Perion Network (NASDAQ:PERI) reported first-quarter financial results on Wednesday. The transcript from the company’s first-quarter earnings call has been provided below.
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View the webcast at https://perion-q1-2026-earnings-call.open-exchange.net/registration
Summary
Perion Network Ltd reported a 6% year-over-year increase in Perion 1 spend, with total revenue for Q1 2026 at $90.4 million, despite macroeconomic headwinds.
Advertising Solutions revenue decreased due to a decline in web activity, but Perion 1’s contribution x stack increased by 7%, signaling a strategic shift towards this platform.
The company expects a meaningful EBITDA inflection in the second half of the year, driven by strategic agreements and a strong pipeline, reiterating their full-year guidance for 2026.
Perion Network Ltd’s net loss on a GAAP basis was $10 million, but the non-GAAP net income was $4.8 million, maintaining a strong liquidity position with $293 million in cash and equivalents.
Management highlighted the significant growth of Outmax, emphasizing its unique capability to operate across CTV, web, and social platforms, and discussed ongoing investments in AI and strategic agreements to bolster future growth.
Full Transcript
OPERATOR
Retail media have been consistently outpacing the broader market. These impressive growth rates drove a 6% year over year increase in total perion1 spend compensating for the decrease in Web the aggregate impact of the customer spend shows a growing momentum through this important KPI. In the first quarter of 2026 we achieved a solid 6% increase in Perion One spend while navigating the near term macro headwinds and cautious advertisers planning cycles. This is a testament of the increasing demand for our solutions and our expected scale as we look towards the second half of the year. Revenue for the first quarter came in at $90.4 million with advertising solutions revenue at $66.7 million and search at $23.7 million. Contribution ex stock remained flat year over year at $39.7 million. The 44% margin was stable and consistent with last year while Advertising Solutions revenue decreased in the first quarter due to the anticipated decline in the web activity, it is important to emphasize that Perion One contribution X Stack increased by 7% year over year aligned with the spend trajectory. This demonstrates that as we are gradually shifting our business to the Perion One platform, Contribution x Stack and Spend are becoming the true indicators of our underlining growth. Perron One Contribution XSTAC continue to be the main profit driver representing 81% of the total Contribution X stack, up from 75% in the first quarter of 2025. We expect this structural shift to continue with Perion One growing to 85 to 90% of the full year 2026. With respect to our search revenue, as we transition away from the Microsoft agreement, the margin profile of our search activity is naturally shrinking. As a result, even though search revenue increased year over year by 21%, the related contribution ex stuck decreased by 70%. As expected, adjusted EBITDA for the first quarter was half a million dollars compared to $1.8 million in the first quarter of 2025. While we are laser focused on operational efficiency and disciplined execution, the year over year delta was expected. This reflects the incremental expense base from the Greenbits acquisition in the second quarter of 2025 and additional go to market investments to support our three year growth plan. In addition, during the first quarter of 2026 the headwinds from the US dollar weakness represented $1.4 million impact related to foreign exchange. Excluding this foreign exchange impact, adjusted EBITDA would have been $1.9 million largely flat year over year despite the additional costs planned for. As we onboard several large strategic agreements currently in advanced stages, we we expect adjusted EBITDA to inflect meaningfully in the second half of the year. This is consistent with the second half weighted profile of our business. Similar to last year. On a GAAP basis, net loss was $10 million or $0.26 per diluted share. This compares with a net loss of $8.3 million or $0.19 per diluted share in the first quarter last year. On a non GAAP basis, net income was $4.8 million or $0.11 per diluted share. This compares with $5.4 million or $0.11 per diluted share in the first quarter last year. Net cash provided by operating activities was $6.7 million and adjusted free cash flow was $7 million. The cash generative quality of our business model and our disciplined capex investments practices ensure that our internal operations are streamlined to support our growth. We ended the first quarter with $293 million in cash, cash equivalents, short term bank deposits and marketable securities on our balance sheet. While we continue to generate positive cash flow from operations, the $20 million reduction from year end is driven by $24.1 million returning cash to our investors and in a form of share repurchases. This strong liquidity profile gives us the financial flexibility to pursue organic investments, MA opportunities and continued shareholders return. Our capital allocation priorities remain highly disciplined, focused on creating long term value. During the first quarter we repurchased 2.5 million shares for a total of $24.1 million. Under our current authorized program, we have now repurchased a cumulative total of 15.3 million shares for $142.2 million. Since the program’s initiation, we have acquired these shares at an average price of 9.$27 per share. This is notably lower than our average stock price at the last 30 days. By doing so, we have already generated immediate tangible value for our shareholders. Buying back our own stock at current valuation levels alongside disciplined organic and inorganic investments is the most effective use of our excess cash. It reflects our confidence in Perion’s long term intrinsic value despite the expected macro headwinds for the second quarter. Given the momentum we see building in our pipeline for the back half of the year, particularly the several large strategic agreements that are in advanced stages, we are reiterating our full year 2026 guidance. To conclude, Perion entered 2026 with a strong financial foundation, a proven platform strategy, highly disciplined operations and a set of growth engines that are constantly outpacing their markets. The infrastructure is in place. The pipeline is building continuously and we are prioritizing sustainable, profitable growth and, and long term value creation for our shareholders. With that I will turn the call back to the operator to open the line for questions. Thank you. We will now begin the Q and A. If you would like to ask a question, we ask that you please use the raised hand function at the bottom of your zoom screen. Or if you have dialled in, please press Star nine. Our first question today comes from Andrew Marrock at Raymond James. Andrew, you may now unmute your line and ask your question. Thank you.
Andrew Marrock (Equity Analyst)
Hi, thanks for taking my questions. Wanted to start off with one on outmax. Some really good numbers there and we’re seeing the agency space getting increasingly crowded I guess. How are you differentiating outmax in the marketplace in your go to market process that is allowing it to more than triple spend year over year. And then I have a follow up.
OPERATOR
Yeah, thank you, Andrew. Yes. So you saw Outmax, the AI agent technology that we have grew by over 300%. The main thing in our main advantage is we’re the only technology out there that can perform this across both CTV, web and social with the walled gardens, which is a major advantage. To have only one AI agent technology and infrastructure that can run across all those channels, all those platforms is a major, major advantage. Great, thank you.
Andrew Marrock (Equity Analyst)
And then maybe one for Elad. Can you expand a little bit on the commentary that you gave in your prepared remarks on the uneven macro conditions and some of the caution you’re seeing from advertisers? You know, from your peer set. We’re kind of hearing feedback that’s, that’s quite variable. So I’d just like to get a little bit more granularity of what you’re seeing from your position. Thank you.
Elad
Sure. Thanks Indra. So in terms of the headwinds that we are seeing, we see that the inflation in the, in the oil prices and all of the tension in the Middle east caused some uncertainty in terms of the budget spends especially I would say around CPG we see and slightly around auto in. In addition to that we are continuing to see the slow, I would say short, short planning cycles of the, of the advertisers in terms of their, their budget spend. So this is what we see currently in, towards, in towards Q2. But it is important to say that we already started to see some more momentum growing in our pipeline towards the second half of the year. Now of course we do not know yet the timing of when one of those headwinds will really be over. We don’t know to anticipate but we do see more and more strength into our pipeline moving forward especially around Outmax, the adoption of more and more customers to this solution. And of course we’re taking all of those consideration when we are building the guidance towards the rest of the year. Thank you. Appreciate the detail.
OPERATOR
Thank you. Our next question comes from Jason Healthsteam at Offenheimer. Jason, please unmute your line by pressing Star six and ask your question.
Jason Healthsteam
Hey Dan, can you hear me? Yes, thank you. Yeah, good morning. So first your comment just about …
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