Taboola loses a quarter of its value as slowing growth overshadows profit turnaround
Adam Singolda’s digital advertising company beat profitability forecasts and moved back into the black, but a revenue shortfall and weaker guidance triggered the Nasdaq selloff.
Taboola published its second-quarter results, revealing a widening gap between improving profitability metrics and weaker revenue growth. The company returned to net profit, raised its annual EBITDA forecast and reported stronger margins, but missed revenue expectations and lowered its full-year revenue outlook, sending its shares down 26% on Nasdaq.
Taboola, which operates a content recommendation and digital advertising platform, was founded and is led by Israeli entrepreneur Adam Singolda. The company reported second-quarter 2026 revenue of $476.8 million, up 2.4% from the same period last year but below analysts’ expectations of $499.4 million. Earnings came in at 1 cent per share, compared with forecasts of 4 cents per share, while adjusted EBITDA reached $55.5 million, beating expectations of $52 million.
For the third quarter, Taboola expects revenue of $460 million-$473 million. The midpoint of the forecast, $466.5 million, is 10% below analysts’ expectations of $518.1 million and represents a 6.1% decline compared with the same quarter last year.
The company also cut its full-year 2026 revenue forecast to $1.93 billion-$1.96 billion. The midpoint of the new guidance, $1.94 billion, is below its previous forecast of $2.03 billion and analysts’ expectations of $2.04 billion.
Despite the revenue pressure, Taboola reported continued improvement in profitability. Gross profit excluding traffic acquisition costs increased 11.8% to $192.4 million, while adjusted EBITDA climbed 22.8% to $55.5 million. The adjusted EBITDA margin expanded to 28.8%, compared with 26.2% in the corresponding quarter last year.
The company posted net income of $4.3 million, compared with a loss of $4.3 million in the same quarter last year, while operating margin improved to 1.5% from break-even a year earlier. However, free cash flow margin declined to 3.6%, compared with 7.3% in the second quarter of 2025.
For the third quarter, Taboola expects adjusted EBITDA of $51.5 million-$56.5 million. The company raised its full-year adjusted EBITDA forecast to a range of $228 million-$240 million.
Singolda said Taboola exceeded expectations for gross profit excluding traffic acquisition costs and adjusted EBITDA, while raising its full-year outlook for both metrics. “With the momentum we’re seeing with Realize, the addition of Fox News and other strategic wins, we are further strengthening our position as a leader in performance advertising and executing on our vision to build the leading platform for the Open Web,” he said.
