Criteo SA Q4 2024 Earnings Call Transcript

The following is excerpted from the question-and-answer section of the transcript.

Question: Ygal Arounian - Citigroup Inc. - Analyst : Hey, good morning, team. So I want to double check, Michael is on the call, right for Q&A?

Question: Ygal Arounian - Citigroup Inc. - Analyst : Okay. Alright. Well, then I can ask the first question. REFINITIV STREETEVENTS | www.refinitiv.com | Contact Us consent of Refinitiv. 'Refinitiv' and the Refinitiv logo are registered trademarks of Refinitiv and its affiliated companies. FEBRUARY 05, 2025 / 1:00PM, CRTO.OQ - Q4 2024 Criteo SA Earnings Call

Question: Ygal Arounian - Citigroup Inc. - Analyst : Alright, great. So well, Megan, congrats on the accomplishments here at Criteo and good luck on retirement and next steps from here. We'll miss you here. And so, as you exit just a bigger picture retail media question, just what the surprises were in 4Q on the strength? And then as we think about next year, gross media take rates and the biggest drivers of retail media, how we should be thinking about all of that? I know you hit on it in the prepared comments, but just expand on that a little bit more.

Question: Ygal Arounian - Citigroup Inc. - Analyst : Great. I got triple answer to that question. I feel a little bit bad asking a follow-up, but maybe just real brief on the margin profile and outlook, was there also any specific onetime things in 4Q given how big of the beep that was relative to expectations. And as we think about next year, even with the 1 point drag you pointed out, you're well ahead of the margins you set out at the 2022 Investor Day. How do you think about the margin opportunity, growth and investments? Thanks.

Question: Ygal Arounian - Citigroup Inc. - Analyst : Yeah. Just how you think about margins but I'm taking a lot of time. I have to be quick and can move on to others.

Question: Mark Kelley - Stifel Financial Corp. - Analyst : Great. Thank you very much. And Megan congrats, looking forward to hear what you are going to do in retirement. It's been a pleasure working with you. Two quick questions. One, I would love to hear your thoughts on Amazon retail ad service. And just, I guess the puts and takes, as they'd like to maybe try to compete with you a bit more. And then second on the bid switch, headwinds in Q4, it sounds like you took some actions to fix whatever the issue was. Is is that something we can expect to go forward or does that large adtech partner maybe revert back to older behaviors that were a little bit more favorable. Thank you.

Question: Mark Zgutowicz - The Benchmark Company - Analyst : Thank you. Good morning, Megan and Sarah. Really nice upside on the retail media takeaway, at least relative to our expectations. And was just curious how much of that benefit or upside that you saw in fourth quarter was lapping that large client transition. I think you may be lapping here now and then how meaningful or off-site volumes in terms of driving that take rate relative to on-site efficiencies that you continue to see? Thanks.

Question: Mark Zgutowicz - The Benchmark Company - Analyst : Thanks. And if I could perhaps ask just one unrelated question related to Microsoft, just curious how much that was contemplated, the contribution there in your either first quarter or annual guide? Thanks.

Question: Thomas White - D.A. Davidson & Co. - Analyst : Great. Thanks. One quick one for Sarah and then a quick one for Megan. I guess just on the guidance, you mentioned potential upside opportunities. I guess after Microsoft and the ramp of that, sort of the pace of that roll off, could you maybe just enumerate maybe one or two things that would be potential meaningful upside drivers in '25. And then Megan, again, congrats on the retirement. You made comments in the prepared remarks about agencies increasingly viewing Criteo an enterprise play. Could you maybe just quickly elaborate on that what you meant there? Thank you.

Question: Richard Kramer - Arete Research Services LLP - Analyst : Megan, thank you for being refreshingly forthright and not just promotional in your communication over the years. I guess my question for you is given the comments on the agencies and the two-year contracts. When you leave now, what sort of portion of a 2025 budget or forecast is now broadly covered for the start of the year and what sort of visibility do you have in the business relative to a few years ago? REFINITIV STREETEVENTS | www.refinitiv.com | Contact Us consent of Refinitiv. 'Refinitiv' and the Refinitiv logo are registered trademarks of Refinitiv and its affiliated companies. FEBRUARY 05, 2025 / 1:00PM, CRTO.OQ - Q4 2024 Criteo SA Earnings Call And I have a follow up for Todd, Megan mentioned the Meta with respect to partnerships. And recently, your code was seen in ads TXT files at Pinterest. Can you speak to what specific competitive edge you would get, whether it's in performance or margins of getting access to much wider pools of inventory and all these social inventory alongside the retailer or website inventory you've got in retail media. Thanks.

Question: Brian Pitz - BMO Capital Markets - Analyst : Thank you. And I echo the congratulations to Megan on retirement. Sarah, in the prepared remarks, I believe you mentioned possible guidance upside depending on some internal strategic initiatives. Can you provide additional insights there? And also, I think you have 30 retailers leveraging retail media off-site campaigns, any sense on the spend you see from these clients versus those