Key Highlights

• Taboola reported Q3 2026 Revenue of $462.3 million, though this marked a 6.9% year-over-year decline

• Adjusted EBITDA rose 16.1% to $56.0 million, with margins expanding to 29.7% from 27.3%

• Ex-TAC Gross Profit increased 6.8% to $188.8 million during the quarter

• The company issued full-year 2026 revenue guidance of $1,882.5 million to $1,898.5 million

Taboola(NASDAQ:TBLA), a global digital Advertising platform focused on delivering performance at scale for advertisers, disclosed its third quarter 2026 financial results on November 4, 2026. While topline revenue declined on a year-over-year basis, the company reported growth in profitability metrics and offered a forward outlook for the remainder of the fiscal year.

Revenue and Profitability in Focus

For the three months ended September 30, 2026, Taboola recorded revenue of $462.3 million, representing a decrease of 6.9% compared to the same quarter in 2025. Despite the topline contraction, the company's gross profit came in at $152.3 million, an increase of 9.6% from the prior year period. Ex-TAC Gross Profit, a key non-GAAP metric that strips out traffic Acquisition costs and non-cash items, totaled $188.8 million, up 6.8% year-over-year. The divergence between declining revenue and growing profit measures suggests a shift in Taboola's revenue mix and cost structure, with the company retaining a larger share of gross advertising dollars.

Net income for the quarter reached $18.4 million, a notable improvement from Net Income of $5.2 million in Q3 2025. Adjusted EBITDA grew 16.1% to $56.0 million, and the company's Adjusted EBITDA Margin expanded to 29.7%, up from 27.3% in the year-ago period.

Cash Flow and Operational Developments

Cash flow provided by Operating Activities totaled $35.6 million during the quarter, compared to $53.2 million in Q3 2025. Free Cash Flow was $20.4 million, down from $46.3 million in the prior year period. The year-over-year decrease in cash generation occurred even as Earnings improved, reflecting potential Working Capital fluctuations or Capital Expenditure timing differences.

On the operational front, Taboola's CEO Adam Singolda highlighted three strategic focus areas: expanding the number of premium publishers on its platform, increasing revenue generated with existing publisher partners, and investing in complementary growth areas including Taboola News and social commerce. The company also noted that its full-page monetization product is now live across all NBCUniversal properties, and its Fox News integration has reached 100% deployment. Additionally, the Dianomi acquisition is expected to close before the end of 2026.

Full-Year and Q4 2026 Guidance

Looking to the fourth quarter, Taboola expects revenue of $477 million to $493 million, with ex-TAC Gross Profit projected between $204.5 million and $213.5 million. Adjusted EBITDA for Q4 is anticipated in the range of $73.5 million to $82.5 million, which would represent a meaningful sequential acceleration. Non-GAAP net income for the fourth quarter is expected to fall between $53 million and $62 million.

For the full year 2026, the company guided for total revenue of $1,882.5 million to $1,898.5 million and Adjusted EBITDA of $212 million to $221 million. Full-year non-GAAP net income is expected to range from $151 million to $160 million.

Looking Ahead

Taboola's Q3 2026 results present a mixed financial picture, with declining topline revenue offset by expanding margins and growing profitability. The company's strategic initiatives around publisher partnerships, new product integrations across major media properties, and the pending Dianomi acquisition suggest an evolving Business model. The Q4 guidance points to an expected pickup in activity, and the full-year outlook implies that management anticipates maintaining momentum in its core profitability metrics through the remainder of 2026.