Good day, ladies and gentlemen, and thank you for standing by. Welcome to the Taboola Third Quarter 2023 Earnings Conference Call. At this time, all participants are in a listen-only mode. After the speaker's presentation, there will be a question-and-answer session. To ask a question, simply press star one one on your telephone keypad. At this time, I would like to turn the conference over to Miss Jessica Kourakos, Head of Investor Relations for the Safe Harbor. Ma'am, please begin. Thank you, and good morning, everyone, and welcome to Taboola's third quarter 2023 earnings conference call. I'm here with Adam Singolda, Taboola's founder and CEO, and Steve Walker, Taboola's CFO. The company issued earnings materials today before the market, and they are available in the investors section of Taboola's website. Now, I'll quickly cover the Safe Harbor. Certain statements today, including our expectations for future periods, are forward-looking statements. They are not facts and are subject to material risks and uncertainties described in our SEC filings. These statements are based on currently available information, and we undertake no duty to update them, except as required by law. Today's discussion is also subject to the forward-looking statement limitations in the earnings press release. Future events could differ materially and adversely from those anticipated. During this call, we will use terms defined in the earnings release and refer to non-GAAP financial measures. For definitions and reconciliations to GAAP, please refer to the non-GAAP tables in the earnings release posted on our website. With that, I'll turn the call over to Adam. Thanks, Jessica. Good morning, everyone, and thank you all for joining us for our third quarter call. Before we talk about the business, I want to first address the war in Israel. These last few weeks have been incredibly hard for us as we continue to face unimaginable events. The safety and well-being of our employees is our very top priority, and we have implemented multiple initiatives to support our people and their families during this crisis. I'm very, very proud of Taboola's tremendous resilience during this difficult time. The work has been instrumental in keeping Taboola safe and in implementing our business continuity plans, and it shows in our confidence in our future. As I think about our mission, it is clear to me, now more than ever, how essential professional journalism is. Society needs thriving sources of truth we can all count on, and Taboola has always been, and forever will be, the biggest supporter of the open web publishers, and our commitment to them is more necessary than ever. Our alignment and win-win approach makes it such that when we do well, the open web does well, too. And now, let's turn into our business results, which I'm very proud of. Financially, we had a strong performance in Q3, beating the high end of our guidance across all metrics. We achieved $125 million in Ex-TAC gross profit, $23 million in Adjusted EBITDA, and $23 million in free cash flow. We're also excited to raise the midpoint of our full year 2023 guidance for Adjusted EBITDA and non-GAAP net income. Free cash flow over the last 12 months is $55 million, which is 3x what it was a year ago for the same time period. 2024 is basically here, and given how we're executing on our key business priorities, we're reiterating our 2024 guidance of over $200 million in Adjusted EBITDA and over $100 million of free cash flow. Last year, when we launched our new bidder platform with Microsoft as our design partner, many investors asked us how this new AI technology would affect Microsoft. We said we believe it will make it growing part of our business, and in Q3, I'm very happy to share that Microsoft is nearly 2x what it was last year at the same time. Yahoo integration is going well and is on track. Now, I care about it not only because it's a good thing for Taboola and for our advertisers, but because it's also a big step towards making Taboola the first open web must-buy ad platform. Google for search, Meta for social, Taboola for the open web. These were just some highlights from this quarter and why I'm happy with our momentum as a company. There are two main factors that drive Taboola's revenue. The first is our ability to reach users and deliver engaging experiences in the open web, so they spend more time with us and engage with our recommendation engine. The second is our ability to monetize our interaction with consumers, also referred to as our yield. I said before that with just investing in yield on the same user base we have now, I believe we can double and triple Taboola's revenue. There's a lot of growth to be had here. Now, let's dive in and start with our ability to reach consumers and create engaging experiences. In our core business, working with publishers all over the world, we've seen strong momentum, with publishers continuing to trust us and sign long-term partnerships. We saw strong renewals and net new wins, such as Nexstar, Absolute Sports, Excite Japan, and more. Many of our existing long-term partners renewed their partnership with us. Publishers like Gannett, Cox Media Group, Sport1, McClatchy, NDTV, and more. Our core is gonna get even stronger as part of our 30-year partnership with Yahoo, the fifth largest media property in the U.S. As of Q3, Taboola is now offering exclusive access to 100% of Yahoo's global native supply, which means that advertisers can now start buying on Yahoo through Taboola, and this is our main focus: migrating Yahoo Native advertisers and onboarding new ones. In addition, Yahoo DSP now has Taboola Ads Console integrated inside, and it looks awesome. That was the initial part of enabling Yahoo omni-channel advertisers to migrate to Taboola. And I can share with you that early results of migrated omni-channel advertisers are very promising. In summary, there's still a lot of work to do, but I feel really good about the progress so far, and continue to expect to be fully ramped up by mid-2024. When you look beyond our core, working with publishers, we reach consumers on Android OEM devices as part of Taboola News. This business is becoming an important part of how Taboola reaches consumers and creates engaging experiences for them. Taboola News grew strong double digits in Q3, and is on track to approach $100 million in revenue in 2023. In the quarter, we rolled out partnership with Realme, one of the world's fastest growing smartphones brand, adding more than 6 million devices to our existing reach. This is on top of existing partnerships with companies like Xiaomi and Samsung, OPPO, and others. Finally, we found ways to engage with even more consumers through our bidding technology. Advancing our bidding technology and getting more advertisers benefiting from it in Q3, provided us with Ex-TAC improvement in the quarter. We've shared with investors that last year in April, Microsoft will be moving to our new bidding technology, which they helped us design, and it will help us make Microsoft grow. Indeed, in Q3, as a result, the revenue was nearly 2x higher than Q3 of last year. Now that I've reviewed the first part of how Taboola grows its revenue by reaching consumers and creating engaging experiences, which is essentially our supply, let me move into the second way we grow revenue, which is by improving yield. As you know, half of our R&D is working on AI technology, helping advertisers to succeed with Taboola. In Q3, Max Conversions went into general availability, which is a way for advertisers to share with us their objective as a business and let Taboola AI do the rest. No need anymore for them to guess a CPC or anything of that kind, which is essentially how Google and Meta do it today. We're working deeply with NVIDIA research team to advance our AI capabilities even further, and I'm happy to say that Max Conversions is now one of our fastest adopted technologies ever, and we've seen encouraging results. In Q3, we saw meaningful improvement in Net Dollar Retention for campaigns using Max Conversions, which is essentially the leading indicator we want to see and track. I believe that the majority of our revenue will be using this sophisticated AI in 2024. Our investments into generative AI technology have had a good impact as well. We made our Gen AI offering available in July, helping our advertisers, many of which are self-service, to create titles and thumbnails. I'm happy to say that Gen AI already represents over 2% of revenue from ads created in Taboola Ads. This week, we introduced a new feature called Taboola Generative AI Ad Maker, which allows advertisers to edit existing creative automatically instead of just creating images from scratch. As we've shared before, about a 1/3 of our company's revenue came from self-service advertisers, so we care a lot to make this as easy and as effective process as we can. While over 2% of our revenue is using Gen AI, 25% of all ad creatives from self-service advertisers are made with our Gen AI. So overall, we're seeing clients adopting our Gen AI capabilities, which contributes to our efforts as a company to grow yield. Finally, one of our big investments to bolster monetization and drive yield growth is e-commerce. In Q3, we saw double-digit growth in e-commerce, driven by strong momentum in Europe as part of our international expansion, and Yahoo now being a new supply channel for our retailers in the U.S.. Overall, we're seeing well over 100% NDR among top advertisers, which is just unbelievable. In summary, I'm very happy with where we are as a company, our performance in Q3, and our momentum heading into 2024, which is a big year for us. With that, let me pass the call over to Steve to review our financials and outlook in more detail. Thanks, Adam, and good morning, everyone. Before I dive into our financial performance, let me reiterate what Adam said about the war in Israel. It is so hard to hear the stories of this conflict, but like Adam, I'm amazed every day by the resilience of Taboola's in Israel and the way our employees have continued to run our business under such trying circumstances. Israel is our largest global office, with over 600 employees, and we have had over 100 who either were called into action in the reserves or had a significant other called into action. In terms of our business exposure, in Q3, we reported that approximately 10% of our revenue comes from advertisers with billing addresses in Israel. However, most of that revenue is what we call export revenue and is actually targeting consumers and publishers outside of Israel. In fact, less than 2% of our revenue is what we would consider domestic Israeli revenue, meaning advertisers spending on Israeli publishers and targeting Israeli consumers. It is because of the diversity of our revenue model, business continuity plans, and the amazing efforts of our employees globally, that we have not seen a material impact on our business, though we obviously continue to monitor the situation. Now let me turn to our Q3 results and our forward-looking guidance. As Adam noted, our Q3 results beat the high end of our guidance on all metrics. We are also raising the midpoint of our full year 2023 guidance for Adjusted EBITDA and non-GAAP net income, and reiterating our 2024 expectations of over $200 million of Adjusted EBITDA and over $100 million in free cash flow. In Q3, revenues were $360.2 million, versus the midpoint of our guidance of $344 million. Gross profit was $100.7 million, versus the midpoint of $89 million. Ex-TAC gross profit was $128.4 million versus the midpoint of $118 million. Adjusted EBITDA was $22.8 million versus the midpoint of $4 million, and non-GAAP net income was $6.7 million versus the midpoint of a loss of $14 million. I will note that the revenue performance shows a return to year-over-year growth of 8%. Our Ex-TAC gross profit was roughly in line with last year, reflecting some margin compression due to the ad rate declines in 2022, which have since stabilized in 2023. We continue to expect XTAC to return to positive growth in Q4. Positive free cash flow of $22.8 million in Q3 was stronger than anticipated. Three main factors drove this overperformance. First, our stronger than forecasted XTAC gross profit contributed to our Adjusted EBITDA beat. Second, we did a good job of controlling operating expenses, which further enhanced our Adjusted EBITDA performance. Both of these factors flowed through to operating cash flow and to free cash flow. Lastly, our Q3 free cash flow also benefited from the timing of our payables and from a delay in some capital expenditures. Both of these were temporary benefits that will reverse in Q4. As Adam said, our strong revenue and XTAC gross profit performance was driven by strength in our e-commerce, bidding, and Taboola News businesses, as well as relatively stable yields in our core business. E-commerce had double-digit growth in Q3, driven by strong momentum in Europe and the U.S.. Revenue retention was well over 100% among top advertisers. In addition, we are seeing great success ramping Taboola Feeds and now Yahoo as supply channel for our retail advertisers. Taboola Feed supply is now a top 10 traffic source globally. We continue to forecast that Taboola News will approach $100 million in revenues this year versus $50 million in revenues in 2022. Finally, our bidding offerings continue to gain momentum. Microsoft registered nearly 2 x more Ex-TAC in Q3 2023 versus the same quarter last year, thanks to advances in our AI-powered bidding technology. Our teams have achieved this strong revenue and Ex-TAC performance while improving cost efficiency, indicated by our adjusted EBITDA margin in Q3, exceeding the margin that was implied by the midpoint of our Q3 guidance. Operating expenses were $119.4 million in the quarter, down $4.7 million year-over-year. This decrease was primarily the result of our focus on cost reductions that we announced in Q3 of last year. Our headcount is down approximately 6% from its peak in July of 2022. With our ongoing expense discipline and strong growth expectations, we expect that in 2024, we will make significant progress toward our long-term Adjusted EBITDA margin target of over 30%. GAAP net loss for the quarter of $23.1 million included amortization of intangibles of $16 million, share-based compensation expenses of $13.6 million, and holdback compensation expenses related to the Connexity acquisition of $2.6 million, all of which were excluded from non-GAAP net income. Our non-GAAP net income of $6.7 million was above the high end of our guidance range. In terms of cash generation, we had approximately $32.5 million in operating cash flow in Q3, with free cash flow of around $22.8 million. This includes net publisher prepayments, which were a source of cash this quarter of $7.2 million, and interest payments on our long-term debt, which were a use of cash of $4.8 million. I would like to note that net publisher prepayments were a source of cash for the second consecutive quarter. This was due to the fact that new prepayments were lower than the quarterly amortization of historical prepayments. Now, let's turn to the balance sheet. You can see that our net cash balance remains healthy. Cash and cash equivalents, plus our short-term investments, increased from $246.9 million at the end of Q2 to $250.7 million at the end of Q3, and remained above our debt principal balance of $202.7 million. I would note that the $202.7 million debt balance reported at the end of Q3 was before we repaid an additional $50 million in Q4, which I will discuss in a moment. The increase in our cash and cash equivalents balance was driven by our strong free cash flow performance of almost $23 million and includes approximately $19 million of share repurchases. I also want to provide an update on our share buyback and debt repayment programs. As you probably recall, we announced that we would buy back up to $40 million of shares in 2023, and that we intended to repay up to an additional $50 million of our long-term debt in the second half of the year. The share buyback program was initiated on June 1st, and as of September 30th, we repurchased a total of approximately 6.7 million shares at an average price per share of $3.45. We continued to repurchase shares in Q4, and as of Friday, November 3rd, we had repurchased a total of approximately 3.3 million additional shares at an average price of $3.69. Additionally, in October, we voluntarily prepaid another $50 million of our long-term debt, which means that we have voluntarily prepaid a total of $141 million since Q4 2022. We are also announcing an expansion of our share repurchase program of up to an additional $40 million, as well as our intention to pay down up to $30 million more of our long-term debt in the first half of 2024. Both the share repurchase program and the debt paydown are contingent upon the availability of sufficient working capital. As an Israeli company, we are also required to obtain Israeli court approval for share repurchases. Our current approval expires November 16th, and courts are currently operating at a limited capacity due to the war, but we expect to obtain approval once Israeli courts are back to normal operations. Now let me shift to our forward-looking guidance. For the full year of 2023, we are raising the midpoint of our Adjusted EBITDA and non-GAAP net income guidance due to our strong operating performance year to date. We believe it is prudent to reiterate our full year 2023 revenue, gross profit, and Ex-TAC guidance, given our desire to be more conservative in the face of greater near-term uncertainty, given what is going on in Israel. We expect revenues of $1.438 billion-$1.469 billion, gross profit of $420 million-$436 million, Ex-TAC gross profit of $531 million-$546 million. We are raising our Adjusted EBITDA range to $75 million-$82 million and our non-GAAP net income to $7 million-$12 million. I will also note that despite 2023 being a year of strategic investment in Yahoo and in our growth initiatives, we expect to generate positive free cash flow for the full year. We continue to be very excited by the addition of Yahoo to our business. Adam mentioned earlier that 100% of Yahoo's global supply is now available to advertisers through Taboola's platform, and we continue to focus on migrating advertisers. As we, as we have previously stated, we expect the revenue to start ramping in Q4 in the $10 million-$99 million range, and we'll expect to reach full run rate by the middle of 2024. Finally, we are issuing Q4 guidance. For Q4 2023, we expect revenues of $418 million-$449 million, gross profit of $132 million-$148 million, Ex-TAC gross profit of $164 million-$179 million, adjusted EBITDA of $26 million-$33 million, and non-GAAP net income of -$3 million to $2 million. Let me finish by saying that we are happy with our third quarter performance and to be able to raise the midpoint of our guidance on adjusted EBITDA and non-GAAP net income for the full year. We are also excited about the step change we are expecting in our business, as reflected by reiterating our 2024 targets of at least $200 million of adjusted EBITDA and at least $100 million of free cash flow. Perhaps most importantly, though, we are excited about the momentum we are building in our business. It is really amazing to start to see advertisers who previously spent their native budgets through Yahoo starting to use the Taboola platform and hearing them talk about their great experience. It is also great to hear stories of Taboola advertisers starting to spend money on Yahoo Supply and being excited about the performance they are able to achieve. The additional scale that Yahoo will bring and the growth of our core business is helping us in our progress towards becoming a must-buy for advertisers looking to reach consumers in the open web. With that, let me pass it back to Adam for some closing remarks. Thanks, Steve. You've heard Steve and I share our point of view this quarter and how excited we are about our momentum. We beat the high end of our guidance on all metrics in Q3. We're laser-focused on growing our reach and engagement with consumers, as well as our yield, and we're doing a good job progressing those. Our integration is going well and on track. Advertiser success and yield growth get a lot of our attention, with Max Conversions being adopted faster than anything we've ever done. 2024 is around the corner, and we're reiterating over $200 million in EBITDA, which is nearly 3x our EBITDA guidance this year, as well as over $100 million in free cash flow, another big step up from this year, all of which support our plan to buy more shares back and prepay more debt. Taboola's mission is to make the open web strong and to empower editorial teams all over the world to provide trusted content in an engaging way that drives exciting growth to publishers and advertisers. As I stated in my shareholder letter, supporting the open web has never been as important as it is now. I'm proud to be part of Taboola, and I'm proud of our execution this year and our employees working passionately to pursue our mission.... I'm sending our employees in Israel my prayers, and my heart is with them every moment of the day. Thank you all for joining us today. We look forward to interacting with many of you over the next few weeks. With that, let's open it up to questions. Operator? Ladies and gentlemen, if you have a question or comment at this time, please press star one one on your telephone keypad. If your question has been answered or you wish to remove yourself from the queue, simply press the pound key. Again, to ask a question, please press star one one on your telephone keypad. Please stand by while we compile the Q and A roster. Our first question or comment comes from the line of Jason Helfstein from Oppenheimer. Mr. Helfstein, your line is open. Hey, thanks. And just wanna send support for everyone in Israel. So, two questions. One, just Steve, maybe on the guide. So to the extent you're expressing a, you know, a little bit, you know, some kind of conservatism there, how much of this is specifically to like, we'll call like, the impact in Israel, like, very company specific or Israel specific, as opposed to like, you're just maybe having some broader macro concerns that, you know, if things kind of expand in the Middle East, that it impacts advertising more broadly, you know, called macro. So that's question one. Question two: What are the conversations you're having with advertisers about what you, you know, you can do for them with the Yahoo assets, and how that might be different either than Yahoo was doing for them before, or kind of how they're thinking about, like, where those dollars are now, and why, you know, like, working with you on Yahoo distribution, you know, really makes sense? Thanks. Thanks, Jason. And thanks for the support for Israel. We all are... That's on our minds, all of our minds constantly right now. So thanks for that. In terms of your question about the Q4 guidance and what we're thinking there. So first of all, obviously, we're really happy with our performance in Q3, so we had a big beat on all metrics, which is great to see. Generally, you know, looking forward, we wanted to be conservative. We didn't want to assume the same level of outperformance would continue. So we're just trying to be conservative there. I will note, we saw relatively normal seasonality in October, so there wasn't anything really unusual in terms of what we're seeing. So you know, net-net, overall, we're just trying to be conservative. you know, we did raise the midpoint of EBITDA and non-GAAP net income because we feel very good about our cost containment, but we're trying to be conservative on the revenue side. Yeah. Good morning, Jason, thanks for the notes as well. So, with regards to Yahoo, there are a few things that we're seeing. First of all, you know, it's already getting some traction, as I mentioned on the call, and that, that's good for us because it validates what we assumed back then when we, you know, partnered with Yahoo, that the quality of supply and what advertisers get, the value they get is higher than the average value they get in general. So it's very good for them. So now this is as we progress, we can continue to showcase that to net new advertisers and existing advertisers as we want them to spend more. The second thing is that there's a whole slew of, kind of, journey in which, Yahoo, if you look at the type of supply they have now, it's a lot of kind of homepage and great placements that today Taboola traditionally doesn't have a lot of. So most of our supply today, and what we recommend to consumers is bottom of articles for the most part, and Yahoo is quite the opposite. It's a lot of, you know, kind of this high impact homepage placement. So for advertisers, it's, it's a great mix, of reaching consumers in multiple touch points. So I would say that. And also, over time, we'll, we'll be able to come up with new formats that we're also excited about, again, as, as, as it relates to homepage placement specifically. I would start with, one, it's very valuable, it works, which is great. And two, it's a very new type of supply versus what Taboola and I think in general, what, you know, a lot of the open web has to offer, given how Yahoo was successfully launching their homepage with consumers. So I would say quality of advertiser success, homepage, and format. Thank you. Thank you. Our next question or comment comes from the line of James Kopelman from TD Cowen. Mr. Kopelman, your line is now open. Taking the question. The first one is for Adam. On generative AI, you mentioned 25% of self-serve creative is based on Gen AI tools. I'm curious, in terms of advertiser feedback, do you find that clients are adopting these tools primarily because it's helping them save time and creative resources? Or is it more that Gen AI is also helping drive better conversions, or is it some combination of both? And then you also mentioned that Gen AI can help you improve yield. Could you also remind us how yield is trending in Q3, more broadly? And I'm curious if it's been recovering along with the recent ad market stabilization. And then I have a follow-up for Steve. Thanks. Okay. Okay, I can start then, and let you know if that, if I answer your question. So on Gen AI, you know, we're, we're getting kind of like, both, feedback from clients. We're seeing that, first of all, as I mentioned, over 2% of our, of our revenue is now with Gen AI, which is because a lot of our business is direct and it's performance advertising driven, our clients, they only do what works for them, and they continue to do it so long that it works. So that's a good feedback from the market that Gen AI is not only something that drives productivity and, of course, helps them save time and, and get, you know, more campaigns going and diverse campaigns, because it gives them such a good offering automatically. But we also see that, voted by the field in the way that revenue is being growing attached to gen AI. So I do like it, and I hope that over time, more and more of our revenue will be driven. Like I said, you know, vast majority of our revenue next year, I expect to be using sophisticated AI in general, like max conversion and ROAS and other things, but then also with gen AI. So that's very important to us. And I think from a yield perspective, you know, as you know, it's about half of our technology organization of R&D is working on performance advertising success and yield expansion. So, this is top, top of mind for us, given how much supply we're adding and the trends of our yield today, which I would say it's mostly flat today or in line with the seasonality we expect, which to me is encouraging given how much supply we're adding. I do expect expansion in 2024 of that, given our investment in yield. As I mentioned, it's a lot of what we do, and I think mainly driven not by the market's recovery, but mainly our internal investment in technology. So I don't wait for the world to get better, Taboola will make it better. And then for Steve, in terms of the Yahoo investments, earlier in the year, you identified, I think, roughly $30 million in Yahoo-related expenses for 2023. Is that still how you're thinking about the size of that investment for this year? And then taking a step back, obviously only November, but can you remind us how far along we are in terms of the overall investment for the integration, both 2023 and 2024, to get us to the full ramp point of mid-next year? Sure. So first of all, we've managed to figure out ways to cut down on the amount of increased costs that we expect to have from Yahoo. So that's been a good thing. That's one of the reasons that we've part of the cost discipline that I've talked about and part of the reason that we're ahead on Adjusted EBITDA. So I don't expect the full $30 million anymore. So that's good. I think in terms of thinking about how much are we investing and where are we in terms of the investment, I think I said in my prepared remarks that most of the increase in operating expenses in Q4 is really around two things: It's it's mostly investment in Yahoo with a little bit of investment in our e-commerce business as well, both of which are ahead of the revenue, so that's why the cost is up a bit more than the revenue. So that's, if you wanna see how much we are investing, you can kind of look at the delta of our operating expenses in Q4, and that gives you a pretty good idea. I would say, you know, as of right now, we expect most of the hiring that we need to support the transition of the Yahoo business to Taboola to be done by the end of Q1. So we're in that ramp phase yet. It's not all there yet, but it'll probably all be added by the end of Q1. And just as a reminder for everybody, in terms of the revenue, we're starting to transition advertisers now. The impact on Q4 will be small, but then we'll be fully ramped by the middle of next year. Yep. Great. Thanks, guys. Thank you. Thank you. Our next question or comment comes from the line of Laura Martin from Needham. Ms. Martin, your line is now open. Hey, can you guys hear me okay? Yes. Good morning. Great. Good morning. So I wanted to ask about, so my net revenue Ex- TAC is down 1%, despite the fact that we're selling new Yahoo ad avails. We have strong growth in Microsoft of 2x, e-commerce up double digits and news revenue growth. So my question is: What's falling? Is it just the yield because we're bringing all this new ad units on for Yahoo, and we're not bringing on their new demand? What, what's going wrong that's offsetting all these wonderful growth categories that you wrote about in the press release, Adam? Yeah, I'll take it. So it's actually, if you look at the business, right, the core supply of our business and the core business in general is very strong. We're winning publishers, we're investing in yield expansion. You know, Q3 revenue is up over last year 8%. Q4 is 17% up versus last year. The main thing that is still affecting us is, which we're carrying from the end of 2022, is the decline of yield in 2022. So because the yield went down throughout the year, the beginning of 2023, it was just the pie was smaller. And that's something that we still carry, and so we're still seeing that in our results. But as we're gonna expand yield, and like I said, I do expect it to go up, and right in 2024, we're gonna see that recovering, and again, mainly because of our investment as a company. So the main thing that creates this optics is the end of 2022 and how we started 2023. Let me also just add that if you, you know, if you look at the midpoint of our guide, we are expecting gross revenue to grow 17% year-over-year in Q4 and Ex-TAC to grow 8% year-over-year in Q4. So we're basically returning to growth. We're just lapping some tougher comparables from before yield declines happened in 2022. Okay. Super helpful. Okay, my second one is on... One of the things—I'm glad you're reiterating 2024, the $200 million and the $100 million of free cash flow as well. My question to you, Adam, is, is the use of cash to prepay more debt and repurchase more shares with that huge step up in free cash flow and EBITDA, implies that you don't actually have a better return on capital use of funds, which would imply that you don't think there's, there's something in the fundamentals of your business you can invest in that's a higher return. So could you speak to that, why shrinking your capital structure is your highest return on capital? Yeah. So I think... Let me, let me jump in, Laura. Adam would love to answer it, but he pointed at me. So the, I think what I would say is, we can, we can fund all the investments that we wanna do in our, in our business out of our existing operating cash flow. So we really don't need to, to, you know, use any of the cash, that we, that we are gonna use on share buybacks or debt repayment, to fund any sort of new initiatives. And, you know, we think, I think we've talked about this, this in the past. We think of R&D as an investment, and that's where we spend our money. We think we're investing the right amount right now in those new initiatives. I think there's, you know, a natural limit in terms of how many things any one company can do, and we have a lot of investment initiatives going on. We've got investments going on in e-commerce. We're bringing on Yahoo. We've got our performance advertising investments. We obviously are continuing to invest in our bidding platform. We're investing in a lot of things. We think we're investing the right amount, and yet we're still able to generate excess cash flow. We think right now, frankly, buying back shares is a very good use of our cash because we think there's a good return on that, and debt's getting expensive, so we do want to pay that down. You know, we have enough cash flow that we can do all of those things. Just one more note to add, is that we also, as a management, we care about Free Cash Flow per share. So buying back share helps us and our investors to kind of track that over time as we kind of stabilize our share count. So that's another thing that we care about, and we hope over time, we can spend more time on. Okay, super helpful. My last one is, you know, there's a lot of industry pressure on made-for-advertising websites. Could you talk about whether you get caught up in that, in that category and in that negative sort of feedback loop from a lot of industry, a lot of industry criticism right now of that type of websites? Yeah, of course. So we know, we monitor the industry discussion. I'll tell you, we're not concerned about it as it relates to us. We have a small single-digit% of revenue spent by publishers of all kinds, so it's a small, you know, from an exposure perspective, and we feel good about our leadership with our policies and our moderation team. We have about 100 people working full-time, kind of making sure that we adhere to those policies. We support the industry trends towards making sure that advertisers know exactly where they spend and what value they get. So I think it's a very good discussion to have, and as a company, I think we're, you know, we're in a good place. Thank you very much. Thanks, Laura. Thanks. Thank you. Our next question or comment comes from the line of Andrew Boone from JMP Securities. Mr. Boone, your line is now open. Good morning, and thanks for taking my questions. Adam, I wanted to go to a big picture question in terms of the strategy of the Yahoo deal in the first place. We've talked about in the past, the benefits of scale, and so just relate that to where we are today, right? Like, how is scale playing through and benefiting the overall platform for Taboola as it relates to today, and then how do we think about that for 2024? Yeah. Good morning. Thanks for the question. I, this is maybe one of the main thing that keeps me excited, as it relates to our journey over the next, you know, three, four, five years. Because I think today for advertisers, and it's- I think it's always important to take the point of view of the client. When advertisers, and you know, about 10 million of them spend on Google and 10 million about spend on Facebook, and we're seeing the growth of advertiser spending with Amazon, and we're seeing, we're seeing how more and more businesses, you know, NVIDIA is spending so much energy on making sure that advertisers is, are supported because everyone sees the opportunity with the advertising sector. I think when you... You know, their point of view is it's uniquely complicated to buy open web today. You have dozens of companies, and they're all in the sub-billion dollar range, revenue scale. And then they have, you know, they each have different platforms, different account management team. It's just too much. It's too complicated, too much. And I think for the most part, there's a very few amount of companies that actually have direct relationship with advertisers, right? We had about 18,000 clients working with us directly, which I'm proud of. But imagine Taboola with 30,000, 40,000, 50,000 or 100,000. But to get there, to get to the point that advertiser says, "We need Taboola as a must-have. We need a Taboola strategy," we have to be bigger. You know, I think when we get Yahoo fully ramped up and we get to our, you know, call it $2.5 billion run rate, we're bigger than Twitter, right, at that point. We're in the same realm as Snap and Pinterest. At that point, it's a whole different area code, and I hope this is this is our one level up. You know, I played Zelda these days, so this is when we get the master sword, you know? This is where we get to become invincible and we're one level up, and advertisers will say, "Well, we can't ignore this open web opportunity, search for Google, you know, social, Facebook and, and Taboola." And that's not where we want to end. We wanna get to $4 billion-$5 billion in revenue and truly become an alternative to the walled gardens. So I see Yahoo as a great partner, an amazing source of supply, which is exclusive to Taboola as it relates to native. A lot of formats, a lot of homepage, a lot of goodness that has that with us. And I think it's gonna get us one step forward, kind of getting outside of the ecosystem as it is today. Nothing wrong with that, but I do want Taboola to be just one step out, bigger, so advertisers build strategies with us. Thanks, Adam. And then you guys in the past have talked about bidding being a billion-dollar plus opportunity. Understood the very good commentary out of Microsoft this last quarter. But talk about the path to be able to make that a billion-dollar opportunity. Where are you guys today and what needs to happen to get to that goal? Thank you. Sure. So yeah, I'm very happy. First of all, I'm always happy when we tell something to our investors and analysts, and a year after, it happens on time. So I'm very happy that Microsoft is double what it was a year ago, which is what we thought it's going to be, and it is. So that's, first of all, that makes me happy, as we're still a new, you know, public company, and we're trying to build trust with our community. So I think over time, this is gonna be our bidder technology, and there's a lot of work here, right? We're still new. It's a startup within Taboola. It's a startup that makes $hundreds of millions, but it's still a startup. We're gonna plug that in across all of our publisher base. This is still early stages, and we wanna do a good job. The way you wanna think about it is, every display inventory that exist across our 9,000 publishers, which I think those display inventory today, they probably generate $20-$30 billion. If we take 10% of it or 5% of it, this is a good $1 billion. Then you have Yahoo, which has a very significant display business, which I also hope to be 5%-10% of. And then you have, you know, just other areas where we can bid into that completely sit outside of a browser, like, you know, CTV perhaps, and other places. So over the next three to five years, at the very least, I want to be part of our core display per ecosystem. So that's the 9,000 publishers in Yahoo, and I wanna take a 5% of it or 10% of it. If that takes us three to five years, that's a good $1 billion, or more. And then over time, you know, I think we can get our bidder integrated into kind of non-browser environments such as CTV and others. But that will take some time, but that, that's how we get to a $1 billion and more. Great. Thanks, Adam. Thank you. Our next question or comment comes from the line of Dan Day from B. Riley Securities. Mr. Day, your line is now open. Hey, good morning, guys. Can you hear me? Yep. Yep. Hey. Hey, Adam, Steve, how are you? Good. How are you doing? Good, good. So just a quick one for me. You talked about, your, your, focus in the near term here being migrating spend over to, over the, to Taboola for the Yahoo inventory. Just maybe if you could give us a peek into what your game plan is to make that happen as quickly as possible and, you know, as effective as possible in terms of migrating budgets over. Is it just salespeople reaching out to get test budgets over? You have incentives in place to start moving budgets over. And then is there a plan, you know, down the line to deprecate the old Gemini platform that, you know, maybe might get, people using it, to start at least testing on the Taboola platform? Sure. I'll jump in on that one, Dan. So first of all, yes, there are detailed plans in place. I don't wanna get into too many specifics because it's obviously getting into the weeds in terms of how we're working with a key customer like Yahoo. But what I can say is, you know, we've said all along that we would start migrating the advertisers in the back half of the year. You obviously all saw the announcement that the supply is now fully available through the Taboola platform, so that has started now. We're making good progress. We feel good about where we're at. I think Adam mentioned that it's really nice to hear stories of some of the advertisers that have migrated over and how they're finding, you know, having a good experience. I heard about one advertiser just last, earlier this week, or maybe it was late last week, it all blurs together, but, about how they are hitting record levels of spend versus what they've ever done with Yahoo directly, and in fact, are now spending more with us than they are with Meta, which was kind of amazing to hear. So I think, so far, progress is encouraging. Our sales teams have a plan that they're executing on. I don't wanna get into all the specifics there, but we're making good progress, and we still feel very good about, getting it fully migrated by middle of next year and being at full ramp starting in Q3. Great. Thanks, Steve. Just, another one. We did hear yesterday from peers about revenue headwinds from an increase in publisher page views attributable to the war-related content, you know, advertisers blocking those for brand safety, suitability reasons, just making it more challenging to monetize those incremental page views. So just wondering if you guys have seen anything similar over the last few weeks? Yeah. So I mean, we obviously have business out of Israel, so about 10% of our revenue in Q3 came from Israel. But that revenue, most of it is what we call export revenue, which is businesses, advertisers that are actually trying to reach consumers in other countries, U.S., U.K., you know, wherever they're trying to reach those consumers, it's not in Israel, and that tends to be much less affected by what's going on. Only around 2% of our revenue is what we would consider domestic Israel revenue, which is advertisers spending on Israeli publishers. And because of that, we're not seeing a huge impact. And in fact, by the way, on those publishers, traffic is up, revenue is down, so it kind of offsets itself somewhat. It's a small enough portion of our business that we're really not seeing an impact overall in our business. Obviously, we're monitoring pretty closely, though, because, you know, we need to see if it spreads or if anything more happens, but as of now, we're not seeing a material impact. Okay, great. Thanks, guys. Thank you. Our next question or comment comes from the line of Sergio Segura from KeyBanc. Mr. Segura, your line is now open. Great. Thank you. Good morning, Adam. Good morning, Steve. Two questions. First on Max Conversions, how broad has that adoption been, and how has that impacted net dollar retention for campaigns using it? And, when should we see a full adoption of that product? And then for Taboola News, great progress towards the $100 million in revenue. How should we think about the drivers for the next $100 million in revenue? Thank you. I can start and Steve feel free to jump in. So on Max Conversions, first, it's like I said in my letter, it's great to see the adoption. It's about 30% now of our revenue has been adopted with Max Conversions, which is a level set, is one of our rich and sophisticated AI that helps clients and advertisers share their business objective with us, but not have to provide a CPC, which is very common in ad tech, but not common in with Google and Facebook. So, we're now we look more like a Google and Facebook from the advertiser point of view, and it's our fastest growing adopted product since I started Taboola in 2007. So that's pretty awesome to see. What's good about it, it does affect NDR. I think we shared this, let Steve check it, but I think we shared in our letter and press release some numbers. But it does affect NDR. So we'll tell you, advertisers, the cohort of clients who use AI and Max Conversions, they see better NDRs as well as lower churn. And these are kind of the two leading indicators that we're tracking as a company, and we have aggressive goals toward improving them. And my expectation is that this will be the majority of our revenue in 2024 will be driven by AI and Max Conversions, as well as the next iteration, which will be ROAS, and that's where advertisers can optimize for revenue as well, not just conversions. This is the whole roadmap into 2024. In fact, just before this call, I had an hour call with our VP, products on that, and it's very exciting to see what we plan to do. As it relates to Taboola News, there's a bunch of things that we're going there. First of all, it's a great business on its own because you know, it helps our core business get stronger. It's very synergetic, so it there's a win-win orientation there. You know, we send traffic to our publishers. They grow audience, especially in times of, you know, the open web that could use more attention. And in general, we're growing that business in a few ways. One, existing relationships with Xiaomi and Samsung and Oppo and Realme and others, we can get to more markets with them, so there's a geography expansion, and that's going to help us get more users. The second thing is get more touch points. So if you look at many of our OEMs today, they tend to work with us in one or two touch points, but not all of them at the same time, and there's an opportunity there. So they might have us on the lock screen, they might have us in the Minus One, they might have us in a notification when they send news to consumers, they might have us in the browser. But a lot of times they just start in a certain integration, and they grow it over time. So there's a whole, vertical expansion opportunity with existing OEMs, and how much more we can do with them. And then you have other kind of, you know, mid-sized OEMs, and all of that is before working with carriers, which we have not yet really, done. So over time, you can imagine Taboola supports not only OEMs directly, but perhaps carriers. And again, this is like a five to 10 years roadmap for this business. So there's a lot of ways this can become hundreds of millions of dollars and in fact, even, even more. Thank you. Our next question or comment comes from the line of Mark Zgutowicz from The Benchmark Company. Mr. Zegartowicz, your line is now open. Thank you. Good morning, Adam and Steve. Just curious on the Yahoo advertiser migration. I'm just curious how much visibility you have on making that happen there by mid-2024. Just, you know, maybe more specifically, do you have, like, a concentration of advertisers that have committed to moving over after, you know, the seasonal holiday period? And then, just in terms of e-com, just broadly speaking, can you talk about how your go-to-market there is perhaps evolving and sort of what types of new client engagements you're seeing? You know, obviously, you're having some continued pretty strong growth there, but just maybe how that strategy is evolving. Thanks. Sure. I'll start with the Yahoo advertiser migration question. So, yeah, I think we have very good. We're partnering very closely with Yahoo on this. It's in Yahoo's best interest to help us with this migration, because obviously the revenue that those advertisers bring flows back to them largely. So we're working hand in hand with them. We have good visibility from working with them on what we need to do. We obviously know kind of what the concentration is and which advertisers we need to move. Like, that's what we're working with them on. So I think we have very good visibility. I think we have a pretty good notion of what we can get done on that. So, I feel good that we have, you know, we have what we need, we have the visibility, and we have a plan in place with them to help make it happen. Yeah. So about e-commerce, first of all, I'm very happy with our decision, strategic decision to acquire Connexity and get into e-commerce in a significant way. I think it's gonna play a very important role in the future of Taboola, as well as the future of the open web. So, it's a very lucrative part of our business that will continue to be as such. And we're seeing that in the results of our business. I mentioned that we saw double-digit growth in e-commerce in Q3, and that is driven by a lot of what we said we'll do. You know, international expansion in Europe, the synergy with Taboola and now Yahoo as a source of supply in... on top of what Connexity had before. I'll tell you, Taboola is now a top 10 partner to e-commerce buyers. So retailers now, when they see where is traffic coming from, Taboola is now a top 10 traffic source, which is great. We're again and we're signing new clients. As you know, we're investing more in growth, more sales, outside of the U.S. So we're seeing in EMEA and APAC new clients and new affiliate partnerships. So all of that is great. As it relates to, you know, our business, it's trending to be, you know, about 20% or almost 20% of our Ex-TAC, which is great because it's very premium, consistent, reliable source of revenue. Over time, I think that's that has a chance of being a third of our business, as well as a third of our publishers. We're seeing some publishers that now make as much money from e-commerce as they make from native advertising. Some of them even make more than from e-commerce. So if you think about that future, that means if you're not in e-commerce and you don't have an e-commerce offering, you may become irrelevant over time. So that's that makes me happy. Adam, just in terms of capacity to address the e-com opportunity, how would you characterize that in terms of having enough capacity to address obviously a big opportunity? Yeah, so I'll jump in on that. I think, so when you say capacity, I assume you're talking about, people resources and the other resources we need to run the business. Is that kind of how you're, what you're thinking about? Right. Sales strategy- Yeah. -broadly. Yeah. Sales capacity. What's interesting... Yeah. Yeah, I hear you. What's interesting is, and I think we said this at the time that we acquired Connexity, this is a business that makes very good revenue, very strong EBITDA. You know, is run by a private equity firm for a long time, despite the fact that, frankly, you know, in our view, it was probably underinvested in, in terms of looking for, seeking growth. So I think what we're doing right now is we're investing more resources into growth areas, for Connexity and for our e-commerce business more broadly. So for instance, we're bringing on more salespeople to sell new merchants in the U.S. and abroad. We're helping them expand internationally into territories where they really didn't have a strong presence historically. And then we're also taking advantage of other synergies that work with our, our core business. For instance, we disclosed in our shareholder letter that, or and in my prepared remarks, that actually, Taboola Feeds are now a top 10 supply source for our e-commerce, advertisers or our merchants, as we call them. So it's, it's been, you know, it's been a success story in terms of all the good things that are going on there. And I think I would characterize it as we have, we have what we need to run the business. I think there's still opportunity to invest more and grow faster over time, and that's really what we're doing now. So that's, you know, in Q4 here, I mentioned that there's really two areas that we're investing more people in, and that's Yahoo and e-commerce, and it's because we think there is potential to grow e-commerce even more and faster. So I'd say we have, we have what we need to keep it going. We probably can invest more to grow it faster. Great. That's helpful, Steve. Thanks much. Thanks, Mark. Thank you. I'm showing no additional questions in the queue at this time. I'd like to turn the conference back over to Mr. Singolda from Taboola for any closing remarks. Thanks, operator. And thanks, everyone, for joining us today. As you can see from our results, we feel very good about our performance this quarter and where we're going. There are many, many things that are going strong. Taboola News, e-commerce, our AI-powered bidding technology with Microsoft and others, our core business, which is well positioned and only getting stronger with Yahoo and our massive investment in performance advertising technology to drive yield expansion. And like I told you, that's one of the key things that's gonna, that can double and triple Taboola over time on its own. I look forward to 2024 to arrive. It's gonna be an important year for us as we make big steps forward towards becoming the very first-ever large-scale must-buy advertising company in the open web. I'll finish my summary here with the same way I started the call today. I wanna thank our employees in Israel and their families, my prayers, my heart is with all of you, and I think about you all the time. And I wanna thank everyone for the hard work at Taboola and the dedication, especially given what's going on in the world. And to our investors, thanks for the support and interest, and here's to a great, great 2024. Ladies and gentlemen, thank you for participating in today's conference. This concludes the program. You may now disconnect. Everyone, have a wonderful day.