We have to start. We'll talk about the most interesting thing from CES on stage.
Let's do it.
Everybody can hear. Okay, so thank you for coming. I'm Laura Martin, a senior media and internet analyst for Needham & Company, and I'm here with Adam Singolda, who's the CEO of Taboola. Welcome, everybody. So I want to start, Adam, with a personal question to begin. What hidden skill that doesn't go on a resume has been mission-critical to your professional success?
I love our session.
I love it, don't you?
The best. So I think for me, there's a good and bad to it, by the way. But I think for me, I think the most common way of people thinking about a good idea is that they think if they keep it a secret and nobody knows about that good idea, they have a better chance to succeed because it's a really good idea. And my opinion is that ideas are a commodity, and the best ideas are those that get shaped so that you can execute on them better. So I tend to share ideas and thoughts with as many people as I can who I appreciate so I can get feedback and adjust the ideas so that I can make more good decisions versus bad decisions. And I think over the years, it's easier said than done.
It's very counterintuitive because people tend to believe this is a really good one, and no one should know about it, and my belief is I'm going to semi-broadcast that to as many people as I know who I can learn fast and adjust and execute. The downside of that, by the way, is that at times it can be exhausting to some people because I just want to, I want to, I want to, I'm a professional listener. I want to listen to what you think about my idea, so if you ask my wife, also probably a bit exhausting, but it can get exhausting because I really enjoy the process of interacting on a concept until I exhaust it enough so I develop conviction, so I think I'm a professional listener versus ideas and ideas are an advantage.
Okay. Okay. Really interesting. CES, you were at CES, I was at CES. We were ships in the night. I left a party. You came to the same party an hour later. You stayed 24 hours. I was gone the next morning.
We had a ships. It's like a coverage. You know, we want to make sure we're just covering the whole thing.
Covering that whole landscape. Anyway, I thought CES was fabulous. Did you read my most provocative takeaways?
No.
No. Okay. Okay. So I get to pick one for you. So the one I would like to pick for you is one of the things that was said at CES: that walls, TVs on walls, are becoming TVs as walls, meaning that in new construction, it's sort of what you just said, you know, off the record. LG last year was showing transparent TVs that they go in front of a window. You can see out the window, and then when you turn it into TV, the monitor
becomes actually a television monitor. Similar idea that TVs are now. TCL was showing 95 inches as their standard TV, 115 inches as their stretch TV, but that every year we get bigger TVs. So they're on their way to the whole wall. New construction will just have a wall that's a screen, and you can put seven things on it. You can turn it into an aquarium, and sometimes it will be a connected television, and sometimes it will be a workout
gym or whatever, so my question is, how does it affect your business if screens become, like the walls become screens?
I think it's already happening in many ways because we're kind of moving already from browsers maybe as the main screen consumers interacted with to consume content, to make decisions, to buy products, to any other app or device is a screen, right? Like Taboola News as an example, which is where Taboola is interacting with OEMs like Samsung and Xiaomi and others. We have a lot of interesting things coming up. It's already, you know, one of our growing, it's over $100 million business. We've said that before, and it's one of our fastest growing business. That's not a browser. It's not a usual screen, if you will. It's a device. And in many ways, the way I think about it, the more we have different canvases consumers interact with, whether that's a screen or an app.
You know, you look at even the advertising market, which you know and cover very well. Everybody wants to be in the advertising space.
Yes.
You know, Netflix has 70 million people they show ads to. Amazon reported their number one line of EBITDA is ads. Uber made more than $1 billion in ads last year. Ads is the new pink, right? So in that regard, I like pink. In that regard, I like pink.
This suit's the new black.
Look at my socks. So I think, you know, I think in the line of screens and canvases, all of those are just opportunities to provide value to consumers, information, content, and ads. So to me, that's just another place Taboola might be part of over time.
Okay, so bigger screens, more screens, ubiquitous screens, good for Taboola. More places to serve.
More touch points.
Okay. More touch points. Okay. Great. Let's go to Yahoo. So where are we on the Yahoo roadmap? What have you learned so far? Upside, surprises, disappointments on the Yahoo acquisitions.
I, you know, I just had a call with Jim Lanzone yesterday, and I told him, you came into my life for a reason. You know, like I just feel like this was such a great partnership. We get to learn so much working with that team, the Apollo team, the Yahoo team, you know, sharing our dreams independently and together. The biggest things that happened to us in 2024, I mean, Yahoo right now, Yahoo is just part of our business.
Yes.
It's kind of like part of what we do. It's a bigger part of the business, but it's just part of the business.
Okay.
Where by 2024, it was more of a, you know, onboarding, ramping, and all of those things.
Okay.
A few things happened through this relationship.
Okay
One, it kind of gave us validation as, you know, if Yahoo can choose Taboola, maybe others can, and then Apple happened. You know, Apple partnered with Taboola, and I think the Yahoo partnership contributed to Apple feeling, you know, good about, bless you, feeling good about working with us. Two, we got to work with fantastic advertisers we never did before, so through the DSP relationship of Yahoo, now we have, you know, we did share some names like Samsung and Hulu and Verizon, big enterprise advertisers who bought from Taboola performance. Remember, Taboola's vision, if you look at the advertising market, you have search, social.
Yes
Then beyond search and social, you really have AppLovin doing a great job for performance in the app space.
Yes.
But for mobile web and desktop, I would argue no one is doing enough of a good job for performance.
Okay.
Maybe we're even already the biggest, but there's such a huge market we want to capture. So with the access to Yahoo's advertiser relationship, we were able to evolve our product to provide those advertisers things they want to be able to spend dollars with us. And, you know, that gave us kind of a bigger ambition to go after those types of advertisers. So I think, you know, that was r
Okay
eally shaping us into the future in terms of the type of advertisers we also want to attract to spend dollars with us. And last but not least, I'll say Taboola's base of publishers already, I mean, if you look at how many people we reach every day,
Yes
we've done it humbly. We've done a tremendous job being such a must-buy for publishers.
If you look at, you know, great names like CNBC and Disney and USA Today and The Independent and all around the world, they work with us for a long time. They love us. We love them back.
Yeah.
We reach 600 million people every day through those exclusive long-term relationships. But Yahoo, what we've learned is it's such a unique source of supply.
Yeah.
It's mostly homepage, very, very, very loyal type of audience, emails and those things. It works really well for advertisers.
Yeah.
So, as I think about the future type of partners I want to add to Taboola, I want more supply partners that get advertisers really excited, like that work for them really well from a performance point of view. I want advertisers saying, wow, I mean, to get to Apple, I can work with Taboola. To get to Yahoo, I can work with Taboola. It performs really well.
Okay.
And I compare myself to Meta. I want to be, you know, I want to be Meta is for social. Here's what I'm getting. And I want Taboola to be similar. So I want to get more and more really high-quality performing sources of supply added to Taboola over time.
Okay. Does that mean you're going to jettison some of the guys that you don't feel are that?
If someone is underperforming in a big way, we already do. If you work with us and something does, there's an index we have. If we think, if we see it's not working to advertisers beyond a certain era, we already part ways with you right now. It has to work for advertisers. If you get traffic in a way that something weird is going on, we can't keep you around.
Okay. So you already cut people off. And is it a return on ad spend kind of metric? What's the metric you use to decide to subscribe?
It's like a ROAS type of thing. We look at what's the likelihood for something to convert on your site as an index. So we have this massive index of performance, which is great because I can tell you some publishers perform really well and some less, and Yahoo is amazing.
Okay. So you sort of move the benchmark up. Like you're going to use Yahoo as a step up.
Because I have so much supply. You know, I want more West Village. You know, I want more great, in New York, West Village is awesome. For those who may not be familiar.
I was thinking Park Avenue myself.
Or Tenafly New Jersey, because I'm now in, you know, I moved my wife from the West Village to Tenafly New Jersey because it's the new West Village. She does not agree with that, but that's my opinion.
That's your opinion.
New Jersey is fantastic.
More LEGO space?
Yeah, more LEGO space. More, you know, more space in general. Three kids, which is too much noise. So I want more of that. I want more performing sources of supply so that advertisers get really excited. Moving for the next, when I look for the next three, four, five, 10 years, I really believe Taboola can be, you know, a very significant channel. Tens of thousands, hundreds of thousands of advertisers can rely on for performance.
Yes.
We have such a huge base. I don't really need more for the sake of more supply. I want it to be awesome for advertisers.
Okay. One of the things that happened is when you added Taboola, it added a ton of supply, which sort of depressed the auction.
Yahoo, you mean?
I'm sorry. When you added Yahoo, I apologize. When you added Yahoo, it added a lot of supply and sort of depressed the pricing at the auctions. Did you ever think as that happened, just getting rid of alternate supply? So it tightened up the auctions again?
I didn't because, I mean, look, I'm a longer-term thinker. I'm going to be here, you know, hopefully for a long time and building something that will be here forever. So I don't really care as much in that regard. So I would never tell a publisher, you know, we're going to part ways. If that publisher is great, but right now we have an issue, we're going to go through this together as partners.
Okay.
I think that's something that publishers give us credit for because we've been doing this for a while.
Yeah.
Whenever things of that nature happen, we support each other. Remember also that Taboola is providing a lot more value to publishers than just money, especially now with Gen AI and all those things. Publishers look to Taboola as an AI company to help them drive personalization on the homepage, increase engagement on the site, bring new traffic to the site. They see us as really strategic partners beyond just CPM today, CPM tomorrow.
Okay. Right. Okay. So one of the goals you've had is to turn Taboola into a must-buy for the open internet. Like you have search and you have Facebook. Those are your walled gardens. And then the open internet, you really, your goal is to have Taboola be a must-buy. Tell me about the progress you're making towards that goal.
We're not there yet. I think, and you know, I encourage anyone who is part of the Taboola ecosystem to join our investor day, which will be in March sometime. We're still figuring out the date. But I think there is a lot we need to do and can do to make it easy for advertisers to work with us at the onboarding stage. We launched Abby, which is a generative AI way for advertisers to converse with a machine to query what they need to do to become an advertiser. It's very, very complicated for businesses to become advertisers. I mean, hard to imagine, you know, you go into a business, any business, I have an insurance company. I want to get people clients to get insurance with me. If you ask an insurance company owner, what is your CPM, no one knows the answer to that question.
Nobody knows what CPM is. Ask them what's your CPA then. They think it's an accountant. Ask them what's your CPC. Nobody knows. These are industry jargon tech things that we talk about. Nobody outside of this building knows what we're talking about. But they all want to drive growth. They deserve to grow.
Right.
We have such an opportunity to bring AI into the front of it so that that insurance business can say, you know, this is what I do now. What should I do? And Taboola should say, well, you should really start by spending $1,000 a day. Aim for a $100 CPA. And here are some suggested creatives for you because we looked at people like you. And I suggest your budget be $10,000. And even two weeks, I can make it work. You should move on.
Okay.
And if I can do that in a few minutes, it's awesome. That's a ChatGPT type experience for advertisers. So I think there's going to be a lot more we need to do. We're still just early at the onboarding stage.
Yeah.
But then the matchmaking, we invest a ton in deep learning and AI to make sure that we quickly get you conversions, quickly get you sales.
Okay.
It's a very emotional experience. You're a business. You want to become a successful advertiser.
Yeah.
Within the first week, you want to see success.
Right. Right.
People don't have patience.
Right.
They want to see like sales going quickly.
Yeah.
So that's a lot of investment on our side. And the last one is even the landing pages. I think it's quite complicated now. The creative. What is a good landing page for me? How should I do it? So there's a lot of work to be done here.
Okay.
Another thing that I think is exciting, which will affect, I think, everyone. With AI being so, and actually, you know, last week we saw some big tech CEOs speaking about that, about the maturity of generative AI.
Yes.
But with generative AI being where it is right now, I think the bar went down.
Okay.
For how much engineering power you need to move forward and the importance of data and distribution became more important.
Okay.
If you have a lot of unique data and you reach a lot of people, you have a significant unfair advantage. When I, as an investor myself, if someone came to me and they were a great engineer, 10 years ago, I would prefer that person because that person is an engineer.
Right.
And I like that. But today, if I found a founder and that person's like a hustler.
Yeah.
They can just pay $9 to ChatGPT a month and get access to Gen AI. I may prefer that person because they can get to something quickly versus maybe five years ago they couldn't. So I think for companies like us, reaching 600 million people a day, people click on Taboola almost 100 billion times a year. With AI revolution the way it is, I think for the next five years we'll be hopefully making progress towards being that must-buy. But we have to touch all of the entire journey of advertisers.
Okay. Okay. So Abby, one of the things we demoed Abby with investors, and it looks so easy, but has it been hard to drive awareness and hard to get adoption because of some of these issues you just raised?
I just looked at the numbers. I was trying to anticipate what might Laura ask me. You know.
Abby, baby.
I was like, Abby is going to come up. AI will come up.
Yep. Will come up.
Yeah. I mean, one way or another, so one of our actually number one lead gen for advertisers to get to Taboola is if you go to ESPN or CNBC or anyone on NBC News. You'll see a By Taboola on our feed of recommendations and ads. If you click on that By Taboola, you land on our self-service.
Okay.
That's one of our biggest lead gen to get businesses to try it out because people say, oh, I want to be here.
Okay.
We also acquire ourselves businesses using our own marketing channels.
Okay.
About 50% in the U.S., about 50% of our self-service advertisers already land on Abby.
Okay.
They try it out, which is fantastic.
Okay.
On investor day, we're going to try to actually share more numbers.
Okay.
But it is getting more and more traction. It's a huge priority for us. Still early.
Okay.
But it's a much. I really believe that over time, I hope 100% of our business front end is AI. And then our account managers can just support and advise and use their brain to give strategy versus talk about CPAs and CPCs and move campaigns and things of that nature.
Okay.
I think I want to move all of our business to AI and Abby type initiatives.
Okay.
Get our amazing people to be strategic and deepen the relationship and build human relationships, not just artificial intelligence, human intelligence, you know, type of thing.
Okay. So when we think about generative AI products, I know you have Max Conversion, which you should tell people what that is. 70% adoption so far and 36% growth in ad campaigns using it quarter over quarter. And then Self-Service, we just talked about Abby, driving revenue upside. It sounds like Abby is sort of happening slower though than you'd hoped in terms of a revenue driver. Did I read that right?
For Abby?
Yeah.
Oh, we haven't shared anything. Abby, it's really early stages. We haven't shared any numbers on Abby, but the 50% on self-service was a good number from my perspective. It's, I think, said first at this event. So that's a good number from my perspective, given how early that is.
Sorry, what's the 50% number?
Of advertisers landing on our self-service.
Okay.
The 50% of them in the U.S. use Abby as of now.
Okay. Great, and that saves you money because those people before Abby were talking to people.
But it's not about saving. It's about churn rates. And about, I just want these guys to get to the end of the process, launch their campaign and not churn.
Right.
When Abby interacts with you, it's the ultimate account manager. They compare you to 20,000 advertisers.
Yeah.
They know exactly what best practices to offer you.
Yeah.
Images, titles, it's all machine-based.
Okay.
So that's.
So it lowers churn.
Yeah. I mean.
It gets you to the campaign faster.
Right, so it's a quickly, you get to the end quickly. Your churn rates are likely to be lower. Your spend hopefully is bigger. These are the metrics we want to see.
Okay. Okay. And you are seeing these so far?
We haven't shared anything yet.
Okay.
But that's what we want to see. And the Max Conversion, which you mentioned, is basically our core AI, which is what matches between ads to users. So when a user goes to a website and they see an ad, we have less than a second to look at the entirety of our advertising base and try to match an ad with that consumer. Within one year, that became about 70% of our business. So 70% of our advertisers have adopted to use Max Conversion, which is our most recent kind of AI matchmaking technology. You have to remember that Taboola, because Taboola is focused aggressively on Performance Advertising. We don't believe, I don't believe there's such a thing as Full Funnel. You either do, you know, it's very hard to do one thing really well.
That is a provocative statement.
Why?
Because everybody else believes in full funnel and omnichannel.
Yeah. So my belief is that Google had to buy YouTube to have a chance at top of the funnel. And before that, they didn't. And I think, and Google is a fairly good company. And that's what they had to do. So my belief is that for companies in general, it's very hard. Most companies fail. And those who succeed, they succeed doing one thing really well. Rarely do you see companies succeeding doing two things really well. And the gap between brand advertising and performance advertising is oil and water. It has nothing to do with each other.
Okay.
So, I think that's a concept that doesn't exist unless you buy YouTube or something of that size or scale. So for us, we kind of, you know, I look at great companies like AppLovin who have done performance advertising, super focused apps. I The Trade Desk, which to me have done a great job doing CTV, top of the funnel. That's my opinion. TV is more of a top of the funnel, you know, Super Bowl type ad experience. But no one has done the gap. There's in between, there's a Trinity, there's a hole missing. So I think, you know, that's Max Conversion and our focus is on performance advertising.
Yeah.
And when I see 70% adoption with advertisers, for them, there's no wine and dine. There's no amount of Château Lafite you can give an advertiser to give you money if it doesn't work. They churn. They give you money. It either works to stay or it doesn't and they go away. There's no meet me for dinner. I hope to get your business. Thank you. Which I'm not against wine. And Steve, our CFO, is an amazing wine collector. If you ever.
As opposed to a wine drinker.
I'm a drinker. I drink Steve's wine. It's a great relationship we have, which I think, you know.
You drink, he collects.
I mean, I'm just, it works for me. I don't know if it works for Steve. But I really like it because, again, in a performance advertising setting, if you see that adoption.
Yeah.
It means something works.
Okay. Okay. Other generative AI things that are on the horizon, like you've already introduced Abby, what happens next with generative AI product?
I think there's a lot more we can do for advertising.
Personalizing homepages, you've been talking about for landing pages.
Yeah. So I think for, right. So there's a publisher angle to that, which is publishers are still. I just met a big publisher at CES. We had breakfast at 8:00 A.M., by the way. Very courageous, I think, from our perspective, given when people tend to go to sleep. And I told them, you know, I enjoy your site more on Instagram than I do on your own app. And that's because Instagram that is doing a fairly good job of personalization is giving me for that publisher the stuff that I really, they give me Israel-related news.
Yeah.
They give me, you know, financial news. They give me Elon Musk's, you know, news, which, you know, it's a topic for our conversation usually at dinners.
Yeah.
So, and it's all about what I like. When I go to the app of that publisher, which is a publisher I really like, I don't get that. And that's a huge opportunity because publishers should be as good as Instagram on their own sites. They should offer personalization. But for a long time, they didn't because why would they? But now with Gen AI risking their business, Google and Gemini and all those things and this whole revolution, sometimes culturally you need a big thing to change. So you change yourself.
Okay.
So I think publishers in years to come have a big opportunity to personalize homepages, article pages, you know, provide consumers really what they want.
Yeah.
We're spending a lot of AI on those. I also think you can do more with Gen AI as relates to publishers, but I don't want to share too much because Steve doesn't allow me to.
Even though you overshare.
Yeah.
That even skills you overshare.
I just add a bow. I say the same thing. I just make it sound like it's great.
Okay. Okay. Fair enough. Okay. Let's talk, just move to e-commerce. Let's talk about what's going on with commerce. I feel like it's been a little slower than I think we'd hoped. But let's talk about sort of what you were hoping for when you closed the commerce deal with Connexity and now where we are today. Because it's been a couple of years now.
Yeah. I mean, it's about 20% of our ex-TAC. I have a different sentiment. I mean, I think it's.
Okay.
What we said is H1 was faster than the business, and last year was a very fast grow business for us given Yahoo and Apple and other things that happened last year.
Yeah.
So we did say commerce was even faster than that.
Right.
And it was more in line with that in H2. So that's fairly fast growth from that perspective. So I'm happy with it. I think also given our performance focus.
Yeah.
There's not much more performance than commerce.
That's true.
And I think retail media is much like CTV, maybe a few years ago, is getting a lot of attention. And those commerce budgets on Best Buy and Walmart and all of those are looking to find consumers outside of the site.
Yes.
So, you know, and Taboola is a great home for those commerce budgets. So I think, and not to compare CTV to retail media for the next few years, but if commerce budgets are looking to find a home and drive sales, Taboola is a very good place for retailers to convert. So I think strategically it's important for us given our performance focus, given the industry retail media kind of momentum. And I'm very happy that we went with that decision.
Okay. All right. So it continues to grow. Did I hear something that Apple had changed its algorithm? And if you're linked to a site with commerce, it's really deranked you. Does that make sense to you what I'm saying?
Google, so Google.
Google Search.
Yeah. Google Search. So Google Search published that if the site that they basically divided to who wrote the content, like the editorial team or a third party.
I see.
And they don't like if it's a third party, which we would, by the way, fall under a third party.
Okay.
So they don't want us writing the content for publishers. If the publishers writing the content, that's fine.
Okay. Does that hurt your business then?
I did think that's something we can do a lot more of. But Google doesn't want us to do more of that.
Okay, so you're not going to do more of that.
It's not affecting us in any significant way right now, but that's something I wanted to do more of.
Yeah.
But that's not something Google want people to do.
So, okay. So it took away the economics of doing that.
I mean, opportunity.
Yeah. The opportunity to do that. Okay. Fair enough. That makes sense. But going back to Taboola News, you announced, I would say, Xiaomi two years ago.
Yeah.
Then you added Apple like round numbers a year ago, maybe nine months. Is this, you know, I think Apple is a huge upside surprise. Stock really moved on that. Is this the kind of? I'm sort of surprised adoption isn't faster. You would guess that Apple adopts and Xiaomi adopts, which is the biggest in the world. Other guys would be jumping on board. Why don't other people follow?
We did say one more big one joined. We just couldn't share the name.
Okay.
And so there's one more that did say that we did sign in and just announced. We just couldn't say who that is. It is an OEM we all know in this room.
Okay.
There are many big opportunities that we're working on. I think Taboola News, just for context for those who may not know, Taboola News is when we aggregate all of our publishers' content and we create a feed of news on an OEM device. There's a lot of opportunity. It's one of our fastest growing businesses. It's more than $100 million. It's in line with our margin overall. It's a similar ex-TAC margin overall. It's very synergetic to the core business because when you open an OEM and you click on a piece of content, it opens the publisher website.
Yeah.
Which they see it as a source of traffic. It's more than a million people a day. So now when publishers are thinking, who do I work with? Taboola, thanks to Taboola News, is another value.
Source of traffic.
Source of traffic, which they really like. I'm going to speak a lot more about that on Investor's Day, but I think in general, the opportunity to engage consumers with relevant content.
Yes.
It's going to be something many, many companies will do over time.
Okay.
So I'm so thankful that we're in that business. I think Taboola News could be worth as much, if not more of Taboola.
Okay. Wow. Okay. Fair enough. I'm just surprised it's the slow adoption.
Of what?
That, you know, we have two guys. Okay. Now three. But that's globally. Like I'm really surprised we don't have sort of faster adoption by the year.
So if you think about OEMs, there aren't many OEMs in the world. It's more about.
I think there's only five or something.
But on that matter. You know, you have about, you know, five or seven that own 80% of the market.
Okay.
But look, you have Apple, Samsung, Xiaomi, and a few others.
Okay.
Right? And so it's more about, it's not about more logos. It's more about vertical integration. What do you do with them?
Okay.
So what markets are you in with those? What touch points do you have?
Yeah.
So it's more about how do you turn one account?
Yes.
To be much, much bigger versus getting, there aren't many Xiaomis or many Samsungs or many Apples.
Yeah.
So it's less of, you know, long tail of OEMs. Now there's a whole market outside of that that I think is interesting. But in the OEM.
There's only five big ones.
There's a few big ones, which we work with.
Yeah.
And then it's about expanding from within. It's more about a vertical expansion.
Okay. All right. That makes sense. And then upselling them.
Right.
Okay. Let's talk about Microsoft. One of the things that happened last year that was a headwind for almost everybody is Microsoft sort of bought Xandr and then completely changed all of its go-to-market stuff, and everybody suffered from this, so where are you in this transition of Microsoft from the downdraft that really masked the growth of underlying businesses because the Microsoft numbers had gone negative for almost everybody?
Yeah. I can speak about other businesses. For us, Microsoft has been a good, great partner and a good revenue source last year. We spoke about just them being a design partner that helped us launch the bidder to begin with. We believe we're the second largest bidder after Bing. The Xandr expansion from our perspective is a growth opportunity.
Okay.
Because it's going to give us more touch points between games and mail that we currently don't have.
Okay.
Specifically, once we're launched on Outlook, at that point, it means Taboola has Outlook and Yahoo Mail.
Okay.
Which means outside of Gmail, we have two of the three largest mail providers in the world that we can get access to for our advertisers, which advertisers really like because, you know, the email environment, it's a high frequency, very loyal, intimate environment and product to provide consumers with ads. So that is something that we, you know, can go to market with and package in a way that says if you want to reach consumers reading mail, Taboola is the place to be.
Okay.
So that's an opportunity for us as well. But otherwise, we, you know, we're very happy with Microsoft as a partner. And I think I mentioned.
So it's not a downdraft to your revenue growth?
I was trying to ask Steve. I think it's either the last letter or the one before for investors. I mentioned Microsoft kind of back, you know, growing. Yeah. Yeah. So I think two letters ago, I spoke about how it's a grower. Like it's a grower for us. So.
Okay.
At least for us, it's been good.
Okay. Good. Questions from the audience. Who has a question? Yes, sir.
You mentioned earlier about publishers having more personalization on their homepages. That's great that we see Instagram. But presumably in Instagram, you're logged in and so they know who you are. If you're on a publisher's page, they don't know who you are unless you are registering or creating, you know, permission with them, right?
So, great question. The publishers and Taboola, because of our integration, so if you look at advertising companies in general, most ad-tech companies are bidding in and bidding out. They're all third-party, which means they're not the publisher, right? We, because we're the recommendation engine and advertising provider for those publishers, they integrate us as part of the site. So we are first-party. If you go to CNBC to watch Squawk Box today and you go tomorrow, we don't know your name, but we know you're the same person. Now that is enough for us as a company, as an AI company, to develop and to predict what markets you're in based on your behavior and actually things that other people like you do. Many actually are very similar to TikTok.
So on TikTok, which I would argue is perhaps one of the most advanced AI products in the world, they actually don't ask you to log in. You can log in if you want, mainly if you want to post. But if you're just a reader, they don't ask you. They have a for you page, personalized homepage. And all they ask you to do is use the product. And on TikTok, when you download TikTok and you start using the product, within seconds, if you like cars, you'll see cars. If you like the NBA, the Knicks, you'll get the Knicks. Whatever you like. And they have no idea who you are, what's your, and when you come back, all they know is it's the same device. So in many ways, we have a similar to TikTok kind of identity. We know the same device.
We have no idea who you are, but we don't need to know. We can within probably.
From pizza or whatever.
Yeah. We're a first-party cookie. So I would say within a few times we see you, we can predict very accurately that you're probably a male. These are your hobbies. These are the things we think you like. And remember that also as opposed to Facebook and Instagram, we tell Facebook and Instagram the things we want others to think about us. But we never tell Instagram the truth. Like if I'm in market for a healthcare topic because my dog just didn't feel well, ate plastic or, you know, he's 13. I don't know. He didn't feel well. And I spent some time reading about it. I would never for the life of me post on Facebook. Anyone knows what, you know, dogs would like, it's not yours. It's mine. It's very personal to me. But I read about it a lot. And that's when Taboola sees you.
So in many ways, our access to your curiosity is actually perhaps even more authentic. Because while I don't know your name and your hobbies based on what you told me, I just get to see what you choose to read, choose to watch, choose to buy, which is more closer to what TikTok does. And I think AI enables all of that.
What else? Other questions you want to ask? Okay. Yes, sir.
How is yield growth looking?
So, without giving, we did say yield was back to growth in 2024. So, without speaking about specific, you know, 2025 guidance, in general, I think that's the biggest growth driver for the company. So, when I look over the next, you know, three years, four years, five years, I think that alone can drive significant growth for Taboola over a longer period of time.
It's the majority of the 20% top line?
In?
In top line growth could be coming from yield?
You know, we always say that over a longer period of time, we think Taboola should be growing 15%-20%. I think we can do most of it by just growing yield on our existing base. Not to say we are not going to partner with more great iconic companies, if we just did that really well, getting more budgets from advertisers around performance, I think we can probably drive that growth.
Let's talk about consolidation briefly. Yesterday, we had the FTC, one of the Republican FTC commissioners on, and she said that they're going to be far faster and far more focused on winning litigation, which means it's going to go back to the old way where you really have to show, they have to show anti-competitive behavior in a market before they say no, which has not been true the last four years under Lina Khan. So my question is, scale matters. Do you feel like you're big enough? Do you need to buy some more stuff? What's your consolidation opinion?
I mean, I think for this, from what I'm seeing right now, if we were to do something, it would be more of a tuck-in type of thing.
Okay.
Like small things that can make us better here and there.
Okay.
I think we have enough on our plate.
Okay.
To execute and do the work.
Okay.
You know? So I don't think there's any, and also I think, you know, at this point for Taboola, I just want to focus and execute, you know, all those things. Remember, it's quite distracting.
Yeah. It is.
M&A is always distracting. Big M&A is more distracting. Really big M&A is disastrous.
Yeah.
In general, I think, you know, you want to do it either if you have to or the value creation is just in the bag.
Yeah.
You know? And so for the most part, I think we have what we need as a company and we just have to lay low, do the work.
See growth and report.
See growth.
That's okay. Any other questions before we call it? Yes, sir?
On Abby with the creative recommendation tool that you have, what's your sort of vision long term? You guys have thousands and thousands of advertisers and as far as like the verticals with direct response. Can you articulate a little bit about how you avoid redundancy? Say something like auto insurance, right? If you have 100 advertisers or 50 advertisers in that insurance vertical, how does the product itself minimize that where you have unique content in the widgets over time?
It's, I think my vision for that over time is that you have AI agents that are working for you. It's like, you know, I imagine a thousand account managers that just managed you, that would never be a reality today. You can barely have one. But let's say you had a thousand of them and all they care about was me. How would that future look like? And I think that that's perhaps something that can happen. So I think that's, to me, that's the ultimate dream is I have a thousand agents that are focused on things that could drive growth for my business. Now, a lot of time I can tell you what we're saying is that it's not always people that are exactly like me that I should copy to drive growth.
Like sometimes you see advertisers that come to us and they're looking for male audience or female audience and they're completely wrong. We end up showing them that actually different audiences. They look for a sports website, but then most of their conversions come from completely something different.
Yeah.
Yeah. Something completely different, so I think it's this serendipity and discovery that can drive growth for a business, and AI can do that really well for you because it's a thing you don't know you know about your business, so the way I think about it is if you have enough, and again, going back to distribution and data, those two things, in my opinion, will be the key factors for success for the next decade. If you have distribution and unique data, you have a huge moat around your business because AI will become available for anyone, so I think it's about looking at a broad range of behaviors and trying to diversify different things, and it's changing very fast, so I don't think it's really, that concern is mitigated from a fatigue perspective and frequency.