Perion Network reported second quarter 2026 results on August 10, 2026 showing adjusted EBITDA of $2.8 million against $7.1 million a year earlier, revenue down 5% to $98.2 million, and a full-year contribution ex-TAC range whose upper bound was reduced by $10 million even as spend across the company's growth channels rose at double-digit and triple-digit rates.

The quarter split cleanly in two. Media volume flowing through Perion grew. The money the company kept from that volume did not.

Total spend reached $194.7 million, up 9% year over year, according to Perion. Spend on the Perion One platform, which the company treats as its go-forward business, rose 15% to $156.7 million and accounted for 80% of the total, against 76% in the second quarter of 2025. Yet reported revenue fell to $98.2 million from $103.0 million, contribution ex-TAC declined 11% to $42.3 million, and adjusted EBITDA landed at 7% of contribution ex-TAC compared with 15% a year earlier.

Perion Network Ltd. (NASDAQ and TASE: PERI) is an Israeli-American advertising technology company that sells campaign execution infrastructure to brands, agencies and retailers. Its results were furnished to the U.S. Securities and Exchange Commission on Form 6-K, signed by Chief Financial Officer Elad Tzubery and dated August 10, 2026.

Guidance narrowed at the top, not the bottom

The company described its revised outlook as a narrowing. The arithmetic is more specific than that.

Full-year contribution ex-TAC is now guided to $215 million to $225 million, against $215 million to $235 million previously. The floor held; the ceiling came down by $10 million, moving the midpoint from $225 million to $220 million. Adjusted EBITDA guidance moved to $51 million to $53 million from $50 million to $54 million, leaving the midpoint at $52 million and lifting the implied adjusted EBITDA to contribution ex-TAC margin from 23% to 24%. The updated contribution ex-TAC band implies full-year revenue of $460 million to $475 million, down from the $460 million to $490 million range implied at the first quarter results on May 20, 2026.

Tzubery attributed the change to first-half performance and improved second-half visibility. "We are narrowing our full-year outlook to reflect our first half performance and increased visibility into second-half trends," he said in the earnings release. "Our structural cost reductions have established a streamlined, highly optimized expense base. This positions us to capture significant operating leverage as recently signed strategic agreements begin contributing and momentum across Perion One accelerates."

Pressed on the same point during the earnings call, Tzubery was more direct about causation. Asked by Eric Martinuzzi of Lake Street whether the lower contribution ex-TAC midpoint reflected a slower ramp at two large strategic accounts, he answered: "First of all, our initial expectation was that this onboarding and those agreement will be signed earlier in the year, and we'll be able to see more growth out there. Also factoring all of the macro headwinds that we saw in H1, we had better visibility to see where we are, but the reduction in ex-TAC was... narrowing down to the low rate was actually because of those two main factors."

The company has been pointing to those agreements since May. At the first quarter results, management said several large deals were in advanced onboarding and would begin contributing in the second quarter. On the August 10 call, the timeline moved again: material contribution is now expected toward the end of the third quarter, with acceleration into the fourth quarter and 2027.

Tzubery characterised the larger of the two as "basically a volume play with a very large agency." Chief Executive Tal Jacobson described the sales cycle in unusually blunt terms. "It was a frustrating process to take so long to close those agreements, but the fact that the barrier for entry was so high gives us the confidence that our technology can provide great value and that others are going to have a very high barrier to entry, which we are considering is a very good thing," he said.

Where the spend went

The channel breakdown explains both halves of the quarter.

Digital out-of-home spend rose 45% year over year to $87.7 million, the largest single line inside Perion One. Retail media, which Perion treats as a vertical spanning CTV, DOOH and display rather than a channel, grew 60% to $59.4 million. Connected TV spend rose 56% to $17.7 million. Spend routed through Outmax, the company's AI execution agent, increased 136% on a pro forma basis to $12.0 million.

Against those figures sits the category the company is exiting. Web and other spend inside Perion One fell to $49.6 million from $64.2 million in the second quarter of 2025, a decline of roughly 23%. Social spend, which Perion attributes to Outmax activity, registered $1.6 million against nothing a year earlier.

Sequentially, the picture is less uniform than the year-over-year percentages suggest. CTV spend of $17.7 million was marginally below the $18.0 million recorded in the first quarter of 2026, the only growth engine to move backwards quarter on quarter. DOOH climbed from $60.6 million, retail media from $36.5 million, and Outmax from $10.3 million.

Perion benchmarked each channel against eMarketer data published in June 2026, citing expected 2026 US market growth of 17.5% for CTV, 16.3% for DOOH and 20.3% for retail media. On those comparisons the company outgrew its markets by wide margins in all three. The benchmark is a spend comparison rather than a revenue one, and the distinction matters given what happened below the spend line.

The take rate problem

Perion One generated $74.2 million in revenue during the quarter and $34.9 million in contribution ex-TAC, a figure that declined 4% year over year even as platform spend grew 15%. The platform's share of total contribution ex-TAC rose to 83% from 76%.

Tzubery identified promotional pricing as the cause. "This was driven by the use of promotional terms to acquire new accounts and drive incremental spend from existing customers, which temporarily impacted our take rates," he said on the call. "As we scale the platform, take rates naturally normalized over time, though we expect them to modestly improve in the second half of the year."

Jacobson framed the same discount activity as deliberate market-share purchasing. "During H1, we ran a lot of test campaigns. Test campaigns come with very low margins. As their name suggests, it's tests," he said in response to a question from Jason Kreyer of Craig-Hallum. "But going forward, even though we do think this is going to be normalized, we think testing budgets is a great tool for us to use to showcase our technology and gain market share."

Search told a separate story. Search advertising revenue slipped 2% to $22.1 million, but search contribution ex-TAC dropped 30% year over year to $6.7 million from $9.6 million. That continues a compression Perion has disclosed since it began moving away from its Microsoft distribution arrangement, a transition whose first shock landed when Q2 2024 revenue fell 39% after Microsoft Bing changed its search distribution marketplace.

Traffic acquisition costs and media buy consumed $55.9 million, or 57% of revenue, against 54% a year earlier. That three-point shift is the mechanical expression of the mix change: as gross-billed DOOH and retail media volume grows relative to net-recognised platform activity, the pass-through share of reported revenue rises.

Costs, currency and a 10% reduction

Adjusted EBITDA of $2.8 million included a $1.6 million foreign exchange headwind. Excluding that effect, the company put the figure at $4.4 million in constant currency, still below the $7.1 million of the prior-year quarter.

Operating expenses came down across most lines. Research and development fell to $6.4 million from $8.9 million. General and administrative dropped to $7.3 million from $9.2 million. Cost of revenue declined to $11.1 million from $13.0 million. Selling and marketing moved the other way, rising slightly to $19.9 million from $19.5 million. Stock-based compensation fell to $4.5 million from $7.5 million.

The quarter carried $2.5 million in restructuring costs and other charges, partially offset by $1.9 million of income from a change in the fair value of contingent consideration. Asked by Jason Helfstein of Oppenheimer to quantify the headcount action behind those charges, Tzubery declined to give a personnel number but gave a cost figure: "Roughly, I can tell you that we reduced roughly 10% of the cost base. It was intentionally made also to support the different fluctuation in the FX (Foreign Exchange), but also to give us some room to invest more when we are going into 2027."

Because the reductions were executed at the end of the second quarter, none of the benefit appears in the reported result. Management expects adjusted EBITDA margin to inflect upward in the second half.

Below the operating line, financial income net collapsed to $0.3 million from $3.6 million, reflecting currency losses and lower interest income on a smaller cash balance. GAAP net loss widened to $6.8 million from $3.5 million, and GAAP diluted loss per share moved to 18 cents from 8 cents. Non-GAAP net income fell 68% to $3.9 million, with non-GAAP diluted earnings per share of 9 cents against 26 cents.

Tzubery attributed the widening GAAP loss primarily to items outside operations. "It is important to emphasize that the year-over-year increase in our GAAP net loss was almost entirely driven by negative foreign exchange impact to our non-operating finance income, and lower interest income from our cash balance," he said.

Cash, buybacks and a shrinking share count

Net cash from operating activities was $2.5 million, against $21.3 million a year earlier. Adjusted free cash flow reached $4.8 million versus $20.7 million. On an unadjusted basis, free cash flow was negative $0.7 million, with the gap between the two figures driven by $5.5 million of retention payments related to acquisitions and $3.0 million of capitalised software development costs, the latter up sharply from $0.4 million in the prior-year quarter.

Cash, cash equivalents, short-term bank deposits and marketable securities stood at $267.8 million on June 30, 2026, down from $293.0 million at March 31 and $312.9 million at the end of 2025. Tzubery said the balance sheet carries no debt.

The buyback continued at pace. Perion repurchased 2.7 million shares for $24.5 million during the quarter at an average price of $9.12. Cumulatively, the company has bought 18.0 million shares for $166.8 million under an authorised $200 million plan, leaving $33.2 million that management intends to execute by year end. Weighted average diluted shares fell to 37.0 million from 42.0 million.

Tzubery presented the timing as intentional. "We are making a highly strategic trade-off by aggressively executing our buybacks now. At depressed valuations, we are permanently reducing our share count," he said. The same mechanism cuts the other way in a loss-making quarter: a smaller denominator amplifies loss per share, which is part of why the GAAP figure deteriorated faster than the underlying loss.

On capital allocation beyond the buyback, Tzubery said the company continues to evaluate acquisitions. Jacobson pointed to the record: "As you can see in the past two or three years, we always been disciplined in buying the right things with Hivestack, which is showing almost three years after it's still showing amazing growth with Digital Home. Greenbids with Outmax showing amazing growth."

Distribution, DV360 and in-store screens

Four commercial developments accompanied the numbers.

Best Buy Canada selected Perion as end-to-end technology partner for its in-store retail media network, a deal announced on June 16, 2026 covering 308 stores. Perion is deploying its ad server, supply-side platform and header bidding stack to move the retailer from fixed-loop signage to dynamic programmatic selection. Two further in-store mandates were disclosed with the results: GS Netvision in South Korea, covering more than 3,300 screens across grocery and convenience stores, and Lovitlocal in the United Kingdom, covering a media network across post offices.

Perion also added programmatic guaranteed deal execution for DOOH inside Google Display and Video 360. According to the company, the capability spans more than 590 media owners, 1.6 million screens and over 40 countries. Programmatic guaranteed applies fixed pricing and committed inventory to a channel that has historically transacted through open auctions or manual insertion orders. Perion is not first through that particular door: Place Exchange, now owned by Broadsign, launched programmatic guaranteed for DOOH within DV360 on December 9, 2025. The competitive question is supply coverage rather than mechanism.

Distribution expanded through a partnership with Acrossmedia241, bringing Outmax to agencies and brands in Greece and Central and Eastern Europe. The model mirrors the Africa reseller arrangement disclosed in the first quarter: the partner absorbs distribution cost, Perion supplies the technology layer, and the arrangement is designed to add reach without adding operating expense.

The fourth item is data. Perion partnered with Fetch, a consumer rewards and purchase intelligence platform, accessed through a LiveRamp integration. The tie-up gives advertisers verified SKU-level purchase signals spanning more than 13 million monthly active users, 13 million daily receipts and over 26,000 merchants, organised into more than 1,300 retailer-agnostic segments across grocery, mass retail, quick service restaurants and ecommerce.

That integration lands in an ownership context worth noting. Publicis agreed in May 2026 to acquire LiveRamp for $2.5 billion, a transaction that has prompted agencies and technology vendors to reconsider routing data through a layer owned by a holding company competitor. Perion's Fetch access runs through exactly that layer.

The company also launched Ask Perion, a self-serve mobile application that exposes Perion One planning and insight functions through a conversational interface. Jacobson said the tool draws on Outmax for its recommendations, including budget reallocation suggestions across platforms after a campaign concludes.

Why the quarter matters to media buyers

Perion's results arrived inside a fortnight that repriced most of the independent advertising technology sector, and the comparison is instructive.

Criteo reported second quarter revenue of $428 million on August 5, 2026, down 11%, and cut its full-year outlook for the second time in three months. The Trade Desk published $715 million in revenue on August 6, up 3%, then watched its shares fall 24% after guiding third-quarter revenue to at least $650 million. Perion's revenue decline of 5% sits between those outcomes, and its guidance adjustment was narrower than Criteo's.

For agencies and in-house teams, three practical signals emerge from the disclosure.

First, the promotional pricing is documented rather than inferred. Perion has stated that it discounted take rates during the first half to win accounts and drive incremental volume, and that it expects those rates to rise modestly in the second half. Buyers who onboarded to Perion One during that window should expect commercial terms to move.

Second, the channel arithmetic favours physical and streaming inventory over web display, and the shift is now large enough to be visible in the pass-through ratio. DOOH spend of $87.7 million is more than five times the CTV figure and nearly twice the web line. That mix is why gross-billed volume grows faster than retained revenue, and why the company has told investors it will report spend and contribution ex-TAC rather than channel-level revenue as its primary indicators. Buyers reading Perion disclosures should track those two metrics rather than the revenue line.

Third, in-store retail media continues to consolidate around full-stack infrastructure providers. The Best Buy Canada mandate follows a pattern PPC Land has documented across the category through 2026, including JB Hi-Fi's Broadsign deployment across more than 200 Australian stores in April 2026 and Stater Bros. Markets launching programmatic audio across 165 California stores in May 2026. Retailers are increasingly buying an entire chain of ad serving, auction and yield technology rather than licensing point tools, which concentrates buyer access behind a smaller set of intermediaries.

The broader DOOH category is forecast to grow 14.5% in the United States during 2026 against 1.5% for traditional outdoor formats, according to Guideline data reviewed by PPC Land in March 2026. Perion's 45% DOOH spend growth substantially exceeds that rate, though the comparison measures gross media volume against forecast market spend rather than like against like.

Perion reaffirmed its 2028 targets: a three-year spend compound annual growth rate above 25%, contribution ex-TAC compound growth above 20%, and an adjusted EBITDA margin above 28%, up from 22% in full-year 2025. Those targets are calculated on a pro forma basis excluding search and discontinued legacy activity.

Whether the second-half inflection arrives depends on variables management has said sit partly outside its control. Onboarding pace at the two strategic agency accounts is set by the clients. Take rate recovery depends on how quickly test budgets convert to standard commercial terms. And the cost reductions completed in June have yet to appear in any reported quarter. The third quarter results, due in November, will be the first period in which all three factors register.

Timeline

Summary

Who: Perion Network Ltd. (NASDAQ and TASE: PERI), an advertising technology company headquartered in Tel Aviv with operations in New York and other markets, led by Chief Executive Tal Jacobson and Chief Financial Officer Elad Tzubery.

What: Second quarter 2026 results showing revenue of $98.2 million, down 5% year over year; contribution ex-TAC of $42.3 million, down 11%; adjusted EBITDA of $2.8 million, down 61%; a GAAP net loss of $6.8 million; and non-GAAP net income of $3.9 million. Perion One spend rose 15% to $156.7 million, with DOOH spend up 45% to $87.7 million, retail media up 60% to $59.4 million, CTV up 56% to $17.7 million, and Outmax spend up 136% on a pro forma basis to $12.0 million. Full-year contribution ex-TAC guidance was reduced at the top end to $215 million to $225 million from $215 million to $235 million, while adjusted EBITDA guidance was narrowed to $51 million to $53 million from $50 million to $54 million.

When: The results cover the three months ended June 30, 2026 and were released before market open on Monday, August 10, 2026, with an earnings call at 8:30 a.m. Eastern the same day and a Form 6-K furnished to the SEC.

Where: Global operations across North America, South America, EMEA and APAC. New commercial disclosures cover Canada (Best Buy Canada, 308 stores), South Korea (GS Netvision, more than 3,300 screens), the United Kingdom (Lovitlocal post office network), and Greece plus Central and Eastern Europe (Acrossmedia241). The DV360 programmatic guaranteed capability covers more than 590 media owners, 1.6 million screens and over 40 countries.

Why: The quarter documents a widening gap between media volume and retained revenue at a company midway through a deliberate pivot away from open web display. Promotional take rates used to win accounts during the first half suppressed contribution ex-TAC even as platform spend grew, cost reductions completed in June contributed nothing to the reported result, and two large agency agreements slipped from a second-quarter contribution to a late third-quarter one. For media buyers, publishers and retailers evaluating Perion One, the disclosure sets out what commercial terms were discounted, which channels absorbed budget, and which infrastructure decisions now sit behind in-store and DOOH inventory access.