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- Adtech company Teads is laying off staff, Business Insider has learned.
- A spokesperson said the reduction would affect less than 10% of its workforce.
- The layoffs follow the merger of Outbrain and Teads 10 months ago.
Adtech company Teads told employees this week that it's laying off staff across its global offices, Business Insider has learned.
A spokesperson for Teads confirmed the layoffs, adding that they affected less than 10% of the company's head count. They declined to provide further comment. Teads had roughly 1,800 employees as of November.
The news comes roughly 10 months after Outbrain, the adtech company best known for its content recommendation widgets, closed its $900 million acquisition of Teads from the European telecommunications giant Altice. Though Outbrain was the acquirer, it rebranded to become Teads.
David Kostman, formerly Outbrain's CEO, became CEO of Teads once the merger was completed. At the time of the deal's closing in February, Kostman said the deal would create a company that addressed "a large gap in the advertising industry," combining Teads' video expertise with Outbrain's performance marketing capabilities to build "a scaled end-to-end platform that can drive outcomes, from branding to consideration to purchase, across screens."
It's not been smooth sailing.
Teads' share price is down more than 90% year to date. Its market cap was about $58 million in early trading on Thursday. The company missed on both revenue and earnings per share in its third quarter and warned that the fourth quarter would continue to be challenging.
Kostman said on the company's November earnings call that Teads had experienced complexities due to the merger process, as well as "macro volatility in certain geographies and verticals."
The company recently hired adtech veteran Mollie Spilman as its chief commercial officer, as part of its plan to turn around its business. Elsewhere, Jeremy Arditi, a 15-year Teads veteran, is leaving his role as co-president and chief business officer of the Americas this month to start a new company in the AI business applications space, he confirmed to Business Insider.
Kostman said in November that the company was conducting a "comprehensive business review" to identify new growth and profit opportunities, and that Teads would provide a more detailed three-year plan and road map at an investor day in March.
Fortunes have been mixed for companies across the adtech industry this year. Overall, the global advertising market is set to grow by 7.4% to reach $1.17 trillion in 2025, per a September forecast from the research firm WARC. Meta, Alphabet, and Amazon are expected to capture more than half (55.8%) of total ad spend outside China.
Taboola, which for years fiercely competed with Outbrain in the content-recommendation space, has pulled ahead by diversifying its offering beyond native ads and striking key partnerships with the likes of Apple and Paramount. Taboola's third-quarter earnings beat expectations, and its stock is up more than 7% year-to-date, with its market cap exceeding $1 billion.
During Teads' November earnings call, the company also highlighted some specific challenges within its business that had affected its recent performance.
A "cleanup" of underperforming, lower-quality supply partners in the legacy Outbrain business resulted in a $10 million year-over-year headwind in the third quarter, the company said. The Outbrain legacy business was also affected by the broader web traffic declines that publishers have experienced, a trend accelerated by the rise of AI summaries in search results, Kostman said on the call. The sales pipeline for the legacy Teads business saw volatility as well, the company said.