Platform outside of Search and Social. What that means is we help businesses grow by placing their performance ads out in the open internet. By open internet, we mean basically everything outside of, you know, Google, Facebook, and the walled gardens. It's all the websites that you love, the apps that you use, connected TV channels that you watch. It's kind of everything outside of the walled gardens. Basically our advantage and kind of what makes us successful as a business is, first, we have significant scale outside of Search and Social. We see about 600 million consumers every day out in the open internet. What that does is it gives us really good data about what consumers tend to click on, what they read, what ads they click on after they're reading content, what products they buy. Like, we have a lot of information about what consumers do out in the open internet. And then when we combine that with our deep learning AI engine, we're able to very effectively target performance ads out on the open internet and basically make them successful. So that's our advantage. And basically that is who we are as a business is we're a performance advertising platform. We basically gain that scale, by the way, by having long-term exclusive agreements with publishers. We work with Yahoo, we work with ESPN, we work with CNBC and all the NBC properties. We have long-term agreements with them. We'll always be on their web pages. That's where we get that first-party data. We see people. If you come back to ESPN day after day, we'll see you every day. We know what you're reading. We probably know who your favorite sports team is. Sorry about the Knicks. But, Knicks fan, no? You would not have been able to guess if I gave you 10 more tries. I am all things Minnesota. Oh, okay. In that case, congrats on the whe-whe. For the audio recording, Skoll. Okay. In any case, that's those long-term publisher relationships where we get our data, that's where we see consumers, and that's where we place those ads. That's Taboola in a nutshell. Yeah. And, and so we've established that you're not exactly a traditional ad tech player. Like, in terms of how you get paid and what you get paid, could, could you just talk a little bit more about how the economics work? And, and then you have a total revenue and an XTAC. I got told last time that I need to use less acronyms. So traffic acquisition cost. Can you just help us understand the relationship of these two, metrics? Sure. We make our revenue from advertisers. Advertisers pay us. About 90% or more of our revenue comes from cost per click advertising. We only pay if a consumer clicks on the advertiser's ad. That's our revenue. We take part of that revenue and pay the publishers. I mentioned that we work with 11,000 publishers globally. We pay a portion of that revenue to the publishers. That's the TAC, traffic acquisition cost. If we make $100, we pay on average about $65 of that to the publishers. That is the traffic acquisition cost. What we keep is called XTAC gross profit. That is, and that's really what I consider our revenue. Frankly, XTAC is the way we measure ourselves. 'Cause I can inflate the top line revenue just by doing some bad publisher deals, pay them all the revenue, and I don't make anything from it. We measure ourselves on the XTAC. That's what we wanna see growing year over year. That's how we measure our growth. And then, you know, as a business, we focus on that XTAC growth rate. We try and always stay above a 30% adjusted EBITDA margin on the XTAC. Adjusted EBITDA divided by the XTAC. We try and convert 60-70% or that or more to free cash flow. That's kind of our model and how we think about it. When we think about kind of how the model's going to evolve as the market changes, you had a new platform come out this year called Realize. Can you tell us more about the potential to better monetize the 600 million people that you reach every day? Yeah. Yeah. Realize is, our, that is our advertising platform. In February of this year, we rolled out Realize. We moved all of our advertisers from our old ad platform to Realize. What Realize does is it helps us in several ways. We moved from being a native advertising business, which is one specific type of performance ad. It's, it's the ones that you see on publisher sites, which has a thumbnail, a headline, and some attribution text. We now can, rather than just do native, we basically can do all types of performance advertising: display, vertical video, native, whatever formats the advertisers wanna use, we'll work with that. Within that, we also rolled out new capabilities. That basically are focused on helping advertisers become more successful on our platform. New algorithms that help them get to conversions faster, make them more successful. New features like, a feature we rolled out called Predictive Audiences, which basically tells them if you spend $10,000 more a month, we expect you to get 100 more conversions every month. Like, helps them understand their performance. It's new formats, new tools within the platform. Also we, at the same time, rolled out a new go-to-market where we're very focused on what we call ideal customer profiles, verticals that we know work well in performance advertising. We're focused on that. It's kind of a whole rethinking of the Taboola business, expanding beyond the native business to all, all things performance. Yeah. I, I, and so that obviously went through a lot of work, kind of an investment point this year. Could you just talk a little bit more about the actual impact on the business of having to transition all of your customers to a new platform? Yeah. Yeah. I mean, it was a, it was a heavy lift. We spent a lot of investment in 2024 actually getting ready for this. Obviously, we rolled out the platform in February this year, but the building of the platform happened last year. It was really a complete rethinking of how we go to market. The interface is different. We integrated Abby, which is our generative AI or our LLM-based chat tool, into more places in the platform to help our advertisers succeed. We built in the new capabilities that I talked about. We rolled out, you know, new features. It was a big investment all last year. We made the choice, and it was maybe a little bit of a risky decision. We made the choice that it was going to become our default ad platform. As opposed to, say, The Trade Desk, who I know ran two parallel platforms for a while and others who have done that, we said, we're gonna, we're gonna make the move. We're gonna, you know, rip the Band-Aid off and move everyone over to it. We're pretty happy with it. I mean, it obviously we did not have a lot of glitches. That, that's good in and of itself. We're also seeing better performance from it now. Just this quarter, we basically talked about the fact that we're seeing kind of an inflection point. We're seeing advertisers increase their spend. We're seeing them happy with the new platform and seeing more success with it. We feel like, we're, we're more confident than ever that this is now gonna be our path back to double-digit growth. Yeah. Yeah. That's the perfect lead into my next question here. And I assume that they were gonna tie out a little bit 'cause you did mention on the Q3 call that you feel like you get into an inflection point and you have more confidence than 90 days ago of that return to double-digit growth. I think we probably have touched on maybe the core of it, but can you talk a little bit more about where that confidence comes from and then the key pillars you see to, you know, trigger that inflection back to double-digit? Sure. Yeah, I think the whole key to our growth as a business, we believe we have plenty of high-quality supply. We don't think, I mean, we'll always try and win more supply. I think we've got the opportunity to gain share on the supply side over time. Generally, the key to growth is getting more advertiser budgets. That's why Realize is so key. I think the three things, and we've touched upon these a little bit to get to that growth, are basically the new features of the platform that make advertisers more successful, the new go-to-market approach of focusing on ideal customer profile type of customers, and then ultimately showing them the success, getting the additional budgets. The new formats are part of that budget, new budgets. We're seeing particular success in the first two. The new platform features, definitely we're seeing advertisers more successful and faster. That's kind of key. Like, if I can see an advertiser get to success within a couple of months, and the probability of them getting there is higher, I can spend more on marketing. We actually, even this past quarter, said for the next couple of quarters, we're increasing our marketing spend 'cause we're seeing that success. It's that, the features getting them success fast, faster, and the verticalized approach, the ideal customer profile approach, we're seeing the most traction there. I do think we'll see more budgets to other formats and things over time. We have over 1,000 advertisers who are testing display and other new formats, but that revenue is still small. I think that's growth for the future. Yeah. Staying on growth, I think over the last five years, it's been really hard for investors to separate the secular from the cyclical. And so I guess when you're thinking about the macro environment today and then also how you're, you know, starting to think about it for 2026, what are you seeing out there? Yeah. So generally, I've been saying for a while that it's, it's fairly stable. You know, you saw the, there was kind of a little bit of a COVID bubble where advertising kind of went nuts for a while. And in 2021, 2022, you saw a softening on that front. Since then, it's been fairly stable. So advertisers are a little skittish. Like, they see all the tariff things going on, political instability, there's wars. Like, it's making them skittish, but they continue to spend. So I think, and we're performance advertising. So performance advertising is particularly resilient to, you know, instability and doubts because it's either working at that time or it's not. So we tend to like the performance advertising even when it's, fairly unstable. But we're, we're seeing relative stability. That's our expectation going into 2026 is that we continue with this maybe a little bit of nervousness, but general stability in the ad markets. It's always kind of a tricky question in the advertising space, but you have some differentiated relationships in terms of your, with your publishers. How do you think about competition? And both from like the traditional ad spend perspective, but also competition to get those kind of exclusive relationships with publishers. And are you seeing any kind of changes in that mentality as you get into the performance space with the Realize platform? Yeah. Let me, I'll separate competition into the demand side versus the supply side. Let me talk about the demand side first because I mentioned that we feel like we have enough high-quality supply that our growth should come from growing advertiser budgets. It is that competition on the demand side that probably matters most at this point. On the demand side, the way we think about it is, we have very unique data. We have very unique technology. We see we have scale that very few have outside of the walled gardens. We think we have a right to win any performance budget that is going to the open internet. Today we have about $2 billion of revenue, roughly, and that is all performance budgets there. We think there is about another $10 billion of performance budgets that is going through other ad tech players. Whether that's through a DSP, directly through an SSP, you know, it's going to the open internet through one of those channels. We estimate there's about $10 billion. We think that's our lowest hanging fruit. We believe we have a right to win that 'cause we think we're better at performance than a standard DSP. The reason for that is like a standard DSP is a software, software platform. It allows an advertiser or an agency on behalf of an advertiser to target the advertiser budget at specific supply, bring in which data they want, you know, manage it, but you've gotta manage it. You've gotta figure out which supply is working. If the data's working, you've gotta figure out the attribution. You've gotta change your pricing, usually on a CPM basis, up or down, all to get to a CPA goal. With us, you come to us and you say, "Here's my budget. Here's my CPA goal." And we figure all that out for you. We think we're a much easier, more frictionless way to do performance in the open internet. We think we have a right to win that $10 billion of other budgets that go elsewhere. That's our kind of primary focus competitively. On the supply side, you know, again, we think we have enough high-quality supply, but where we're focused there is we'll continue to try and win publishers for the long-term relationships like we always have. You know, frankly, some of our competitors are having their own challenges right now. We think we have an increased opportunity to win that. We'll also now start bidding on display spots and winning other types of supply that historically we haven't really played in. I think that's our other growth path on the supply side. When thinking about the supply side and thinking about some of those displacement opportunities, what is kind of like the variable or marginal cost of adding on supply? Do you want as much as you can get, or are you guys more particular about who you wanna partner with? Yeah. I would say we want as much as we can get of the right type of supply. I know that's like. Both. Yeah. Both. The answer's both. Yeah. For instance, you know, I would say we don't really play in the long, long tail of the internet. And that's because it's a little bit of the wild, wild west. You just. Don't know what you're gonna get. There's fraud out there. There's click, clickbaity type of stuff that is not really what we want. There's a lot of stuff in the long tail. There's a lot of quality there too, but you just can't, it's too hard to sort out the quality from the chaff, the wheat from the chaff. Ultimately we do not play in the long tail. We will play in the mid-tail and above. Usually we want to focus on brands that we would trust as consumers because usually you can count on that as being high quality. We will win as much of that as we possibly can. The incremental costs of bringing on incremental supply of that type is very low and we can do it very quickly. We want as much of that as we can get. We just do not want the longer tail stuff that may bring down the overall quality level. Great. Switching back to product. So you've seen some strong results recently from Taboola News. Could, could you tell us a little bit about the product, but also kind of maybe looking down the road, three, five years, what you think the long-term opportunity is for that solution? Okay. Yeah. Sure. For those of you who do not know, Taboola News is basically, think of it like Apple News for an Android device. We partner with Xiaomi and Huawei and Oppo and Samsung and all of the Android cell phone manufacturers. I think we have eight of the top 10 as partners to basically provide an Apple News-like experience for their devices. What that does for us, we view it as just a very unique type of supply. We provide it, again, just like we do with our publisher partners in the open internet, we provide the service for free, then we generate revenue from it and we pay them a portion of that revenue, just like we would a publisher. It's a very unique form of supply because it's advertisements that are directly on the device before they ever get to a web browser, before they ever get distracted by, you know, their social media site or whatever their app or whatever they're going to. It's very unique supply. We think that for us, it's an advantage 'cause it gives us, again, something for our advertisers that's really unique. In terms of where we see that growing, ultimately there's still a lot of growth left in that business. It's smaller, you know, it's a small part of our overall business, but growing faster than our business as a whole. We still think there's a lot of expansion opportunities. We're not globally rolled out with all those partners. Samsung, we could still go roll out more with. We're also not on all devices. We also are, we, I think we can expand the number of touch points per device. There is a news swipe right type of news feed. There is a lock screen implementation that we have. There is a lot of browser implementation. There are a lot of different things we can do. We think we can grow that by expanding our global footprint with our partners, expanding our touch points with our partners, and just basically getting on more devices and seeing consumers more often. Again, it is exciting to us 'cause it is such high-quality supply. Yeah. A little bit earlier you mentioned about a right to win in the areas of performance. When we think about product enhancements in the future, are there kind of logical adjacencies or areas where, again, you feel like you have a right to win? I think, if I can steal one of Adam's terms, I think he called these speedboat type initiatives on your last call. Yeah. Yeah. So it's interesting. I think our biggest opportunity is Realize. And we're really, you know, this transition of going from being a native ad, ad platform to being all things performance throughout the open internet, we're still in the early innings on that. So I think we have a lot of expansion opportunities there. There's a lot of product features that we still need to roll out. You know, we tend to copy what Facebook and Google do because they're the leaders in performance advertising. And I don't know the exact numbers, but my guess is we've got, you know, a third of the product features that they do. So there's still a lot of ground to be covered to roll out more product features to be really good at performance in the open internet. Likewise, there's also a lot more we can do on the supply side there. Like I mentioned, we're starting to bid on display spots. You know, we've only been doing that for a few years now, and we're fairly early in it. I think we can be way better at it. Like that's something that when we really get good as a bidder, that'll bring advertiser success. It'll make them happier. They'll be in these really premium spots, but showing the performance goals that they want to meet. We have a lot of work to do there. We have a lot of work to do on the kind of advertising side and advertising features. I think that's going to be our primary focus. Now, having said that, you know Adam, and he can't always focus completely on one thing. We do have some speedboats. I think probably the most prominent of those is we have a new product called Deeper Dive, which is a publisher product. If you go to usatoday.com, it's at the top of the homepage. You can play with it there, but it's basically like a ChatGPT for the publisher site. If you come to USA Today, historically, if you come to the homepage, you get a bunch of links and you get to pick which articles you wanna read. Now you can go to the homepage and just say, what's going on with the Knicks these days? Or sorry, what's going on with the Timberwolves these days? Yeah. Sorry. Bad, bad example. So, and it'll then show you, it'll tell, it'll give you an answer. It'll say, you know, lately with the Timberwolves, you know, Ant Edwards has been, you know, playing pretty well or whatever. I haven't followed them. Yes. Okay. Good. Ultimately it'll give you an answer, and then it'll also tell you all the articles on USA Today where you can read more about it. It's called Deeper Dive. It basically gives the publishers a way to engage at a deeper level with their consumers, and, you know, through an LLM type of interface, which is becoming the way consumers like to consume information now. That's an example of kind of one of these kind of growth opportunities we have, that we're always working on. Yeah. No, that's super interesting. Unfortunately, if I typed in, "Give me information on Timberwolves, Vikings, and Wild championships," it would just explode. How? It would actually then start to hallucinate and just give you answers that. I would love that. I'd dream the dream for a minute. How should we think? This has been such a big topic this year, but the impact of LLMs on search traffic and what that means for Taboola. Because you do, it's a little different, right? Because you do have properties that you're attached to. And maybe what you're seeing and what you think the long-term impact is. Yeah. Yeah. So I think, where the biggest impact of LLMs on search is, is for sites that are very search, they're built for search. So, you know, think of the internet brands of the world or, you know, those, the health sites that are really built for search, WebMD and those, they're built for search. They have 70-80% of their traffic comes from search. They have a big impact. The good thing for Taboola is, we actually have disclosed information the last couple of quarters that only about 5% of our US traffic comes from search and only high single digits globally comes from search. So fairly low exposure. The reason for that is twofold. One is we have certain partners that are just not exposed to search. So Yahoo has very little search because they're mostly Yahoo Finance, Yahoo Sports, the apps. Microsoft, very little search. And those are our two biggest partners. Apple News, no search. All of our Taboola News partners that I mentioned just now, no search. So we have a whole swath of partners that have no search, little to no search. And then even our partners that have some exposure to search, like the ESPNs, USA Today, CNBCs of the world, they're branded sites. So 60-70% of their traffic comes direct to the homepage of people who just, that's part of their daily habit. And they don't go, you know, you probably go to ESPN to see the Timberwolves scores every, all the time. That is more of the traffic to our branded sites. So at the end of the day, we're only, you know, mid to high single digits exposure to search. that is declining. We've seen that declining over time, but it's a small impact. Overall, if you look year over year on our partner sites, they've actually grown year over year, even on the same store basis. Generally speaking, I think we're just much less exposed than most. Yeah. And that's maybe the most topical, but just one aspect of kind of what we're seeing from GenAI and Agentic in the industry. What do you see as like the, so if that wasn't a big impact, like what are the biggest impacts from kind of this technology revolution? Maybe for the market and then also just like zooming in on Taboola. Yeah. I think, I mean, for everyone, I think one of the biggest impacts is productivity. I think we're seeing internally with our developers, they're getting more productive. I mean, it's, you know, it's hard for somebody who has two kids graduating from college this year. It's hard for college graduates because, frankly, you don't need entry-level coders. The Agentic tools are your entry-level coder, and then you just need people who kind of manage them. It's interesting. We're seeing a good boost in productivity there. We're also seeing a lot of tools, consumer-facing tools that make things easier for our advertisers and easier for customers in general to do business. We rolled out a tool called Abby, which is an LLM-based chat tool that helps our advertisers get on board. We're now having Abby help advertisers who are already established to grow, to figure out which tools to use to grow. Like, you're seeing tools like that as well as generative AI tools to generate headlines and thumbnails and the like. A lot of productivity both internally and for our customers. I think you're, you know, when we talk to our publisher partners, our advertising partners, we hear the same thing. Like they see the value of these tools to make them more productive internally and also to help their customers more productive as well. I think there's gonna be a big productivity boon coming out of this, across all businesses. We got about five minutes left. Are there any questions from the audience? All right. I mean, following up on kind of where we've been going, I guess throughout this, you're always building to this question, but like what, what are you most excited about for Taboola in the next three to five years? Yeah. So I think, I'm most excited to see us make this transition from native to all things performance. Like, I mean, obviously that's our big focus as a business, and that's what I'm excited to see. You know, it's great that we've got this business that's with the publishers with long-term, committed supply, and it's very defensible. It's a good business, generating a lot of cash flow, but there's so much opportunity for us as a business if we can just be all things performance across the whole open internet, that that's exciting. I mean, we've gone from what we estimate to be probably a $3 billion-$4 billion market, of which we're almost $2 billion, to having this opportunity to compete in what we think is more of a $50 billion-$55 billion market. That transition's exciting. That's what we're really excited about as a, as a company. I will say I'm also excited about seeing how our partners and our customers transition through this AI phase. Like I could potentially see a day where publisher sites are basically just chats. You know, you go to USA Today, and instead of a ton of links, you get a, a chat tool, and you just, you talk to USA Today about what you're interested in that day. I'm also interested to see how the industry develops with all these new tools. For us as a business, the most I'm excited about is basically becoming all things performance across the open internet. Yeah. I guess I always talk to companies about this, but it seems like you've done the R&D stage. You now feel like you have the product. What do you think is the biggest gap in terms of kind of, pardon the pun, but realizing. The potential of the platform and like getting advertisers and publishers to also see what you already know, what you've, the work you've done? Yeah, we're, I'd say we're early in this. Like, you know, we only announced this February of this year, so we're still relatively early in the process. There's a couple of steps that have to happen. First, we have to just reposition ourselves in the minds of our, especially our advertising partners. Like when we walk into a room today, we're still seen as being that native advertising company, and you need to have them think of you as the performance advertising company. We're doing that. Like part of that is just feet on the street, talking to people, explaining the new, the new platform and all the capabilities and how we're much broader. Part of it is marketing efforts, getting out at conferences, telling your story, explaining to people how it is. That transition has to happen. and then, you know, where the rubber meets the road is then we have to have advertisers start to trust us to do more than what we've done historically. Like they know us as that native company. They know that works for them. They're already spending money there, but will they give us display campaigns and display budgets? Will they try some of the new features that we've built into the platform and expand their spend with us? I think that's where the rubber meets the road. That's where we are now. I think we're in that journey. We're starting to see the uptick from it, and we just need to see that continue. Yeah. We're just about at time here. I mean, is there anything else that we didn't cover that you'd like to leave us with or? No, I think that's, we've hit the end. Incredibly efficient. More sports talk than I was expecting. I just gotta remember you're a Timberwolves fan going forward. Yeah. Don't insult you with Knicks fandom. Sorry. How many Knicks fans do we have in the audience? Oh. All right. Oh man. I'm a Celtics fan. Does that make you hate me? We will wrap up this. Taboola. Thank you, Steve. Thank you so much for spending some time with us today. All right. Thank you. Thank you.