Outbrain Inc. Unveils Strategic Moves And Financial Performance In 2024

$OB

Outbrain Inc. (Nasdaq:OB), now operating under the Teads brand following a strategic acquisition, has recently announced its financial outcomes for the fourth quarter and the entirety of 2024. In the fourth quarter of 2024, the company experienced revenue of $234.6 million, marking a 5% decrease from the $248.2 million reported in the same period the previous year.

In contrast, its gross profit saw an increase, rising by 5% to $56.1 million compared to $53.2 million in the prior year. This improvement in gross profit highlights an effective management of operational costs and an enhanced gross margin, which increased by 250 basis points to 23.9%.

Its net income presented a different scenario, showing a slight loss of $0.2 million, a stark contrast to the $4.1 million net income of the previous year. This shift to a net loss can be attributed to acquisition-related costs amounting to $3.6 million, net of taxes. Outbrain’s adjusted net income stood at $3.5 million, down from $4.3 million in the previous year, reflecting a 20% decrease.

The company generated a net cash provided by operating activities of $42.7 million, up 67% from $25.5 million in the prior year. This substantial increase in cash flow underscores the company’s operational efficiency and financial health. The acquisition of Teads, completed on February 3, 2025, for a total value of approximately $900 million, marks a pivotal expansion for Outbrain.

This merger combines Outbrain’s and Teads’ capabilities, creating one of the largest Open Internet platforms. The acquisition was financed through a mix of cash and common stock, alongside a new $100.0 million credit facility and a private offering of $637.5 million in senior secured notes.

Ahead to 2025, Outbrain has provided an optimistic financial outlook. For the first quarter ending March 31, 2025, the company expects an Ex-TAC gross profit between $100 million and $105 million and an Adjusted EBITDA ranging from $8 million to $12 million. For the full year, the company anticipates an Adjusted EBITDA of at least $180 million.

By leveraging synergies from the merger and continuing to innovate in its offerings, Outbrain is well-positioned to enhance its market presence and deliver value to its global clientele. The focus now remains on how effectively the company can integrate Teads and realize the projected synergies, which are expected to significantly contribute to its financial and operational performance in the coming years.

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