Market Newsdesk

• Teleflex to create a new, independent publicly traded company (“NewCo”) consisting of Teleflex’s Urology, Acute Care, and OEM businesses.
• Teleflex RemainCo (“RemainCo”) will consist of Teleflex’s Vascular Access, Interventional, and Surgical businesses – focusing on high-growth, high-acuity, primarily hospital-focused emergent end markets.
• Separation expected to position RemainCo to deliver 6%+ constant currency revenue growth post-separation, to be accretive to Teleflex adjusted gross margin, initially neutral to Teleflex adjusted operating margin, and drive double-digit EPS growth in the first full year post separation.
• Separation will position each company to accelerate its growth profile with a simplified operating model, streamlined manufacturing footprint, better allocation of resources and increased management focus.
• Transaction intended to take the form of a distribution of newly issued shares of NewCo to shareholders that is tax-free for U.S. tax purposes and is expected to be completed mid-2026.

WAYNE, Pa., Feb. 27, 2025 (GLOBE NEWSWIRE) — Teleflex Incorporated (NYSE:TFX), a leading global provider of medical technologies, today announced that following a comprehensive business portfolio evaluation, its Board of Directors has authorized Teleflex management to pursue a plan to separate the company’s Urology, Acute Care, and OEM businesses into a new, independent, publicly traded company via a distribution of newly issued shares of NewCo to shareholders that is tax-free for U.S. tax purposes.

“The decision to pursue this separation was driven by our active portfolio management process and focus on driving shareholder value,” said Liam Kelly, Teleflex’s Chairman, President and Chief Executive Officer. “Following the separation, RemainCo will be well-positioned to accelerate growth in attractive, primarily hospital-focused, emergent end markets, with a simplified operating model, streamlined manufacturing footprint and increased management focus. We expect RemainCo to have increased flexibility to invest in and better compete in the markets in which it will operate with a focus on enhanced innovation. We believe NewCo will also emerge poised to deliver greater value via its enhanced ability to identify, invest in, and capitalize on the opportunities unique to its end markets. This transaction is designed to optimize the positioning of both companies in order to better meet the needs of patients and customers and maximize value for shareholders.”

Teleflex RemainCo to Sharpen Focus on High-Growth, High-Acuity End Markets

RemainCo, with approximately $2.1 billion in revenue in 2024 (pro forma for our announced acquisition of substantially all of Biotronik’s Vascular Intervention business), will focus on attractive, high-growth end markets addressing emergent procedures performed primarily in the hospital setting across the Intensive Care Unit, Emergency Department, Catheter Lab, and Operating Room. The product portfolio will be highly complementary with significant breadth across the hospital, with leading market positions and opportunities for growth across three core product categories:

• Vascular Access, offering devices that facilitate a variety of critical care therapies and other applications with a focus on helping reduce vascular-related complications. These products primarily consist of our Arrow branded catheters, catheter navigation and tip positioning systems, and our intraosseous access systems. Post-separation, Vascular Access will also include our emergency medicine portfolio, including our hemostatic products branded under our QuikClot trade name.
• Interventional, offering devices that facilitate a variety of applications to diagnose and deliver treatment of coronary and peripheral vascular disease. These products primarily consist of a variety of coronary catheters and structural heart support devices used by interventional cardiologists, interventional radiologists and vascular surgeons. The Interventional product category will also include the Biotronik Vascular Intervention business, significantly expanding our portfolio in both coronary and peripheral cath lab procedures¹.
• Surgical, offering single-use and reusable devices designed for use in a variety of surgical procedures, primarily consisting of metal and polymer ligating clips, fascial closure surgical systems used in laparoscopic surgical procedures, percutaneous surgical systems, a powered bariatric stapler, and other surgical instruments used in ear, nose and throat and cardiovascular and thoracic procedures.

Following the separation, RemainCo is expected to generate constant currency revenue growth of 6%+. The separation is expected to be accretive to Teleflex adjusted gross margin and neutral to Teleflex adjusted operating margin initially, partially as a result of higher anticipated investment in R&D. RemainCo will have a simplified and nimble operating model with a streamlined manufacturing footprint, transitioning from 19 manufacturing facilities anticipated at Teleflex as of year-end 2025 to 7 facilities at RemainCo post-separation with the remaining 12 expected to transfer to NewCo. This simplification will provide opportunities for margin improvement over time and will create capacity for additional focused R&D investment. The transaction is also expected to be accretive to EPS growth, with RemainCo anticipated to deliver double digit EPS growth in the first full year following the separation.

With this enhanced financial profile, RemainCo will have increased flexibility to better align its capital allocation philosophy and growth strategy. RemainCo will remain disciplined, planning to prioritize allocating capital to internal investment into high-ROI growth drivers, growth-accretive acquisitions to help RemainCo more effectively compete in highly innovative end markets, repaying debt as appropriate to optimize leverage profile, and continuing to return capital to shareholders via quarterly dividends and opportunistic share repurchases. RemainCo is targeting a net leverage ratio below 3.0x through 2026.

Liam Kelly will continue to lead RemainCo as its Chairman, President and CEO.

NewCo Will Have Undivided Management Focus to Unlock Potential in Urology, Acute Care, and OEM End Markets

NewCo, with approximately $1.4 billion in revenue in 2024, is also expected to benefit from a simplified operating model, increased management focus, and a tailored investment and capital allocation strategy. NewCo will be better positioned to identify, invest in, and capitalize on opportunities unique to its businesses, with established leadership positions across three categories:

• Urology, to include the company’s Interventional Urology and bladder management portfolios. Key brands and products include the UroLift System, a minimally invasive technology for treating lower urinary tract symptoms due to benign prostatic hyperplasia in men 45 years of age or older, Barrigel, the company’s hyaluronic acid gel-based rectal spacing product used in connection with radiation therapy treatment of prostate cancer, and the Rüsch brand of catheters and bladder management products.
• Acute Care, to include the majority of Teleflex’s Anesthesia product category, as well as the company’s Respiratory product category, portfolio of intra-aortic balloon pumps, and select other products. Anesthesia products will include our airway management portfolio consisting of laryngoscopes, supraglottic airways, and endotracheal tubes, as well as our pain management portfolio, consisting of epidurals, catheters and disposable pain pumps for regional anesthesia, designed to improve patients’ post-operative pain experience.
• OEM, focused on the design, manufacture, and supply of devices and instruments for other medical device manufacturers. The OEM segment specializes in custom extrusions, micro-diameter film-cast tubing, diagnostic and interventional catheters, balloons and balloon catheters, film-insulated fine wire, coated mandrel wire, conductors, sheath/dilator introducers, specialized sutures and performance fibers, bioabsorbable sutures, yarns and resins.

Following the separation, NewCo is expected to generate low-single digit constant currency revenue growth with a mid-50% adjusted gross margin profile. Over the medium term, NewCo will have the potential to improve growth into the low-single-digit to mid-single digit range as the UroLift business recovers, Barrigel growth remains strong, and the OEM business seeks to return to historical growth empowered by greater flexibility to further expand customer base and enhance capabilities.

Teleflex intends to initiate an executive search for key management positions at NewCo shortly. The NewCo Board of Directors, management and headquarters will be announced as they are finalized.

Transaction Details

The transaction is intended to take the form of a distribution of newly issued shares of NewCo to shareholders that is tax-free for U.S. tax purposes. The company expects the transaction to be completed mid-2026. The transaction is subject to satisfaction of customary conditions, including final approval from the Teleflex Board of Directors, filing and effectiveness of a Form 10 registration statement with the U.S. Securities and Exchange Commission, receipt of a tax opinion from Teleflex’s tax advisor, receipt of a private letter ruling from the Internal Revenue Service, satisfactory completion of financing, and receipt of other regulatory approvals. No assurance can be given regarding the form that a separation transaction may take or the specific terms or timing, or that a separation will in fact occur.

Advisors

Centerview Partners LLC is serving as financial advisor to Teleflex. Simpson Thacher & Bartlett LLP is acting as legal advisor to Teleflex.

Conference Call and Webcast

Teleflex separately reported today fourth quarter and full-year 2024 financial results and announced its entry into a definitive agreement to acquire substantially all of Biotronik’s Vascular Intervention business. The company will host a conference call at 8:00 am ET on Thursday, February 27, 2025 to discuss the results and today’s announcement.

To participate in the conference call, please utilize this link to pre-register and receive the dial-in information. The call can also be accessed through a live audio webcast on the company’s website, teleflex.com.

An audio replay of the call will be available beginning at 11:00 am Eastern Time on February 27, 2025, either on the Teleflex website or by telephone. The call can be accessed by dialing 1 800 770 2030 (U.S. and Canada) or 1 609 800 9909 (all other locations). The conference ID is 69028.

About Teleflex Incorporated

As a global provider of medical technologies, Teleflex is driven by our purpose to improve the health and quality of people’s lives. Through our vision to become the most trusted partner in healthcare, we offer a diverse portfolio with solutions in the therapy areas of anesthesia, emergency medicine, interventional cardiology and radiology, surgical, vascular access, and urology. We believe that the potential of great people, purpose driven innovation, and world-class products can shape the future direction of healthcare.

Teleflex is the home of Arrow™, Barrigel™, Deknatel™, LMA™, Pilling™, QuikClot™, Rüsch™, UroLift™ and Weck™ – trusted brands united by a common sense of purpose.

At Teleflex, we are empowering the future of healthcare. For more information, please visit teleflex.com.

References:

1. Teleflex announced today that it has entered into a definitive agreement to acquire substantially all of the Vascular Intervention business of BIOTRONIK SE & Co. KG, which it expects to close by the end of the third quarter of 2025.

Forward-Looking Statements

This press release contains forward-looking statements, including, but not limited to, statements about the company’s plans to separate certain of its businesses into an independent company, the expected timetable for completing the transaction, the tax-free nature of the transaction, the future financial and operating performance of each company following the transaction, the benefits and synergies of the transaction, strategic and competitive advantages of each company, and future growth and other opportunities for each company. Actual results could differ materially from those in the forward-looking statements due to, among other things, any changes in or abandonment of the proposed transaction and our ability to satisfy the conditions to the proposed transaction; unanticipated costs and length of time required to comply with legal requirements and regulatory approvals applicable to the transaction; customer and shareholder reaction to the transaction; disruption from the transaction making it more difficult to maintain business and operational relationships; significant transaction costs; changes in general and international economic conditions, including fluctuations in foreign currency exchange rates; and other factors described or incorporated in our filings with the Securities and Exchange Commission, including our Annual Report on Form 10-K for the year ended December 31, 2024.

CAUTION: Federal (USA) law restricts these devices for sale or use by or on the order of a physician.

Teleflex, the Teleflex logo, Arrow, Barrigel, Deknatel, LMA, Pilling, QuikClot, Rüsch, UroLift and Weck are trademarks or registered trademarks of Teleflex Incorporated or its affiliates in the U.S. and/or other countries. Other names are the trademarks of their respective owners. Refer to the Instructions for Use for a complete listing of the indications, contraindications, warnings, and precautions. Information in this document is not a substitute for the product Instructions for Use. Not all products may be available in all countries. Please contact your local representative. 

© 2025 Teleflex Incorporated. All rights reserved.

Contacts:

Teleflex
Lawrence Keusch
Vice President, Investor Relations and Strategy Development

[email protected]



610-948-2836

Reports another quarter of accelerated growth and profitability, achieved Q4 guidance on Ex TAC gross profit and Adjusted EBITDA, and generated strong cash flow

Closed acquisition of Teads in February 2025; Combined company operating under the name Teads

NEW YORK, Feb. 27, 2025 (GLOBE NEWSWIRE) — Outbrain Inc. (Nasdaq: OB), which is operating under the new Teads brand, announced today financial results for the quarter and full year ended December 31, 2024.

Fourth Quarter and Full Year
2024
Key Financial Metrics:

	Three Months Ended December 31,												Twelve Months Ended December 31,
(in millions USD)		2024				2023			% Change					2024				2023			% Change
Revenue	$	234.6			$	248.2				(5	)%		$	889.9			$	935.8				(5	)%
Gross profit		56.1				53.2				5	%			192.1				184.8				4	%
Net (loss) income		(0.2	)			4.1				(104	)%			(0.7	)			10.2				(107	)%
Net cash provided by operating activities		42.7				25.5				67	%			68.6				13.7				399	%
Non-GAAP Financial Data*
Ex-TAC gross profit		68.3				63.8				7	%			236.1				227.4				4	%
Adjusted EBITDA		17.0				14.0				21	%			37.3				28.5				31	%
Adjusted net income (loss)		3.5				4.3				(20	)%			4.1				(3.9	)			205	%
Free cash flow		37.6				21.0				79	%			51.3				(6.5	)		NM

_____________________________

NM Not meaningful

* See non-GAAP reconciliations below

“Continued momentum in our growth areas helped drive accelerated growth and profitability, with a record level of cash flow” said David Kostman, CEO of Outbrain.

“A few weeks post closing of our merger with Teads, I am even more excited about combining the category-leading branding and performance capabilities of Outbrain and Teads into one of the largest Open Internet platforms. We believe the new Teads will better serve enterprise brands and agencies, as well as mid-market and direct response advertisers, by delivering elevated outcomes from branding to performance across curated, quality media environments from digital to CTV,” added Kostman.

Recent Developments

On February 3, 2025, we completed the acquisition of Teads, for total value of approximately $900 million, comprised of $625 million in cash and 43.75 million shares of Outbrain common stock. The combined company will operate under the name Teads.

In connection with the acquisition:

• On February 3, 2025, entered into a credit agreement with Goldman Sachs Bank, U.S. Bank Trust Company, and certain other lenders, which provided, among other things, for a new $100.0 million super senior secured revolving credit facility maturing on February 3, 2030, which may be used for working capital and other general corporate purposes.
• On February 11, 2025, completed the private offering of $637.5 million in aggregate principal amount of 10.0% senior secured notes due 2030 at an issue price of 98.087% of the principal amount in a transaction exempt from registration. The proceeds were used, together with cash on hand, to repay in full and cancel a bridge credit facility used to finance the cash consideration paid at closing.
• Terminated the existing revolving credit facility with the Silicon Valley Bank, a division of First Citizens Bank & Trust Company, dated as of November 2, 2021.
• We expect to realize approximately $65 million to $75 million of annual synergies in 2026 with further opportunities for expanded synergies. Of this amount, approximately $60 million relates to cost synergies, including approximately $45 million of compensation-related expenses, with approximately 70% of the estimated compensation-related synergies already actioned in February.

Fourth
Quarter
2024
Business Highlights:

• Continued acceleration of year-over-year growth of Ex-TAC gross profit, improvement in Ex-TAC gross margin, and growth in Adjusted EBITDA.
• Fifth consecutive quarter of year-over-year RPM growth.
• Strong initial reception of our Moments offering, launched in Q3 and live on over 40 publishers, including New York Post, NewsCorp Australia, RTL and Rolling Stone.
• Continued growth in advertiser spend on Outbrain DSP (previously known as Zemanta), by approximately 45% in FY 2024, as compared to the prior year.
• Continued supply expansion outside of traditional feed product representing approximately 30% of our revenue in Q4 2024, versus 26% in Q4 2023.
• Premium supply competitive wins include Penske Media (US) and Prensa Ibérica (Spain), and renewals including Spiegel (Germany), Il Messaggero (Italy), and Grape (Japan).

Fourth
Quarter
2024
Financial Highlights:

• Revenue of $234.6 million, a decrease of $13.6 million, or 5%, compared to $248.2 million in the prior year period, including net unfavorable foreign currency effects of approximately $1.8 million.
• Gross profit of $56.1 million, an increase of $2.9 million, or 5%, compared to $53.2 million in the prior year period. Gross margin increased 250 basis points to 23.9%, compared to 21.4% in the prior year period.
• Ex-TAC gross profit of $68.3 million, an increase of $4.5 million, or 7%, compared to $63.8 million in the prior year period, as lower revenue was more than offset by our Ex-TAC gross margin improvement of approximately 340 basis points to 29.1%, compared to 25.7% in the prior year period.
• Net loss of $0.2 million, compared to net income of $4.1 million in the prior year period. Net loss in the current period includes acquisition-related costs of $3.6 million, net of taxes.
• Adjusted net income of $3.5 million, compared to adjusted net income of $4.3 million in the prior year period.
• Adjusted EBITDA of $17.0 million, compared to Adjusted EBITDA of $14.0 million in the prior year period. Adjusted EBITDA included net unfavorable foreign currency effects of approximately $0.8 million.
• Generated net cash provided by operating activities of $42.7 million, compared to $25.5 million in the prior year period. Free cash flow was $37.6 million, as compared to $21.0 million in the prior year period.
• Cash, cash equivalents and investments in marketable securities were $166.1 million, comprised of cash and cash equivalents of $89.1 million and short-term investments in marketable securities of $77.0 million as of December 31, 2024.

Full Year
2024
Financial Results:

• Revenue of $889.9 million, a decrease of $45.9 million, or 5%, compared to $935.8 million in the prior year period, including net unfavorable foreign currency effects of approximately $2.4 million.
• Gross profit of $192.1 million, an increase of $7.3 million, or 4%, compared to $184.8 million in the prior year period, including net unfavorable foreign currency effects of approximately $1.3 million. Gross margin increased 190 basis points to 21.6% in 2024, compared to 19.7% in 2023.
• Ex-TAC gross profit of $236.1 million, an increase of $8.7 million, or 4%, compared to $227.4 million in the prior year period, including net unfavorable foreign currency effects of approximately $1.3 million.
• Net loss of $0.7 million, including net one-time expenses of $4.8 million, compared to net income of $10.2 million, including net one-time benefits of $14.1 million in the prior year. See non-GAAP reconciliations below for details of one-time items.
• Adjusted net income of $4.1 million, compared to adjusted net loss of $3.9 million in the prior year.
• Adjusted EBITDA of $37.3 million, compared to $28.5 million in the prior year. Adjusted EBITDA included net unfavorable foreign currency effects of approximately $1.2 million.
• Generated net cash provided by operating activities of $68.6 million, compared to net cash provided $13.7 million in the prior year. Free cash flow was $51.3 million, compared to a use of cash of $6.5 million in the prior year.

Share
Repurchases
:

There were no share repurchases during the three months ended December 31, 2024. During the twelve months ended December 31, 2024, we repurchased 1,410,001 shares for $5.8 million, including related costs, under our $30 million stock repurchase program authorized in December 2022. The remaining availability under the repurchase program was $6.6 million as of December 31, 2024.

2025 Full Year and First Quarter
Guidance

The following forward-looking statements reflect our expectations for 2025, including the contribution from Teads.

For the first quarter ending March 31, 2025, which includes the results for the legacy Outbrain business plus the addition of operating results for legacy Teads beginning on February 3, 2025, we expect:

• Ex-TAC gross profit of $100 million to $105 million
• Adjusted EBITDA of $8 million to $12 million

For the full year ending December 31, 2025, we expect:

• Adjusted EBITDA of at least $180 million

The above measures are forward-looking non-GAAP financial measures for which a reconciliation to the most directly comparable GAAP financial measure is not available without unreasonable efforts. See “Non-GAAP Financial Measures” below. In addition, our guidance is subject to risks and uncertainties, as outlined below in this release.

Conference
Call and Webcast Information

Outbrain will host an investor conference call this morning, Thursday, February 27 at 8:30 am ET. Interested parties are invited to listen to the conference call which can be accessed live by phone by dialing 1-877-497-9071 or for international callers, 1-201-689-8727. A replay will be available two hours after the call and can be accessed by dialing 1-877-660-6853, or for international callers, 1-201-612-7415. The passcode for the live call and the replay is 13750872. The replay will be available until March 13, 2025. Interested investors and other parties may also listen to a simultaneous webcast of the conference call by logging onto the Investors Relations section of the Company’s website at https://investors.outbrain.com. The online replay will be available for a limited time shortly following the call.

Non-GAAP Financial Measures

In addition to GAAP performance measures, we use the following supplemental non-GAAP financial measures to evaluate our business, measure our performance, identify trends, and allocate our resources: Ex-TAC gross profit, Ex-TAC gross margin, Adjusted EBITDA, free cash flow, adjusted net income (loss), and adjusted diluted EPS. These non-GAAP financial measures are defined and reconciled to the corresponding GAAP measures below. These non-GAAP financial measures are subject to significant limitations, including those we identify below. In addition, other companies in our industry may define these measures differently, which may reduce their usefulness as comparative measures. As a result, this information should be considered as supplemental in nature and is not meant as a substitute for revenue, gross profit, net income (loss), diluted EPS, or cash flows from operating activities presented in accordance with U.S. GAAP.

Because we are a global company, the comparability of our operating results is affected by foreign exchange fluctuations. We calculate certain constant currency measures and foreign currency impacts by translating the current year’s reported amounts into comparable amounts using the prior year’s exchange rates. All constant currency financial information that may be presented is non-GAAP and should be used as a supplement to our reported operating results. We believe that this information is helpful to our management and investors to assess our operating performance on a comparable basis. However, these measures are not intended to replace amounts presented in accordance with GAAP and may be different from similar measures calculated by other companies.

The Company is also providing fourth quarter and full year guidance. These forward-looking non-GAAP financial measures are calculated based on internal forecasts that omit certain amounts that would be included in GAAP financial measures. The Company has not provided quantitative reconciliations of these forward-looking non-GAAP financial measures to the most directly comparable GAAP financial measures because it is unable, without unreasonable effort, to predict with reasonable certainty the occurrence or amount of all excluded items that may arise during the forward-looking period, which can be dependent on future events that may not be reliably predicted. Such excluded items could be material to the reported results individually or in the aggregate.

Ex-TAC Gross Profit

Ex-TAC gross profit is a non-GAAP financial measure. Gross profit is the most comparable GAAP measure. In calculating Ex-TAC gross profit, we add back other cost of revenue to gross profit. Ex-TAC gross profit may fluctuate in the future due to various factors, including, but not limited to, seasonality and changes in the number of media partners and advertisers, advertiser demand or user engagements.

We present Ex-TAC gross profit, Ex-TAC gross margin (calculated as Ex-TAC gross profit as a percentage of revenue), and Adjusted EBITDA as a percentage of Ex-TAC gross profit, because they are key profitability measures used by our management and board of directors to understand and evaluate our operating performance and trends, develop short-term and long-term operational plans, and make strategic decisions regarding the allocation of capital. Accordingly, we believe that these measures provide information to investors and the market in understanding and evaluating our operating results in the same manner as our management and board of directors. There are limitations on the use of Ex-TAC gross profit in that traffic acquisition cost is a significant component of our total cost of revenue but not the only component and, by definition, Ex-TAC gross profit presented for any period will be higher than gross profit for that period. A potential limitation of this non-GAAP financial measure is that other companies, including companies in our industry, which have a similar business, may define Ex-TAC gross profit differently, which may make comparisons difficult. As a result, this information should be considered as supplemental in nature and is not meant as a substitute for revenue or gross profit presented in accordance with U.S. GAAP.

Adjusted EBITDA

We define Adjusted EBITDA as net income (loss) before gain on convertible debt; interest expense; interest income and other income (expense), net; provision for income taxes; depreciation and amortization; stock-based compensation; and other income or expenses that we do not consider indicative of our core operating performance, including but not limited to, merger and acquisition costs, regulatory matter costs, and severance costs related to our cost saving initiatives. We present Adjusted EBITDA as a supplemental performance measure because it is a key profitability measure used by our management and board of directors to understand and evaluate our operating performance and trends, develop short-term and long-term operational plans and make strategic decisions regarding the allocation of capital, and we believe it facilitates operating performance comparisons from period to period.

We believe that Adjusted EBITDA provides useful information to investors and others in understanding and evaluating our operating results in the same manner as our management and board of directors. However, our calculation of Adjusted EBITDA is not necessarily comparable to non-GAAP information of other companies. Adjusted EBITDA should be considered as a supplemental measure and should not be considered in isolation or as a substitute for any measures of our financial performance that are calculated and reported in accordance with U.S. GAAP.

Adjusted Net Income (Loss) and Adjusted Diluted EPS

Adjusted net income (loss) is a non-GAAP financial measure, which is defined as net income (loss) excluding items that we do not consider indicative of our core operating performance, including but not limited to gain on convertible debt, merger and acquisition costs, regulatory matter costs, and severance costs related to our cost saving initiatives. Adjusted net income (loss), as defined above, is also presented on a per diluted share basis. We present adjusted net income (loss) and adjusted diluted EPS as supplemental performance measures because we believe they facilitate performance comparisons from period to period. However, adjusted net income (loss) or adjusted diluted EPS should not be considered in isolation or as a substitute for net income (loss) or diluted earnings per share reported in accordance with U.S. GAAP.

Free Cash Flow

Free cash flow is defined as cash flow provided by (used in) operating activities less capital expenditures and capitalized software development costs. Free cash flow is a supplementary measure used by our management and board of directors to evaluate our ability to generate cash and we believe it allows for a more complete analysis of our available cash flows. Free cash flow should be considered as a supplemental measure and should not be considered in isolation or as a substitute for any measures of our financial performance that are calculated and reported in accordance with U.S. GAAP.

Forward-Looking Statements

This press release contains forward-looking statements within the meaning of the federal securities laws, which statements involve substantial risks and uncertainties. Forward-looking statements may include, without limitation, statements generally relating to possible or assumed future results of our business, financial condition, results of operations, liquidity, plans and objectives, and statements relating to our recently completed acquisition of Teads S.A., a public limited liability company(société anonyme) incorporated and existing under the laws of the Grand Duchy of Luxembourg (“Teads”). You can generally identify forward-looking statements because they contain words such as “may,” “will,” “should,” “expects,” “plans,” “anticipates,” “could,” “intends,” “guidance,” “outlook,” “target,” “projects,” “contemplates,” “believes,” “estimates,” “predicts,” “foresee,” “potential” or “continue” or the negative of these terms or other similar expressions that concern our expectations, strategy, plans or intentions or are not statements of historical fact. We have based these forward- looking statements largely on our expectations and projections regarding future events and trends that we believe may affect our business, financial condition, and results of operations. The outcome of the events described in these forward-looking statements is subject to risks, uncertainties and other factors including, but not limited to: the ability of Outbrain to successfully integrate Teads or manage the combined business effectively; our ability to realize anticipated benefits and synergies of the acquisition, including, among other things, operating efficiencies, revenue synergies and other cost savings; our due diligence investigation of Teads may be inadequate or risks related to Teads’ business may materialize; unexpected costs, charges or expenses resulting from the acquisition; the outcome of any securities litigation, stockholder derivative or other litigation related to the acquisition; our ability to raise additional financing in the future to fund our operations, which may not be available to us on favorable terms or at all; the volatility of the market price of our common stock and any drop in the market price of our common stock following the acquisition; our ability to attract and retain customers, management and other key personnel; overall advertising demand and traffic generated by our media partners; factors that affect advertising demand and spending, such as the continuation or worsening of unfavorable economic or business conditions or downturns, instability or volatility in financial markets, and other events or factors outside of our control, such as U.S. and global recession concerns, geopolitical concerns, including the ongoing war between Ukraine-Russia and conditions in Israel and the Middle East, tariffs and trade wars, supply chain issues, inflationary pressures, labor market volatility, bank closures or disruptions, the impact of challenging economic conditions, political and policy changes or uncertainties in connection with the new U.S. presidential administration, and other factors that have and may further impact advertisers’ ability to pay; our ability to continue to innovate, and adoption by our advertisers and media partners of our expanding solutions; the success of our sales and marketing investments, which may require significant investments and may involve long sales cycles; our ability to grow our business and manage growth effectively; our ability to compete effectively against current and future competitors; the loss or decline of one or more of our large media partners, and our ability to expand our advertiser and media partner relationships; conditions in Israel, including the sustainability of the recent cease-fire between Israel and Hamas and any conflicts with other terrorist organizations; our ability to maintain our revenues or profitability despite quarterly fluctuations in our results, whether due to seasonality, large cyclical events, or other causes; the risk that our research and development efforts may not meet the demands of a rapidly evolving technology market; any failure of our recommendation engine to accurately predict attention or engagement, any deterioration in the quality of our recommendations or failure to present interesting content to users or other factors which may cause us to experience a decline in user engagement or loss of media partners; limits on our ability to collect, use and disclose data to deliver advertisements; our ability to extend our reach into evolving digital media platforms; our ability to maintain and scale our technology platform; our ability to meet demands on our infrastructure and resources due to future growth or otherwise; our failure or the failure of third parties to protect our sites, networks and systems against security breaches, or otherwise to protect the confidential information of us or our partners; outages or disruptions that impact us or our service providers, resulting from cyber incidents, or failures or loss of our infrastructure; significant fluctuations in currency exchange rates; political and regulatory risks in the various markets in which we operate; the challenges of compliance with differing and changing regulatory requirements; the timing and execution of any cost-saving measures and the impact on our business or strategy; and the risks described in the section entitled “Risk Factors” and elsewhere in the Annual Report on Form 10-K filed for the year ended December 31, 2023, in our definitive proxy statement filed with the SEC on October 31, 2024 and in subsequent reports filed with the SEC. Accordingly, you should not rely upon forward-looking statements as an indication of future performance. We cannot assure you that the results, events and circumstances reflected in the forward-looking statements will be achieved or will occur, and actual results, events, or circumstances could differ materially from those projected in the forward-looking statements. The forward-looking statements made in this press release relate only to events as of the date on which the statements are made. We may not actually achieve the plans, intentions or expectations disclosed in our forward-looking statements and you should not place undue reliance on our forward-looking statements. We undertake no obligation and do not assume any obligation to update any forward-looking statements, whether as a result of new information, future events or circumstances after the date on which the statements are made or to reflect the occurrence of unanticipated events or otherwise, except as required by law.

About The Combined Company

Outbrain Inc. (Nasdaq: OB) and Teads combined on February 3, 2025 and are operating under the new Teads brand. The new Teads is the omnichannel outcomes platform for the open internet, driving full-funnel results for marketers across premium media. With a focus on meaningful business outcomes, the combined company ensures value is driven with every media dollar by leveraging predictive AI technology to connect quality media, beautiful brand creative, and context-driven addressability and measurement. One of the most scaled advertising platforms on the open internet, the new Teads is directly partnered with more than 10,000 publishers and 20,000 advertisers globally. The company is headquartered in New York, with a global team of nearly 1,800 people in 36 countries.

Media Contact

[email protected]

Investor Relations Contact

[email protected]

(332) 205-8999

OUTBRAIN INC. Condensed Consolidated Statements of Operations (In thousands, except for share and per share data)
	Three Months Ended December 31,								Twelve Months Ended December 31,
		2024				2023				2024				2023
	(Unaudited)
Revenue	$	234,586			$	248,229			$	889,875			$	935,818
Cost of revenue:
Traffic acquisition costs		166,247				184,425				653,731				708,449
Other cost of revenue		12,277				10,572				44,042				42,571
Total cost of revenue		178,524				194,997				697,773				751,020
Gross profit		56,062				53,232				192,102				184,798
Operating expenses:									​
Research and development		9,434				8,369				37,080				36,402
Sales and marketing		25,736				25,254				97,498				98,370
General and administrative		18,357				13,899				70,162				58,665
Total operating expenses		53,527				47,522				204,740				193,437
Income (loss) from operations		2,535				5,710				(12,638	)			(8,639	)
Other income (expense), net:
Gain on convertible debt		—				—				8,782				22,594
Interest expense		(699	)			(965	)			(3,649	)			(5,393	)
Interest income and other income, net		1,522				2,060				9,209				7,793
Total other income, net		823				1,095				14,342				24,994
Income before income taxes		3,358				6,805				1,704				16,355
Provision for income taxes		3,525				2,748				2,415				6,113
Net (loss) income	$	(167	)		$	4,057			$	(711	)		$	10,242
Weighted average shares outstanding:
Basic		49,767,704				50,076,364				49,321,301				50,900,422
Diluted		49,767,704				50,108,460				52,709,356				56,965,299
Net income (loss) per common share:
Basic	$	0.00			$	0.08			$	(0.01	)		$	0.20
Diluted	$	0.00			$	0.08			$	(0.11	)		$	(0.06	)

OUTBRAIN INC. Condensed Consolidated Balance Sheets (In thousands, except for number of shares and par value)
	December 31, 2024				December 31, 2023
	(Unaudited)
ASSETS:
Current assets:
Cash and cash equivalents	$	89,094			$	70,889
Short-term investments in marketable securities		77,035				94,313
Accounts receivable, net of allowances		149,167				189,334
Prepaid expenses and other current assets		27,835				47,240
Total current assets		343,131				401,776
Non-current assets:
Long-term investments in marketable securities		—				65,767
Property, equipment and capitalized software, net		45,250				42,461
Operating lease right-of-use assets, net		15,047				12,145
Intangible assets, net		16,928				20,396
Goodwill		63,063				63,063
Deferred tax assets		40,825				38,360
Other assets		24,969				20,669
TOTAL ASSETS	$	549,213			$	664,637
LIABILITIES AND STOCKHOLDERS’ EQUITY:
Current liabilities:
Accounts payable	$	149,479			$	150,812
Accrued compensation and benefits		19,430				18,620
Accrued and other current liabilities		113,630				119,703
Deferred revenue		6,932				8,486
Total current liabilities		289,471				297,621
Non-current liabilities:
Long-term debt		—				118,000
Operating lease liabilities, non-current		11,783				9,217
Other liabilities		16,616				16,735
TOTAL LIABILITIES	$	317,870			$	441,573
STOCKHOLDERS’ EQUITY:
Common stock, par value of $0.001 per share − one billion shares authorized; 63,503,274 shares issued and 50,090,114 shares outstanding as of December 31, 2024; 61,567,520 shares issued and 49,726,518 shares outstanding as of December 31, 2023		64				62
Preferred stock, par value of $0.001 per share − 100,000,000 shares authorized, none issued and outstanding as of December 31, 2024 and December 31, 2023		—				—
Additional paid-in capital		484,541				468,525
Treasury stock, at cost − 13,413,160 shares as of December 31, 2024 and 11,841,002 shares as of December 31, 2023		(74,289	)			(67,689	)
Accumulated other comprehensive loss		(9,480	)			(9,052	)
Accumulated deficit		(169,493	)			(168,782	)
TOTAL STOCKHOLDERS’ EQUITY		231,343				223,064
TOTAL LIABILITIES AND STOCKHOLDERS’ EQUITY	$	549,213			$	664,637

OUTBRAIN INC. Condensed Consolidated Statements of Cash Flows (In thousands)
	Three Months Ended December 31,								Twelve Months Ended December 31,
		2024				2023				2024				2023
	(Unaudited)
CASH FLOWS FROM OPERATING ACTIVITIES:
Net (loss) income	$	(167	)		$	4,057			$	(711	)		$	10,242
Adjustments to reconcile net (loss) income to net cash provided by (used in) operating activities:
Gain on convertible debt		—				—				(8,782	)			(22,594	)
Stock-based compensation		3,974				2,988				15,461				12,141
Depreciation and amortization of property and equipment		1,658				1,720				6,312				6,915
Amortization of capitalized software development costs		2,477				2,372				9,758				9,633
Amortization of intangible assets		850				853				3,409				4,154
Provision for credit losses		55				1,931				3,006				8,008
Non-cash operating lease expense		1,305				1,092				5,130				4,453
Deferred income taxes		(664	)			(1,478	)			(5,095	)			(4,312	)
Amortization of discount on marketable securities		(396	)			(729	)			(2,235	)			(3,604	)
Other		665				(483	)			47				(717	)
Changes in operating assets and liabilities:
Accounts receivable		4,471				(16,939	)			35,905				(12,946	)
Prepaid expenses and other current assets		9,291				2,409				18,412				843
Accounts payable and other current liabilities		18,867				27,127				(11,696	)			(1,228	)
Operating lease liabilities		(1,223	)			(1,018	)			(5,092	)			(4,297	)
Deferred revenue		555				1,524				(1,496	)			1,621
Other non-current assets and liabilities		945				51				6,228				5,434
Net cash provided by operating activities		42,663				25,477				68,561				13,746
CASH FLOWS FROM INVESTING ACTIVITIES:
Acquisition of a business, net of cash acquired		—				(77	)			(181	)			(389	)
Purchases of property and equipment		(2,712	)			(2,257	)			(7,380	)			(10,127	)
Capitalized software development costs		(2,321	)			(2,243	)			(9,913	)			(10,107	)
Purchases of marketable securities		(34,436	)			(44,658	)			(90,602	)			(131,543	)
Proceeds from sales and maturities of marketable securities		31,068				35,228				175,325				221,878
Other		(15	)			(63	)			(96	)			(72	)
Net cash (used in) provided by investing activities		(8,416	)			(14,070	)			67,153				69,640
CASH FLOWS FROM FINANCING ACTIVITIES:
Repayment of long-term debt obligations		—				—				(109,740	)			(96,170	)
Payment of deferred financing costs		(598	)			—				(1,099	)			—
Treasury stock repurchases and share withholdings on vested awards		(210	)			(5,270	)			(6,600	)			(18,521	)
Principal payments on finance lease obligations		—				(353	)			(263	)			(1,830	)
Payment of contingent consideration liability up to acquisition-date fair value		—				—				—				(547	)
Net cash used in financing activities		(808	)			(5,623	)			(117,702	)			(117,068	)
Effect of exchange rate changes		(1,400	)			564				634				(1,004	)
Net increase (decrease) in cash, cash equivalents and restricted cash	$	32,039			$	6,348			$	18,646			$	(34,686	)
Cash, cash equivalents and restricted cash — Beginning		57,686				64,731				71,079				105,765
Cash, cash equivalents and restricted cash — Ending	$	89,725			$	71,079			$	89,725			$	71,079

OUTBRAIN INC. Non-GAAP Reconciliations (In thousands) (Unaudited)

The following table presents the reconciliation of Gross profit to Ex-TAC gross profit and Ex-TAC gross margin, for the periods presented:

​	Three Months Ended  December 31,								Twelve Months Ended  December 31,
​		2024				2023				2024				2023
Revenue	$	234,586			$	248,229			$	889,875			$	935,818
Traffic acquisition costs		(166,247	)			(184,425	)			(653,731	)			(708,449	)
Other cost of revenue		(12,277	)			(10,572	)			(44,042	)			(42,571	)
Gross profit		56,062				53,232				192,102				184,798
Other cost of revenue		12,277				10,572				44,042				42,571
Ex-TAC gross profit	$	68,339			$	63,804			$	236,144			$	227,369
Gross margin (gross profit as % of revenue)		23.9	%			21.4	%			21.6	%			19.7	%
Ex-TAC gross margin (Ex-TAC gross profit as % of revenue)		29.1	%			25.7	%			26.5	%			24.3	%

The following table presents the reconciliation of net income (loss) to Adjusted EBITDA, for the periods presented:

​	Three Months Ended  December 31,								Twelve Months Ended December 31,
​		2024				2023				2024				2023
Net (loss) income	$	(167	)		$	4,057			$	(711	)		$	10,242
Interest expense		699				965				3,649				5,393
Interest income and other income, net		(1,522	)			(2,060	)			(9,209	)			(7,793	)
Gain on convertible debt		—				—				(8,782	)			(22,594	)
Provision for income taxes		3,525				2,748				2,415				6,113
Depreciation and amortization		4,985				4,945				19,479				20,702
Stock-based compensation		3,974				2,988				15,461				12,141
Regulatory matter costs		—				—				—				742
Acquisition-related costs		5,469				—				14,256				—
Severance and related costs		—				361				742				3,509
Adjusted EBITDA	$	16,963			$	14,004			$	37,300			$	28,455
Net (loss) income as % of gross profit		(0.3	)%			7.6	%			(0.4	)%			5.5	%
Adjusted EBITDA as % of Ex-TAC Gross Profit		24.8	%			21.9	%			15.8	%			12.5	%

The following table presents the reconciliation of net income (loss) and diluted EPS to adjusted net income (loss) and adjusted diluted EPS, respectively, for the periods presented:

​	Three Months Ended  December 31,								Twelve Months Ended December 31,
​		2024				2023				2024				2023
Net loss (income)	$	(167	)		$	4,057			$	(711	)		$	10,242
Adjustments:
Gain on convertible debt		—				—				(8,782	)			(22,594	)
Regulatory matter costs		—				—				—				742
Acquisition-related costs		5,469				—				14,256				—
Severance and related costs		—				361				742				3,509
Total adjustments, before tax		5,469				361				6,216				(18,343	)
Income tax effect		(1,844	)			(97	)			(1,438	)			4,234
Total adjustments, after tax		3,625				264				4,778				(14,109	)
Adjusted net income (loss)	$	3,458			$	4,321			$	4,067			$	(3,867	)
Basic weighted-average shares, as reported		49,767,704				50,076,364				49,321,301				50,900,422
Restricted stock units		793,713				32,096				519,729				—
Adjusted diluted weighted average shares		50,561,417				50,108,460				49,841,030				50,900,422
Diluted net income (loss) per share – reported	$	—			$	0.08			$	(0.11	)		$	(0.06	)
Adjustments, after tax		0.07				0.01				0.19				(0.02	)
Diluted net income (loss) per share – adjusted	$	0.07			$	0.09			$	0.08			$	(0.08	)

The following table presents the reconciliation of net cash provided by (used in) operating activities to free cash flow, for the periods presented:

	Three Months Ended  December 31,								Twelve Months Ended December 31,
		2024				2023				2024				2023
Net cash provided by operating activities	$	42,663			$	25,477			$	68,561			$	13,746
Purchases of property and equipment		(2,712	)			(2,257	)			(7,380	)			(10,127	)
Capitalized software development costs		(2,321	)			(2,243	)			(9,913	)			(10,107	)
Free cash flow	$	37,630			$	20,977			$	51,268			$	(6,488	)

Teads

Non-IFRS Reconciliations


(In thousands)


(Unaudited)

The below information is presented for informational purposes only. The acquisition of Teads closed in February 2025. Therefore, its results are not included in Outbrain Inc.’s consolidated results of operations for any periods in 2024. The following is a summary of Teads’ non-IFRS financial measures, as calculated based on Teads’ historical financial statements, which we may publicly present from time to time, and which differ from US GAAP. Non-IFRS financial measures should be viewed in addition to, and not as an alternative for, Teads’ historical financial results prepared in accordance with IFRS. The financial information set forth below for the three months and twelve months ended December 31, 2024 is preliminary and is subject to change. Actual financial results may differ from these preliminary estimates due to the completion of Teads’ annual audit and are subject to adjustments and other developments that may arise before such results are finalized.

Ex-TAC Gross Profit is defined as gross profit plus other cost of revenue. The following table presents the reconciliation of Ex-TAC Gross Profit to gross profit for the periods presented:

​	Three Months Ended March 31, 2024				Three Months Ended June 30, 2024				Three Months Ended September 30, 2024				Three Months Ended December 31, 2024				Twelve Months Ended December 31, 2024
​	(in thousands)
Revenue	$	125,372			$	153,734			$	149,376			$	188,953			$	617,435
Traffic acquisition costs		(46,939	)			(55,716	)			(59,085	)			(69,091	)			(230,831	)
Other cost of revenue(a)		(26,387	)			(26,721	)			(26,865	)			(26,441	)			(106,414	)
Gross profit		52,046				71,297				63,426				93,421				280,190
Other cost of revenue(a)		26,387				26,721				26,865				26,441				106,414
Ex-TAC Gross Profit	$	78,433			$	98,018			$	90,291			$	119,862			$	386,604

<sup>__________________________________

(a)</sup> Other cost of revenue for Teads is subject to accounting policy alignment with Outbrain, with no impact to Ex-TAC Gross Profit included in the above table.

Teads defines Adjusted EBITDA as profit (loss) for the year/period before income tax expense, finance costs, other financial income and expenses, depreciation and amortization, other expenses and income (capital gains, non-recurring litigation, restructuring costs) and share-based compensation. This may not be comparable to similarly titled measures used by other companies. Further, this measure should not be considered as an alternative for net income as the effects of income tax expense, finance costs, other financial income and expenses, depreciation and amortization, other expenses and income (such as severance costs, and merger and acquisition costs) and share-based compensation excluded from Adjusted EBITDA do affect the operating results. Teads believes that Adjusted EBITDA is a useful supplementary measure for evaluating the operating performance of Teads’ business. The following table provides a reconciliation of profit (loss) for the period to Adjusted EBITDA, the most directly comparable IFRS measure, for the periods presented:

​	Three Months Ended March 31, 2024				Three Months Ended June 30, 2024				Three Months Ended September 30, 2024				Three Months Ended December 31, 2024				Twelve Months Ended December 31, 2024
​	(in thousands)
(Loss) profit for the period		(36,551	)			23,323				32,933			$	46,158			$	65,863
Finance Costs		250				277				532				117				1,176
Other financial (income) and expenses		20,531				(12,432	)			(20,529	)			(19,967	)			(32,397	)
Provision for income taxes		716				10,800				10,597				17,637				39,750
Depreciation and amortization		3,180				3,350				3,277				3,027				12,834
Share-based compensation		25,612				5,760				(3,284	)			(134	)			27,954
Severance costs		281				520				398				394				1,593
Merger and acquisition costs		323				763				(125	)			4,929				5,890
Adjusted EBITDA	$	14,342			$	32,361			$	23,799			$	52,161			$	122,663