What happened
Shares of Perion Network (PERI 4.41%) were moving higher today after the advertising technology company reported better-than-expected results in its second-quarter earnings release this morning. It also raised its full-year earnings before interest, taxes, depreciation, and amortization (EBITDA) guidance.
As of 11:36 a.m ET, the stock was up 10%.
So what
Perion's primary business is its Intelligent Hub platform, which connects ad buyers and sellers, helping each one efficiently find the right demand and supply.
Despite headwinds in the digital advertising industry, Perion continued to deliver strong growth in the quarter. Revenue increased 34% to $146.7 million as growth in video and connected TV (CTV) remained strong, up 273% and 90% respectively. Together, those two segments made up close to a third of revenue, and video revenue growth was helped by its acquisition of video monetization platform Vidazoo last fall.
Perion also continued to gain with SORT, its recently introduced cookie-less technology, as the number of SORT customers nearly doubled from the first quarter from 65 to 126. SORT isn't a revenue driver for Perion, but it helps bring in new customers.
On the bottom line, growth was impressive as well, with adjusted EBITDA doubling from $14.3 million to $28.5 million, and adjusted earnings per share jumping 55% to $0.51, easily beating estimates at $0.32.
CEO Doron Gerstel said in a statement: "Perion's continued margin expansion demonstrates the effectiveness of our Intelligent HUB (iHUB). By connecting all our data assets and analyzing signals from all channels on both sides of the open web, iHUB optimizes campaign yields, increases operational efficiencies and powers new, innovative products like SORT."
Now what
Perion maintained its revenue guidance for the full year at $620 million to $640 million, or 32% growth at the midpoint, but it raised its adjusted EBITDA guidance. It now sees full-year EBITDA of at least $102 million, or 47% growth or better, compared to a prior range of $98 million to $102 million.
The adtech stock's performance shows the flexibility of its multichannel business model in the face of a slowdown in digital advertising as nearly every social media and digital ad company has posted sluggish growth in the second quarter. That combined with strong guidance and a cheap valuation makes Perion look like an appealing buy.
