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1. Company Snapshot

1.a. Company Description

Outbrain Inc., together with its subsidiaries, operates an online content recommendation platform worldwide.It offers Outbrain Engage, a product suite for media partners that provides personalized feeds and data-driven recommendations, as well as a solution to maximize user engagement.The company's Outbrain Engage solution also includes a web-based dashboard to manage and control various aspects of the platform, including content, formats, sources, frequency, and categories of ads delivered on their properties, as well as monetizes the content through customized data-driven advertising.


It also provides Outbrain Amplify, a product suite for advertisers that provides an open web platform that helps users to connect with audiences on premium digital properties.The company's Outbrain Amplify solution also provides advertisers with access to ad inventory that support various formats, including text and image, video, interactive carousel, app install, and other forms of direct response; and ads optimized for engagement.Outbrain Inc.


was incorporated in 2006 and is headquartered in New York, New York.

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1.b. Last Insights on OB

Outbrain's recent performance was negatively impacted by a 39% decline in its share price over the past three months. The company's Q1 2025 earnings release revealed a mixed bag of results, with CTV revenues growing by over 100% year-over-year on a pro forma basis, but also a decline in revenue due to the Teads acquisition. The integration and synergies from the acquisition remain on track, but the company's ability to execute on its growth strategy remains a concern.

1.c. Company Highlights

2. Teads' Q3 2025 Earnings: A Mixed Bag

Teads reported revenue of $319 million for Q3 2025, representing a 42% year-over-year increase on an as-reported basis, primarily driven by the impact of the acquisition. However, on a pro forma basis, the company saw a 15% year-over-year decline in Q3. The Ex-TAC gross profit and adjusted EBITDA came in slightly below guidance, with EPS at -$0.15147, missing estimates of -$0.02. The company's financial performance was impacted by various headwinds, including demand volatility, operational changes, and strategic decisions.

Publication Date: Nov -18

📋 Highlights
  • Connected TV Growth Accelerates:: CTV revenue surged 40% YoY, driven by 2,500+ home screen campaigns and partnerships with TCL, LG, Samsung, and Google TV, accessing 500M+ TVs globally.
  • Revenue Performance Mixed:: Reported revenue rose 42% YoY to $319M (acquisition-driven), but pro forma declined 15% due to demand volatility and merger integration delays.
  • Adjusted EBITDA Guidance Revisions:: Q4 adjusted EBITDA projected at $26M–$36M, with $35M annualized EBITDA savings from operational efficiencies expected by 2026.
  • Merger Challenges Persist:: Integration complexities and execution delays caused weaker-than-expected Q3 results, with macro headwinds (e.g., search traffic decline, tariff impacts) affecting top-line stability.
  • Outbrain Segment Struggles:: DSP revenue fell $5M from client losses, while page views declined in Q3, though RPM growth and supply-quality initiatives offset some losses.

Operational Challenges

The company's operational changes, including quality improvements, supply cleanup, and demand content restrictions, had a bigger impact than expected, affecting revenue. As David Kostman noted, "a lot of it relates to distractions from the merger and the execution challenges that we highlight that are taking longer than we had anticipated." The company is taking steps to address these challenges and is committed to protecting free cash flow.

Growth Areas

Despite the challenges, Teads saw growth in certain areas, including Connected TV (CTV), which grew approximately 40% year-over-year. The company is focusing on driving long-term and sustainable value propositions for enterprise advertisers, with a growing pipeline and stronger cross-sell. The CTV business is expected to continue growing, with the company expanding partnerships with major CTV players.

Valuation

Teads' valuation metrics indicate a challenging financial situation. The company's P/E Ratio is -1.1, and the EV/EBITDA ratio is 63.32, suggesting that the market is pricing in significant challenges. The P/S Ratio is 0.06, indicating a low revenue multiple. Analysts estimate next year's revenue growth at 5.3%, which may not be enough to address the company's financial challenges.

Outlook

The company is guiding Q4 conservatively, considering the volatility in the pipeline and advertisers' shorter planning cycles. However, October is performing better than Q3, and the company sees positive growth in CTV and acceleration in cross-selling. The company's focus on execution and financial discipline, investing in growth areas, is expected to drive long-term value.

3. NewsRoom

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Outbrain Completes Change of Corporate Name to Teads

Jun -09

Source: globenewswire.com

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Outbrain, Inc. (OB) Q1 2025 Earnings Call Transcript

May -09

Source: seekingalpha.com

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Outbrain Announces First Quarter 2025 Results

May -09

Source: globenewswire.com

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Outbrain to Release First Quarter 2025 Financial Results on May 9, 2025

Apr -29

Source: globenewswire.com

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Teads Celebrates Major Milestone as CTV HomeScreen Powers 1,500 Campaigns

Apr -22

Source: globenewswire.com

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Outbrain: Decent Potential Due To Diversification From Native Display Business

Mar -18

Source: seekingalpha.com

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Outbrain Stock Plummets 39% in 3 Months: Should You Buy the Dip?

Mar -11

Source: zacks.com

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Bears are Losing Control Over Outbrain (OB), Here's Why It's a 'Buy' Now

Mar -03

Source: zacks.com

4. Business Breakdown

4.a. Revenues by Country

4.b. Revenues by Segment

5. Expected revenues mid-term growth (5.00%)

6. Segments

Content Discovery Platform

Expected Growth: 5.0%

Outbrain's Content Discovery Platform growth is driven by increasing demand for native advertising, rising adoption of AI-powered content recommendation, and expansion into new markets. Additionally, the platform's ability to provide personalized user experiences, improve engagement, and offer measurable ROI for publishers and advertisers contributes to its 5.0 growth rate.

7. Detailed Products

Outbrain for Publishers

A platform that helps online publishers to increase user engagement, boost revenue, and enhance their audience's experience

Outbrain for Advertisers

A platform that enables brands to reach their target audience with personalized, native ads across the web

Outbrain Amplify

A platform that helps brands to amplify their content marketing efforts and reach a larger audience

Outbrain Zemanta

A platform that helps brands to create and distribute sponsored content at scale

8. Outbrain Inc.'s Porter Forces

Forces Ranking

Threat Of Substitutes

Outbrain's content discovery platform is unique, but users can substitute it with other platforms like Taboola or Disqus. However, Outbrain's strong partnerships with publishers and its ability to provide personalized content recommendations reduce the threat of substitutes.

Bargaining Power Of Customers

Outbrain's customers are primarily publishers who rely on the platform to increase engagement and revenue. While customers have some bargaining power, Outbrain's strong brand and wide reach reduce their negotiating power.

Bargaining Power Of Suppliers

Outbrain's suppliers are primarily publishers who provide content. The company has a strong network of suppliers, and the cost of switching suppliers is low, reducing their bargaining power.

Threat Of New Entrants

The content discovery platform market is highly competitive, and new entrants can easily enter the market. However, Outbrain's strong brand, established partnerships, and proprietary technology reduce the threat of new entrants.

Intensity Of Rivalry

The content discovery platform market is highly competitive, with several players competing for market share. Outbrain faces intense competition from companies like Taboola, Disqus, and others, which increases the intensity of rivalry.

9. SWOT Analysis

Strength

Weaknesses

Opportunities

Threats

10. Capital Structure

10.a. Balance Sheet

10.b. Weighted Average Cost of capital

Value
Debt Weight 35.34%
Debt Cost 6.57%
Equity Weight 64.66%
Equity Cost 10.80%
WACC 9.31%
Leverage 54.67%

11. Quality Control: Outbrain Inc. passed 1 out of 9 key points

12.a Historical Valuation

12.b Price/Earnings Ratio

12.c Margin Valuation

12.d Peers Valuation

Peers Group Analysis

Stock-Card
EverQuote

A-Score: 5.6/10

Value: 5.9

Growth: 8.3

Quality: 8.4

Yield: 0.0

Momentum: 7.5

Volatility: 3.3

1-Year Total Return ->

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Stock-Card
Arena Group Holdings

A-Score: 5.0/10

Value: 8.5

Growth: 4.7

Quality: 6.2

Yield: 0.0

Momentum: 10.0

Volatility: 0.3

1-Year Total Return ->

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Stock-Card
comScore

A-Score: 3.9/10

Value: 7.8

Growth: 3.7

Quality: 2.9

Yield: 0.0

Momentum: 8.0

Volatility: 1.0

1-Year Total Return ->

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Liberty TripAdvisor Holdings

A-Score: 3.8/10

Value: 10.0

Growth: 2.9

Quality: 6.4

Yield: 0.0

Momentum: 2.0

Volatility: 1.3

1-Year Total Return ->

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Stock-Card
Outbrain

A-Score: 3.3/10

Value: 7.8

Growth: 3.2

Quality: 2.2

Yield: 0.0

Momentum: 1.0

Volatility: 5.7

1-Year Total Return ->

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Stock-Card
TechTarget

A-Score: 2.9/10

Value: 9.2

Growth: 2.1

Quality: 3.6

Yield: 0.0

Momentum: 0.0

Volatility: 2.3

1-Year Total Return ->

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Peers Metrics

12.e Scoring Insights

12.f DCF BETA

Parameters

Short Term Growth

Short term Time

Long-Term Growth

WACC

Target Price

2.74$

Current Price

2.74$

Potential

-0.00%

Expected Cash-Flows