• Outbrain, a content recommendation platform, achieved a revenue of USD 254.2 million (11% YoY growth) for Q1 2022, which was above analyst expectations by 5%. This growth was driven primarily by new users, which contributed ~USD 26 million as well as renewals by existing users. New users include Sankei Digital, one of Japan’s largest digital publishers, which signed an exclusive deal with Outbrain.

• During the quarter, the firm’s adjusted EBITDA was USD 11.6 million (43% YoY dip), which was 29% above the upper bound of the firm’s guidance. The dip was mainly due to growth investments and costs of operating as a public company as well as unfavorable currency movements.  

<ul><li>The firm also reported that the remaining cash balance of its acquisition of Vi , a contextual video analytics platform, which was completed in January 2022, would be paid in Q3 2022. The firm also announced the deployment of its SmartLogic solution on mobile and plans to roll it out to desktop during the year. The firm also grew its product and engineering team by 25% YoY.</ul>

• For the full year of 2022, the firm revised down its ex-TAC gross profit target to between USD 270 million and USD 290 million (~3% YoY growth at the midpoint). The adjusted EBITDA target was nearly halved to be between USD 50 million and USD 60 million (~38% YoY dip at the midpoint) compared with ~11% YoY growth expected in Q4 2021, citing spillover effects due to the conflict in Europe.

<ul><li> Analyst QuickTake: Like other ad marketplace platforms such as Taboola, Outbrain too has revised down its expectations for 2022E after having recorded a strong end to 2021 where the firm reached the USD 1 billion revenue mark . The management reported a slowdown in segments such as automotive and CPG as a result of the conflict and expects activity in Europe to be affected in the coming quarters.</ul>