Organic referrals from Google to Ziff Davis's websites fell by approximately 37% in the third quarter of 2026 compared with the same quarter a year earlier, chief executive Vivek Shah told analysts on November 6. The figure came a day after the New York-based owner of CNET, PCMag, IGN, RetailMeNot, Everyday Health and MedPage Today reported, on November 5, third-quarter revenue of $289.3 million, down 5.6% from $306.5 million, and an operating loss of $33.6 million after a $29.6 million goodwill impairment and a $14.6 million long-lived asset impairment.

In Short

Ziff Davis runs websites like CNET and IGN, and Google sent those sites about 37% fewer visitors in the July-to-September quarter than a year before, even though Google's AI answers pointed to their articles about 2.7 billion times. Search visits are only one part of the business, but the company's advertising revenue still fell 7.7% and its total quarterly sales dropped 5.6%. Ziff Davis is answering with fewer staff, code written by AI, shopping through social media and large share buybacks, and it expects fourth-quarter sales to come in a low-to-mid single-digit percentage below last year.

The search numbers

The traffic disclosure was not in the written results. Shah gave it in his prepared remarks on the call, and set it against the year before. "Organic Google referrals to our properties declined approximately 37% year-over-year in the third quarter," he said. "Last year, the Q3 drop in referrals was approximately 23%, making the two-year drop over 50%." Compounding the two declines, PPC Land calculates that third-quarter organic referrals in 2026 were roughly 49% of their level in the third quarter of 2024, a two-year fall of about 51%.

Shah then introduced a second number, drawn from a reporting feature Google added to Search Console this year. "Across our digital media sites, our content was cited in AI Overviews and AI Mode responses roughly 2.7 billion times in the quarter, nearly 10x the clicks those same sites received from Google Search," he said. On PPC Land's arithmetic, a ratio of nearly ten to one puts the quarter's Google Search clicks to those sites in the region of 270 million or somewhat above. Ziff Davis did not disclose the click total itself.

The source matters. Asked by Shyam Patil of SIG how the company could turn that visibility into money, Shah said: "Yeah, look, so that statistic is new. It comes from Google Search Console." Google began rolling out generative AI visibility reports in Search Console to a subset of sites in June and extended them to every website by August 31. Those reports count impressions in AI Overviews and AI Mode, but they carry no click or query data. Ziff Davis's ten-to-one comparison therefore sets impressions inside AI features against clicks from Google Search as a whole, not against clicks generated by the AI features. Google publishes no figure that would allow that second comparison.

Shah's reading of the gap was direct. "It's clear that our content has significant value to users, even though we're seeing a major reduction in referral traffic from search," he said. Earlier in his remarks he had put it more bluntly: "While AI has helped improve our operating efficiency, the disruption of search traffic by Google and LLMs has been a clear business headwind."

He also referred to Google's own numbers, saying he believed Google's "query volume is at a five-year high." What Alphabet said when it reported its third quarter on October 28 was that year-over-year growth in search queries was the highest in five years; it gave no query count. The distinction is small, but it is the difference between a rate and a level.

Licensing and litigation

What does Ziff Davis intend to do about the gap? "Monetizing that relevance is the priority," Shah said. "Simply, we remain open to signing licensing deals, which would be a method in which we can extract value out of the use of our content within these systems." He tied the question to the courts: "I do think our litigation with OpenAI will bring clarity around this area and subject, and that hopefully can move things along."

Ziff Davis filed its copyright suit against OpenAI in federal court in Delaware on April 24, 2025. The claim has since been folded into the consolidated proceedings in the Southern District of New York, where OpenAI and Microsoft moved for summary judgment on September 4 in a case that asserts 10.8 million articles. Shah also argued that citations have a nearer-term commercial use, because "marketers are increasingly factoring AI visibility into the media partners they pick." He closed the answer with a concession: "But yes, there is a gap between usage and monetization."

The quarter in figures

All results below are for continuing operations, which exclude the Connectivity division that Ziff Davis sold in the second quarter. Cash flow figures, as the company presents them, combine continuing and discontinued operations.

  • Revenue: $289.3 million, against $306.5 million, a decline of 5.6%. Sequentially, revenue rose 0.9% from $286.7 million in the second quarter.
  • Operating result: a loss of $33.6 million, against operating income of $11.4 million. The operating margin was negative 11.6%, against positive 3.7%.
  • Net loss from continuing operations: $28.7 million, or $0.85 per diluted share, against a loss of $16.0 million, or $0.39.
  • Adjusted EBITDA: $82.2 million, down 16.0% from $97.8 million. The adjusted margin fell to 28.4% from 31.9%, but rose 160 basis points from the second quarter.
  • Adjusted diluted EPS: $1.39, against $1.40. Adjusted net income fell 15.0% to $48.3 million; the per-share figure held almost flat because the share count fell.
  • Cash flow: free cash flow was negative $100.1 million, against positive $108.2 million in the third quarter of 2025, a period that still included Connectivity.

Revenue by type shows where the pressure sits. Advertising and performance marketing revenue fell 7.7% to $186 million from $202 million. Subscription and licensing revenue fell 2.7% to $98 million from $101 million. "Other" revenue, a small line, rose by about $1 million, or almost 30%, which chief financial officer Bret Richter attributed in part to Semantic Labs, a business Ziff Davis bought in the third quarter of 2025.

The trajectory across the year is less flattering than the sequential improvement suggests. Set against the same quarters of 2025, revenue fell 1.9% in the first quarter, 2.7% in the second and 5.6% in the third, by PPC Land's calculation from the company's quarterly table. Over nine months, revenue was $843.7 million, down 3.5%, and adjusted EBITDA was $222.4 million, down 10.7%.

Costs moved the other way. Total operating costs and expenses rose to $322.9 million from $295.1 million. General, administrative and related costs climbed to $64.3 million from $47.7 million, a line that absorbed the $14.5 million of long-lived asset impairments, $10.3 million of transaction and integration charges and $10.3 million of share-based compensation, according to the company's reconciliation tables. Net interest swung to income of $1.8 million from an expense of $6.5 million, a shift that coincides with the much larger cash balance after the Connectivity sale.

Four segments, four declines

Technology & Shopping, home to CNET, PCMag, RetailMeNot and Spiceworks, posted revenue of $82.0 million, down 3.8% from $85.2 million. Its advertising and performance marketing revenue fell to $78.2 million from $84.2 million, while subscription and licensing rose to $3.7 million from $2.8 million. Adjusted EBITDA fell 20.4% to $21.8 million, and the margin dropped to 26.6% from 32.2%. The segment also took the entire $29.6 million goodwill impairment for the quarter and $7.4 million of the long-lived asset charges, turning an operating profit of $48,000 into an operating loss of $38.8 million.

Shah presented the segment's revenue as an improving trend. "This is the third straight quarter the rate of decline narrowed, from 18% in Q4 2025 to 13% in Q1, 5% in Q2, and just under 4% in Q3," he said in prepared remarks. In the question-and-answer session he gave a different starting point, saying "we have narrowed the decline three quarters in a row from -16% to under 4%." The company did not reconcile the two figures. Richter said the margin decline came "due in part to a revenue mix shift related to the shift of traffic from organic web towards social media."

Gaming & Entertainment, which includes IGN and Humble Bundle, reported revenue of $46.6 million, down 2.1%. Advertising revenue fell to $30.7 million from $31.9 million, partly offset by subscription and licensing at $15.8 million against $15.7 million. Adjusted EBITDA fell 19.8% to $15.0 million and the margin to 32.2% from 39.2%, which Richter linked to revenue mix and to more custom event and activation programmes, which carry lower margins than display and video.

"The gaming ad market has been weak due to a light slate in the run-up to this month's launch of GTA VI," Shah said. He described IGN's problem as one of demand rather than traffic. "The single largest property from a search referral point of view is actually IGN, but it is also amongst the properties that has held up well because a lot of its search referral is around game help, which is very maps heavy, so game maps," he said, adding that IGN monetises more through vertical and social video than through web pages. At San Diego Comic-Con, IGN recorded 196 million video views, up 65%, according to Shah, and it was again the official production and media partner of Gamescom. Humble delivered a record third quarter in revenue, and cumulative gross charitable donations through the platform passed $280 million.

Health & Wellness was the weakest segment. Revenue fell 9.5% to $92.5 million from $102.3 million, with advertising revenue down to $77.3 million from $85.6 million. Adjusted EBITDA fell 14.3% to $32.6 million, a 35.2% margin against 37.2%. Shah attributed the decline mainly to lower advertising aimed at healthcare professionals at MedPage Today, and he did not soften it on the call: "there, we've got a little bit of a structural issue on the MedPage side, where clearly, we're losing share, and that's not because physician engagement is low." The segment had already taken a $54.8 million goodwill write-down in the second quarter.

On the consumer side, Shah said pharmaceutical advertising strengthened, with continued GLP-1 promotion for diabetes and weight loss, and that the company's healthcare media network signed a long-term exclusive contract with Harvard Health Publishing, joining Cleveland Clinic, Mayo Clinic and the University of Pittsburgh Medical Center. Subscription customers in the segment fell to 1,480,000 from 1,902,000, a drop of 22% by PPC Land's calculation, while average quarterly revenue per customer rose to $8.41 from $7.17. Shah explained part of that move. Lose It!, the food-logging app, used to sell lifetime subscriptions. "We have suspended that practice, and so we are no longer selling lifetime subscriptions in any meaningful way, if at all," he said, adding: "We have stopped spending into Lose It! subscriptions, almost entirely relying on organic."

Cybersecurity & Martech reported revenue of $68.2 million, down 4.6%, with subscription and licensing revenue at $65.5 million against $69.1 million. Adjusted EBITDA slipped 5.8% to $22.7 million, a 33.2% margin. Shah attributed the decline primarily to "weakness in our SEO tools and email marketing businesses." SMTP.com and Semantic Labs grew at double-digit rates, he said, and IPVanish, the consumer cybersecurity brand that Shah said continues to grow strongly, added a next-generation antivirus product in October. The segment recorded $8.2 million of long-lived asset impairments in the quarter.

More advertisers, smaller cheques

The operating metrics in the company's earnings slides give a sharper view of advertising demand than the headline revenue lines. In Technology & Shopping, the number of advertising and performance marketing customers rose to 717 from 634, but quarterly revenue per customer fell to $109,111 from $132,849, a decline of about 18% by PPC Land's calculation. Net advertising revenue retention, a trailing twelve-month measure of what returning customers spend, fell to 87.0% from 94.0%.

Gaming & Entertainment showed the same pattern more starkly: 537 customers against 431, revenue per customer of $57,224 against $74,053, and retention of 84.7% against 88.8%. Health & Wellness moved in the opposite direction on volume, with 723 customers against 825, slightly higher revenue per customer at $106,710 against $103,132, and retention below 100% at 95.9%, down from 102.1%.

Retention below 100% means the advertisers that spent with Ziff Davis a year ago are, in aggregate, spending less now. In all three ad-supported segments, that figure fell.

Where the offsets come from

Shah repeated a framework he said the company had given on earlier calls: "roughly a third of revenues depended on web traffic, and search was roughly 40% of that traffic." Ziff Davis is no longer updating that split each quarter, he said, noting that the Connectivity sale mechanically raised the web-dependent share while lower search referrals pushed it back down. A year earlier, Ziff Davis had described about 35% of revenue coming from ads on owned web traffic, with about 40% of that from search.

The company's answer is to move monetisation off the web page. Shah named two "green shoots" on social platforms: vertical video and affiliate commerce. "Historically, we were very web-dependent for affiliate commerce, and now social presents itself," he said. The social commerce push comes mainly from Technology & Shopping, and Shah acknowledged that only one segment had so far worked out how to use social platforms for commerce, calling the gaps between businesses the main opportunity. He listed the channels the company counts as non-web: Instagram, Facebook, Snap, TikTok, YouTube, email, notifications, mobile apps and a browser extension in the shopping business.

RetailMeNot is the clearest example. The app was relaunched in the third quarter as a loyalty-first product built on guaranteed cashback, verified promo codes and product deals. Signed-in monthly users more than doubled, according to Shah, and app commissions reached a 2026 high in September, up 25% year on year. Those commissions come from the same affiliate model that Shah said was, until recently, almost entirely web-dependent.

Shah's stance on search itself was unambiguous. "Look, I think our position is we're not planning on a search recovery, and in fact, are operating with the view that referrals are going to continue to come down," he told Patil. Later he added: "Look, I do continue to believe search referrals will go down."

Advertisers, Safari and AI slop

Robert Coolbrith of Evercore asked whether changes Apple made to Safari in iOS 26 could push advertisers toward buying directly from endemic sites rather than through programmatic audience extension. Apple's Safari 26 made Advanced Fingerprinting Protection the default for all browsing, not just private windows. Shah's answer went beyond the browser. "Yeah, I mean, even without the iOS change, I think generally we're seeing more of an interest in aligning with trusted brands, in contextual content," he said.

He pointed to a second concern among buyers: "there's a different issue, which is how much AI slop is in the ecosystem that is getting essentially monetized with programmatic ads." It is, he said, a question many marketers have: "Hey, where are my ads running and what is it against?" PPC Land has tracked the spread of AI-generated slop sites and the trust problems they create for brands. Shah's pitch is that contextual advertising on known publishers, and "creating programs that are well beyond spots and dots on web pages," can only benefit from that unease. The claim is a sales argument; Ziff Davis offered no data on whether advertisers are in fact moving budgets on those grounds, and its own retention figures fell in all three segments that report them.

AI inside the company

Ziff Davis is also applying AI to its own cost base. "Today, more than 90% of pull requests across the product and engineering teams are written by AI," Shah said, up from a statement last quarter that the majority of new or updated code was AI-written. "The result is a lower cost per feature delivered and a leaner cost base, with the capacity to support a broader product roadmap without growing headcount at the same pace."

The headcount effect is explicit. "More broadly, we're very focused on efficiency and margin improvements at the company, and by the end of the year, we estimate headcount will be down 10%," Shah said. Asked by Jake Hallac of Citi how AI productivity would split between reinvestment and margin, he qualified the link: "That's not all AI, I won't say that, but it's a good portion of what we're working on."

Shah framed AI partly as a way to clear accumulated technical debt. "You take a step back, having done something like 90 acquisitions over the years at Ziff Davis, we have accumulated a fair amount of tech debt," he said. The relaunch of the Humble platform, which he said was days away, was his example: "This had been, frankly, a multi-year project that, in a matter of months, has been brought to completion."

Richter made the same point in financial terms. "As we manage through the continued transition of the digital media landscape and the impacts of AI, protecting our profitability is a priority for us," he said, describing targeted spending cuts alongside AI-driven efficiency.

Cash, Connectivity and buybacks

The balance sheet looks very different from a year ago. Ziff Davis agreed on March 2, 2026, to sell its Connectivity division to Accenture, for total proceeds of about $1.2 billion, and completed the sale in the second quarter. The nine-month cash flow statement records $1.13 billion of proceeds from the sale of businesses, net of cash divested, and a gain of $860.6 million. Net income from discontinued operations for the nine months was $699.7 million, which is why Ziff Davis reported total net income of $618.0 million for the period despite a loss from continuing operations of $81.6 million.

At September 30, Ziff Davis held $1.41 billion of cash and cash equivalents and $100 million of long-term investments, against gross debt of $872 million: $460 million of 4.625% senior notes, $149 million of 1.75% convertible notes and $263 million of 3.625% convertible notes. Gross leverage stood at 2.5 times trailing twelve-month adjusted EBITDA, and cash exceeded debt by $535 million. Early in November, Richter said, the company repaid the 1.75% convertibles at maturity, paying $149.1 million of principal and $1.3 million of accrued interest. The next significant maturity falls in March 2028.

The sale also carries a large tax bill. "In the third quarter, we paid approximately $55 million of the approximately $200 million in tax obligations related to the Connectivity transaction," Richter said, adding that the company expects most of the remaining payments to be settled by the end of the first quarter of 2027. Current income taxes payable on the balance sheet stood at $130.8 million, up from $7.3 million at the end of 2025.

That is the main reason free cash flow turned sharply negative. Of the $100.1 million outflow in the quarter, $55.0 million was cash tax on the sale and $35.1 million was transaction costs. Strip those out and the company's transaction-adjusted measure was still negative, at $10.0 million, against $108.2 million a year earlier, although the earlier figure includes the cash generated by Connectivity. On a trailing twelve-month basis, transaction-adjusted free cash flow was $208.5 million.

Much of the remaining cash has gone into the company's own shares. Ziff Davis spent $92.0 million on repurchases in the third quarter, buying 1.7 million shares under a 10b5-1 plan, and $265.0 million in the first nine months. It has bought back 5.5 million shares since the start of 2026, and the share count stood at 33.1 million on November 2, down from 38.4 million at the end of 2025 and 47.3 million at the end of 2022. About 6 million shares remain available under the current authorisation. Acquisition spending was $7.0 million in the quarter, which Richter said related to prior-period deals, and $16.2 million for the year to date.

Further disposals remain possible. The company's risk disclosures refer to "our announced review of potential value-creating opportunities," including a sale of one or more business lines. "Look, the Connectivity sale, I think, demonstrated that we are going to act when the market undervalues a business, and I think the market is undervaluing all of the businesses collectively, and then the businesses individually," Shah said, in response to a question from JPMorgan. "We do not need cash right now, but we do need share value growth." Ziff Davis shares were trading at $50.71 on the afternoon of November 6, down $3.57, or 6.58%, according to the company's investor relations website.

Richter added a reminder of how much the mix has changed: "we were a business prior to the Connectivity sale that was approaching 50% subscription and licensing revenue." In the third quarter of 2026, subscription and licensing accounted for $98 million of $289.3 million in revenue, roughly 34%, by PPC Land's calculation.

Fourth-quarter outlook

Ziff Davis did not include guidance in its written release, but Richter gave direction on the call. "Revenues in Q4 are expected to increase sequentially by a double-digit percentage and decline low to mid-single digits year over year," he said, describing a rate of decline "similar to, if not better than" the third quarter's. "Our adjusted EBITDA margin percentage is expected to increase sequentially, but is expected to decline as compared with the prior year period to the low to mid-30s." Adjusted diluted EPS is expected to be up slightly year over year, helped by the lower share count.

The comparison base is demanding. In the fourth quarter of 2025, continuing operations generated revenue of $346.4 million, adjusted EBITDA of $132.4 million and adjusted diluted EPS of $2.04. That margin was 38.2%, by PPC Land's calculation, so a margin in the low-to-mid 30s implies a decline of several percentage points. Applying a 1% to 5% decline to the 2025 base, PPC Land estimates fourth-quarter revenue in a range of roughly $329 million to $343 million.

Gaming is one swing factor. Shah said the GTA VI launch, now only weeks away, should unlock marketing from other game publishers that had avoided competing with it, though he placed most of that benefit "more into 2027." Tech & Shopping enters its seasonally largest quarter, which Shah expects to continue the narrowing trend.

Why this matters for marketers

Ziff Davis's sites carry the kind of inventory that search-driven publishing produces: product reviews, buying guides, coupons, game guides and health information. Its 37% fall in organic Google referrals sits alongside a series of similar disclosures this year. Future plc reported a 67% drop in first-half profit in May, as website sessions fell 15%. In July, Reach said Google referrals had fallen 55% year on year in the first half. Chartbeat's network data, reported by PPC Land on October 19, put search at 12% of North American publisher pageviews in the third quarter, down from 21% a year earlier. And a randomised study covered in July found that AI Overviews cut outbound organic clicks by 39.8%.

The 2.7 billion figure adds a different kind of evidence. Publishers have long argued that Google's AI features use their content while sending fewer visitors back. Ziff Davis has now put a ratio on that from Google's own reporting tool, even if the comparison is imperfect because Search Console does not report clicks from AI features. For advertisers, the practical consequences show up in the operating metrics: more advertisers buying from Ziff Davis's tech and gaming brands, each spending less, with returning customers spending below last year's level in all three segments that report the metric. The audience is moving toward social video, apps and email, and the inventory is moving with it.

There is also a market signal. Alphabet's own results, about a week before Ziff Davis reported, prompted a 12.6% fall in Alphabet's Class A shares on October 29 after the company cited lower monetisation in AI Mode. Google is under pressure to make AI answers pay; publishers such as Ziff Davis are under pressure to get paid for supplying them. Ziff Davis did not say when, or how, it expects the gap Shah described between usage and monetisation to close.

Timeline

Summary

Who: Ziff Davis, Inc. (Nasdaq: ZD), the owner of CNET, PCMag, IGN, RetailMeNot, Everyday Health, MedPage Today, Lose It! and IPVanish, with chief executive Vivek Shah and chief financial officer Bret Richter presenting the results.

What: Third-quarter 2026 revenue fell 5.6% to $289.3 million, advertising and performance marketing revenue fell 7.7% to $186 million, and the company swung to a $33.6 million operating loss after $44.1 million of impairments. Organic Google referrals to its properties fell about 37% year on year, while Search Console counted roughly 2.7 billion citations in AI Overviews and AI Mode, nearly ten times the clicks Google Search sent. Headcount is expected to be 10% lower by the end of 2026.

When: Results for the quarter ended September 30, 2026, were released on November 5, 2026, and discussed on an earnings call on November 6, 2026.

Where: Ziff Davis is headquartered in New York. The results cover four segments: Technology & Shopping, Gaming & Entertainment, Health & Wellness, and Cybersecurity & Martech.

Why: The figures show how falling search referrals are reaching the revenue lines of a large publisher, even with a diversified portfolio, and why Ziff Davis is shifting toward social commerce, video, apps and licensing while cutting costs and buying back shares. For advertisers and publishers, the quarter puts a number on the gap between how often AI search features use publisher content and how much traffic they return.