Criteo S.A. Q2 FY26 earnings call CRTO

Criteo announced a significant leadership change with Sarah Glickman stepping down as CFO on August 10 after six years, transitioning to an advisory role through September. Connor McGogney, currently Chief Strategy Officer, has been appointed as the new CFO, effective August 10. McGogney brings extensive finance, strategy, and capital markets experience, along with deep company knowledge, positioning him to lead the finance organization and execute against Criteo's strategy.

The second quarter was challenging, with results falling short of expectations primarily due to client-specific performance media dynamics, which became more pronounced. Several large enterprise clients reduced spending due to factors like geopolitical conflicts, tariff changes, or shifts in investment tactics. This led to a more conservative outlook for the remainder of 2026, assuming no improvement in spending from these clients, aiming for a prudent and achievable baseline.

Criteo's long-term strategy, centered on commerce intelligence and AI decisioning, remains unchanged. The partnership with OpenAI continues to exceed expectations, attracting over 2,000 brands and becoming the fastest-growing channel. Traffic from ChatGPT converts at 1.5 to 2x the rate of traditional referral traffic, with 80% being new to the brand, demonstrating AI's role in creating new discovery channels. Criteo is also expanding OpenAI integration internationally and into its self-service platform, Criteo GO.

Beyond OpenAI, Criteo is embedding agentic capabilities across its platform, including AI-powered conversational ad formats and sponsored recommendations. Albertsons was the first retailer to launch AI assistance with Criteo, with more expected to follow. Page Intelligence, an AI-driven orchestration layer, also secured its first retailer launch with a major partner, optimizing merchandising, monetization, and shopper experience. These innovations aim to reshape commerce and unlock new monetization opportunities for retailers.

To restore growth in Performance Media, Criteo is focused on expanding self-service through Criteo GO, increasing cross-channel activation, and extending performance up the funnel. Criteo GO adoption among existing small clients is progressing faster than anticipated, driving productivity gains and lowering cost to serve. New client acquisition is showing encouraging signs, with account creation up 3x in June. The platform's cross-channel capabilities are also gaining traction, with nearly 80% of U.S. revenue from GO being cross-channel.

Retail Media execution remains strong, with underlying business growth of 20% (excluding client scope reductions) outpacing the market. Momentum is driven by expanding relationships with brands and agencies, with media spend growing 31% YoY. Criteo added new retailer partners globally, including Loblaw Advance, Monoprix, Druni, Olive Young, and Golf Digest Online. Auction-based display is now live with over 85 retailers, up from 60 last quarter, improving monetization and attracting advertiser demand.

Disciplined capital allocation remains a core priority. Criteo completed its redomiciliation to Luxembourg and direct listing of ordinary shares. The company intends to pursue a subsequent redomiciliation to the United States as early as January next year, subject to approvals, to complete corporate structure simplification, enable U.S. index inclusion, and broaden investor access. Criteo continues to generate strong cash flow and maintain a robust balance sheet, deploying $30 million to repurchase 1.7 million shares this quarter.