Criteo Contribution Ex-TAC Decline Widens in Third Quarter

The Tip Desk · November 11, 2026 · 3 min read

Contribution ex-TAC fell 17% to $240 million as Retail Media and Performance Media both contracted.

Criteo S.A. (CRTO), the global commerce intelligence platform, reported third-quarter revenue of $416 million, down 11% from a year earlier, as Contribution ex-TAC declined 17% to $240 million, a steeper drop than the 13% year-over-year decline in the second quarter.

The sequential acceleration in the Contribution ex-TAC decline was the quarter’s defining turn. In the three months ended September 30, 2026, Contribution ex-TAC fell 15% at constant currency. Gross profit declined 19% to $208 million, and gross margin compressed to 50% from 55% a year earlier.

Retail Media revenue decreased 23%, or 22% at constant currency, and Retail Media Contribution ex-TAC decreased 23%, reflecting a $20 million headwind from previously communicated scope changes with two specific Retail Media clients. Excluding that impact, Contribution ex-TAC grew 10% in the third quarter across the underlying client base, versus 24% growth excluding the same impact in the first quarter. The company said the remaining retail partner base posted solid growth.

Performance Media revenue decreased 9%, or 8% at constant currency, and Performance Media Contribution ex-TAC decreased 15%, or 13% at constant currency, primarily reflecting soft performance in Commerce Growth. In the first quarter, Performance Media Contribution ex-TAC had been down 2% year-over-year at constant currency.

Adjusted EBITDA fell 39% year-over-year to $65 million, after an 18% year-over-year decline to $73 million in the second quarter. Adjusted EBITDA margin compressed to 27% of Contribution ex-TAC from 36% a year earlier. The company said the decline reflected lower Contribution ex-TAC from Performance Media softness and the two Retail Media scope changes, partially offset by lower employee costs and lower share-based compensation.

Net income was $6 million, or $0.11 a share, down 85% year-over-year. Adjusted diluted EPS was $0.43. Operating expenses decreased 9% year-over-year to $187 million, primarily reflecting disciplined resource allocation, productivity gains, lower share-based compensation, and a lower bonus accrual, partially offset by planned growth investments. Non-GAAP operating expenses decreased 3% to $153 million.

Cash flow from operating activities was $57 million. Free Cash Flow was $21 million, down 69% year-over-year, after a $38 million outflow in the second quarter. FCF as a percentage of Adjusted EBITDA was 33%. Cash and cash equivalents, and marketable securities, were $326 million. Total financial liquidity was approximately $788 million, including $462 million available through a revolving credit facility.

Media spend was $1.2 billion in the third quarter, up 9% year-over-year at constant currency, matching the second-quarter constant-currency increase. Criteo expanded Performance Connected TV capabilities beyond the United States, starting with Brazil and Mexico by year-end 2026, followed by additional markets in 2027. The OpenAI advertising partnership, first announced in March 2026, is now available in 89 countries. Retail Media adoption spanned approximately 4,700 brands.

Chief Executive Officer Michael Komasinski said the company is making tangible progress across the business, with momentum in newer channels and a growing pipeline of opportunities. Chief Financial Officer Connor McGogney said the company maintained cost discipline while investing in growth priorities.

Criteo continues to expect full-year 2026 Contribution ex-TAC to decrease 12% to 10% year-over-year at constant currency and an Adjusted EBITDA margin of approximately 30% of Contribution ex-TAC. For the fourth quarter, it expects Contribution ex-TAC of $292 million to $298 million, or down 11% to 9% at constant currency, and Adjusted EBITDA of $105 million to $111 million. The company said foreign exchange is expected to be a greater headwind in the fourth quarter than reflected in prior guidance.