Taboola cuts its outlook, saying readers now see fewer of its ads per page

Taboola sells advertising shown across the websites and apps of publishers that use its technology, and the measure it guides on is ex-TAC gross profit: roughly what it keeps from advertisers' spending after paying the publishers whose pages carry the ads. On 4 November the company lowered its full-year guidance for that measure to $754-763 million. On 5 August it had raised the same guide to $772-783 million, about 9% growth; the chief executive, Adam Singolda, put the new figure at about 6% growth.

The quarter just reported did not cause the cut. Ex-TAC gross profit for the September 2026 quarter was $188.8 million, near the top of the range the company gave in August. Taking the middle of each full-year range, the reduction is about $19 million, calculated from the two sets of guidance, and it all lands in the final three months. Fourth-quarter revenue is guided to $477-493 million, against $522.3 million a year earlier. Full-year revenue, which August's range placed above last year's, is now expected to finish below it.

What changed is the weight given to falling ad impressions. In August, management put most of the year's revenue shortfall down to Google ending a product called Explore More, which it expected to cost over $20 million of ex-TAC in the second half, and to dropping low-quality publishers; traffic lost as AI changed search was described as a smaller effect, and Walker said the guidance already reflected the reduction in display ad impressions being discussed across the open web. Now the company says page views across its publishers are holding steady, but readers are seeing fewer of its ads on each page. Asked whether Google was sending less traffic, the chief financial officer, Stephen Walker, said it was not: "So it's not fewer page views. It's less engagement once they're on the page or at least seeing fewer of our ads."

Walker said signs of this showed earlier in the year, but the Explore More loss and the publisher clean-up hid it, and higher ad rates made up most of the difference. It became plain only last quarter, which he called relatively clean. Singolda said he suspects the decline will level off at some point. That account is management's own reading of how people behave on pages Taboola does not own.

Lower supply, from the publisher clean-up, the loss of Explore More and fewer ads per page, helps explain why last quarter looked healthier than its revenue; Walker also credited growth in Taboola News. Revenue fell 6.9% from a year earlier while ex-TAC gross profit rose 6.8%. Walker's account is supply and demand: with fewer impressions to sell, roughly the same advertiser spending is spread over less inventory, and prices per ad rise. Payments to publishers, which the company calls traffic acquisition cost, fell 14.3%, calculated from the filed results, though part of that reflects the low-quality supply removed earlier in the year. Adjusted EBITDA, which excludes depreciation and amortisation, grew faster still, and its margin on ex-TAC widened to 29.7% from 27.3%.

Impressions were not the only drag on last quarter's revenue: Walker also named a slower-than-expected rollout of Next Engage, the product meant to replace Explore More.

The company's answer is more pages and more ad space: its full-page format now runs across all of NBCUniversal and it is live across Fox News, and it expects to close its purchase of Dianomi before the end of the year. Walker said these give Taboola more impressions to sell; they add inventory rather than change how readers behave once they arrive. Guidance for next year will come in February, and Walker said the fourth-quarter range can be read as an indication of it.