Teads Holding Co. — Second Quarter 2026 Earnings Summary

Financial Performance

• Revenue for the three months ended June 30, 2026, was $284.6 million, a 17% decrease compared to $343.1 million in the prior year period; for the six months ended June 30, 2026, revenue was $550.6 million, a 13% decrease compared to $629.5 million.
• Gross profit was $95.6 million for the quarter (33.6% margin), down 21% from $120.3 million (35.1% margin) in the prior year; for the six months, gross profit was $179.2 million, down 12% from $202.9 million.
• Ex-TAC gross profit was $123.4 million for the quarter, down 14% from $144.2 million, with Ex-TAC gross margin increasing to 43.4% from 42.0%; for the six months, Ex-TAC gross profit was $231.3 million, down 6% from $247.3 million.
• Net loss was $42.5 million for the quarter compared to $14.3 million in the prior year; for the six months, net loss was $81.3 million compared to $69.2 million.
• Adjusted net loss was $40.0 million for the quarter compared to $9.7 million in the prior year; for the six months, adjusted net loss was $76.2 million compared to $25.0 million.
• Adjusted EBITDA was $7.0 million for the quarter, down 74% from $27.0 million; for the six months, adjusted EBITDA was $7.7 million, down 80% from $37.7 million.
• Net cash provided by operating activities was $9.2 million for the quarter, down 63% from $25.0 million; for the six months, net cash used in operating activities was $25.7 million compared to $24.1 million provided.
• Adjusted free cash flow was $3.2 million for the quarter, down 86% from $22.1 million; for the six months, adjusted free cash flow was negative $37.9 million compared to positive $27.4 million.
• Cash, cash equivalents, and investments in marketable securities totaled $91.0 million as of June 30, 2026.
• Total debt obligations were $614.5 million, including $607.4 million carrying value of 10.000% senior secured notes due 2030 and $7.1 million outstanding under a short-term overdraft facility.
• Deferred revenue was $14.958 million as of June 30, 2026, compared to $14.930 million as of December 31, 2025.

Guidance and Future Outlook

• Teads suspended all guidance, including previously provided full-year 2026 Adjusted EBITDA guidance, citing volatility in the Direct Response and SME business and the execution of strategic initiatives.

Business Segments and Product Lines

• CTV revenue grew 67% year-over-year, accelerating from recent quarters, with CTV representing 13% of Q2 2026 revenue compared to 7% in Q2 2025.
• Launched Teads CTV Ensemble, a unified suite combining HomeScreen and InStream capabilities for AI-driven, full-funnel outcomes.
• Expanded partnership with Lumen Research to provide exclusive attention measurement for CTV HomeScreen placements globally.
• Renewed exclusive partnership with LG across Europe and Asia-Pacific, extending into new markets.
• Partnered with TiVo Ads to integrate HomeScreen placements into Teads Ad Manager, accessing 5.3 million households in the U.S., Canada, and the U.K.
• Omnichannel adoption increased, with branding customers utilizing omnichannel campaigns representing 16% of CTV spend in Q2 2026, up from 9% in Q2 2025.
• Renewed Joint Business Partnerships with Stellantis, LVMH, Warner Brothers, and Dyson.
• Launched Teads EngageOS, an AI-powered operating system for publishers designed to unify editorial content and ad inventory to optimize revenue across reader sessions.
• Direct Response and SME businesses faced headwinds from open-web challenges.

Market and Competitive Landscape

• The company noted open-web headwinds impacting the Direct Response and SME business segments.
• Teads is directly partnered with more than 10,000 publishers and 20,000 advertisers globally.

Risks and Challenges

• Volatility in the Direct Response and SME business segments.
• Risks related to the integration of Legacy Teads and managing the combined business effectively.
• Potential impact of AI on the industry and the need to invest in AI-based solutions.
• Dependence on media partners and advertiser demand.
• Risks associated with the acquisition of Legacy Teads, including unexpected costs and realization of synergies.
• Litigation against Google LLC and Alphabet Inc.
• Regulatory changes regarding privacy, data protection, and generative AI content.
• Geopolitical conflicts and economic conditions affecting advertising demand.

Management Commentary and Tone

• CEO David Kostman expressed pleasure with results across strategic growth drivers, specifically highlighting 67% CTV growth and expanding omnichannel wins in the Enterprise business.
• Management acknowledged open-web headwinds in the Direct Response and SME businesses and stated they are actively mitigating these challenges.
• The company plans to leverage momentum in the Enterprise business to continue investments aimed at accelerating high-margin growth.

Other Key Points

• The company completed the acquisition of Legacy Teads, a private limited liability company incorporated under the laws of Luxembourg, which contributed to the results from February 3, 2025, through June 30, 2025.
• The quarter included a $7.3 million income tax provision, $1.6 million of acquisition and integration costs, and $1.2 million of restructuring costs.
• The prior year period included a $5.8 million income tax benefit, $5.4 million of acquisition and integration costs, $1.7 million of restructuring charges, and a $1.2 million gain on the repurchase of debt.
• The company has a global team of approximately 1,700 people in 30+ countries.