Slide 1: Yahoo! + Taboola Investor Presentation
Yahoo! + TaboolaInvestor Presentation March 1, 2023
Slide 2: Forward-Looking Statements Disclaimer
Forward-Looking Statements Disclaimer Certain statements in this presentation are forward-looking statements. Forward-looking statements generally relate to future events, including Taboola.com Ltd.’s (the “Company’s”) expectations for the Company’s partnership with Yahoo described in this presentat
Slide 3: Agenda
Taboola & Partnership Overview Fireside Chat with Integration Summary Audience Q&A Adam Singolda 01 02 03 04 05 Monica Mijaleski Yahoo CFO, Taboola Director Eldad Maniv President & COO Steve Walker CFO Rick Hoss Moderated by Moderated by Presented by Presented by Presented by Agenda Lunch & Demo Sta
Slide 4: Taboola & Yahoo partnership
Taboola & Yahoo partnership Doubling and tripling our partnership Building a “must buy” advertising company in the open web
Slide 5: Information Overload
Information Overload
Slide 6: slpood
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Slide 7: Recommendation Engines Are Everywhere
RECOMMENDATION ENGINES ARE EVERYWHERE
Slide 8: Recommendation Engines Are Everywhere
RECOMMENDATION ENGINES ARE EVERYWHERE
Slide 9: Recommendation Engines Are Everywhere
RECOMMENDATION ENGINES ARE EVERYWHERE
Slide 10: Recommendation Engines Are Everywhere
RECOMMENDATION ENGINES ARE EVERYWHERE
Slide 11: Powering Recommendations For The Open Web
Powering Recommendations For The Open Web Helping People Discover Things They May Like
Slide 12: Open Web = Huge Market
Open Web = Huge Market $70B1 (1) Company estimate Open Web = Sites, Apps, CTV
Slide 13: Time spent on editorial content on the open web
Video Platforms 17% Shopping Platforms 15% Social Platforms 23% Search Platforms 16% Source: Hootsuite, Digital 2021 Report, January 2021. Percentages do not sum to 100% due to rounding 25% Portion of time people spend reading editorial content on the open Web
Slide 14: Privacy Matters
Privacy Matters
Slide 15: Walled Gardens vs Open Web
Walled Gardens Open Web Easy To Buy Fragmented SOCIAL SEARCH
Slide 16: ‘SHOP GIFTS
‘SHOP GIFTS UNDER*50 acrestaurants) in your city Save up to 75* off a5
Slide 17: Bringing The Power Of Walled Gardens To The Open Web
Taboola = Bringing The Power Of Walled Gardens To The Open Web Paid Organic Paid Organic Organic Paid Paid Paid
Slide 18: Taboola & Yahoo partnership
Taboola & Yahoo partnership Doubling and tripling our partnership Building a “must buy” advertising company in the open web
Slide 19: Slide 19
Slide 20: Native advertisers across Yahoo sites
Thousands of native advertisers Contextual Segments Exclusive native across Yahoo sites (nearly 900M users)
Slide 21: Yahoo Supply Unlocks Premium Access To Users
Yahoo Supply Unlocks Premium Access To Users Across Verticals Y! is the 5th largest internet property in the US: 84% of US Internet Population visits a Y! Property on a monthly Basis.1 (1) Comscore Media Metrix ® Multi-Platform, Total Audience and % Reach, Top 100 properties, Total Unique Visitors/V
Slide 22: Becoming A Must Buy For Advertisers
Becoming A “Must Buy” For Advertisers ADVERTISERS
Slide 23: Becoming The Largest Ad Company In the Open Web
$224B $114B $37B $2.8B ~$4.5B ~$4.6B ~$7.7B <=$1B Others (1) Estimated 2022 Results if Yahoo were to be included in full year results, plus uplift. See appendix for assumptions.(2) FY 2022 figures as presented in each company’s respective Form 10-K (except as noted) are as follows: Amazon: “Advertis
Slide 24: Scale Matters In Our Industry
More Publisher Partners More Users Reached More Frequently More Data Generated Higher Yield Better Targeting Drives Better Results for Advertisers GROWTH WITH A BUILT-IN NETWORK EFFECT = Win even more publishers = Make advertisers successful Scale Matters In Our Industry
Slide 25: Taboola & Yahoo partnership
Taboola & Yahoo partnership Doubling and tripling our partnership Building a “must buy” advertising company in the open web
Slide 26: Innovative formats & experiences
Innovative formats & experiences - Stories, Video, Carousels, and more Taboola Feed Explore More Video Reel Taboola Stories (Beta) Designed to engage and monetize Next Up
Slide 27: Building Contextual Segments
Building Contextual Segments Reaching targeted audiences based on relevant articles and topics
Slide 28: Header Bidding Into Display
Header Bidding Into Display Taboola’s incremental CPC demand increases the performance of existing display placements Simple Prebid wrapper integration
Slide 29: Supercharge eCommerce: Connecting High Intent Content and Retailers
Yahoo is already Connexity’s #1 partner in 20221 Additional opportunities to explore: Creating bespoke eCommerce content Integrating deeper into Yahoo’s Commerce Opportunities Circulating traffic from content to commerce Supercharge eCommerce: Connecting High Intent Content and Retailers (1) Company
Slide 30: The Force is with us
The Force is with us 2024 Expectations: $200M+ Adj. EBITDA1 $100M+ Free Cash Flow1 Assuming Yahoo is fully live mid-2024 (1) Non-GAAP Measures; see appendix for explanation and information regarding reconciliation to GAAP.
Slide 31: Agenda
Taboola & Partnership Overview Fireside Chat with Integration Summary Audience Q&A Adam Singolda 01 02 03 04 05 Monica Mijaleski Eldad Maniv President & COO Steve Walker CFO Rick Hoss Moderated by Moderated by Presented by Presented by Presented by Agenda Jim Lanzone Yahoo’s CEO Yahoo CFO, Taboola D
Slide 32: Fireside Chat
Fireside Chat Adam Singolda Taboola CEO Monica Mijaleski Yahoo CFO Taboola Director Yahoo CEO Jim Lanzone
Slide 33: Agenda
Partnership Overview Fireside Chat with Integration Summary Audience Q&A Adam Singolda 01 02 03 04 05 Monica Mijaleski Eldad Maniv President & COO Steve Walker CFO Rick Hoss Moderated by Moderated by Presented by Presented by Presented by Agenda Yahoo’s CEO Jim Lanzone Yahoo CFO, Taboola Director He
Slide 34: Executing the Integration While Maintaining a Perfect Mix of Demand and Supply
Executing the Integration While Maintaining a Perfect Mix of Demand and Supply
Slide 35: Yahoo + Taboola: Integration Overview
Tech Advertisers Supply People Yahoo + Taboola:Integration Overview Multiple complex integration paths:
Slide 36: Yahoo + Taboola: Integration Overview
Feature Parity Format Parity Data & Cookie Sync Targeting Reporting Campaign Continuity Platform Migration Policy Alignment Hit performance Goals 1,000’s of Placements A/B Testing and UI Optimization Reporting and insights Staffing Requirements Operational support Yahoo + Taboola:Integration Overvie
Slide 37: Native API Data Reco Engine Yahoo Native Platform Native Demand Serving Native Demand Recommendations
Native API Data Reco Engine Yahoo Native Platform Native Demand Serving Native Demand Recommendations Yahoo Supply Advertisers Technology Supply Omni Channel Buyers Native-Only Buyers Yahoo DSP
Slide 38: Native API Data Reco Engine Native Demand Serving Native Demand Recommendations Yahoo Supply Ads
Native API Data Reco Engine Native Demand Serving Native Demand Recommendations Yahoo Supply Ads Console Data Reco Engine Serving Native demand Taboola platform Recommendations Open Web Supply Advertisers Technology Supply Omni Channel Buyers Native-Only Buyers Yahoo Native Platform Yahoo DSP
Slide 39: Native API Data Reco Engine Native Demand Serving Native Demand Ads Console Data Reco
Native API Data Reco Engine Native Demand Serving Native Demand Ads Console Data Reco Engine Serving Native demand Taboola platform Recommendations Open Web Supply Recommendations Yahoo Supply Advertisers Technology Supply Omni Channel Buyers Native-Only Buyers Yahoo Native Platform Yahoo DSP
Slide 40: Advertisers Technology Supply Native API Data Reco Engine Native Demand Recommendations Serving Yahoo Supply
Advertisers Technology Supply Native API Data Reco Engine Native Demand Recommendations Serving Yahoo Supply Native demand User & page data Initial Integration Recos Omni Channel Buyers Ads Console Data Reco Engine Serving Native demand Taboola platform Recommendations Open Web Supply Native-Only Bu
Slide 41: Example Initiatives
Advertisers Technology Supply Example Initiatives Targeting Parity Feature Parity S2S Connection & Data Sync Targeting Parity Algo Optimization Content Moderation A/B Testing Infrastructure Feature Parity Ad Policy Parity Reporting Parity UX Implementation & Optimization Feature Parity
Slide 42: Ads Console Data Reco Engine Serving Native demand Taboola platform Yahoo DSP Data Advertisers
Ads Console Data Reco Engine Serving Native demand Taboola platform Yahoo DSP Data Advertisers Technology Supply Native demand User & targeting data Open Web Supply Recommendations Omni Channel Buyers Yahoo Supply
Slide 43: Example Initiatives
Advertisers Technology Supply Example Initiatives Customer Migration: Taboola Onboarding Campaign History & Reporting New Open Web Supply Client-side Supply Integration Omni-channel sales support Client-side Integration Targeting Parity Feature Parity S2S Connection & Data Sync Targeting Parity Algo
Slide 44: Integration Staffing
Advertisers Technology Supply Integration Staffing Sales & Account Managers to service and optimize our larger base & provide Native support to Y! sales. Finance & Operational support: billing, reporting, collections, etc. Customer Support teams to onboard, implement, and provide ongoing support to
Slide 45: Phased Integration Approach
Phased Integration Approach PHASE 0: CLOSE & PLAN The transaction closed 1/17/23 and our integration team is now hard at work on detailed discovery and planning technical and commercial integration efforts. PHASE 1: BUILD & TEST In 2023, our priority is building the technical infrastructure to allow
Slide 46: Clear Path to a Successful Launch
Clear Path to a Successful Launch
Slide 47: Agenda
Taboola & Partnership Overview Fireside Chat with Integration Summary Audience Q&A Adam Singolda 01 02 03 04 05 Monica Mijaleski Eldad Maniv President & COO Steve Walker CFO Rick Hoss Moderated by Moderated by Presented by Presented by Presented by Agenda Yahoo’s CEO Jim Lanzone Yahoo CFO, Taboola D
Slide 48: Phased Integration Approach
Phased Integration Approach PHASE 0: CLOSE & PLAN The transaction closed 1/17/23 and our integration team is now hard at work on detailed discovery and planning technical and commercial integration efforts. PHASE 1: BUILD & TEST In 2023, our priority is building the technical infrastructure to allow
Slide 49: Phased Integration Approach: Revenue & Cost Implications
REVENUE IMPACT No Revenue COST IMPACT Minimal Cost (Existing Resources) No Revenue Ramping Cost (Hiring Starts) Ramping Revenue (Not In Guidance) Ramping Cost (Hiring Continues) Full Run Rate Revenue Steady State Cost (Hiring Continues) PHASE 0: CLOSE & PLAN PHASE 1: BUILD & TEST PHASE 2: RAMP & TRA
Slide 50: Revenue & Cost Implications: Revenue Impact
PHASE 0: CLOSE & PLAN PHASE 1: BUILD & TEST PHASE 2: RAMP & TRANSITION PHASE 3: OPTIMIZE & GROW 2H-2023 2024 and beyond… Phased Integration Approach Revenue & Cost Implications REVENUE IMPACT1 (1) Revenue model is illustrative only. Ramping revenue in Phase 2 not reflected in guidance.
Slide 51: Revenue & Cost Implications: Cost Impact
PHASE 0: CLOSE & PLAN PHASE 1: BUILD & TEST PHASE 2: RAMP & TRANSITION PHASE 3: OPTIMIZE & GROW 2H-2023 2024 and beyond… Phased Integration Approach Revenue & Cost Implications REVENUE IMPACT1 COST IMPACT1 INCREMENTAL INVESTMENT IN YAHOO IN 2023 IS APPROXIMATELY $30 MILLION (1) Revenue & cost models
Slide 52: Infrastructure Costs and Support Team
Small + Infrastructure Costs and Support Team Significant Costs Associated With Supporting Publisher account management team General & Administrative e.g., finance, collections Advertiser sales and account management Customer support Technical team to build and support infrastructure (significant sh
Slide 53: 2023 Is An Investment Year… But ROI Opportunity Is Huge
2023 Is An Investment Year… But ROI Opportunity Is Huge (1) Reflects expected incremental full year annual run rate once integration is fully live, including certain assumptions and adjustments based on anticipated uplifts. See Appendix for explanation and information. (2) Non-GAAP measures. See App
Slide 54: Expanding Ex-TAC Margins Point To Competitive Advantage
Expanding Ex-TAC Margins Point To Competitive Advantage ex-TAC Margin has increased significantly since 2015 Competitive landscape has not changed significantly in that time period Margins increase as competitive advantages increase (1) Non-GAAP measure. See Appendix for reconciliation to GAAP. Ex-T
Slide 55: Taboola's Differentiation
Taboola’s Differentiation Connexity will further increase competitive advantage Growth fuelled by a network effect Long-term yield increases Taboola’s technology is resilient to the future disappearance of third-party cookies Platform advantage driven by Taboola’s technology How we drive superior Fi
Slide 56: Quantum Leap Forward in Scale
More Publisher Partners More Users Reached More Data Generated More advertisers More Successful Higher yield (Better Results for Advertisers and Publishers) Quantum Leap Forward in Scale - Accelerates the Network Effect 1
Slide 57: Yahoo Supercharges Our Ability To Drive Yield
CTR and Conversions Click Through Rate, Conversion Rates CPC Cost Per Click Yahoo Supercharges Our Ability To Drive Yield Across Our Network 2 Algorithmic improvements drive better prediction of what users will engage with More advertisers on the platform and higher diversity of campaigns More data
Slide 58: Added Data Especially Important In Contextual World
Taboola’s strong yield performance despite 3rd party cookies being blocked in the industry for years: 3 Added Data Especially Important In Contextual World Yahoo reaches 84% of the US Internet Population every month1 Taboola has its own 1st party cookie - recommending personalized editorial content
Slide 59: Platform Advantage Driven By Investment In Technology
Homepage For You Newsroom Platform Advantage Driven By Investment In TechnologyYahoo Contextual Data will further enhance these tools 4 Driving Subscriptions Taboola News
Slide 60: Connexity Furthers our Competitive Advantage
Connexity Furthers our CompetitiveAdvantage 5 Strategic Value Additive to the Core Synergies ⅓ of Open Web Publisher Revenue will be E-Commerce1 and Taboola with Connexity is uniquely differentiated Significant expansion of our addressable TAM with long runway of growth Tremendous opportunity to lev
Slide 61: Taboola's Differentiation
Taboola’s Differentiation Connexity will further increase competitive advantage Growth fuelled by a network effect Long-term yield increases Taboola’s technology is resilient to the future disappearance of third-party cookies Platform advantage driven by Taboola’s technology 1 2 3 4 5 How we drive s
Slide 62: Agenda
Taboola & Partnership Overview Fireside Chat with Integration Summary Audience Q&A Adam Singolda 01 02 03 04 05 Monica Mijaleski Eldad Maniv President & COO Steve Walker CFO Rick Hoss Moderated by Moderated by Presented by Presented by Presented by Agenda Yahoo’s CEO Jim Lanzone Yahoo CFO, Taboola D
Slide 63: Q&A
Q&A Up Next: Lunch & Demo Stations Yahoo Native Supply: Desktop Inventory Yahoo Native Supply: Mobile & Apps Generative AI in Action @ Taboola
Slide 64: Appendix & Reconciliations
Appendix & Reconciliations
Slide 65: Non-GAAP Information
NON-GAAP INFORMATION Adjusted EBITDA We calculate Adjusted EBITDA as Net income (loss) before net financial expenses, income tax provision and depreciation and amortization, further adjusted to exclude share-based compensation and other noteworthy income and expense items such as certain M&A related
Slide 66: Assumptions: If Y! Were on Taboola Network for FY 2022
ASSUMPTIONS: IF Y! WERE ON TABOOLA NETWORK FOR FY 2022 All numbers are management estimates based on the following assumptions and sources: Revenue baseline is equal to the FY 2022 financials for TBLA (66% of combined Revenues) + FY 2022 expected financials for Yahoo Native supply* that will be serv
Slide 67: Ex-TAC Revenues Margin Reconciliation
EX-TAC REVENUES MARGIN RECONCILIATION
Slide 68: Adjusted EBITDA Reconciliation
ADJUSTED EBITDA RECONCILIATION
Slide 69: Free Cash Flow Reconciliation
FREE CASH FLOW RECONCILIATION