Slide 1: Investor Presentation 2024
j ry ‘ATION | 2024 —— eo . . _ w i INVESTOR cour , A ~ -_ ee
Slide 2: Forward-Looking Statements - Disclaimer
Forward-Looking Statements - Disclaimer Certain statements in this presentation are forward-looking statements, including our Q2 2024 and full-year 2024 guidance. Forward-looking statements generally relate to future events including future financial or operating performance of Taboola.com Ltd. (the
Slide 3: Today's Presenters
TODAY’S PRESENTERS Adam Singolda Stephen Walker Founder & CEO CFO ● Founded Taboola in 2007; Has led the ● Joined Taboola in 2014 when the Company Company as its CEO ever since acquired Perfect Market, which Steve founded ● Previously: Israeli National Security Agency ● Previously: ● Graduated first
Slide 4: Agenda
AGENDA Taboola Capturing Share of 1 $80B+ Open Web Ad Market Taboola’s Differentiation 2 and Why We Win 3 Strong Financial Profile 4 Q1 2024 Updates & Momentum
Slide 5: We Power Recommendations for the Open Web
We Power Recommendations for the Open Web Driving Consumer Action with AI CONFIDENTIAL 5
Slide 6: The Open Web Is a Large and Growing Market
THE OPEN WEB IS A LARGE AND GROWING MARKET $80B+ 66% …but only 30% digital ad spend on the Open Web of web/mobile time is spent of total digital ad spend is growing at ~10% per year (1) on the Open Web (2)… spent on the Open Web (2) Open Web consists of iconic digital properties outside walled garde
Slide 7: Open Web Challenges / Opportunities
OPEN WEB CHALLENGES / OPPORTUNITIES BAD USER EXPERIENCE BAD ADVERTISER EXPERIENCE INFERIOR AD PERFORMANCE Open Web uses the same Open Web highly No “walled garden” level of AI ad format as 30 years ago fragmented and complex(1) and data in the Open Web Sharing Data / Social Ad Networks Tools Agency
Slide 8: Taboola Is Best Positioned to Build the First Must Buy Company
TABOOLA IS THE BEST POSITIONED TO BUILD THE FIRST “MUST BUY” COMPANY IN THE OPEN WEB ADVERTISERS Long term exclusive publisher agreements Scaled, direct advertisers AI technology ~600M DAU 1st party, contextual data CONFIDENTIAL 8
Slide 9: Taboola Revolution
Paid TABOOLA REVOLUTION Brings power of walled gardens to Open Web with tens of billions clicks a year Editorial
Slide 10: Bombas Case Study
COMPANY CHALLENGE SOLUTION RESULTS Bombas is a comfort-focused Drive holiday sales for its revamped Use Taboola native ads, Attentive With Taboola, Bombas achieved a apparel brand with a mission to help and expanded line of slippers, and Audiences, and site retargeting to 50% increase in ROAS, those
Slide 11: Big Momentum
BIG MOMENTUM E-COMMERCE GROWTH ICONIC PARTNERSHIPS RAPID AI ADOPTION FOR ADVERTISERS FOR PUBLISHERS 11
Slide 12: Agenda
AGENDA Taboola Capturing Share of 1 $80B Open Web Ad Market Taboola’s Differentiation 2 and Why We Win 3 Strong Financial Profile 4 Q1 2024 Updates & Momentum
Slide 13: Why Taboola
WHY TABOOLA Bringing walled garden experiences to an $80B+ Open Web market 1 Integrated native advertising experience 2 Long-term, exclusive access to supply and direct relationships with advertisers 3 AI driven tech platform that is best-in-class 4 Taboola tech & code on page built for a cookie-les
Slide 14: Integrated Native Advertising Experience
1 INTEGRATED NATIVE ADVERTISING EXPERIENCE More integrated Paid ad experience Easy access to Organic Paid scale Organic Better user data and Paid AI for more accurate ad targeting 14
Slide 15: Long-Term, Exclusive Access to Supply and Direct Advertiser Relationships
2 LONG-TERM, EXCLUSIVE ACCESS TO SUPPLY AND DIRECT RELATIONSHIPS WITH ADVERTISERS Highly predictable supply base with 98%+ of supply consistent from quarter to quarter Long-term, exclusive partnerships and native Direct relationships with blue-chip, brand integrations with the world’s top publishers
Slide 16: AI Driven Tech Platform That Is Best-in-Class
3 AI DRIVEN TECH PLATFORM THAT IS BEST-IN-CLASS Our unified tech stack offers comprehensive platforms for publishers and advertisers underpinned by AI ENGAGEMENT AUDIENCE MONETIZATION Comprehensive publisher platform Organic Recs Taboola News Feed Homepage For You Newsroom Video Reel & Slider Deep L
Slide 17: Tech & Code on Page Built for a Cookie-Less World
4 TABOOLA TECH & CODE ON PAGE BUILT FOR A COOKIE-LESS WORLD Taboola has its own Unique readership People click on 1st party cookie thanks to context Taboola “code on page” integrations deep access to the recommendations with publishers context of the page, tens of billions of recommending personaliz
Slide 18: Our Scale Drives Network Effect That Creates Competitive Advantage
2 5 OUR SCALE DRIVES NETWORK EFFECT THAT CREATES COMPETITIVE ADVANTAGE Our predictable access to scale creates strong network effects that drive higher yield OUR SCALE DRIVES HIGHER YIELD THROUGH: More Users Reached More Data More Frequently Generated ~600M daily 1 trillion monthly CPC active users
Slide 19: Significant Growth Opportunities
6 SIGNIFICANT GROWTH OPPORTUNITIES 20% - 30% Growth ps Ap | C PU es TCV am TV R R G /A | ea | Ta ic ch d b at oo el m in la Yi m g N ra ew og us s pr 10% - 15% Growth er o/ | de s H vi ea | de ce rB 2024 - 2025 outsized growth er id m di CORE om ng - Yahoo ramping eC | | Pu I - Yield growth through
Slide 20: Proven, Founder-Led Management Team
7 PROVEN, FOUNDER-LED MANAGEMENT TEAM Adam Singolda Stephen Walker Eldad Maniv Lior Golan Kristy Sundjaja Tal Sliwowicz 17 years at Taboola 10 years at Taboola 12 years at Taboola 15 years at Taboola 4 years at Taboola 11 years at Taboola Founder & CEO CFO President & COO CTO CPO SVP, R&D Ran Buck E
Slide 21: Agenda
AGENDA Taboola Capturing Share of 1 $80B+ Open Web Ad Market Taboola’s Differentiation 2 and Why We Win 3 Strong Financial Profile 4 Q1 2024 Updates & Momentum
Slide 22: Strong Financial Profile
8 STRONG FINANCIAL PROFILE FAST GROWING HIGH PROFITABILITY STRONG BALANCE SHEET GENERATING CASH FLOW $667M $200M+ $100M+ $28M 2024 2024 2024 Net Cash Position ex-TAC Gross Profit(1) Adj. EBITDA(1) Free Cash Flow(1) 18% 30% $181M 50%+ Seven Year Cash Balance 2024 Adjusted Free Cash Flow Compounded at
Slide 23: Financial Highlights
FINANCIAL HIGHLIGHTS
Slide 24: Taboola Focuses on Profitable Growth
TABOOLA FOCUSES ON PROFITABLE GROWTH LONG-TERM MODEL 20% ex-TAC Gross Profit Growth 30%+ Ratio of Adjusted EBITDA to ex-TAC Gross Profit 50%+ FCF conversion from Adjusted EBITDA long-term (1),(2) Non-GAAP measure, see appendix for reconciliation to GAAP
Slide 25: Revenue Model Drives High Incremental Margins
REVENUE MODEL DRIVES HIGH INCREMENTAL MARGINS Engagement Number of Frequency of Depth of (Page views / ad impressions) unique users engagement engagement x Yield Depth / breadth of Quality of data AI technology (RPM / CPM) advertisers (ability to target) = ▪ Revenue paid by Advertisers, before traff
Slide 26: Why Taboola
WHY TABOOLA Bringing walled garden experience to an $80B+ Open Web market 1 Integrated native advertising experience 2 Long-term, exclusive access to supply and direct relationships with advertisers 3 AI driven tech platform that is best-in-class 4 Taboola tech & code on page built for a cookie-less
Slide 27: Why Taboola
WHY TABOOLA Bringing walled garden experiences to an $80B+ Open Web market 1 Integrated native advertising experience 2 Long-term, exclusive access to supply and direct relationships with advertisers 3 AI driven tech platform that is best-in-class 4 Taboola tech & code on page built for a cookie-les
Slide 28: Agenda
AGENDA Taboola Capturing Share of 1 $80B Open Web Ad Market Taboola’s Differentiation 2 and Why We Win 3 Strong Financial Profile 4 Q1 2024 Updates & Momentum
Slide 29: Q1 2024 Business in Review - Strong Start to 2024
Q1 2024 BUSINESS IN REVIEW - Strong start to 2024 Renewing and building new long term relationships ➔ Publisher wins that were new and from competitors included 20 Minutes, RTL, TVBS News, A Bola, Webedia Group, El Colombiano. ➔ Top premium advertisers included Verizon, Intuit, Samsung among others.
Slide 30: Q1 2024 - All Metrics Beat High End of Guidance
Q1 2024 - ALL METRICS BEAT HIGH END OF GUIDANCE Q1 2024 Actuals Guidance Revenues $414M $397 to $413M Gross profit $109M $94 to $106M ex-TAC Gross Profit1 $139M $123 to $135M Adj. EBITDA1 $23M $10 to $17M (1) Non-GAAP measures, see appendix for reconciliation to GAAP
Slide 31: 2024 Guidance - Expecting Record Year
2024 GUIDANCE - EXPECTING RECORD YEAR WITH SUBSTANTIAL GROWTH ACROSS ALL KEY METRICS Q2 2024 GUIDANCE (3) FY 2024 GUIDANCE (3) Revenues $410 to $440M $1,892 to $1,942M (+28% YoY) (+33% YoY) Gross profit $110 to $120M $535 to $555M (+18% YoY) (+28% YoY) ex-TAC Gross Profit1 $140 to $150M $656 to $679
Slide 32: Thank you
TabOela Thank you 32
Slide 33: Appendix
APPENDIX
Slide 34: Our Model in a Nutshell
OUR MODEL IN A NUTSHELL Model components: Sample inputs / financials: Illustrative Taboola economics: Revenues(1) $909 $1.00 (100%) – Traffic Acq Cost (Value to publishers) ($627) ($0.69) = ex-TAC Gross Profit(2) $282 $0.31 – Cost of Revenues ($48) ($0.05) = Gross profit $234 $0.26 – 34 R&D ($73) ($
Slide 35: Historical Revenues & ex-TAC Gross Profit (Reported Basis)
HISTORICAL REVENUES & EX-TAC GROSS PROFIT1 (REPORTED BASIS) 1 1 (1) Non-GAAP measure, see appendix for reconciliation to GAAP 35
Slide 36: Selected GAAP and Non-GAAP Metrics
SELECTED GAAP AND NON-GAAP METRICS (1) 1 1 1 (1) 22 2 (1)Non-GAAP measures, see appendix for reconciliation to GAAP Note: 2024 projections reflect the midpoint of current company guidance. Note: Adj. Gross Profit Margin is calculated by dividing Gross profit by ex-TAC Gross Profit. 36
Slide 37: FY 2024 Guidance
FY 2024 GUIDANCE 1 1 (1 1 ) 11 22 2 1 1 1 1 1 1 (1) Non-GAAP measure, see appendix for reconciliation to GAAP 37
Slide 38: Additional Modeling Assumptions
ADDITIONAL MODELING ASSUMPTIONS ● Interest payments: $18.6M in 2023 and $14.7M in 2024; approximately $3.7M per quarter associated with $152.7M term loan related to the Connexity acquisition and reflecting our $50M voluntary prepayment in October 2023. ● Share based compensation: $64M in 2023 and $7
Slide 39: Adjusted EBITDA Reconciliation
ADJUSTED EBITDA RECONCILIATION 1 2 1 A substantial majority is share-based compensation expenses related to going public. 2 Relates to the acquisition of ION Acquisition Corp. 1 Ltd. and going public. 39
Slide 40: Quarterly Results: Adjusted EBITDA Reconciliation
QUARTERLY RESULTS: ADJUSTED EBITDA RECONCILIATION 1 2 1 A substantial majority is share-based compensation expenses related to going public. 2 Includes Commercial agreement asset acquisition costs. 40
Slide 41: ex-TAC Gross Profit Reconciliation
EX-TAC GROSS PROFIT RECONCILIATION 41
Slide 42: Ratio of Adjusted EBITDA to ex-TAC Gross Profit Reconciliation
RATIO OF ADJUSTED EBITDA TO EX-TAC GROSS PROFIT RECONCILIATION 42
Slide 43: ex-TAC Gross Profit Margin Reconciliation
EX-TAC GROSS PROFIT MARGIN RECONCILIATION 43
Slide 44: Historical Adj. Gross Profit Margin Reconciliation
HISTORICAL ADJ. GROSS PROFIT MARGIN RECONCILIATION Note: Adj. Gross Profit Margin is calculated by dividing Gross profit by ex-TAC Gross Profit. 44
Slide 45: Historical Free Cash Flow Reconciliation
HISTORICAL FREE CASH FLOW RECONCILIATION 1 1 1 (1) Adj. EBITDA plus the change in working capital reflects the Net cash provided by operating activities. 45
Slide 46: Supplemental Cash Flow Information
SUPPLEMENTAL CASH FLOW INFORMATION 1 (1) We calculate cash investment in publisher prepayments (net) for a specific measurement period as the gross amount of cash publisher prepayments we made in that measurement period minus the amortization of publisher prepayments that were included in traffic ac
Slide 47: Non-GAAP Net Income Reconciliation
NON-GAAP NET INCOME RECONCILIATION 1 A substantial majority is share-based compensation expenses related to going public. 2 Relates to the acquisition of ION Acquisition Corp. 1 Ltd. and going public. 47
Slide 48: Example of Publisher Prepayments
EXAMPLE OF PUBLISHER PREPAYMENTS 1 48
Slide 49: Consolidated Balance Sheet
CONSOLIDATED BALANCE SHEET As of As of Dec Dec 31, As of Dec As of Dec As of Mar ($ in millions) 31, 2020 2021 31, 2022 31, 2023 31, 2024 Cash, cash equivalents, short-term $ 243 $ 319 $263 $183 $182 deposits and investments Total Assets $ 580 $ 1,598 $1,530 $1,708 $1,660 Total Liabilities & Convert
Slide 50: Q2 2024 and 2024 Full Year Guidance: ex-TAC Gross Profit Reconciliation
Q2 2024 and 2024 FULL YEAR GUIDANCE: EX-TAC GROSS PROFIT RECONCILIATION 50
Slide 51: Note Regarding Adjusted EBITDA Guidance
Note Regarding Adjusted EBITDA Guidance Although we provide guidance for Adjusted EBITDA, we are not able to provide guidance for projected Net income (loss), the most directly comparable GAAP measure. Certain elements of Net income (loss), including share-based compensation expenses, are not predic
Slide 52: Thank You!
THANK YOU!