TBLA - Taboola stock gains on Q2 earnings beat

Taboola ( NASDAQ: TBLA ) stock gained as much as 24% on Wednesday as the advertising firm posted Q2 earnings beat , driven by increased new publisher signings and triple-digit growth at Taboola News.

TBLA reported Q2 adj. EPS of $0.06 vs. $0.09, while revenue rose 4.1% Y/Y to $342.69M.

New digital property partners drove $21.8M and existing digital property partners decreased by $8.2M of revenue.

"This year we are seeing near record level new publisher signings, including a large number of competitive wins all around the world, exponential growth in Taboola News and the launch of new products like Homepage For You and our new bidder," said TBLA CEO Adam Singolda.

Taboola News' growth rate is on track to exceed $50M in revenues this year.

TBLA expects Q3 revenue of $311M-$331M, below consensus estimate of $369.17M.

Q3 gross profit is projected to be $91M-$101M vs. $107.7M in Q3 2021. Ex-TAC gross profit is estimated to be $120M-$130M vs. $126.9M in Q3 2021.

TBLA expects Q3 adj. EBITDA of $11M-$17M vs. $39.7M in Q3 2021, and adj. net loss of $2M-$8M.

The company also lowered its 2022 revenue guidance to $1.43B-$1.47B from prior outlook of $1.50B-$1.54B. Consensus estimate is $1.51B.

TBLA maintained its outlook for 2022 ex-TAC gross profit, gross profit, adj. EBITDA and adj. net income.

The company's conservative guidance assumes continuing headwinds from the Ukraine war, inflation, forex and overall macroeconomic weakness.

Shares of TBLA declined ~58% YTD.

TBLA is at high risk of performing badly due to decelerating momentum and negative EPS revisions vs. other communication services stocks, according to SA Quant .

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