Perion Network Ltd. (NASDAQ:PERI) reported first-quarter results on Wednesday that came in below analyst expectations, although investors appeared encouraged by the company’s reaffirmed full-year guidance and ongoing growth initiatives.
Shares of the digital advertising technology company rose 4.50% in pre-market trading following the earnings release.
Earnings and Revenue Miss Expectations
Adjusted earnings per share came in at $0.11, falling short of the analyst consensus estimate of $0.13.
Revenue totaled $90.4 million, below the expected $92.92 million, but still represented a 1% increase from $89.3 million reported in the first quarter of 2025.
Perion maintained its full-year 2026 guidance, projecting contribution ex-TAC between $215 million and $235 million, along with adjusted EBITDA of $50 million to $54 million. The midpoint of the contribution ex-TAC forecast, at $225 million, indicated management’s confidence in the company’s outlook despite the softer quarterly performance.
AI and Connected TV Drive Growth
“During the quarter, we continued to advance the Perion One platform and our Outmax AI Agent technology, with encouraging adoption from customers and new global partnerships,” said Tal Jacobson, CEO.
The company highlighted strong momentum across several strategic growth areas. Spending tied to the Outmax AI agent platform jumped 316% year over year, while connected TV (CTV) spend increased 68% and digital out-of-home (DOOH) spend rose 29%.
Advertising Weakness Offset by Search Growth
Advertising solutions revenue declined 4% year over year to $66.7 million, mainly due to continued softness in the web channel. The decline was partially offset by growth in connected TV and digital out-of-home advertising.
Search advertising revenue increased 21% year over year to $23.7 million.
Contribution ex-TAC remained steady at $39.7 million, maintaining a margin of 44%.
Adjusted EBITDA was $0.5 million, down from $1.8 million in the same quarter last year.
Cash Flow and Share Repurchases
During the quarter, Perion generated $6.7 million in operating cash flow and $7.0 million in adjusted free cash flow.
The company also repurchased 2.5 million shares for $24.1 million.
As of March 31, 2026, Perion held $293.0 million in cash, cash equivalents, short-term deposits, and marketable securities.