Megan Clarken and Chief Financial Officer, I'm, sorry, I'm going to share some prepared remarks.

Melanie Dambre: That person, our chief product officer will join us, particularly in our system.

Melanie Dambre: As usual, you will find our investor presentations on our IR website now, as well as our prepared remarks and transcripts after the court. Before we get started, I would like to remind you that our remarks will include forward-looking statements which reflect Criteo's judgments, assumptions, and analysis only as of today. Our actual results may differ materially from current expectations based on a number of factors affecting Criteo's business.

Melanie Dambre: As usual I think we'd find our investor presentation on our IR website as well as our prepared remarks I Trust after the court.

Melanie Dambre: Except as required by law, we do not undertake any obligation to update any forward-looking statements discussed today. For more information, please refer to the risk factors discussed in our earnings release, as well as our most recent forms, 10-K and 10-Q, filed with the FDA. We will also discuss non-GAAP measures of our performance. Definitions and reconciliations to the most directly comparable GAAP metrics are included in our earnings release published today. Finally, unless otherwise stated, all board comparisons made during this call are against the same period in a prior year. With that, let me now hand it over to Megan. Thanks, Melanie.

Speaker Change: Before we get started I would like to remind you that our remarks will include forward looking statements, which reflect kudos judgment. Some stuff and then he says I mean, you guys up to date.

Speaker Change: Actual results may differ materially from current expectations.

Speaker Change: Just on a number of factors affecting crinone fitness.

Speaker Change: That is required by law, we do not undertake any obligation to update any forward looking statements discussed today.

Speaker Change: For more information please refer to the risk factors discussed in our earnings release as well as our luxury products.

Speaker Change: Thank you Ed and thank you find that the D S.

Speaker Change: We may also discuss non-GAAP measures of our performance definitions and reconciliations to the most directly comparable GAAP metrics are included in our earnings release published today.

Speaker Change: Finally, unless otherwise stated all growth comparisons made during this call are against the same charity to prior year.

Speaker Change: With that let me now hand, it over to me.

Megan Clarken: Thanks, Melanie, and good morning, everyone. Thank you for joining us today. We're off to a great start in 2024. We continue to transform our company into a commerce media powerhouse, and we're gaining more and more momentum. We delivered double-digit organic growth for the second consecutive quarter and achieved record top-line results in Q1, while nearly doubling our adjusted EBITDA from the same period last year. I'm very proud of the incredible work from our teams.

Speaker Change: Thanks, Melanie and good morning, everyone. Thank you for joining US today, we're off to a great start in 2024, we continue to transform our company into a commerce media powerhouse and we're gaining more and more momentum we delivered double digit organic growth for the second consecutive quarter.

Speaker Change: <unk> achieved record top line results in Q1, while nearly doubling our adjusted EBITDA for the same period last year.

Speaker Change: I'm very proud of the incredible work from our teams. These results are testament to our laser focus and steadfast execution.

Megan Clarken: These results are testament to our laser focused and steadfast execution. As we continue to make progress on our plan, we're even more excited about our future and confident that we have the right strategy to capitalize on the next wave of digital advertising and deliver value for our shareholders. We've built the only unified platform that directly connects advertisers with retailers and publishers. And we believe we've repositioned our business to be the leader, the leading ad tech player in retail media and the platform of choice for performance based advertising. Starting with Retail Media.

Speaker Change: We continue to make progress on our plan, we're even more excited about our future and confident that we have the right strategy to capitalize on the next wave of digital advertising and deliver value for our shareholders.

Speaker Change: We've built the only unified platform that directly connect advertisers with retailers and publishes.

Speaker Change: And we believe we've repositioned our business to be the leader.

Speaker Change: Leading edge chip player in retail media and the platform of choice for <unk>.

Speaker Change: Performance based advertising.

Speaker Change: Starting with retail media.

Megan Clarken: We continue to gain market share with 38% year-over-year growth and activated media spend outpacing the market. We have a leading and growing market footprint with close to 225 retailers and 2700 brands globally. This is now miles ahead of any competitor, with our scaled network of retailers becoming the obvious complement to Amazon when buying retail media. Our global presence, ability to scale quickly, our end-to-end capabilities, and simple-to-use products. AI-driven performance and world-leading sales and product expertise remain key differentiators. We continue to expand our coverage. We're delighted to have extended our partnership with Walmart Connect in Guatemala, Costa Rica, Nicaragua, Honduras, and El Salvador, further broadening our retail media presence in LATAM.

Speaker Change: We continue to gain market share with 38% year over year growth in activated media spend outpacing the market.

Speaker Change: We have a leading and growing market footprints with close to 225 retailers.

Speaker Change: 'twenty 700 brands globally.

Speaker Change: This is now malls ahead of any competitor without scaled network of retailers, becoming the obvious complement to Amazon wind buying retail media.

Speaker Change: Our global presence and ability to scale quickly now end to end capabilities simple to use products.

Speaker Change: Driven performance and world, leading sales and product expertise.

Speaker Change: They remain key differentiators.

Speaker Change: We continue to expand our coverage we are delighted to have extended our partnership with Walmart connect.

Speaker Change: Malo, Costa Rica, Nicaragua, Honduras, and El Salvador further broadening our retail media presence in Latam.

Megan Clarken: In the U.S., we're proud to add new retail partners, including a leading retail department store chain and a TV and online shopping platform. We also continue to win new retailers in APAC, including David Jones in Australia and drugstore chain Welsia in Japan. We're quickly ramping up our newly signed partnerships, including Albertsons, and expanding our reach into adjacent commerce verticals, as exemplified by the recent addition of Ticketmaster to our platform, the world's leading ticket marketplace.

Speaker Change: In the U S. We are proud to add new retail partners, including a leading retail department store chain.

Speaker Change: And a T V and online shopping platform.

Speaker Change: We also continue to win new retailers in the APAC, including David Jones in Australia.

Speaker Change: And drugstore chain will see us in Japan.

Speaker Change: We quickly ramping up our newly signed partnerships, including Elbit systems, and expanding our reach into adjacent comments there Nichols as exemplified by the recent addition of Ticketmaster to our platform.

Speaker Change: World's leading ticket marketplace.

Megan Clarken: We also look forward to expanding our partnership with Uber Eats as we work with them to go into new categories and add new ad formats. With our relentless focus on driving demand, or said differently, attracting advertising spend to our retailers' sites, our access to unique and premium retail media inventory at scale has been instrumental in achieving this. We added over 100 new brands in Q1 and saw continued strong growth through our agency partners by making retail media easily accessible to them via Commerce Map. In the U.S. alone, agency spend reached about $100 million for the first time this quarter, with 40% coming from three agency holdcosts, growing by triple digits in Q1.

Speaker Change: We also look forward to expanding our partnership with the E S.

Speaker Change: As we work with them to go into new categories.

Speaker Change: And Ed and youthful ad format.

Speaker Change: Without a relentless focus on driving demands or said differently, attracting advertising spend to a retailer's sites.

Speaker Change: Oh access to unique and premium retail media inventory at scale has been instrumental in achieving this.

Speaker Change: We added over 100, new brands in Q1 and saw continued strong growth through our agency partners by making retail media.

Speaker Change: Usually accessible to them via E Commerce Max.

Speaker Change: In the U S alone agency spend reached about $100 million first time this quarter.

Speaker Change: With 40% coming from three agency whole case growing by triple digits in Q1.

Megan Clarken: We expect sustaining momentum as our multi-year partnerships with leading agencies and brands represent hundreds of millions of dollars in spend anticipated to come through our platform in 2024 and beyond. Evidence of this can be seen with our largest brands, who are now advertising on 50% more retailer sites than they were last year. Commerce Max drives demand to both retailers' own inventory and to off-site campaigns, using retailer data assets to extend their reach across open internet inventory. Fresh Direct is one of the latest retailers to participate in off-site campaigns with our Promise Max DSP.

Speaker Change: We expect sustaining momentum as a multi year partnership partnerships with leading agencies and brands represent hundreds of millions of dollars in spend anticipated to come through our platform in 2024 and beyond.

Speaker Change: Evidence of this can be seen with our largest brands who are now advertising on 50% more retailer sites than they were last year.

Speaker Change: Okay mismatch drives demand to both retailers own inventory and to Offsite 10 times.

Speaker Change: Retirement data assets to extend their reach across the open internet inventory.

Speaker Change: Fresh direct is one of the latest retailers.

Speaker Change: Isopedin Offsite 10 times without Palm and Smacks D. S T.

Megan Clarken: Further to enabling demand through direct channels via Commerce Max, we're also focused on indirect demand channels. While still early days, opening more channels creates further opportunities to scale. Our Commerce Grid SSP gives brands a further way to access our retailer audiences. For off-site campaigns, run through third-party DSPs

Speaker Change: Further to enabling demand through direct channels by appointment as Max We're also focused on indirect.

Speaker Change: Demand channels.

Speaker Change: While still early day is opening more channels creates further opportunities to scale.

Speaker Change: Our Congress grid SSP gives brands are further way to access our reseller audiences.

For Offsite campaigns running Street's third party dst's.

Megan Clarken: This means more channels for retailers to attract additional demand and more revenue opportunities. Nobody else offers such flexibility and optionality to reach the most valuable audiences and Connect Supply So Efficiently with Demand. In advertising, results are supported by measurement. Measurement is critical to buying and selling and helping brands and agencies understand the effectiveness of their retail media spend. In February, we gained our first MRC accreditation for retail media measurement. This is an important step forward as we help to unify the ecosystem. MRC accreditation of our retail media measurement means that the data provided by Criteo is certified to the level of the currency data used in buying and selling traditional media and digital display, and therefore is comparable.

Speaker Change: This means more channels for retailers to attract additional demand and more revenue opportunities.

Speaker Change: Nobody else offers such flexibility and optionality to reach the most valuable audiences and.

Connect supply so efficiently.

Speaker Change: With demand.

In advertising results are supported by measurement.

Speaker Change: It is critical to buy.

Speaker Change: And selling and helping brands and agencies understand the effectiveness of their retail media spend.

Speaker Change: In February we get enough fish MRC accreditation for retail media measurement.

Speaker Change: This is an important step forward as we helped to unify the ecosystem.

Speaker Change: MRC accreditation of our retail media measurement means that the data provided by Chris Young.

It's certified to the level of the currency data used in buying and selling traditional media and digital display and this for is comparable.

Megan Clarken: Our measurement can be used to make decisions across platforms and media buy-in. This accreditation underscores our reliable and advanced measurement capabilities for both on-site sponsored products and On-Site Display Ads and represents a significant step forward to drive larger brand investments in retail media. We're also working with key third-party verification leaders, like Integral Ad Science and DoubleVerify, to enable viewability and invalid traffic measurements across our network of retailers. Overall, we expect significantly more dollars to continue to shift to retail media because it helps brands take advantage of retailers' increasingly valuable first-party data to connect with consumers.

Speaker Change: Our measurement can be used to make decisions across platforms and media buys.

Speaker Change: This is a credit credit types and underscores our reliable and advanced measurement capabilities.

Speaker Change: As part of <unk> sponsored products.

Speaker Change: And on site display ads.

Speaker Change: And represents a significant step toward to drive.

Speaker Change: Larger brand investments in retail media.

Speaker Change: We're also working with our key third party verification lasers like integral AD science, and Deb will verify to enable your ability and then build a traffic measurement across a network of retailers.

Speaker Change: Overall, we expect significantly more dollars to continue to shift to retail media because it helps brands take advantage of retailers increasingly valuable first party data to connect with consumers.

Megan Clarken: 83% of agencies rate the performance of retail media spend as more effective than other channels in terms of sales and tax, according to our recent ecosystem survey. Today, more than half of brands and agencies in all regions are investing in retail media, both on-site and Upside.

Speaker Change: 83% agencies right. The performance of retail media spend is more effective than other channels in terms of sales intact. According to a recent ecosystem survey.

Speaker Change: Today more than half the brands and agencies in all regions and investing in retail media.

Speaker Change: Got it.

Speaker Change: And upside.

Speaker Change: Lastly.

Megan Clarken: We remain at the forefront of retail media innovation by integrating generative AI into our global platform. We're testing sponsored ads in conversational environments as consumers increasingly use chatbots on retailer websites as part of their shopping experience. Now turning to performance media, which encompasses our targeting capability including commerce audiences and our supply and ad tech services from our IPON web acquisition. Again, this quarter, our growth was led by commerce audiences, up an impressive 54% year over year. Commerce audiences are a set of precision targeting tactics that leverage the largest commerce data set on the open internet and best in class AI to help advertisers acquire and retain customers.

Speaker Change: We remain at the forefront of retail media innovation by integrating generative AI into our global platform.

Speaker Change: We're testing sponsored ads into conversational environments as consumers progressive lay use chat bots.

Speaker Change: On retail websites as part of the shopping experience.

Speaker Change: Now turning to performance media.

Speaker Change: Which encompasses our targeting capability, including commerce audiences and our supply in the Ed Tech services for Mt. I pointed with acquisition.

Speaker Change: Again this quarter our growth was led by comments the audience is up an impressive 54% year over year.

Audiences are fits our precision targeting tech that's that.

Speaker Change: That leveraged the largest commerce dataset on the open Internet and best in class I ought to help advertisers to acquire and retain customers.

Megan Clarken: Our strong momentum is driven by the accelerated adoption of first party data driven solutions, successful cross-selling efforts, and incremental third-party demand through our Commerce Grid SSP and AI-driven performance enhancements. Firstly, we're seeing notable success with our first party data driven commerce audiences, as we captured both new budgets and budget shifts from retargeting, with privileged access to first party data. Now, various targeting tactics enable advertisers to reach relevant consumers everywhere.

Speaker Change: Our strong room in my.

Speaker Change: Mentioned is driven by the accelerated adoption of first party data driven solutions.

Speaker Change: Successful cross selling efforts.

Speaker Change: Incremental third party demand through our promise grid, it's S P.

Speaker Change: I driven performance enhancements.

Speaker Change: Firstly, we're seeing notable success without first party data driven commerce audiences as we captured by the new budgets and budget shifts from re targeting.

Speaker Change: With privileged access to first party data.

Speaker Change: Now various targeting tactics enable advertisers to reach relevant with consumers everywhere.

Megan Clarken: For example, we're activating advertisers and first-party audiences through integrations with about 40 customer data and data collaboration platforms to re-engage existing customers and turn them into loyal shoppers. Second, we're actively capitalizing on cross-selling opportunities for our clients' value, having one part- because of our clients' value, having one partner to help them engage with consumers across their buying journey. Almost all of our top clients in each region, by commerce audiences.

Speaker Change: For example, we're activating advertisers first party debt audiences through integrations with about 40 customer data and data collaboration platforms to reengage existing customers and turn them into loyal shoppers.

Second we're actively capitalizing on cross selling opportunities for our clients value, having one part because that points, Doug and having one partner that helps them engage with consumers.

Speaker Change: Their buying journey.

Speaker Change: Almost all of our top clients in each region.

Megan Clarken: In fact, 75% of our performance media revenue, excluding supply and ad tech services, comes from clients using commerce audiences in addition to retargeting. Third, we're attracting more demand for our Commerce Grid SSP. Our SFP gives agencies and brands access to our commerce audiences packaged with publisher inventory to run highly targeted campaigns through third-party DSPs, including Google's Display & Video 360. This means distribution at scale.

Speaker Change: I call mass audiences in fact, 75% about performance media revenue excluding supply in Ed Tech services.

Speaker Change: Comes from clients using commerce audiences. In addition to re targeting.

Speaker Change: This is where we're attracting more demand Barbara communist grid SSP.

Speaker Change: Now if this thing gets agencies and brands access to our comments audio that says packaged with publisher inventory turn highly targeted campaigns through third party DSP, including Google's display and video a 360.

Speaker Change: This means distribution at scale.

Megan Clarken: Finally! AI-driven performance enhancements drove an increase in Contribution X-TAC in the double-digit million range in Q1. Our cutting-edge AI is front and center, and our ability to differentiate through superior performance. Just two weeks ago, we received the 2024 SBR Technology Excellence Award in the AI Advertising category for our deep K&N technology. This acknowledges the groundbreaking innovation we're bringing to market, transforming the way marketers engage consumers through personalized and impactful advertising. In addition, retargeting remains an important tactic valued by marketers.

Speaker Change: Finally.

Speaker Change: I know I driven performance enhancements drove an increase in contribution ex Tac in.

And the double digit million range in Q1.

Speaker Change: Our cutting edge AI is front and center in our ability to differentiate through superior performance.

Speaker Change: Just two weeks ago, we've received the 'twenty 'twenty four SBR Technology Excellence Award.

Speaker Change: The advertising category for a deep Kate and in technology.

This acknowledges the groundbreaking innovation, we're bringing to market transforming the way marketers engage consumers.

Speaker Change: Through personalized and impactful advertising.

Speaker Change: In addition, re targeting remains an important tactic that you'd buy market.

Megan Clarken: Retargeting grew slightly in Q1, including the activation of META's large-scale inventory in combination with open internet inventory. We saw a meaningful increase in the number of Facebook and Instagram campaigns in Q1 compared to last quarter, and we expect continued traction as we progress through the year. This is part of our next-generation addressability strategy and is one of our addressability pillars, bringing resilience to our retargeting business going forward. As you know, people announce.

Speaker Change: Re targeting grew slightly in Q1.

Speaker Change: Including the activation of Mrs large scale inventory in combination with open Internet inventory.

Speaker Change: We saw a meaningful increase in the number of Facebook and Instagram campaigns.

Speaker Change: In Q1 compared to last quarter, and we expect continued traction as we progress through the year.

Speaker Change: This is part of our next generation of dress the ability strategy.

Speaker Change: And there's one about dress ability pillars, bringing resilience to our re targeting business going forward.

Speaker Change: Now as you know Google announced that they want to protect third party cookies until early 2025.

Megan Clarken: They won't deprecate third-party cookies until early 2025. This is just a few months' delay, and we continue to advance a comprehensive, multi-pronged addressability strategy to future-proof our clients' advertising performance. This delay means upside for our business in 2024. Regardless of any scenario, we believe our next-gen addressability strategy gives us an edge in the market. We already bring AI-driven performance to our clients in cookie-less environments today, and we continue to expand our capabilities to drive the best outcomes for our clients without third-party identifiers. Our stable testing of the Privacy Sandbox APIs involving 1% of Chrome's traffic without third-party cookies is still ongoing, and we'll report that back to the UK CMA when it is completed.

Speaker Change: This is just a few months delay and we continued to advance a comprehensive multi pronged digestibility strategy to fill.

Speaker Change: To future proof their clients advertising performance.

Speaker Change: This delay means upside to our business in 2024.

Speaker Change: Regardless of any scenario, we believe that Nextgen address the ability strategy gives us an edge in the market.

Speaker Change: We are already bringing AI driven performance to our clients and cooking live environments today, and we continue to expand our capabilities to drive the best outcomes for our clients with the outside party identifiers.

Speaker Change: Our stable testing of the privacy sandbox, a tea ice involving 1% of crumbs traffic without third party cookies is still ongoing and we'll report that back to the UK CMA when completed.

Megan Clarken: Building on our differentiation, we continue to innovate and prove that our commerce-focused AI helps advertisers engage privacy-first commerce audiences throughout each step of the consumer journey as user signals disappear, by leveraging our deep learning models at the intersection of proprietary interest groups, commerce data, and media data across retail sites, Social Media Platforms, and the Open Internet in pioneering the future of post-cookie advertising. We're confident in continuing our positive momentum, and our recently announced investor update in the fall will be an opportunity to provide a broader update on our retail media business and opportunities. Stay tuned for more details on that.

Speaker Change: Building on our differentiation, we continue to innovate and proves that our comments focused AI helps advertisers engage privacy first commerce audiences.

Throughout each step of the consumer journey is used as signals disappear.

Speaker Change: By leveraging our deep learning models at the intersection of proprietary interest groups.

Speaker Change: This data and the media data across retail sites.

Speaker Change: Media platforms.

Speaker Change: And the open internet with pioneering the future of post cookie advertising.

Speaker Change: We're confident in continuing our positive momentum and our recent recently announced an investor update and the school will be an opportunity to provide a broader update on our retail media business and the opportunities.

Speaker Change: They chose <unk> for more details on that.

Megan Clarken: To conclude, I'd like to take a moment to thank all of our shareholders for their valued feedback over the past couple of months. We remain open to and will continue to consider all opportunities to create further value for shareholders. We're confident in our business strategy and financial strength, and we are laser focused on the execution of our commerce media powerhouse vision. We believe we're best positioned to lead the market, with retail media being the fastest growing segment of advertising, and performance media bringing the most valuable commerce audiences to global advertising. With that, I'll hand the call over to Sarah, who will provide more details on our financial results and our outlook.

Speaker Change: To conclude I'd like to take a moment to thank all of our shareholders for their valued feedback over the past couple of months.

Speaker Change: We remain open and we'll continue to consider all opportunities to create further value for shareholders.

Speaker Change: Confidence in our business strategy and financial strength.

Speaker Change: And we are laser focused on execution about commerce media powerhouse vision.

Speaker Change: We believe we're best positioned to lead the market with retail media being the fastest growing segment of advertising and performance media, bringing the most valuable commerce audiences to global advertisers.

Speaker Change: With that I'll hand, the call it the stirrer, who will provide more details on our financial results and outlook Tara.

Sarah J. S. Glickman: Thank you, Megan, and good morning, everyone. Our first quarter performance reflects outstanding execution and strong cost discipline. Revenue was $450 million, and Contribution XTAC increased $254 million. This includes the year-over-year headwind from foreign currencies of $4 million.

Tara: Thank you Megan and good morning, everyone. Our first quarter performance reflects outstanding execution and strong cost discipline.

Tara: Revenue was $415 million contribution ex Tac increased $254 million. This includes a year over year headwind from foreign currency of $4 million.

Sarah J. S. Glickman: At constant currency, Q1, contribution x-tax grew by 17% sequentially compared to a growth of 10% in Q4, with strong performance across the board. As part of our transformation, we continue to shift and rebalance our top line mix, and our new solutions represented slightly more than half of our business in Q1. Client retention remains high at close to 90%, and about 40% of our clients are using more than one of our solutions.

Tara: At constant currency Q1 contribution ex Tac grew by 17% up sequentially compared to a growth of 10% in Q4 with strong performance across the board.

Tara: As part of our transformation, we continue to shift and rebalance our topline mix and all the new solutions represented slightly more than half the boat business in Q1.

Tara: Client retention remains high at close to 90% and about 40% of all clients are using more than one of our solution.

Sarah J. S. Glickman: Clients who engage with multiple products, more typically our largest clients, have a seven times higher customer lifetime value than those who only use one product. As previously communicated, we updated our segment reporting structure beginning in Q1 2024, and we now have two segments: Retail Media and Performance Media.

Tara: Clients to engage with multiple product well typically our largest clients have a stephanie times higher customer lifetime value and those who only use one product.

As previously communicated we updated our segment reporting structure beginning in Q1, 'twenty 'twenty four and we now have two segments.

Tara: Retail media.

Tara: And performance media.

Sarah J. S. Glickman: Both segments delivered strong growth in Q1. Our Retail Media segment encompasses revenue generated from brands, agencies, and retailers for the purchase and sale of retail media inventory, audiences, and services. Our performance media segment encompasses revenue generated from our targeting capabilities and supply, as well as our taxes. Starting with retail media, revenue was $51 million, and contribution XTAC grew 34% at constant currency to $50 million. Our growth is primarily driven by our client base in the US, Germany, and the UK and our retail marketplace.

Tara: Both segments delivered strong growth in Q1.

Tara: Our retail media segment encompasses revenue generated from brands and agencies and we tell you that the purchase and sale of retail media inventory audiences and services.

Tara: Our performance media segment encompasses revenue generated from our targeting capabilities and supply in Texas.

Tara: Starting with retail media revenue was $51 million and contribution ex Tac could do that.

Tara: T, 4% at constant currency to $50 million.

Tara: Growth was primarily driven by our private banks in the U S, Germany, and the U K and a retailer marketplaces.

Sarah J. S. Glickman: We benefited from the contribution of newly-signed retailers, and growth from existing clients remained strong, with same retailer contribution XTAC retention at 136%. During the first quarter, we also benefited from new licensing and service fees with our largest retail clients while they started to transition to their direct sales model and an earlier Easter compared to last year. It's important to highlight that we benefit from a robust and expanding base of clients in retail media and that we continue to experience strong client retention.

Tara: We benefited from the contribution of new he sized retailers and growth from existing clients remained strong with same retailer contribution ex Tac retention as 136%.

Tara: During the third quarter, we also benefited from new licensing and service fees with our largest retail client or are they starting to transition to that direct sales model.

Tara: And although he had easter compared to last year.

Tara: It's important to highlight that we benefit from a robust and expanding base of clients in retail media and that we continue to experience strong client retention.

Sarah J. S. Glickman: Many of our retailer partners, including our largest client, have been successfully growing with us for many years. At the same time, we have been expanding our client roster, and we are seeing growth in every annual retailer cohort. Notably, in our recent cohort, contribution x-tax for our retailers in their second year doubled, doubled year-over-year in Q1, and our cohort of retailers in their third year grew over 50% in the same period. Remember, this growth comes from retailers already selling directly to their largest brands, which we call Retailer Sold Demand.

Tara: Many of our retailer partners, including our largest client I think successfully growing with us for many years at the same time, we've been expanding our client roster and we are seeing growth at every annual we take a poll.

Tara: Notably in our recent cohorts.

Tara: Integration X test for all retailers in that second year doubled.

Tara: Double with you I think you have in Q1, and all capable of retailers in their third year grew over 50% in the same period.

Tara: This growth comes from retailers already sending directly to the largest brands, which we call retailer demand.

Sarah J. S. Glickman: On the demand side, we continue to see significant expansion with CPG brands, and we have onboarded 100 brands again this quarter. We have momentum with our client partners, and we are pleased to see our 2,700 global brands prioritize retail media as a key channel for their investment. This is a trend we expect to continue as first-party data becomes increasingly valuable and brands are looking to reach large global audiences of shoppers.

Tara: On the demand side, we continue to see significant expansion with CPG brands.

Tara: We have on boarded 100 brands getting this quarter.

Tara: We have momentum with our pilot partners and we are pleased to say up 27 countries global brands prioritize retail media is a key channels for their investments.

Tara: This is a trend we expect to continue that's first party data becomes increasingly valuable I'm, Brian said looking to reach knowledge global audiences of shoppers.

Sarah J. S. Glickman: In performance media, revenue was $399 million, and contribution ex-tac was $204 million, up 13% at constant currency. Again this quarter, we saw impressive growth in commerce audiences targeting, up 54% year-on-year and representing 20% of our overall contribution ex-tac as we leverage our large-scale commerce data and A-hour powered audience modeling technology to find in-market shoppers. Retargeting was up 4%, and supply in our tech services was up 8%. We benefited from our latest AI-driven performance optimization.

Tara: In performance media revenue was $399 million contribution ex Tac was $204 million up.

Tara: 13% at constant currency.

Tara: Again this quarter, we saw impressive growth in e-commerce audience, you're targeting up 54% year on year, I'm, representing 20% of our overall contribution ex Tac as we left which are large scale commerce data and eight hour powered Odeon smoking technology to find any.

Tara: Market shoppers.

Tara: We targeting was up 4% and supplying that Texas was up 8%.

Tara: We benefited from our latest AI driven performance optimization.

Sarah J. S. Glickman: Our platform is built on best-in-class AI, and our Criteo AI lab has 140 R&D and product experts who drive continuous innovation to deliver unparalleled performance for our clients. We deliver solid growth across all regions and have tailwings in all our verticals. Travel remains robust, and we saw improving retail and classified trends compared to last quarter.

Tara: Platform, that's still our best in class a high and all courteous.

Tara: <unk> hundred 40, <unk>, R&D and product experts, who drive continuous innovation deliver unparalleled performance for our clients.

Tara: We delivered solid growth across all regions and has tailwind in all our verticals.

Tara: [laughter] remains robust and we saw improving return classified trends compared to last quarter.

Sarah J. S. Glickman: We delivered a JTB of $71 million in Q1 2024, up 83% year-over-year, largely driven by operational leverage from top-line growth and cost discipline. Non-GAAP operating expenses were flat year over year, reflecting continued rigor on resource allocation. We invest in our growth areas and enable our transformation through realigning our organization and optimizing our operating model to enable scale and operational efficiency. We continue to streamline our processes to work better and faster, and we continue to enable efficiency by investing in AI-driven tools this year.

Tara: We delivered adjusted EBITDA of 71 million told us in Q1, 'twenty 'twenty four.

Tara: 83% year over year, largely driven by operational leverage from topline growth and cost discipline.

Tara: non-GAAP operating expenses were flat year over year reflected continued rigor on resource allocation.

Tara: We invest in our growth areas and enable our transformation through realigning our organization and optimizing our operating model to enable scale and operational efficiency.

Tara: We continue to streamline our processes to work so I'm foster and we continue to enable efficiency by investing in AI driven tools this year.

Sarah J. S. Glickman: Moving down the P&L, depreciation and amortization decreased by 2% in Q1 2024 to $25 million. Share-based compensation expense was $27 million, including $10 million related to shares granted to iPornweb's founder as part of the acquisition. Our income from operations was $10 million, and our net income was $9 million in Q1 2024. Our weighted average diluted share count was 59.3 million, which resulted in diluted earnings per share of 12 cents. Our adjusted diluted EPS was $0.80 in Q1 2024, up 60% year-over-year.

Tara: Moving down the P&L depreciation and amortization decreased by 2% in Q1, 2000 $24 million to $25 million.

Tara: Share based compensation expense was $27 million, including $10 million related to shares granted to I put words bounds as part of the acquisition.

Tara: Our income from operations was $10 million and our net income was $9 million in Q1, 'twenty 'twenty four.

Tara: Our weighted average diluted share count was $59 3 million, which resulted in diluted earnings per share of 12 states.

Tara: Our adjusted diluted EPS was <unk> 86 in Q1, 'twenty 'twenty four up 60% year over year.

Sarah J. S. Glickman: We continue to benefit from a strong financial position and robust balance sheet with solid cash generation and no long-term debt. We had about $805 million in total liquidity at the end of March, which gives us significant financial flexibility to execute our growth strategy and discipline and balance capital allocation. As expected, operating cash flow was $40 million, and free cash flow was $1 million in Q1, reflecting seasonality and lower capex. Our priorities are to invest in high ROI organic investments and value-enhancing acquisitions and to return capital to shareholders via our Share Buy Back program.

Tara: He continued to benefit from a strong financial position and robust balance sheet with solid cash generation and no long term debt.

Tara: We had about $805 million in total liquidity at the end of March which gives us significant financial flexibility to execute our growth strategy and disciplined and balanced capital allocation.

Tara: As expected operating cash flow was $14 million and free cash flow with a million dollars in Q1, reflecting seasonality and lower capex.

Tara: Our priorities are to invest in high ROI organic investments.

Tara: Value enhancing acquisitions and to return capital to shareholders via a share buyback program.

Sarah J. S. Glickman: We are confident in our business strategy, and we are committed to driving shareholder value. We have a longstanding track record of returning significant capital to shareholders and intend to repurchase $150 million of stock in 2024, including 62 million already deployed in Q1. This includes 2 million shares repurchased at an average cost of $31.10 per share, and we also cancelled 2 million shares in early Q2.

Tara: We are confident in our business strategy and we are committed to driving shareholder value.

Tara: We have a long standing track record of returning significant capital to shareholders and intend to repurchase a hunger and a $15 million of Stoke in 'twenty 'twenty four.

Including 62 million already deployed in Q1.

Tara: This includes 2 million shares repurchased at an average cost of $31.10 per share and we also cancelled 2 million shares in early Q2.

Sarah J. S. Glickman: Turning to our financial outlook, we have updated our guidance for the year based on

Tara: Turning to our financial outlook, we have updated outside of city, yet based on our expectations as of today makes that kind of 'twenty 'twenty four.

Sarah J. S. Glickman: for the year based on our expectations as of today, May 2nd, 2024. For 2024, we now expect Contribution XTAC to grow high single digits year over year at constant currency with growth in both segments. This is an acceleration compared to our organic growth of 4% in 2023. Our updated four-year guidance reflects our Q1 outperformance and Google's delay of third-party deprecation until early next year. As a reminder, comparisons to the prior year become tougher as we progress through the year.

Tara: The 'twenty 'twenty four we now expect contribution ex Tac to grow high single digits year over year at constant currency with growth in both segments.

Tara: This is an acceleration compared to our organic growth of 4% in 2023.

Tara: Our updated full year guidance reflects our Q1 outperformance and Google's Tonight.

Tara: Hershey deprecation until early next year.

Tara: As a reminder, comparisons to the prior year become tougher as we progressed through the year.

Sarah J. S. Glickman: In retail media, while we are still early in the year, given our Q1 performance, we are confident in our ability to deliver contribution x-tax of 20% and constant currency in 2024. This is from a scaled $200 million revenue base and with the impact of our largest client transitioning demand for large brands to a direct sales model, as previously communicated. As a reminder, we also have tougher comparisons for Q3 and Q4, with Q4 being our largest quarter.

Tara: In retail media, while we are still early in the year given our Q1 performance. We are confident in our ability to deliver contribution ex tax of 20% in constant currency in 2020 full.

Tara: This is from a scaled 200 million dollar revenue base and with the impact of our largest client transitioning demand the large brands to a direct sales model as previously communicated.

Tara: As a reminder, we also have tougher comparisons.

Tara: Harrison for Q3, and Q4 with Q4 being our largest quarter.

Sarah J. S. Glickman: Importantly, we continue to expect our activated media spend to grow above 30% year over year, faster than GroupM's estimated market growth of 12%, as we anticipate sustained momentum across our client base and future share gains. In the fall, we intend to provide an update on the exciting opportunities we believe we have to drive profitable growth and enhance our position as the leading retail media ad tech provider. In performance media, given our strong performance in Q1, we now expect to grow mid to high single digits in 2024. Our outlook assumes no material signal loss impact this year.

Tara: Importantly, we continue to expect our activated media spend to grow at a 30% year over year, Boston Group had its estimated market growth of 12% as we anticipate sustained momentum across our client base and future.

Tara: Share gains.

Tara: In the fall, we intend to provide an update on the exciting opportunities. We believe we have to drive profitable growth and enhance our position as the leading retail media AD tech provider.

Tara: And performance media given our strong performance in Q1, we now expect to grow mid to high single digits in 2024.

Tara: Our outlook assumes no material loss impact this year.

Sarah J. S. Glickman: We now anticipate an adjusted EBITDA margin of approximately 31% for 2024. This reflects our operational leverage and the transformation and optimization of our operating model while investing in areas of growth. For 2024, we now expect a normalized tax rate of 26% to 30%. We expect CAPEX to be slightly below $100 million, and we expect the free cash flow conversion rate to be about 45% of adjusted EBITDA before any non-recurring items. So in Q2 2024, we expect contribution XTAC of $261 million to $265 million, growing by 10 to 12% at constant currency. We estimate four exchanges to drive a negative year-over-year impact of about $2 to $4 million on contribution XCAT and Q2.

Tara: We now anticipate an adjusted EBITDA margin of approximately 31% to 2024. This reflects the operational leverage and the transformation and optimization of our operating model, while investing in areas of growth.

Tara: But twice 24, we now expect a normalized tax rate of 26% to 30%, we expect capex to be slightly below $100 million and we expect free cash flow conversion rate at about 45% of adjusted EBITDA before any non recurring items.

Tara: The Q2, 'twenty 'twenty four we expect contribution ex Tac of $261 million to $265 million growing by 10% to 12% at constant currency.

Tara: We estimate Forex changes to drive a negative year over year impact of about $2 million to $4 million on contribution ex Tac in Q2.

Sarah J. S. Glickman: We expect adjusted EBITDAs between $70 million and $74 million, reflecting year-over-year margin improvements in a seasonally low quarter. In closing, we have strong conviction in our strategy and business model. We are well positioned for continued success, and we are committed to maximizing shareholder value. The future is wide open for Criteo. And with that, I'll turn it over to the operator to begin the Q&A session.

Tara: We expect adjusted EBITDA of between 17 million and $74 million, reflecting year over year margin improvement in a seasonally low quarter.

Tara: In closing we have strong conviction in our strategy and business model. We are well positioned for continued success and we are committed to maximizing shareholder value.

Tara: The future is wide open for Korea.

Speaker Change: And with that I'll turn it over to the operator to begin the Q&A session.

Tara: Yeah.

Operator: Thank you. Ladies and gentlemen, we will now begin the question and answer session. To ask a question, please press star and then the number 1 on your telephone keypad. If you are using a speakerphone, please pick up your handset before pressing any key. To withdraw your question, please press star, then the number 2. At this time, we will pause to assemble our roster. The first question comes from the line of Mark Zgutowicz from Benchmark Company. Your line is now open.

Operator: Thank you Lee.

Operator: And gentlemen, we will now begin to quit a question and answer session will take.

Speaker Change: So ask a question. Please press Star then the number one on your telephone keypad, if youre using a speakerphone. Please pick up your handset before pressing any quiche to withdraw your question. Please press Star then the number two at this time, we will pause to assemble our roster.

Speaker Change: The first question comes from the line of Mark Rich from Benchmark Company. Your line is now open.

Megan Clarken: Thank you. A couple of questions. I was curious how much cookie deprecation being pushed into 25 is impacting your annual guidance and if you could possibly break out the benefit that you anticipate from retargeting this year and perhaps maybe offset the commerce audiences. And then, you know, perhaps a question for Todd, based on what you perceive the CMA is looking for, just curious how you would handicap the timing of 25 deprecation in terms of the first quarter versus the second quarter of next year, even the second half.

Mark Rich: Thank you a couple of questions I was curious how much.

Mark Rich: Much cookie deprecation being pushed into 'twenty five is impacting your annual guide.

Mark Rich: Guidance and if you could possibly break out the benefit that you anticipate.

Mark Rich: From re targeting this year, perhaps maybe offset the commerce audiences.

Mark Rich: And then.

Mark Rich: Perhaps a question for Todd based on what you perceive the CMA is looking for just curious how you would handicap the timing of twenty-five deprecation.

Mark Rich: In terms of the first quarter versus second quarter of next year or even the second half.

Sarah J. S. Glickman: Actually, let me just start. Mark, it's good to hear from you. Great questions. They're top of mind at the moment. I just want to say that we do see a benefit from cookie deprecation being pushed out to 24. And I'll get Sarah to talk about what that looks like for us as much as she can going into next year. But what I think Todd will also talk about is the work that we've been doing to leapfrog having to use third-party cookies or using third-party cookies in our retargeting business through the work that he's doing with Next Generation, the Next Generation model here.

Todd: Well actually let me just start my I'm good to hear from you and great questions sort of top of mind at the moment I just want to say that we we do see a benefit from cookie deprecation being pushed out to 'twenty four.

Todd: And I don't get Sarah to talk to what that looks like for us as much as you can.

Todd: Going into next year.

Todd: But what I think Todd little so talk to us the work that we've been doing to leapfrog are having to use third party cookies or using third party cookies and a re targeting business.

Todd: Through the work that he's doing with next generation.

Todd: He.

Sarah J. S. Glickman: The longer this goes on, the further we get traction on that Next Generation model. The longer this goes on, the smaller the impact is on Criteo's overall portfolio because the retargeting business, as compared to the high growth areas, gets less, gets smaller. So I'll sort of start framing that, and then I'll pass it across to Todd. Sarah, do you want to talk about the goals first? Yeah. Hi Mark.

Todd: The next generation model here the longer this goes out on the further we get traction on that next generation model the longer this goes on.

Todd: The smaller the impact is on a pretty outside of our overall portfolio because either re targeting business as compared to the high growth areas gets it gets a.

Todd: Less gets smaller.

Speaker Change: So I'll sort of start of framing that and and then I'll pass it across to trial on lung.

Speaker Change: Sarah units with their own says yeah, Hi, Mark.

Sarah: First of all in terms of the delay of the privacy sandbox for.

Sarah J. S. Glickman: First of all, in terms of the delay in the privacy sandbox, for 2024, you could model assuming about $35 million of impact. We had previously communicated $30 to $40 million of impact in 2024. In terms of next year's impact, kind of similar modeling to what we've said before, which is that retargeting is now less than 50% of our overall CXT. Chrome is... approximately 50% of that.

Sarah: The 'twenty 'twenty four.

Sarah: You could model, assuming about $35 million of impact we had previously communicated.

Sarah: $8 million to $40 million impact in 2024.

Sarah: In terms of next year's impact kind of similar modeling to what we've said before which is the be targeting is now less than 50% of our road rules CX T. A crowd of them is.

Sarah J. S. Glickman: Our assumption today, which could obviously get better, is that we'd retain about 60% of that. But overall, we would have about a 10% impact on overall CXTs, depending on and how the signal loss takes place next year. In terms of retargeting for the year, I mean, as you know, it's a very effective, resilient tactic that's loved by our clients. So we were very pleased to see the growth in Q1. We have benefited from two things.

Sarah: Approximately 50% of that our assumption today, obviously could get better.

Sarah: Is it going to retain about 60% of that but overall wage we would have about 10% impact to those little CX takes them depending on how the signal loss take somebody that's just.

Sarah: In terms of we targeting for the year.

Sarah: I mean as you know, it's a very effective resilient.

Sarah: That's loved by our clients, but we were very pleased to see the growth in Q1, we have benefited from two things first of all.

Sarah J. S. Glickman: First of all, the AI and continued enhancement in AI. And secondly, the extension with matter that we have on retargeting. So we would assume that given there's no PFB impact and the continued AI performance that we're seeing, that retargeting would remain resilient. And just to clarify, the 10% would be of CXT for 2025 impact, if you're thinking for modeling purposes.

Sarah: And your life and continued enhancements in AI and secondly, the extension with methods that we have always targeting.

Sarah: So we would assume that given there's no <unk> impact and the continued de Oh, yeah performance that we're seeing that we're targeting with when they are resilient and just to clarify the 10% would be a CX T.

Sarah: For 2025 impact if you're thinking the model of Cups.

Todd Parsons: I can jump in on the last part, Mark. How are you?

Speaker Change: I can jump in on the last part Mark how are you.

Mark Rich: I think there's two dimensions that are important to point out as we look at the delay and.

Todd Parsons: I think there are two dimensions that are important to point out as we look at the delay. The first is really, you know, the benefit of industry readiness as it relates to the delay. Obviously, more participants across the industry make for more trading in a functioning market on the supply between the supply and demand sides.

Speaker Change: The first is really.

Speaker Change: The benefit of industry readiness as it relates to the delay I'm, obviously more participants across the industry.

Speaker Change: It makes for more trading in a functioning market on the supply between the supply and demand sides, and we see that as as upside for.

Todd Parsons: We see that as an upside for Criteo. The second thing is, of course, the additional time for us helps us focus our performance pipeline, which was, you know, entirely built around Privacy Sandbox or a new pipeline, I should say, was built around Privacy Sandbox. It affords us time to continue to develop and innovate that, which is very much in our control. So, there are two things that we look at as positives with the delay out into the beginning of the year.

Speaker Change: For cardio.

Speaker Change: The second thing is of course, the additional time for us and helps us focus our performance pipeline, which was.

Speaker Change: You know entirely built around privacy sandbox or a new pipeline I should say was built around privacy sandbox. It affords us time to continue to develop and innovate that which is very much in our control. So there too.

Speaker Change: Things that we look at it as positives with the delay out into the beginning of the year in terms of handicapping anything further we don't we're prepared for any scenario and as Megan pointed out.

Todd Parsons: In terms of handicapping anything further, we don't. We're prepared for any scenario. And as Megan pointed out, because we've been planning for Privacy Sandbox for over two years and developing on it, and because we have a multi-pronged strategy for post-cookie addressability, you know, we're prepared for anything, and we're well ahead. So, it is time. We'll take it and do what we can with it, but we're happy to see the way things are unfolding currently.

Speaker Change: Because we've been planning for privacy sandbox for over two years and developing on it and because we have a multi pronged strategy proposed cookie addressable <unk>.

Speaker Change: We're prepared for anything and we're well ahead. So time is time, we'll take and do what we can with it.

Speaker Change: But we're happy to see the way things are unfolding currently.

Operator: Excellent. Thank you all. I appreciate it. Your next question comes from the line of Tim Nollen from Macquarie. Your line is now open. All right, thanks. I'd just like to pick up on retargeting.

Speaker Change: Excellent. Thank you all appreciate it.

Speaker Change: Okay.

Speaker Change: Right.

Operator: Your next question comes from the line of Tim Nollen from Macquarie. Your line is now open. All right, thanks. I'd just like to pick up on

Speaker Change: Your next question comes from the line of Tim Nolan from Macquarie. Your line is now open.

Timothy Wilson Nollen: Alright, Thanks, I'd, just like to pick up on the re targeting line.

Timothy Wilson Nollen: I know its obviously your most important business line anymore and that's great.

Timothy Wilson Nollen: But if I look back and if I have my numbers right. This is the first time. It was in positive growth since Q3 of 'twenty. One I think I just want if you could give a bit more color as to why that swung.

Timothy Wilson Nollen: So nicely positive in the quarter.

Megan Clarken: Let me just say it's always been an important product in our portfolio because it addresses the need of advertisers, who are wanting to reach the same consumer multiple times to get their attention. And so we continue to see advertisers coming to us for that tactic and retargeting. So, you know, we're delighted to see the turnaround there.

Speaker Change: Well, let me just it's important to know it's always been an important hum.

Speaker Change: Product in our portfolio because it addresses a native advertisers.

Speaker Change: We're wanting to reach the same consumer multiple times to get their attention and and so we continue to see advertisers coming to us for that tactic and re targeting so we're delighted to see the turnaround there and it's been you know based on a whole bunch of work.

Megan Clarken: And it's been based on a whole bunch of work that's gone into the product itself, whether that be using AI technology for performance or activity that's going on to help advertisers use the right tactic and get access to their ad spends to move it between retargeting and commerce audiences in order for them to get the right results. And so the sort of combination of focusing in on it because it is needed and will always be by marketers has sort of led to some green sheets for us, and we're thrilled by that.

Speaker Change: Work, that's gone into them into the product itself, whether that be using the AI technology for performance.

Speaker Change: That's been extending out into points environments.

Speaker Change: In the case of right now the Mets or environment, where we see an uptick.

Speaker Change: And that's sort of power of this.

Speaker Change: Cross sale.

Speaker Change: Activity, that's going on to help advertisers use the right tactic and get access to their AD spends to move between re targeting and commerce audiences in order for them to get the right results.

Speaker Change: And so there's sort of a combination of focusing in on that because it is needed and will always be by market is has sort of led to some green shoots for us and we're thrilled by that.

Sarah J. S. Glickman: Yeah, let me just add that it helps that we don't have the impact of signal loss, and we're able to use our AI to go and enhance our clients' experiences and get higher ROAS. So last year, Q1, Q2, we had signal loss of about $4 million per quarter. Q1, Q2, 23. And obviously, in 2022, we had an incremental signal loss of about $60 million. So the teams are able to just really take that AI to a different level, to not only refine the signal, but to use the multi-pronged approach to address addressability, and then to continue to extend that signal.

Speaker Change: Uh huh.

Speaker Change: Got anything else, but yeah, let me just add it helps that we read.

Speaker Change: We don't have the impact of the signal loss and we were able to use our AI to go in and enhance our clients' experiences and get high Umbro as so our last year Q1, Q2, we had signaled last year about $4 million per quarter, Q1, Q2, 'twenty three and obviously in 2022, we had an incremental signals.

Speaker Change: $60 million so.

Speaker Change: Teams are able to just really take that to a different level.

Speaker Change: Not only re refined state military use the multi pronged approach to to to address address ability and then to continue to extend that signals. So it's oh well.

Sarah J. S. Glickman: So we're very happy with retargeting. Also, just to add, and as we said, most of our clients, about 75% of our CXT for performance media are clients that are using both retargeting and commerce audience, and interplay between those. And our AI technology also ensures that we optimize the way that we're using their budgets to do both. And that's been a strong performance indicator for performance media overall, but for retargeting and for commerce audiences, so we are seeing more budgets coming in.

Speaker Change: We're very happy with the with the re targeting and also just to add on and as we said we talk at most of our play is about 75% of our CX taper performance media.

Speaker Change: Clients are using both retail team commerce audience and into place between those and our AI technology also ensures that we optimize the way that we're using that budgets to do part of it and that's been offset a strong stone performance indicator for what's media overall.

Speaker Change: We'll be targeting and Tacoma, Sony is going to be I'll say more budgets coming in.

Speaker Change: Great. Thanks for the color. Thanks.

Speaker Change: Yeah.

Speaker Change: Okay.

Operator: Your next question comes from the line of Ygal Arounian from Citigroup. Your line is now open.

Speaker Change: Your next question comes from the line of Eagle Runion from Citigroup. Your line is now open.

Megan Clarken: Hey, good morning, everyone. It's certainly nice to see strength coming across all three lines here. I guess now two segments, but really all three business lines. I guess with the questions on retargeting commerce audiences, I'll focus on retail media for a bit. Maybe specifically on the agency side, because it seems like you're gaining more traction there. It sounds like that's coming at least a bit off the back of Commerce Max, and you mentioned all the new CPG brands that are coming on board as well.

Eagle Runion: Hey, good morning, everyone.

Eagle Runion: Certainly nice to see strength coming across.

Eagle Runion: All three all three lines here I guess now two segments, but really all three business lines.

Eagle Runion: I guess, what the question is on re targeting commerce audiences will focus on.

Speaker Change: He told me here for a bit.

Speaker Change: Maybe specifically on the agency side, because it seems like you're gaining more traction there it sounds like that's coming at least a bit off the off the back of Commerce, Max and you mentioned all the newsfeed CPG brands that are coming onboard as well can you just.

Megan Clarken: Can you just elaborate on the agency channel, you know, where we are with that opportunity, and if you can point to how much of the growth is coming from there directly? Just what else we can understand from there.

Speaker Change: Elaborate on on the agents the agency channel.

Speaker Change: Where we are with that opportunity and if.

Speaker Change: If you can point to how much of the growth is coming from there directly just what else we can understand from there.

Megan Clarken: Yeah, I'll start. Sarah can talk about the growth. Look, agencies have access to national media budgets, as you know, and so the unlock, I guess, for retail media is the flow of those national media budgets into retail media, meaning that most of the dollars, and I don't want to, you all know this, but I'll repeat it, most of the dollars in retail media are coming from trade marketing budgets, budgets that are spent on advertising in-store, and that's unique to retail media because clearly those budgets don't flow across into other media, but the unlock is when retail media gets access to the national media budgets that are coming through the agencies, the brands to agencies, and then into media.

Speaker Change: Yeah I'll start.

Speaker Change: Eric I'm talking about the the growth.

Speaker Change: Look.

Speaker Change: You can see have access to national media budget as you know and.

Speaker Change: And so the the analogue I guess for retail media is the flow of those national media budgets into retail media.

Speaker Change: Meaning that most of the dollars and I don't Wanna, you will know this but I'll repeat it in or most of the dollars in retail media are coming through trade marketing budget budgets that are spent on advertising in store.

Speaker Change: And that's unique to retail media because lately those budgets don't fly with cross sell to other other.

Speaker Change: Media, but the unlock has waned retail media gets access to the national market.

Speaker Change: National media budgets that are coming through the three of the agencies the brands to agencies and then into media.

Megan Clarken: And it was really interesting, you know, listening to the dialogue at shop talk this year about how many retailers and brands are trying to work out how to unlock it. Now, you'd think that was crazy because brands are the key to it, but brands are actually leaning in. They are looking for a more holistic spend. They're looking for an easier way to spend their advertising dollars and not have to decide between trade marketing and the national media budget.

Speaker Change: And.

Speaker Change: It was really interesting.

Speaker Change: Turning to the dialog at Shoptalk this year about how many.

Speaker Change: Retailers and brands are trying to work out how to unlock now you'd think that was crazy because brands are the key to it but brands are actually leaning in they are looking for more holistic spend theyre looking for an easier way to place their advertising dollars.

Speaker Change: And not have to decide between <unk>.

Speaker Change: Marketing and in the National media budgets.

Megan Clarken: So, you know, as that unlocks, then we see more and more and more flow through the agencies. And the second part of it, of course, is to make it easy for the agencies to make those choices by giving them a platform that's easy to use and a platform that gives them access to the number of retailers that we have in the network to be able to spend those national media budgets. And then the third part of that I alluded to on the call was the power of measurement is to be able to unlock that measurement for agencies to be able to prove the success of it and compare it to the other mediums that they're placing their advertising dollars across. So all of these things, these moving parts are powerful moving parts, which ultimately are just driving, you know, more and more money into retail media. It is still early days.

Speaker Change: So you know as that unlocks then we see more and more and more flow through the agencies.

Speaker Change: And the second part of it of course is to make it easy for the agencies to make those choices by giving them a platform that's easy to use and apply.

Speaker Change: For them that gives them access to the amount of retailers that we have in the network to be able to spend those national media budgets and then the third part of that I alluded to on the call was the power of measurement.

Speaker Change: Is to be able to unlock that measurement for agencies to be able to prove the success of it and compare it to the other mediums that their pricing their advertising dollars across so all of these things. These moving parts are powerful and leaving pods, which ultimately just driving more and more on la Quinta retail media.

Sarah J. S. Glickman: And so we see our relationships with agencies being incredibly powerful and exactly where we want them to be right now. And just a reminder, the three holdcos grew triple digits. So in terms of just the take-up of the agency by the brands, we are seeing that traction, and we expect that to continue. So we have signed contracts with all the key holdcos, and not just in the U.S. but globally. And obviously, that's a huge part of our strategy.

Speaker Change: Here. It is still early days and so we see our relationship and our relationships with agency, it's been incredibly powerful.

Speaker Change: And and exactly where we want them to be right now.

Speaker Change: And just a reminder, the three pretty Hell cause grew double.

Speaker Change: Triple digits. So in terms of just the take up of the agencies with the brands.

Speaker Change: We are seeing that traction and we expect that to continue so we have signed contracts with all the key key health coaches and not.

Speaker Change: Not just in the U S, but globally and all of them.

Speaker Change: That's a huge protocol strategy.

Operator: Thank you. And then there is just one broader question. Yeah, as we get through earnings here, this really seems like one of the strongest ad markets we've seen in quite some time. Pretty much everyone we've been paying attention to is, You know, maybe just more broadly, are you seeing things improve? What's the tone you're hearing from advertisers and anything else to help paint the picture there? Thanks. Yeah, I mean, we saw traction coming from Q4, which obviously was a very

Speaker Change: Thank you and then just a broader question.

Speaker Change: But as we get through earnings here. This really seems like one of the strongest AD markets. We've seen in quite some time, but pretty much everyone. We've been paying attention to is.

Speaker Change: Reported results.

Speaker Change: Head of expectations can you just public.

Speaker Change: Help us characterize what youre seeing from from the AD market I know sorry, you gave some color but.

Speaker Change: Maybe just more broadly are you seeing things improve.

Speaker Change: What are the what's the tone you're hearing from advertisers.

Speaker Change: The paint the picture there thanks.

Sarah J. S. Glickman: Yeah, I mean, we saw traction coming from Q4, which obviously was a very healthy quarter coming into Q1. So I would say, you know, we're seeing that kind of continue. Robust demand, if you will. We're also seeing, especially if you look year-on-year, big changes in terms of retail, especially department stores, fashion, travel continues to be robust, and classified. So we are seeing across the board that the market we're in today, which is similar to the market we were seeing in Q4, is continuing versus Q1 last year, which was obviously a low watermark for the spend.

Speaker Change: Yeah, I mean, we saw traction coming from Q4, which obviously was a very healthy quarter coming into Q1. So I would say you know we're seeing that kind of continued.

Speaker Change: Robust demand if you will we're also seeing especially if you look year on year, a big changes in terms of the retail, especially department stores fashion.

Speaker Change: Travel continues to be robust classified so we are seeing across the board the market. We're in today, which is similar to the market real estate in Q4 is continuing versus Q1 last year, which is obviously a low watermark for up to the spend.

Speaker Change: Great. Thanks, so much.

Operator: Your next question comes from the line of Mark Kelley. Your line is now open.

Speaker Change: Your next question comes from the line of Mark Kelly.

Mark Patrick Kelley: It is now open.

Operator: Great, thank you. Good morning.

Mark Patrick Kelley: Great. Thank you good morning.

Operator: My first question is, um..., on the competitive dynamics in retail media, especially on the supply side. Curious to get your thoughts there if anything's changed, you know, given you guys continue to gain share. And then the second question is just on the, you know, updated guide for the full year. When I look at the, you know, incremental revenue to EBITDA flow through, it looks like you're reinvesting some of that incremental Revex tech back into the business. A, am I right? And B, I guess, you know, where are those investments? Thank you.

Mark Patrick Kelley: My first question is just on the competitive dynamics.

Mark Patrick Kelley: Retail media, especially on the supply side curious to get your thoughts there if anything's changed I'm, giving you guys continue to gain share.

Mark Patrick Kelley: And then the second question is just on the updated guide for the full year.

Speaker Change: When I look at the incremental revenue to EBITDA flow through it looks like you are reinvesting some of that incremental Rev. Ex Tac back into the business.

Speaker Change: Am I right and it would be I guess, you know where are those investments. Thank you.

Megan Clarken: I'll start with, I'm sorry, hi. I have a great, great question. I'll start by sort of digging deep into the competition side. It's, you know, I talked in the opening remarks about how, you know, differentiated and how far ahead we are in terms of scale and in terms of our share of voice, I guess, the shared market. It seems to be getting wider.

Speaker Change: I'll start with some Q I'm sorry [laughter].

Speaker Change: Great Great question.

Speaker Change: I'll start with sort of digging deep into the competition sides.

Speaker Change: It's it's I you know I talked in my opening remarks about how you differentiate it and how far ahead, we are in terms of scale and in terms of.

Speaker Change: Our share of voice I guess.

Speaker Change: Share of market.

Megan Clarken: We just, we see a very fragmented sort of smaller competitive environment through. I guess France has a very different marketplace where there's a number of, you know, much smaller players. And, of course, we've got the publicists. You know, we used to talk about some competitors that we were more concerned about in the past but less concerned about today because we've moved so far ahead. And I think, you know, again, if I go back to listening to our clients, what they like about us is this network effect. So a network builds a network; momentum drives momentum.

Speaker Change: It seems to get wider [laughter], we just we see very fragmented sort of.

Speaker Change: Competitive environment through.

Speaker Change: I guess, France is a very different market place, where there's a number of.

Speaker Change: Smaller players and of course, you've got the pulses.

Speaker Change:

Speaker Change: Play there.

Speaker Change: But again very small compared to where we are in the scheme of things so.

Speaker Change: We used to talk about some competitors that we were.

Speaker Change: We're more concerned about in the past, but less concerned about today, because we've moved so far ahead.

Speaker Change: And I think you know again, if I go back to listening to our clients.

Megan Clarken: What they can what they liked about US is this network effect.

Sarah J. S. Glickman: It would've been cement network momentum drive some momentum.

Megan Clarken: And the more that we're investing in those clients, building the services and the functions and features that they're looking for, the more they want to couple onto that, and the more momentum you get in terms of share. And so we're very focused on serving the clients that we have because they will attract more share. Again, you know, small fragmented space everywhere else, but we're just laser focused on moving further and further away and investing in those things that divide our clients and bring differentiation. Yeah, I can; I can take the guidance question.

Speaker Change: And the more that we're investing for those clients building.

Speaker Change: This is in the functions and features that they're looking for the more they want a couple onto that and demand momentum you get in terms of share.

Megan Clarken: And so when you know very focused on serving the clients that we have because they will attract more share.

Speaker Change: Again, you know small fragmented space.

Speaker Change: Warehouse them, but we're just laser focused on.

Megan Clarken: Moving further and further away and are investing in those things that delight, our clients and bring differentiation.

Sarah J. S. Glickman: So in terms of the 2024 guidance, yeah, we did update the guidance to reflect the Q1 outperformance. And we also, of course, added back the pricing sandbox pushback. The guidance is now high, single-digit growth that we're anticipating. In terms of how that flows through to the margin, we banked the levels of performance in Q1 EBITDA, so that's been booked. The PSV pushback, you kind of see this, it's like 50-50, so 50% is to look at reinvestments and accelerate, as we've talked before about ways to do that in a smarter way.

Speaker Change: And I can I can tell you can expand them I guess, it's on the guidance question, sometimes the 'twenty 'twenty four guidance, Yeah, we did update the guidance to reflect the Q1 outperformance.

Sarah J. S. Glickman: Also of course added back the privacy sandbox pushed back and the guidance is now high single digit growth that we were anticipating in terms of how that flows through to the margin. We think that is.

Sarah J. S. Glickman: The performance in the Q1 EBITDA so that's been baked.

Sarah J. S. Glickman: The P S being pushed back kind.

Sarah J. S. Glickman: Kind of see this is a 50, 50% 50% is to look at reinvestments into accelerate them as we've talked before about ways to do that in a smarter way and then we get about 50% operational leverage from that and it really is about small investments. So yeah, we continue to get.

Sarah J. S. Glickman: And then we get about 50% operational leverage from that. And it really is about smart investments, so we continue to get asked from the business. And I would say most of them make sense, and as we saw from the Q1 results, we're delivering, so that's our focus. It's all, I would say, relatively incremental, so we do see the flow-through coming into the EBITDA line, and we would continue to expect that. On the other side, there is some FX drag, so that's just one kind of call-out just on how it's also impacting EBITDA.

Sarah J. S. Glickman: From the business and I would say most of them make sense and as we saw from the Q1 results. We're delivering so that's our focus it's all I would say that generally incrementals. So we do see the flow through coming into the EBITDA line and we would continue to expect that on the other side. There is some FX drag. So that's just one kind of cleanup system.

Sarah J. S. Glickman: On what tools are impacting EBITDA.

Operator: All right, perfect. Thank you both.

Speaker Change: Alright, perfect. Thank you both.

Operator: Yeah.

Operator: Your next question comes from the line of Doug Anmuth from J.P. Morgan. Your line is now open.

Operator: Your next question comes from the line of Doug Anmuth from Jpmorgan. Your line is now open.

Operator: Hey guys, this is Katie from Verdun. Thanks for taking the questions. Wanted to dive in a little bit more to the delay in cookie deprecation. I guess I'm curious from your perspective, what is giving them the most pause to drive the delay? Do you think it's that, you know, Google solutions need some more work, the industry needs some better solutions, and marketers need more time? Just trying to understand, from your perspective, where the biggest gaps exist today.

Operator: Hey, guys. This is Katie on for Gautam. Thanks for taking our question I wanted to dive in a little bit more to the delight of Cookie deprecation I guess I'm curious from your perspective, what is giving them. The most pause. He tried to delay do you think it is that you know Google solution needs more work the industry need some better solution marketers need more time.

Operator: I'm just trying to understand you know from your perspective, where the biggest gap exists today.

Operator: That's one. And then two, as you look out to 2025, you mentioned the 10% impact on contribution X-TAC. I know you're not providing a formal outlook at this time, but can you just walk through kind of the puts and takes and how we should think about that flow through to profitability?

Operator: That's one and then two as you look out to 2025, you mentioned, the 10% impact contribution ex Tac I know you're not providing a formal outlook at this time, but can you just walk through kind of puts and takes of how we should think about that flow through to profitability in the adjusted EBITDA line. Thanks.

Operator: Let me push the first one across to you...

Speaker Change: Let me, let me push the first one across to two two times yeah. He came here how are you doing.

Todd Parsons: Thomas. Yeah, hey Katy, how are you doing? I'm just really pretty straightforward on your question about, you know, what's thriving. If, you know, one can assume that the delay, if you're reading and following the CMA outlook on this, is really tied to, you know, mostly industry readiness and participation towards a functioning market. And what I said before about enough trading volumes between labeled supply and DSPs participating. So one could imply that this is what is driving the delay most.

Todd Parsons: Just a really a pretty straightforward on your question about what's driving it but you know one can assume.

Todd Parsons: That's a delay if you are reading in following the CMA.

Todd Parsons: Our outlook on this.

Todd Parsons: It is really tied to mostly to industry readiness.

Todd Parsons: And participation towards a functioning market and what I said before about enough trading volumes.

Todd Parsons: We labeled supply.

Todd Parsons: N D Sps participate in.

Todd Parsons: So this is.

Todd Parsons: One could imply that this is what is driving the delay most.

Todd Parsons: As I mentioned, you know, our view of the delay is that we'll use whatever time we have to continue building our advantage in the tech pipelines that we've built. And, of course, we're working actively with Google to continue debugging the privacy sandbox, both with the Chrome and the GAM teams. So, you know, for us, we're in a great position, and there are a lot of folks that we're helping bring along to be ready to participate in the process. Yeah,

Todd Parsons: I mentioned you know our view of the delay is we'll use whatever time, we have to continue building our advantage in in detect pipelines that we built and of course, we're working actively with Google to continued debugging.

Todd Parsons: Privacy sandbox, those with the chrome and the Gam teams.

Todd Parsons: So for US we're in a great position and there are a lot of folks that were helping bring along to be ready to participate in the process.

Todd Parsons: Okay.

Sarah J. S. Glickman: Yeah, in terms of the first of all, we're not going to guide for 2025. So that was the intent when talking about the impact of Friday's sandbox delay. Now, that being said, we are seeing the operational leverage flow through to EBITDA, obviously a critical metric for us, and our expectation is that we will continue to keep everything in balance, the top line, the EBITDA line, with continued reinvestment into growth areas. So I would assume for modeling purposes that we continue to drive, I would say, a very healthy EBITDA margin with the operational leverage that we're already seeing through our transformation, and assuming that we continue to ensure that we are working as effectively and smartly as we can with a modern and continued, I would say, new skill set coming into our operating model.

Todd Parsons: Oh, yeah, Yeah in terms of the festival.

Sarah J. S. Glickman: We're not going to guide for 2025, so I E.

Sarah J. S. Glickman: The intent when talking about the impact of the private assembles delay now that being said we are seeing the operational leverage flow through to EBITDA, obviously, a critical metric for us and our expectation is that we will continue to keep everything in balance the top line. The EBITDA line with continued reinvestment into.

Sarah J. S. Glickman: Growth areas, so I would assume for modeling purposes that we continue to drive.

Sarah J. S. Glickman: No I would say a very healthy EBITDA margin with the operational leverage that we're already seeing through our transformation and assuming that we continue to ensure that we are working as effectively as smartly as we can with a modern.

Sarah J. S. Glickman: And continued I would say new skill sets coming in.

Sarah J. S. Glickman: Our operating model.

Sarah J. S. Glickman: Okay.

Speaker Change: That's helpful. Thanks.

Operator: Your next question comes from the line of Tom White from Davidson.

Sarah J. S. Glickman: Your next question comes from the line of Tom White from Davidson. Your line is now open.

Operator: Great. Good morning.

Tom White: Great. Good morning, Thanks for taking my questions.

Operator: Thanks for taking my questions. Just on the retargeting commentary and the growth that you guys saw there in the quarter, I'm curious whether you're seeing any advertisers that have opted to kind of push ahead maybe with increased commitment to retargeting spend kind of since we got the news about the Google delay. I realize that retargeting is more of like a set it and forget it type product, but just curious whether, you know, that news kind of is bringing any customers back in the near term in order to kind of capitalize here over the next few months. And then, sorry if I missed it, but any way you can quantify the impact of the cross-selling on that uplift in retargeting that you discussed? In terms of

Tom White: On the re targeting commentary and the growth that you guys saw there in the quarter I'm curious, whether you're seeing any advertisers that have opted to kind of push ahead, maybe with increased commitment to re targeting spend kind of since we've gotten in the news about the Google delay I realize that.

Megan Clarken: In terms of customers coming back, no, customers mostly want, they expect their ad tech provider to solve this for them. They need the tactic, and they want us to find a way to get a message out to a consumer once, twice, three times. And they've never changed their view of that tactic because of what Google's doing. They want to use it while it's there and continue to have access to it and ultimately have their ad tech provider solve that issue for them, which is testament to our performance in our performance media business because it is about clients working with us because they know that they're in good hands, that we're a long way ahead when it comes to keeping continuity for them in So a long answer to a quick and very good question, Tom.

Tom: We are targeting is more of like a set it and forget it type product, but just curious whether you know that news kind of is bringing any customers back in the near term in order to kind of capitalize here over the next few months and then sorry, if I missed it but anyway, you can quantify the impact of the cross selling.

Megan Clarken: To that uplift and re targeting that you discussed.

Megan Clarken: Yeah.

Speaker Change: Oh in terms of.

Megan Clarken: Our customers coming back.

Megan Clarken: And our customers.

Megan Clarken: Customers, mostly one they they they expect their AD tech provided to solve this for them [laughter] they need the tactic and they want us to find a way to get them a message out to a consumer once twice three times and they've never change there you have that tactic.

Megan Clarken: Because of what Google is doing they have wanted to use it while it's there and continue to have access to it and ultimately have their AD tech provide us solves that issue for them.

Megan Clarken: Which is testament to our performance and our performance media business because it is about clients.

Megan Clarken: Working with us.

Megan Clarken: They know that they are in good hands that we're a long way ahead when it comes to keeping continuity for them in.

Megan Clarken: And this tactic and in the commerce audience tactic or more upper funnel performance tactics.

Megan Clarken: After a cookie deprecation through our next generation addressing ability model so.

Speaker Change: Long answer to a.

Megan Clarken: Question very good question, Tom I know, it's not change are our client.

Megan Clarken: No, it hasn't changed our client behavior. We're just bringing better and better and better performance and results for our clients, which is what you're seeing here. Yeah, just in terms of commerce audience, that's about, as I said, 75% of our clients are buying both retargeting and commerce audience. The impact on retargeting and the shift from retargeting to commerce audience was actually quite small for the quarter, smaller than we saw in Q4.

Megan Clarken: Behavior wages, bringing them better and better and better performance and results for our clients, which is what you're saying here.

Megan Clarken: Yeah, and just in terms of commerce audience.

Megan Clarken: That's about as I said, 75%.

Megan Clarken: Our clients are buying both <unk> and commerce audience, the impact on re targeting and the shift from each held seem to commerce audience was actually quite small for the quarter as more let me saw in Q4.

Megan Clarken: We also do see AI enhancements, I mean, that goes across all the tactics that we do, so that's driving growth in both retargeting and commerce audience CXP. Your next question comes from the line of Brian Fitzgerald from Wells Fargo. Your line is now open. Thanks, guys.

Megan Clarken: It looks like do you see that.

Megan Clarken: AI enhancements I mean that goes across gross all the tactics for eight days. So that's driving growth in both re targeting and commercial audience CX team.

Brian Nicholas Fitzgerald: Thank you.

Operator: Your next question comes from the line of Brian Fitzgerald from Wells Fargo. Your line is now open. Thanks, guys. We wanted to ask about the overall activity level.

Megan Clarken: Your next question comes from the line of Brian Fitzgerald from Wells Fargo. Your line is now open.

Brian Nicholas Fitzgerald: Thanks, guys well, we wanted to ask about the overall activity levels in programmatic.

Brian Nicholas Fitzgerald: Programmatic market that you're observing direct on web.

Brian Nicholas Fitzgerald: Google Network reported double digit declines in impressions last week are you seeing weakness in volumes or any trends you can discuss there. We've heard there were some headwinds around social media algorithms and traffic referrals out into the open web, but but wanted to ask about what you are saying.

Operator: Oh.

Operator: I can take that one, Brian. I think, I mean, first of all, we don't get into the details of what we see between trading pairs and trading partners. I think it goes without saying that different trading pairs and different partners will change their traffic patterns based on strategies that they fine-tune over time. That's nothing new with programmatic. Everybody's moving towards the most efficient supply paths, and they're doing whatever traffic shaping they need to do to get that to happen.

Speaker Change: I can take that one Brian I think I mean first of all we don't.

Operator: We don't care into the details of what we see between.

Operator: Trading Parison trading partners I think it goes without saying that.

Operator: That different trading pairs and different partners will change.

Operator: Their traffic patterns based on strategies that they tune over time, that's nothing new with programmatic.

Operator: <unk> is moving towards the most efficient supply paths and theyre doing whatever traffic shaping they need to do to get that to happen.

Operator: So, we see that all the time. People change, and they move around, but, you know, ultimately, we're just trying to connect the two parties and have them trade more on whichever supply path optimization strategy they deploy.

Operator: So we see that all the time people changed and they move around but ultimately we're just trying to connect the two parties and have them trade more on whichever supply path optimization strategy they deploy it.

Brian: Got it thanks, Todd I appreciate it.

Brian: You bet.

Operator: Your next question comes from the line of Richard Kramer from Artists Research. Your line is now open.

Richard Alan Kramer: Your next question comes from the line up for the chart Kramer from Artisan Research. Your line is now open.

Operator: Thanks very much. Megan, you spoke a lot about the completeness of your offering, spanning retailers, publishers, advertisers, and agencies. And you've also talked in the past about some competitors being sort of point solutions and mentioned being an alternative to Amazon. So my question for you is, what would mark success for Criteo becoming the sort of de facto industry alternative or standard? And what are the proof points of that? Are you seeing higher win rates and direct pitches now? Can you get agencies to secure preferred relationships despite some of their own investments?

Richard Alan Kramer: Thanks, very much Megan you spoke a lot about the completeness of Europe, you're offering spanning the retailer publishers and advertisers and agencies and you've also talked in the past on some competitors were sort of point solutions had mentioned being the alternative to Amazon. So my question for you is what would mark success for curtail becoming the sort of.

Operator: <unk> industry alternative or standard and what are the proof points of that are you seeing now higher win rates and direct pitches can you get agencies to secure preferred relationships. Despite some of their own investments. So.

Megan Clarken: So, you know, what are the couple of things you're looking for to say we've really put the complete distance between ourselves and rivals? And then one other one for Sarah, you know, an issue that's been raised over the past year or so is the volatility in some of the forecasts since investor day. And you've now had several quarters where you're able to meet or exceed expectations. What do you attribute that to?

Operator: Couple of things you're looking for to say, we've really put the completes distance between ourselves and rivals and then one other one for Sarah issue that's been raised over the past year or so with the volatility in some of the forecast since Investor day, and you've now had several quarters, where were you able to meet or exceed expectations. What do you attribute that to is it.

Megan Clarken: Is it that retail media is becoming more mature, that you're getting more clarity in the sales pipeline, or some other factors that are making you more confident being able to forecast and hit the numbers? Thanks.

Megan Clarken: Retail media is becoming more mature that youre getting more clarity in the sales pipeline or if it's some other factors that are making you more confident being able to forecast and hit the numbers. Thanks.

Megan Clarken: Okay.

Sarah J. S. Glickman: Hey Richard, great question. I think it's a pretty straightforward one.

Speaker Change: Hi, Richard Great question.

Speaker Change: On the sports Oh.

Speaker Change: What I would say, it's it's I think it's a pretty straightforward one and we would love to be the size of Amazon.

Megan Clarken: We would love to be the size of Amazon in terms of the advertising that's flowing through there. But let me caveat that. And again, we're agnostic about all of this, so we're an ad tech provider who's joining one side to the other. So in the spirit of that, we would love to be that size, or a complementary choice to a buy on Amazon or a buy on Walmart would be a buy across Criteo's retail media network.

Megan Clarken: In terms of the advertising that's flowing through there. So let me caveat that and Ah and we're not again, we're not where we're agnostic and all of that this summer and AD tech provider who's joining one side to the other so in our AR and AR.

Megan Clarken: Spirit is that we would love to be that.

Megan Clarken: That size or an Ah Ah complementary choice to a buy on Amazon or a buy on Walmart would be buying on a on a cross sell pretty eyes retail media network.

Megan Clarken: For us, I think, you know, the it's I talked about earlier, it's the unlocking of those national budgets where when you're an agency, and you're looking to spend your dollars, you're spending them across social and retail. And when it comes to retail, you're buying, you know, maybe Amazon, maybe Walmart, and then definitely Criteo. And so that our retailers are getting a fair share of the spend that's coming into retail media.

Megan Clarken: For US I think you know the it's I talked about it before it's the unlock of those national budgets, where by when you're an agency and you're looking to spend your dollars you're spending it across search social and retail and when it comes to retail you are buying you know maybe Amazon, maybe Walmart and then <unk>.

Megan Clarken: Finally, prettier and sorry that our retailers are getting our fair share of.

Megan Clarken: The spend that's coming into retail media.

Megan Clarken: And that that grows because it becomes, you know, somewhere where the evidence of performance, is measured through measurement. And it is a performance vehicle because you're getting to consumers that are close to the point of sale using first party data. And so it's the greatest place to advertise. For us, we got to serve our clients, we need to make sure that in order to do that and unlock that spend, continue to get the trade marketing spend across and start to make sure that we're at the table next to an Amazon is to continue to invest in our clients, stay close to them, scale them, get more supply available on their properties, to fill their fill rates, bring more formats to them, help them drive advertising, not just on site, but off site.

Megan Clarken: And then that grows because it becomes.

Megan Clarken: Eni's somewhere where the evident so of performance.

Megan Clarken: Is mentioned through measurement and it is a performance vehicle because you're getting to consumers that are close to the point of styled using third party data.

Megan Clarken: And so it's a it's a it's.

Megan Clarken: Docked greatest place to advertise for US we've got a set of our clients we need to make sure that in order to do that and unlock that spend continue to get the trade marketing spend across.

Megan Clarken: And start to make sure that we're at the table next to an Amazon is to continue to invest in our clients stay close to them.

Megan Clarken: All of them.

Megan Clarken: Get more.

Megan Clarken: Supply available.

Megan Clarken: If I live alone their properties.

Megan Clarken: Fulfill this list there their civil rights spring more formats to them.

Megan Clarken: Help them drive advertising not just onsite and Offsite all of these things that is the power and I guess the magic of retail media.

Megan Clarken: All of these things that are the power and, I guess, the magic of retail media, us leaning into that and bringing that to life over the next years is what's going to get us to the place that we want to be, which is the, you know, ultimate compliment to an Amazon buy. So, you know, watch this space.

Megan Clarken: Us leaning into that and bring that to life over the knee.

Megan Clarken: <unk> is what's going to get us to.

Megan Clarken: So the place that we want to be which is the ultimate compliment to an Amazon buy.

Speaker Change: So what's the space.

Sarah J. S. Glickman: Yeah, I guess if I address the other part of your question, yeah, we feel very good about the performance we delivered in 2023 and 2021.

Speaker Change: Yeah, and I guess, if I'm, if I address the part of your question.

Sarah J. S. Glickman: part of your question. Yeah, we feel very good about the performance we delivered in 2023 and, obviously, coming into Q1 2024, as well as the guidance for the year. Of course, the whole industry was impacted by the advertising recession, starting just after our earnings date in late 2022. But we feel very, very good about our business. Our strategy stays intact. We've continued to drive top line and bottom line performance. We obviously have an incredible balance sheet.

Sarah J. S. Glickman: Yeah, we feel very good about the performance we delivered in 2023 and 'twenty, We're obviously coming into Q1 'twenty four as far as the guidance for the year.

Sarah J. S. Glickman: Of course, the whole industry with impact by the appetizing risk.

Sarah J. S. Glickman: Recession, starting off just after all.

Sarah J. S. Glickman: Right.

Sarah J. S. Glickman: In late 2022, but we feel very very good about our business our strategy stays intact.

Sarah J. S. Glickman: We've continued to drive top line and bottom line performance. We obviously have an incredible balance sheet on retail media, we have a scaled base of $200 million with the only independent AD Tech platform, that's shutting in that retail media numbers and like rubbing all sectors is that from our largest clients all the way through to a new appliance.

Sarah J. S. Glickman: On retail media, we have a scaled base of $200 million with the only independent ad tech platform that's showing its retail media numbers. And we're growing all sectors of that, from our largest clients all the way through to our newer clients.

Sarah J. S. Glickman: So all in all with fitting.

Sarah J. S. Glickman: Pretty good about life.

Speaker Change: Okay. Thanks.

Speaker Change: Thank you.

Operator: Thank you, Megan, Sarah, and Todd. Please go ahead.

Speaker Change: Thank you and there are no further questions.

Operator: Yeah, thank you. Thank you, everyone. Thanks, Megan, Sarah, and Todd. This now concludes our call for today. The Investor Relations Team is available for any additional questions. Have a great day.

Speaker Change: Please go ahead.

Speaker Change: Yeah. Thank you. Thank you everybody, thanks and against our inside this now concludes our call for today.

Speaker Change: Investor Relations team is available for any additional questions have a great day.

Operator: Thank you. Thank you. Bye. Bye. The conference call has now concluded. Thank you for attending today's presentation. You may now disconnect.

unknown: [inaudible]

Speaker Change: Thank you bye bye.

unknown: The conference call has now concluded. Thank you for attending today's presentation you may now disconnect.

unknown: [noise].