Criteo's Earnings Miss Expectations, Shares Drop 8.9%
Written by Emily J. Thompson, Senior Investment Analyst
Updated: 4 days ago
0mins
Should l Buy CRTO?
Source: seekingalpha
- Disappointing Earnings: Criteo reported fourth-quarter revenue of $541 million, a 2% decline year-over-year that fell short of Wall Street expectations, resulting in an 8.9% drop in premarket trading.
- Declining Profitability: Adjusted earnings per share were $1.30, down from $1.75 a year earlier and below analysts' estimates of $1.41, indicating a significant decline in the company's profitability.
- Retail Media Pressure: Retail media revenue decreased by 17% year-over-year due to scope changes with two clients, although performance media revenue saw a slight increase of 1%, highlighting ongoing challenges.
- Cautious Future Outlook: Criteo expects contribution ex-TAC growth for 2026 to range from flat to 2%, with first-quarter contributions projected to decline by 9% to 11% year-over-year, reflecting a cautious approach to future performance.
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Analyst Views on CRTO
Wall Street analysts forecast CRTO stock price to rise
8 Analyst Rating
4 Buy
4 Hold
0 Sell
Moderate Buy
Current: 18.210
Low
25.00
Averages
35.00
High
42.00
Current: 18.210
Low
25.00
Averages
35.00
High
42.00
About CRTO
Criteo SA is a France-based company specializing in digital performance marketing. Its solution consists of the Criteo Engine, the Company's data assets, access to inventory, and its advertiser and publisher platforms. The Criteo Engine consists of various machine learning algorithms, such as prediction, recommendation, bidding and creative algorithms and the global hardware and software infrastructure. The Criteo Engine delivers advertisements through multiple marketing channels and formats, including display advertising banners, native advertising banners and marketing messages delivered to opt-in e-mail addresses. Advertisements are delivered on all devices and screens, including Web browsers on desktops and laptops, mobile Web browsers on smart phones and tablets, as well as mobile applications. It operates in approximately 90 countries through a network of over 30 international offices located in Europe, the Americas and the Asia-Pacific region.
About the author
Emily J. Thompson
Emily J. Thompson, a Chartered Financial Analyst (CFA) with 12 years in investment research, graduated with honors from the Wharton School. Specializing in industrial and technology stocks, she provides in-depth analysis for Intellectia’s earnings and market brief reports.
Criteo Proposes Legal Domicile Transfer to Luxembourg
- Shareholder Support: Criteo announced that leading independent proxy advisory firms Glass Lewis and ISS recommend shareholders vote in favor of the proposal to transfer the company's legal domicile from France to Luxembourg, a move expected to enhance the company's appeal in capital markets.
- Shareholder Meeting Scheduled: The company will hold a shareholder meeting on February 27, 2026, to seek approval for the domicile transfer and related proposals, which, if approved, will provide greater flexibility for future capital management.
- Increased Capital Management Flexibility: By eliminating the American Depositary Shares structure, Criteo will reduce restrictions related to share repurchases and treasury share holdings, thereby enhancing capital management flexibility and potentially increasing stock liquidity.
- Potential Market Opportunities: The domicile transfer may position Criteo for inclusion in certain U.S. indices, expanding access to passive investment capital and driving diversification of the shareholder base and market share growth.
See More
Criteo Proposes Legal Domicile Transfer to Luxembourg
- Shareholder Voting Support: Criteo announced that leading independent proxy advisory firms Glass Lewis and ISS recommend shareholders vote in favor of the proposal to transfer the company's legal domicile from France to Luxembourg, a move expected to enhance shareholder value and provide strategic opportunities.
- Shareholder Meeting Arrangement: The company will hold a shareholder meeting on February 27, 2026, to seek approval for the domicile transfer and related proposals, with completion anticipated in the third quarter of 2026, contingent on shareholder approval.
- ADS Structure Replacement: Criteo plans to replace its American Depositary Shares structure with ordinary shares to be directly listed on Nasdaq, a change that aims to simplify the shareholder structure and potentially enhance market liquidity.
- Long-term Strategic Implications: The Board believes that the domicile transfer and structural adjustments will bring potential strategic opportunities, enhancing the company's competitiveness in the global market, particularly against the backdrop of ongoing growth in the digital advertising sector.
See More
Criteo Q4 2025 Earnings Call Insights
- Strong Financial Performance: Criteo reported $1.9 billion in revenue for 2025, with Contribution ex-TAC growing 3.5% to $1.2 billion, demonstrating robust execution underpinned by strong cash flow and a 35% adjusted EBITDA margin, despite challenges from Retail Media client scope reductions.
- Clear Strategic Priorities: CEO Komasinski emphasized the company's focus on agentic commerce, AI assistants, and Retail Media leadership, with the newly launched Agentic Commerce Recommendation Service showing a 60% uplift in product prioritization, which is expected to enhance customer conversion rates and strengthen market competitiveness.
- Cautious Future Outlook: CFO Glickman anticipates flat to 2% growth in Contribution ex-TAC for 2026, primarily impacted by a $75 million headwind from Retail Media client scope reductions, although excluding this, growth is expected to accelerate to high teens to 20%.
- Cash Flow and Buyback Plan: Criteo generated $134 million in free cash flow in Q4 2025, and the Board has authorized a stock buyback of up to $200 million, reflecting the company's balanced strategy between ongoing investments and shareholder returns.
See More
Criteo's Earnings Miss Expectations, Shares Drop 8.9%
- Disappointing Earnings: Criteo reported fourth-quarter revenue of $541 million, a 2% decline year-over-year that fell short of Wall Street expectations, resulting in an 8.9% drop in premarket trading.
- Declining Profitability: Adjusted earnings per share were $1.30, down from $1.75 a year earlier and below analysts' estimates of $1.41, indicating a significant decline in the company's profitability.
- Retail Media Pressure: Retail media revenue decreased by 17% year-over-year due to scope changes with two clients, although performance media revenue saw a slight increase of 1%, highlighting ongoing challenges.
- Cautious Future Outlook: Criteo expects contribution ex-TAC growth for 2026 to range from flat to 2%, with first-quarter contributions projected to decline by 9% to 11% year-over-year, reflecting a cautious approach to future performance.
See More
Criteo Reports 2025 Financial Results and Share Buyback Plan
- Financial Overview: Criteo reported $1.945 billion in revenue for 2025, reflecting a 1% year-over-year increase, yet a slight decline of 0.5% at constant currency, indicating intensified market competition that may impact future growth expectations.
- Net Income Fluctuation: The net income for 2025 reached $149 million, a 30% increase from 2024; however, Q4 net income dropped to $46 million, down 36% year-over-year, highlighting challenges in cost control and market conditions.
- Cash Flow and Buyback Plan: Criteo returned $152 million to shareholders through share repurchases in 2025 while maintaining strong cash flow, demonstrating confidence in future growth, and plans to increase the buyback authorization to $200 million to mitigate potential shareholder dilution.
- Strategic Restructuring and Legal Changes: The Board approved the transfer of the company's legal domicile from France to Luxembourg and plans for a direct listing in 2026, aimed at optimizing corporate structure and enhancing market competitiveness.
See More
Criteo S.A. Issues Fiscal Year 2026 Guidance
- Earnings Highlights: Criteo S.A. reported a Q4 non-GAAP EPS of $1.30, with revenue at $541 million, reflecting a 2.2% year-over-year decline, indicating pressure in the competitive landscape.
- Future Outlook: The fiscal year 2026 guidance suggests contribution ex-TAC growth is expected to be flat to +2%, reflecting a cautious stance on future growth, while adjusted EBITDA margin is projected to be between 32% and 34%.
- Q1 Expectations: For Q1 2026, contribution is anticipated to be between $245 million and $250 million, representing a year-over-year decline of 11% to 9%, indicating short-term challenges that may affect investor confidence.
- Market Reaction: Despite Criteo's earnings beat, the market's muted response highlights investor concerns regarding the risks faced by the company and its low valuation, potentially presenting opportunities for contrarian investors.
See More
Criteo Proposes Legal Domicile Transfer to Luxembourg
- Shareholder Support: Criteo announced that leading independent proxy advisory firms Glass Lewis and ISS recommend shareholders vote in favor of the proposal to transfer the company's legal domicile from France to Luxembourg, a move expected to enhance the company's appeal in capital markets.
- Shareholder Meeting Scheduled: The company will hold a shareholder meeting on February 27, 2026, to seek approval for the domicile transfer and related proposals, which, if approved, will provide greater flexibility for future capital management.
- Increased Capital Management Flexibility: By eliminating the American Depositary Shares structure, Criteo will reduce restrictions related to share repurchases and treasury share holdings, thereby enhancing capital management flexibility and potentially increasing stock liquidity.
- Potential Market Opportunities: The domicile transfer may position Criteo for inclusion in certain U.S. indices, expanding access to passive investment capital and driving diversification of the shareholder base and market share growth.
See More
Criteo Proposes Legal Domicile Transfer to Luxembourg
- Shareholder Voting Support: Criteo announced that leading independent proxy advisory firms Glass Lewis and ISS recommend shareholders vote in favor of the proposal to transfer the company's legal domicile from France to Luxembourg, a move expected to enhance shareholder value and provide strategic opportunities.
- Shareholder Meeting Arrangement: The company will hold a shareholder meeting on February 27, 2026, to seek approval for the domicile transfer and related proposals, with completion anticipated in the third quarter of 2026, contingent on shareholder approval.
- ADS Structure Replacement: Criteo plans to replace its American Depositary Shares structure with ordinary shares to be directly listed on Nasdaq, a change that aims to simplify the shareholder structure and potentially enhance market liquidity.
- Long-term Strategic Implications: The Board believes that the domicile transfer and structural adjustments will bring potential strategic opportunities, enhancing the company's competitiveness in the global market, particularly against the backdrop of ongoing growth in the digital advertising sector.
See More
Criteo Q4 2025 Earnings Call Insights
- Strong Financial Performance: Criteo reported $1.9 billion in revenue for 2025, with Contribution ex-TAC growing 3.5% to $1.2 billion, demonstrating robust execution underpinned by strong cash flow and a 35% adjusted EBITDA margin, despite challenges from Retail Media client scope reductions.
- Clear Strategic Priorities: CEO Komasinski emphasized the company's focus on agentic commerce, AI assistants, and Retail Media leadership, with the newly launched Agentic Commerce Recommendation Service showing a 60% uplift in product prioritization, which is expected to enhance customer conversion rates and strengthen market competitiveness.
- Cautious Future Outlook: CFO Glickman anticipates flat to 2% growth in Contribution ex-TAC for 2026, primarily impacted by a $75 million headwind from Retail Media client scope reductions, although excluding this, growth is expected to accelerate to high teens to 20%.
- Cash Flow and Buyback Plan: Criteo generated $134 million in free cash flow in Q4 2025, and the Board has authorized a stock buyback of up to $200 million, reflecting the company's balanced strategy between ongoing investments and shareholder returns.
See More
Criteo's Earnings Miss Expectations, Shares Drop 8.9%
- Disappointing Earnings: Criteo reported fourth-quarter revenue of $541 million, a 2% decline year-over-year that fell short of Wall Street expectations, resulting in an 8.9% drop in premarket trading.
- Declining Profitability: Adjusted earnings per share were $1.30, down from $1.75 a year earlier and below analysts' estimates of $1.41, indicating a significant decline in the company's profitability.
- Retail Media Pressure: Retail media revenue decreased by 17% year-over-year due to scope changes with two clients, although performance media revenue saw a slight increase of 1%, highlighting ongoing challenges.
- Cautious Future Outlook: Criteo expects contribution ex-TAC growth for 2026 to range from flat to 2%, with first-quarter contributions projected to decline by 9% to 11% year-over-year, reflecting a cautious approach to future performance.
See More
Criteo Reports 2025 Financial Results and Share Buyback Plan
- Financial Overview: Criteo reported $1.945 billion in revenue for 2025, reflecting a 1% year-over-year increase, yet a slight decline of 0.5% at constant currency, indicating intensified market competition that may impact future growth expectations.
- Net Income Fluctuation: The net income for 2025 reached $149 million, a 30% increase from 2024; however, Q4 net income dropped to $46 million, down 36% year-over-year, highlighting challenges in cost control and market conditions.
- Cash Flow and Buyback Plan: Criteo returned $152 million to shareholders through share repurchases in 2025 while maintaining strong cash flow, demonstrating confidence in future growth, and plans to increase the buyback authorization to $200 million to mitigate potential shareholder dilution.
- Strategic Restructuring and Legal Changes: The Board approved the transfer of the company's legal domicile from France to Luxembourg and plans for a direct listing in 2026, aimed at optimizing corporate structure and enhancing market competitiveness.
See More
Criteo S.A. Issues Fiscal Year 2026 Guidance
- Earnings Highlights: Criteo S.A. reported a Q4 non-GAAP EPS of $1.30, with revenue at $541 million, reflecting a 2.2% year-over-year decline, indicating pressure in the competitive landscape.
- Future Outlook: The fiscal year 2026 guidance suggests contribution ex-TAC growth is expected to be flat to +2%, reflecting a cautious stance on future growth, while adjusted EBITDA margin is projected to be between 32% and 34%.
- Q1 Expectations: For Q1 2026, contribution is anticipated to be between $245 million and $250 million, representing a year-over-year decline of 11% to 9%, indicating short-term challenges that may affect investor confidence.
- Market Reaction: Despite Criteo's earnings beat, the market's muted response highlights investor concerns regarding the risks faced by the company and its low valuation, potentially presenting opportunities for contrarian investors.
See More
