Israeli digital advertising company Perion network (Nasdaq: PERI; TASE: PERI) is implementing a simplification plan that will include an estimated 35 layoffs – 6% of the company’s workforce. At the end of 2023, Berion had 561 employees, including 235 in Israel, and today the company has 650 employees.
Sources close to the company say that most of the employees who were laid off are in Israel. As far as is known, Perion is reconsidering its organizational structure, especially in the CodeFuel research division, which has seen its activities significantly reduced in recent months due to the measures taken by Microsoft.
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In recent months, Perion has reported on two actions taken by Microsoft that adversely affected its activities. In February, Microsoft changed the pricing mechanism for the Bing search engine, which negatively affected the company’s revenue.
Two weeks ago, Perion announced that Microsoft Bing was excluding a number of publishers from its search distribution marketplace, some of whom worked with Perion. The company said that Microsoft’s action will reduce revenues by less than 5% in the second half of 2024. Perion was exposed to a similar situation several years ago when Google changed its pricing policy and the company’s revenues were affected.
Perion, led by CEO Tal Jacobson, revised its revenue guidance to $106-108 million in the second quarter from $118-122 million with adjusted EBITDA of $6.5-7.5 million, down from its previous forecast of $6.5-7.5 million. 10-12 million US dollars. Full-year 2024 guidance was lowered from $590-610 million to $490-510 million after revenue of more than $700 million in 2023. EBITDA in 2024 will be $48-52 million, down 70% from 2024 2023.
The simplification plan will allow the company to focus on expanding its key growth drivers, including digital programmatic out-of-home (DOOH) advertising – a space it entered after acquiring Hivestack for $100 million – retail media and AI-driven advertising on smart TVs.
Perion’s stock price fell 1.32% on the Nasdaq yesterday, giving it a market capitalization of $403 million.
Published by Globes, Israel Business News – en.globes.co.il – on June 26, 2024.
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