Content discovery platform Taboola (NASDAQ: TBLA) fell short of the market’s revenue expectations in Q4 CY2025, but sales rose 6.4% year on year to $522.3 million. Next quarter’s revenue guidance of $453 million underwhelmed, coming in 0.9% below analysts’ estimates. Its GAAP profit of $0.17 per share was 56.6% above analysts’ consensus estimates.
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Taboola (TBLA) Q4 CY2025 Highlights:
- Revenue: $522.3 million vs analyst estimates of $537.8 million (6.4% year-on-year growth, 2.9% miss)
- EPS (GAAP): $0.17 vs analyst estimates of $0.11 (56.6% beat)
- Adjusted EBITDA: $86.15 million vs analyst estimates of $84.15 million (16.5% margin, 2.4% beat)
- Revenue Guidance for Q1 CY2026 is $453 million at the midpoint, below analyst estimates of $457.1 million
- EBITDA guidance for the upcoming financial year 2026 is $229 million at the midpoint, above analyst estimates of $224.7 million
- Operating Margin: 8.4%, down from 9.6% in the same quarter last year
- Free Cash Flow Margin: 9%, down from 10.6% in the same quarter last year
- Market Capitalization: $905 million
Company Overview
Often appearing as those "You May Also Like" or "Recommended For You" boxes at the bottom of news articles, Taboola (NASDAQ: TBLA) operates a digital platform that recommends personalized content to users across publisher websites, helping both publishers monetize their sites and advertisers reach target audiences.
Revenue Growth
A company’s long-term sales performance is one signal of its overall quality. Even a bad business can shine for one or two quarters, but a top-tier one grows for years.
With $1.91 billion in revenue over the past 12 months, Taboola is a mid-sized business services company, which sometimes brings disadvantages compared to larger competitors benefiting from better economies of scale. On the bright side, it can still flex high growth rates because it’s working from a smaller revenue base.
As you can see below, Taboola’s 10% annualized revenue growth over the last five years was impressive. This shows it had high demand, a useful starting point for our analysis.
Long-term growth is the most important, but within business services, a half-decade historical view may miss new innovations or demand cycles. Taboola’s annualized revenue growth of 15.2% over the last two years is above its five-year trend, suggesting its demand was strong and recently accelerated. 
This quarter, Taboola’s revenue grew by 6.4% year on year to $522.3 million, missing Wall Street’s estimates. Company management is currently guiding for a 6% year-on-year increase in sales next quarter.
Looking further ahead, sell-side analysts expect revenue to grow 5.9% over the next 12 months, a deceleration versus the last two years. Still, this projection is above the sector average and indicates the market sees some success for its newer products and services.
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Operating Margin
Taboola was roughly breakeven when averaging the last five years of quarterly operating profits, one of the worst outcomes in the business services sector.
On the plus side, Taboola’s operating margin rose by 3.3 percentage points over the last five years, as its sales growth gave it operating leverage.
In Q4, Taboola generated an operating margin profit margin of 8.4%, down 1.2 percentage points year on year. This reduction is quite minuscule and indicates the company’s overall cost structure has been relatively stable.
Earnings Per Share
We track the long-term change in earnings per share (EPS) for the same reason as long-term revenue growth. Compared to revenue, however, EPS highlights whether a company’s growth is profitable.
Taboola’s full-year EPS flipped from negative to positive over the last five years. This is a good sign and shows it’s at an inflection point.
Like with revenue, we analyze EPS over a more recent period because it can provide insight into an emerging theme or development for the business.
For Taboola, its two-year annual EPS growth of 61.4% was higher than its five-year trend. We love it when earnings growth accelerates, especially when it accelerates off an already high base.
In Q4, Taboola reported EPS of $0.17, up from $0.10 in the same quarter last year. This print easily cleared analysts’ estimates, and shareholders should be content with the results. Over the next 12 months, Wall Street expects Taboola’s full-year EPS of $0.14 to shrink by 24.2%.
Key Takeaways from Taboola’s Q4 Results
It was good to see Taboola beat analysts’ EPS expectations this quarter. On the other hand, its revenue missed and its revenue guidance for next quarter fell slightly short of Wall Street’s estimates. Overall, this was a softer quarter. The stock traded down 4% to $3.02 immediately following the results.
Taboola may have had a tough quarter, but does that actually create an opportunity to invest right now? We think that the latest quarter is only one piece of the longer-term business quality puzzle. Quality, when combined with valuation, can help determine if the stock is a buy. We cover that in our actionable full research report which you can read here (it’s free).
