What happened?
Shares of content discovery platform Taboola (NASDAQ: TBLA) fell 16.5% in the morning session after the company reported a 6.9% decrease in third-quarter revenue to $462.3 million that missed Wall Street expectations and issued disappointing fourth-quarter guidance.
According to a company press release, Taboola reported third-quarter revenue of $462.3 million, down 6.9% year over year, while its free cash flow margin fell to 4.4% from 9.3% in the same quarter last year. The sales figure missed Wall Street expectations of $466.8 million.
At the midpoint of $485 million, the fourth-quarter revenue outlook trailed analysts' consensus estimate of $533.9 million by 9.2%, while full-year EBITDA guidance of $216.5 million at the midpoint also fell short of forecasts. Taboola also noted that headwind pressures tied to the deprecation of Google Explore More contributed to the results.
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What is the market telling us
Taboola’s shares are quite volatile and have had 18 moves greater than 5% over the last year. But moves this big are rare even for Taboola and indicate this news significantly impacted the market’s perception of the business.
The biggest move we wrote about over the last year was 6 months ago when the stock gained 16.3% on the news that the company reported strong first-quarter 2026 results that beat Wall Street expectations and raised its full-year financial outlook.
The content discovery platform announced revenues of $466.4 million, a 9.1% increase year-over-year, exceeding analysts' estimates.
More impressively, Taboola posted a GAAP profit of $0.20 per share, a significant improvement from a loss of $0.03 per share in the same quarter of the previous year. This profit figure substantially surpassed Wall Street's forecasts.
Citing the strong start, management lifted its full-year 2026 revenue guidance to $2.03 billion at the midpoint. The optimistic forecast and strong performance across all key metrics signaled accelerating growth for the company.
Taboola is down 36.2% since the beginning of the year, and at $2.83 per share, it is trading 49.4% below its 52-week high of $5.58 from July 2026. Investors who bought $1,000 worth of Taboola’s shares 5 years ago would now be looking at only $291.84.
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