Criteo (CRTO) Q3 2024 earnings summary

Executive summary

• Achieved record Q3 2024 results with strong Retail Media growth, robust operating leverage, and disciplined cost management, despite a slight revenue decline year-over-year.

• Retail Media Contribution ex-TAC grew 23% year-over-year at constant currency, with platform adoption expanding to 3,100 brands and 225 retailers, outpacing market growth and gaining share from search and social channels.

• Continued innovation in AI and automation, including Commerce Go and generative AI, enhanced campaign efficiency and client outcomes.

• Strategic partnerships expanded with major retailers, United Airlines, and deepened relationships with Microsoft Advertising and Costco.

• Announced plans to return a record $180 million of capital to shareholders in 2024.

Financial highlights

• Q3 2024 revenue was $459 million, down 2% year-over-year; Contribution ex-TAC was $266 million, up 9% year-over-year at constant currency.

• Retail Media revenue was $61 million, with Contribution ex-TAC up 23% at constant currency; Performance Media revenue was $398 million, Contribution ex-TAC up 5%.

• Adjusted EBITDA was $82 million, up 20% year-over-year, with a margin of 31% on Contribution ex-TAC.

• Net income was $6 million; diluted EPS $0.11, adjusted diluted EPS $0.96, up 35% year-over-year.

• Free cash flow for Q3 was $39 million; total liquidity at $711 million with no long-term debt.

Outlook and guidance

• 2024 guidance tightened: Contribution ex-TAC expected to grow 10%-11% year-over-year at constant currency.

• Retail Media Contribution ex-TAC expected at high end of 20%-22% range; Performance Media to grow mid to high single digits.

• Adjusted EBITDA margin for 2024 raised to 32%-33%; normalized tax rate expected at 25%-30%.

• Q4 2024 Contribution ex-TAC expected at $327-$333 million, up 3%-5% at constant currency; Adjusted EBITDA $114-$120 million.

• CapEx for 2024 projected at $80-$100 million; free cash flow conversion rate about 45% of Adjusted EBITDA.