TBLA 10-K & 10-Q changes, risk factors and insider trading

If the launch or implementation of Realize is not successful, if it fails to gain market acceptance, or if it does not deliver the financial accretion we expect, our business, operating results, financial condition and reputation could be adversely affected.

Moreover, technology companies in the Internet browser and operating system spaces, including Google,spaces have announcedimplemented intentionssignificant changes to discontinuerestrict theor useisolate oftracking cookies,mechanisms. andGoogle has transitioned from its original intention to developphase alternativeout methodssuch andcookies mechanismsin forChrome trackingto users.an approach that prioritizes a new user-choice experience. These web browser and operating system developers have significant resources at their disposal and command substantial market share, and any restrictions they impose could foreclose our ability to understand the preferences of a substantial number of consumers. The Safari, Firefox, and Edge browsers currently block cookies by default, and other browsers may do so in the future. On January 4, 2024, Google started restricting third-party cookies by default for 1% of global Google Chrome users. However, in July 2024, Google announced it would not proceed with the full deprecation of third-party cookies and confirmed in April 2025 that it would instead maintain current cookie controls while offering users a way to make persistent privacy choices. Unless suchInternet defaultusers proactively allow tracking or maintain browser settings inthat browserspermit areour adjusted by Internet users,cookies, our ability to set our cookies in browsers will be more limited, which could adversely affect our business. While Google previously announced plans to completely phase out third-party cookies in Google Chrome they have since announced they no longer plan to deprecate third-party cookies in its Chrome browser. Moreover, mobile devices using Android and iOS operating systems limit the ability of cookies to track users while they are using applications other than their web browser on the device. As a consequence, fewer of our cookies or media partners’ cookies may be set in browsers or be accessible in mobile devices, which can adversely affect our ability to target and measure ads effectively.

Potential “Do Not Track” or similar browser-based preference standards or government regulation could negatively impact our business by limiting our access to the user data that informs the advertising campaigns we run, and as a result could degrade our performance for our digital properties and Advertisers.

As the use of cookies has received ongoing media attention in recent years, some government regulators and privacy advocates have suggested creating abrowser- or device-based preference signals, historically referred to as “Do Not Track” standard that would allow Internet users to express a preference, independent of cookie settings in their web browser, not to have their website browsing recorded. All the major Internet browsers have implemented some version of a “Do Not Track” setting. However, there is limited guidance, consensus and industry standards regarding the definition of “tracking,” what message is conveyed by asuch “Do Not Track” settingsignals and how to respond to a “Do Not Track” preference.them. We could face competing policy standards, or standards that put our business model at a competitive disadvantage to other companies that collect data from Internet users, standards that reduce the effectiveness of our solutions, or standards that require us to make costly changes to our solutions. For example, the FTC has stated that it will pursue a legislative solution if the industry cannot agree upon a standard. “Do Not Track” has seen renewed emphasis from proponents of the CCPA, which, in certain circumstances, requires browser-based or similar “do not sell” signals. If a standard is imposed by international federal or state legislation, or agreed upon by standard setting groups, that requires us to recognize a “Do Not Track” signal and prohibits us from using data as we currently do, then that could hinder growth of advertising and content production on the web generally, and limit the quality and amount of data we are able to store and use, which would cause us to change our business practices and adversely affect our business.

On May 16, 2023, the EU Interactive Advertising Bureau (IAB), a digital marketing trade association, released an updated version of the IAB Transparency & Consent Framework, or TCF, to reflect updated regulator guidance and decisions. While Taboola is a registered vendor on the latest version of the TCF, the TCF remainshas under review by European courts afterbeen the IABsubject appealedof regulatory and judicial scrutiny in Europe, including a February 2022 decision by the Belgian data protection authority that the TCF violates the GDPR.GDPR, which decision was appealed by IAB Europe. The TCF is currently a key tool in the EU ad tech ecosystem for passing on consent and “do not sell” signals, and in turn, facilitating compliance with the GDPR. If the TCF is found to be unlawful under the GDPR, the ad tech industry will need to determine new mechanisms for GDPR compliance, which could affect our ability to serve targeted ads and consequently impact our revenue.

Technology companies in the Internet browsers and operating systems spaces have announced intentions to limit or discontinue the use of cookies, and to develop alternative methods and mechanisms for tracking users. The most commonly used Internet browsers allow users to modify their browser settings to block first-party cookies (placed directly by the media partner or website owner that the user intends to interact with) or third-party cookies, and some browsers block third-party cookies by default. For example, Apple previously released an update to its Safari browser that limits the use of third-party cookies, which reduces our ability to provide the most relevant ads to our users and impacts monetization, and also released changes to iOS, requiring users to voluntarily choose (opt-in) to permit app developers to track them across applications and websites, that limit our ability to target and measure ads effectively. In addition ,addition, Google has announced its intention to disable the use of third-party cookies across its Google Chrome web browser. Based on public announcements from Google, the phase out willhas bebeen insubject effectto forregulatory allreview usersand intiming adjustments, and Google has indicated its intention to modify or limit the second halfuse of 2024third-party cookies over time, subject to regulatory compliance. This change may force many businesses to reevaluate their marketing strategies.

As a multinational organization, operatingwe operate across several jurisdictions, with our primary operations centered in multiple jurisdictions, including Brazil, China, European Union, India, Israel, Japan, South Korea, Taiwan, Thailand, Turkey, the United Kingdom and the United States, amongthe others,United weKingdom, The European Union and APAC. We may be subject to taxation in several jurisdictions around the world with increasingly complex tax laws, the application of which may be uncertain. The amount of taxes we pay in these jurisdictions could increase substantially as a result of changes in the applicable tax principles, including increased tax rates, new tax laws or revised interpretations of existing tax laws and precedents, which could have a material adverse effect on our liquidity and results of operations. In addition, as internet commerce and globalization continue to evolve, increasing regulation by government authorities becomes more likely. Our business could be negatively impacted by the application of existing laws and regulations or the enactment of new laws applicable to digital advertising. The cost to comply with such laws or regulations could be significant, and we may be unable to pass along those costs to our clients in the form of increased fees, which may negatively affect our business and results of operation. We are subject to regular review and audit by Israeli, U.S. and other foreign tax authorities. Although we believe our tax estimates are reasonable, the authorities in these jurisdictions could review our tax returns and impose additional taxes, interest and penalties, and the authorities could claim that various withholding requirements apply to us or our subsidiaries or assert that benefits of tax treaties are not available to us or our subsidiaries, any of which could materially affect our income tax provision, net income, or cash flows in the period or periods for which such determination and settlement is made.

There is heightened scrutiny by fiscal authorities in many jurisdictions on the potential taxation of digital services, including but not limited to, online advertising, search engine and e-commerce businesses (referred to as DST or alike). The Organization for Economic Co-operation and Development (OECD) has issued guidelines, referred to as the Base Erosion and Profit Shifting project (BEPS), to its member-nations aimed at encouraging broad-based legislative initiatives intended to prevent perceived base erosion transactions and income shifting in a tax-advantaged manner. Further, for the past several years, the OECD has had a specific focus on the taxation implications of digital services including online advertising, search engine and e-commerce businesses, generally referred by the OECD as the “digital economy.” In the fourth quarter of 2019, the OECD released details on its proposed approach which would, among other changes, create a new right to tax certain “digital economy” income not necessarily based on traditional nexus concepts nor on the “arm’s length principle.” As there has been a lack of consensus among the key members, particularly the United States, several jurisdictions legislated digital tax provisions in an uncoordinated and unilateral manner that could result in greater or even double taxation that companies may not have sufficient means to remedy. For example, a number of jurisdictions, including the U.K., France, Italy, Spain, Austria, Turkey, India and other countries have already adopted or have formally proposed legislation to affect the taxation of digital services based on differing criteria and metrics.

The taxation by multiple jurisdictions (e.g. Spain, France, Italy and others) of digital services including online advertising and e-commerce could increase our tax burdens and compliance obligations as well as our costs of doing business internationally and our worldwide effective tax rate which may lead to adverse impact on our financial position and results of operations.

A number of Taboola directors and executive officers are not residents of the United States, and thea majoritysignificant amount of Taboola’s assets and the assets of these persons are located outside the United States. As a result, it may be difficult or impossible for investors to effect service of process upon Taboola within the United States or other jurisdictions, including judgments predicated upon the civil liability provisions of the federal securities laws of the United States. Additionally, it may be difficult to assert U.S. securities law claims in actions originally instituted outside of the United States. Foreign courts may refuse to hear a U.S. securities law claim because foreign courts may not be the most appropriate forum in which to bring such a claim. Even if a foreign court agrees to hear a claim, it may determine that the law of the jurisdiction in which the foreign court resides, and not U.S. law, is applicable to the claim. Further, if U.S. law is found to be applicable, the content of applicable U.S. law must be proved as a fact, which can be a time-consuming and costly process, and certain matters of procedure would still be governed by the law of the jurisdiction in which the foreign court resides.

Conditions in Israel, including the war in Israel,Israel could have a material adverse effect on our business and operations.

Further, the State of Israel and Israeli companies have been from time to time subjected to economic boycotts. Several countries, principally in the Middle East, still restrict doing business with Israel and Israeli companies, and additional countries may impose restrictions on doing business with Israel and Israeli companies if hostilities in Israel or political instability in the region continues or increases.companies. Any hostilities involving Israel or the interruption or curtailment of trade between Israel and its present trading partners, or significant downturn in the economic or financial condition of Israel, could adversely affect our operations and product development, and could cause our sales to decrease.

Prior to the outbreak of war in October 2023, the Israeli government pursued extensive changes to Israel’s judicial system.system, and it continues to pursue such changes. In response to the foregoing developments,response, many individuals, organizations and institutions, within and outside of Israel, have voicedexpressed concerns overregarding the potential negative impactsimpact of suchthe proposed changes and the related public controversy surrounding them on the business and financial environment in Israel. SuchWhile negativethere impactsare maycurrently include,no significant demonstrations, unlike in the past, renewed public protests or other forms of civil unrest could occur. These developments could contribute to, among others,other things, a downgrade in Israel’s sovereign credit rating, increased interest rates, currency fluctuations, inflation, civil unrestinflation and volatility in securities markets, which could adversely affect the conditions in which we operate in Israel and potentiallycould deter foreign investors and organizations from investing in, or transacting business inwith Israel. If any of the foregoing risks were to materialize, it may have an adverse effect on our business, our results of operations and our ability to raise additional funds.

We currently have sales denominated in currencies other than the US dollar. In addition, we incur a portion of our operating expenses in BrazilianIsraeli Reals,shekels, British pounds, Euro, Israeli shekels, Japanese YenYen, Brazilian Reals and Thai baht, among others. Any fluctuation in the exchange rates of these foreign currencies could negatively impact our business, financial condition and results of operations. We have a foreign currency cash flow hedging program to address possible exposure arising from expected expenses to be paid in NIS. As part of this program we hedge a portion of our anticipated NIS denominated payroll of Israeli employees for a period of one to twelve months with forward contracts and other derivative instruments. We may continue to pursue additional currency hedging or may modify or terminate these arrangements from time to time. We intend to enter into these transactions only to hedge underlying risk reasonably related to our business and not for speculative purposes. There can be no assurance that any such activities will be effective or beneficial to us in whole or in part for several reasons including lack of experience, costs or illiquid markets. In addition, it is difficult to predict the effect hedging activities would have on our results of operations, and hedging activities can themselves result in losses.

Taboola is a technology company that helps businesses grow by placing ads on publisher sites, mobile apps, and devices, which we collectively refer to as digital properties. We operate outside of the major search and social media walled gardens such as Meta, Google, and Amazon. Thousands of Advertisers trust us to drive growth, while approximately 11,00014,000 digital property partners, including NBCNews, Disney, Yahoo, and Apple, rely on us for monetization and audience growth. Our scale is meaningful - we reach approximatelyover 600 million people a day, gaining real-time insight into what people read and buy. This gives us unique “pulse of the internet” data - which alongside our artificial intelligence (AI) - is our competitive advantage and helps our advertiser clients achieve exceptional returns on their advertising spend.

As a result of the launch of our Realize performance platform onin February 26, 2025, we expect a growing portion of our business to be tied to inventory where we bid for ad placements, primarily on sites where we have a first party data advantage.

(1)The yearyears ended December 31, 20242025 and 2024, included $16,372 and $2,832 amortization expense of the non-cash based Commercial agreement asset.asset, respectively. See Note 1b of Notes to the Consolidated Financial Statements.

(12)The yearyears ended December 31, 2025 and December 31, 2024, includes one-timeincluded write-off of internal use software in the amount of $3,038.$2,800 and $3,038, respectively. See Note 97 of Notes to the Consolidated Financial Statements. The yearyears ended December 31, 20242025 and December 31, 2024, included $16,372 and $2,832 amortization expense of the non-cash based Commercial agreement asset.asset, respectively. See Note 1b of Notes to the Consolidated Financial Statements.

(4)The year ended December 31, 2025 and December 31, 2024, includes $1,830 related to excess termination expenses from a headcount reduction due to the launch of Realize, $1,664 in professional and legal expenses related to a litigation matter in which the Company is the plaintiff and is not related to our ongoing business operations in the amount of $6,907 and certain$1,664. See Note 19 of Notes to the Consolidated Financial Statements. The year ended December 31, 2024, also includes $1,830 related to excess termination expenses from a headcount reduction due to the launch of Realize and one-time professional serviceservices costs. The year ended December 31, 2023, includes one-time costs related to the Commercial agreement.

The following table provides a reconciliation of net income (loss) to Non-GAAP Net Income (Loss) for the periods shown*:

(1)The yearyears ended December 31, 2024,2025 includes one-time write-off of internal use software in the amount of $3,038. See Note 9 of Notes to the Consolidated Financial Statements. The year endedand December 31, 20242024, included $16,372 and $2,832 amortization expense of the non-cash based Commercial agreement asset.asset, respectively. See Note 1b of Notes to the Unaudited Consolidated Interim Financial Statements.

(43)The year ended December 31, 2025 and December 31, 2024, includes $1,830 related to excess termination expenses from a headcount reduction due to the launch of Realize, $1,664 in professional and legal expenses related to a litigation matter in which the Company is the plaintiff and is not related to our ongoing business operations in the amount of $6,907 and certain$1,664. See Note 19 of Notes to the Consolidated Financial Statements. The year ended December 31, 2024, also includes $1,830 related to excess termination expenses from a headcount reduction due to the launch of Realize and one-time professional serviceservices costs. The year ended December 31, 2023, includes one-time costs related to the Commercial agreement.

Sales and marketing expenses consist of payroll and other personnel related costs, including salaries, share-based compensation, employee benefits, and travel for our sales and marketing departments, advertising and promotion, rent and depreciation and amortization expenses, particularly related to the acquired intangibles. We expect to increase selling and marketing expensesspend to support the overall growth in our business.

As of December 31, 2024,2025, we have an accumulated tax loss carry-forward of approximately $23.8 million in Israel and $1.4$1.2 million federal tax in the U.S. Those tax losses can be offset indefinitely. Non-Israeli subsidiaries are taxed according to the tax laws in their respective jurisdictions.

The following section discusses our financial condition and results of operations for the year ended December 31, 2025 compared to the year ended December 31, 2024. For a discussion of our financial condition and results of operations for the year ended December 31, 2024 compared to the year ended December 31, 2023. For a discussion of our financial condition and results of operations for the year ended December 31, 2023 compared to the year ended December 31, 2021,2023, refer to Part II, Item 7, “Management’s Discussion and Analysis of Financial Condition and Results of Operations”, in our Annual Report of Form 10-K for the fiscal year ended December 31, 2023,2024, filed with the Securities and Exchange Commission on MarchFebruary 13,26, 2023.2025.

Revenues increased by $326.5$145.8 million, or 22.7%,8.3%, for the year ended December 31, 20242025 compared to the year ended December 31, 2023.2024, Newmainly as the result of an increase in the number of Scaled Advertisers which grew 6.2% and the Average Revenue per Scaled Advertiser by 2.4%. The increase in Average Revenue per Scaled Advertiser was in part driven by the testing of ad formats with Yahoo and the recognition of Revenue as an offset to traffic acquisition cost in the last six months of the year ended December 31, 2024. From a publisher perspective, new digital property partners contributed approximately $291.7$134.9 million of new Revenues on a 12-month run rate basis calculated based on their first full month on the network, a majority of which is related to Yahoo supply.network. Existing digital property partners, including the growth of new digital property partners (beyond the revenue contribution determined based on the run-rate revenue generated by the partners when they are first on-boarded) increased by approximately $34.8$10.9 million. This increase was primarily driven by continued growth on Yahoo supply partially mitigated by lower advertiser rates on existing digital property partners due to spend being served on new Yahoo supply added to the network.

Ex-TAC Gross Profit, a non-GAAP measure, increased by $131.7$46.0 million, or 24.6%,6.9%, for the year ended December 31, 20242025 compared to the year ended December 31, 2023,2024, primarily due to revenuebenefiting from advertisers transferred from Yahoo, as well as growth in spendadvertising fromspend. existingThis Taboolawas advertisers.partially offset by a a margin decrease on certain digital property partners, including the impact of the testing of ad formats with Yahoo in the last six months of the year ended December 31, 2024.

Other cost of revenues increaseddecreased by $20.2$2.8 million, or 18.3%,2.2%, for the year ended December 31, 20242025 compared to the year ended December 31, 2023,2024, mainlyprimarily due toas a $13.9result of a $6.5 million increase in data, content, communication and IT related expenses, $3.1 million increasedecrease in depreciation expenses related to newour productservers innovationdue andto $2.7useful life reassessment, a $5.8 million increasedecrease in digital service tax expenses, and a $1.3 million decrease in consultancy fees, which were partially offset by an increase of $8.9 million in data, hosting and and IT related expenses, and a $1.7 million increase in salaries and related expenses.

SalesResearch and marketingdevelopment expenses increased by $22.2$5.6 million, or 9.0%,3.9%, for the year ended December 31, 20242025 compared to the year ended December 31, 2023,2024, primarilymainly attributedas toa $24.3result of a $4.4 million increase in employee and subcontractor headcountsalaries and related costs,expenses, includinga share-based$1.5 compensationmillion increase in IT services, and a $1.2 million increase in rent expenses, supportingwhich our growthwere partially offset by a decrease inof amortization$1.7 million depreciation expenses ofrelated $3.2to millionour .servers due to useful life reassessment.

GeneralSales and administrativemarketing expenses decreasedincreased by $9.4$6.7 million, or 8.8%,2.5%, for the year ended December 31, 20242025 compared to the year ended December 31, 2023,2024, primarilymainly attributedas a result of a $7.8 million increase in salaries and related expenses, a $7.6 million increase in advertising and promotion expenses mainly related to the launch of Realize, which were partially offset by a decrease of $2.3$9.4 million in insuranceamortization expenses in connection with the Yahoo partnership, a decrease of $2.4 million in credit losses expenses and a decrease of $6.1 million in employee and subcontractors related costs,to includingacquired share-basedintangible compensation expenses, and, partially offset by an increase of $1.0 million in depreciation expenses.assets.

FinanceGeneral expenses,and netadministrative decreasedexpenses increased by $0.8$4.9 millionmillion, or 5.0%, for the year ended December 31, 20242025 compared to the year ended December 31, 2023,2024, mainly attributableas a result of a $6.9 million increase in professional and legal expenses primarily related to $2.1a litigation matter in which the Company is the plaintiff and is not related to our ongoing business operations, which were partially offset by a decrease of $2.3 million Warrants liability revaluation and $5.3 million decrease in interestshare-based expensecompensation expenses mainly due to the voluntary repaymentscompletion of aConnexity portionholdback ofcompensation the long-term loan in 2024 and lower average interest rates, partially offset by an increase of $6.6 million in Foreign currency exchange rate gains, net.obligations.

IncomeFinance (loss)expenses, beforenet income taxes increaseddecreased by $90.5$7.3 million,million for the year ended December 31, 20242025 compared to the year ended December 31, 2023,2024, asattributable to $4.2 million decrease in Foreign currency exchange rate loss, net, and a result$3.6 million decrease in interest expenses due to the refinancing of theour factorslong-term described above.debt.

TaxIncome expensebefore income taxes increased by $12.2$18.8 million, or 221.8%, for the year ended December 31, 20242025 compared to the year ended December 31, 2023. This increase was primarily driven by higher taxable income overall2024, as wella asresult adjustments in deferred tax expenses related toof the U.S.factors entity.described above.

As part of our growth strategy, we have made and expect to continue to make significant investments in research and development and in our technology platform. We also plan tomay selectively consider possible future acquisitions that are attractive opportunities we deem strategic and value-enhancing. To fund our growth, depending on the magnitude and timing of our growth investments and the size and structure of any possible future acquisition, we may supplement our available cash from operations with issuances of equity or debt securities and/or make other borrowings, which could be material.

On AugustMarch 9,18, 20222025, we entered into an incrementala revolving credit facility amendment to our existing senior secured credit agreement (the “Amended2025 Revolving Credit Agreement”)., The Amended Credit Agreementwhich provides for borrowings in an aggregate principal amount of up to $90$270.0 million (the “Revolving Facility”). The proceeds of the Revolving Facility can be used to finance working capital needs and general corporate purposes. Borrowings under the Revolving Facility are subject to customary borrowing conditions and will bear interest at a variable annual rate based on Term SOFR or Base Rate plus a fixed margin. The Amended2025 Revolving Credit Agreement also contains customary representations, covenants and events of default as well as a financial covenant, which places a limit on our allowable net leverage ratio. As of December 31, 2024,2025, wethe hadCompany nowas outstandingin borrowingscompliance underwith the Revolving Facility.Facility covenants.

InOur Mayboard 2023,of our Boarddirectors authorized a share buyback program for the repurchase of up to $40.0 million of the Company’sour outstanding Shares,Ordinary withshares noand Non-voting Ordinary shares, which commenced in June 2023 and does not have an expiration date (the “Buyback Program”). In November 2023, our Boardboard of directors authorized up to an additional $40.0$80.0 million of buybacks under the Buyback ProgramProgram. and inIn February 2024, theour Boardboard of directors authorized up to $100.0 million for use under the Buyback Program, including any remaining authority from the November 2023 Boardboard authorization.of directors authorization and in February 2025, our board of directors authorized up to an additional $200.0 million for use under the Buyback Program. In July 2025, our board of directors authorized up to an additional $200.0 million for use under the Buyback Program. As permitted by the Buyback Program, share repurchases may be made from time to time, in privately negotiated transactions or in the open market, including through trading plans intended to comply with Rule 10b5-1, at the discretion of our management and as permitted by securities laws and other legal requirements, including Rule 10b-18 of the Exchange Act. The Buyback Program does not obligate the Company to repurchase any specific number of shares and the number of shares repurchased may depend upon market and economic conditions and other factors. The Buyback Program may be discontinued, modified or suspended at any time.

During the year ended December 31, 2024,2025, Net cash provided by operating activities of $184.3$208.4 million was related to our net lossincome of $(3.8)$42.3 million adjusted by positive adjustments of non-cash charges of $173.6$164.8 million and net cash inflows of $14.5$1.3 million provided by changes in working capital.

During the year ended December 31, 2023,2024, Net cash providedused by investing activities was $59.6$30.1 million, primarily consisting of $114.5 million proceeds from maturities of short-term investments, partially offset by $32.1$35.2 million purchase of property and equipment, including capitalized internal-use softwaresoftware, andpartially $22.0offset by $5.8 million purchaseproceeds from maturities of short-term investments..investments.

The commitment amounts in the table above are associated with contracts that are enforceable and legally binding and that specify all significant terms, including fixed or minimum services to be used, fixed, minimum or variable price provisions, and the approximate timing of the actions under the contracts. The table does not include obligations under agreements that we can cancel without a significant penalty. The table above does not reflect any reduction for prepaid obligations as of December 31, 2024.2025. As of December 31, 2024,2025, we have a provision related to unrecognized tax benefit liabilities totaling $10.2 million and other provisions related to severance pay and contribution plans, which have been excluded from the table above as we do not believe it is practicable to make reliable estimates of the periods in which payments for these obligations will be made.

You should read the following discussion and analysis of our financial condition and results of operations together with Taboola’s accompanying unaudited consolidated interim financial statements and the related notes included elsewhere in this Quarterly Report on Form 10-Q for the three months ended MarchJune 31,30, 2026 (the “Quarterly Report”) and audited consolidated financial statements and the related notes appearing in our Annual Report on Form 10-K for the year ended December 31, 2025 (the “2025 Form 10-K”) filed with the U.S. Securities and Exchange Commission (the “SEC”) on February 25, 2026. Some of the information contained in this discussion and analysis is set forth in our 2025 Form 10-K, including information with respect to Taboola’s plans and strategy for Taboola’s business, and includes forward-looking statements that involve risks and uncertainties. As a result of many factors, including those factors set forth in Part I, Item 1A “Risk Factors” in our 2025 Form 10-K and “Note Regarding Forward-Looking Statements” in our 2025 Form 10-K and elsewhere herein, Taboola’s actual results could differ materially from the results described in or implied by the forward-looking statements contained in the following discussion and analysis. Throughout this section, unless otherwise noted or the context requires otherwise, “we,” “us,” “our” and the “Company” refer to Taboola and its consolidated subsidiaries, and in references to monetary amounts, “dollars” and “$” refer to U.S. Dollars, and “NIS” refers to New Israeli Shekels.Shekels

Taboola is a technology company that helps businesses grow by placing ads on publisher sites, mobile apps, and devices, which we collectively refer to as digital properties. We operate outside of the major search and social media walled gardens such as Meta, Google, and Amazon. Thousands of Advertisers trust us to drive growth, while approximately 12,000 digital property partners, including NBCNews,NBC News, Disney, Yahoo, and Apple, rely on us for monetization and audience growth. Our scale is meaningful - we reach over 600 million people a day, gaining real-time insight into what people read and buy. This gives us unique “pulse of the internet” data - which alongside our artificial intelligence (AI) - is our competitive advantage and helps our advertiser clients achieve exceptional returns on their advertising spend.

Global economic and geopolitical conditions remain volatile, driven by persistent inflation, fluctuating interest rates, and ongoing conflicts in the Middle East and Ukraine. Throughout 2025 and into the firstsecond quarter of 2026, the global trade landscape has shifted significantly due to the implementation of U.S. tariffs and subsequent retaliatory measures from foreign trade partners. These evolving trade policies are difficult to predict, and their ultimate impact will depend on the final scope, timing, and potential exclusions of specific duties. While we are closely monitoring these macroeconomic headwinds, we cannot yet determine if these factors will have a material impact on our business operations or financial results during the remainder of 2026.

We engage with a diverse network of digital property partners, substantially all of which have contracts with us containing either an evergreen term or an exclusive partnership with us for multi-year terms at inception for their native advertising supply. These agreements typically require that our code be integrated on the digital property web page because of the nature of providing both editorial and paid recommendations. In the portion of our business that is tied to these native advertising supply partnerships. which currently accounts for the vast majority of our business, we do not bid for ad placements, as traditionally happens in the advertising technology space, but rather see all users that visit the pages on which we appear. Due to our multi-year exclusive contracts and high retention rates, our supply is relatively consistent and predictable. We had approximately 12,000, 11,00012,000 and 12,00011,000 digital property partners in the firstsecond quarterquarters of 2026, 2025 and 2024, respectively.

We have a large network of Advertisers that wish to achieve specific performance goals, such as obtaining subscribers for email newsletters or acquiring leads for product offerings, across multiple verticals. As we look at growing our advertiser client base, we want to grow the number of advertisers that spend with us at scale. We define a Scaled Advertiser as an Advertiser that has more than $100,000 of cumulative gross spend on the network on a trailing four quarter basis. We had approximately 2,100, 2,000 and 1,8001,900 of Scaled Advertiser clients working with us directly, or through advertising agencies, worldwide during the firstsecond quarters of 2026, 2025 and 2024, respectively. In an effort to also measure how we are growing our advertising spend with each Scaled Advertiser, we have introduced an Average Revenue per Scaled Advertiser performance measure. Average Revenue per Scaled Advertiser is calculated as the aggregate cumulative gross spend of all Scaled Advertisers for a given period divided by the number of Scaled Advertisers for that period. The Average Revenue per Scaled Advertiser was approximately $193,000,$197,000, $184,000$196,000 and $191,000$194,000 during the firstsecond quarters of 2026, 2025 and 2024, respectively. A large portion of our revenue comes from Scaled Advertisers. The Revenue contribution from Scaled Advertisers represented 85%,86%, 86% and 84%85% of our Revenues for the firstsecond quarters of 2026, 2025 and 2024, respectively. These performance Advertisers use our service when they obtain a sufficient return on ad spend to justify their ad spend. We grow the revenue from performance Advertisers in three ways. First, we improve the performance of our network by developing new product features, improving our algorithms and optimizing our supply. Second, we secure increased budgets from existing Advertisers by offering new ad formats and helping them achieve additional goals. Third, we grow our overall Advertiser base by bringing on new Advertisers that we have not worked with previously.

(1)The weighted-average shares used in the computation of the diluted EPS for the three months ended MarchJune 31,30, 2026 and 20252025, are 288,764,244291,392,907 and 341,960,999,313,572,282, respectively, and for the six months ended June 30, 2026 and 2025, are 290,505,359 and 327,578,134, respectively. The weighted-average shares for the three months ended MarchJune 31,30, 2026 and 2025, included 258,724,600273,353,263 and 298,323,708277,929,745 Ordinary shares, and 30,039,64418,039,644 and 43,637,29135,642,537 Non-voting Ordinary shares, respectively, and for the six months ended June 30, 2026 and 2025, included 272,465,715 and 287,985,819 ,Ordinary shares, and 18,039,644 and 39,592,315, Non-voting Ordinary shares, respectively.

We calculate ex-TAC Gross Profit as gross profit adjusted to add back other cost of revenues and non-cash amortization of the Commercial agreement asset. We add back (i) the non-cash amortization of the Commercial agreement asset because it is unique primarily due to the issuance of equity rather than cash and (ii) Publisher’s prepayments write-off that are one time non cash, such that ex-TAC Gross Profit includes solely direct cash contribution components.

(1)The three and six months ended MarchJune 31,30, 20262026, included $4,082 and 2025 included $4,037$8,119 amortization expense of the non-cash based Commercial agreement asset.asset respectively, and $12,169 write-off of Publisher’s prepayments. See Note 1b1(b) and Note2 2respectively of Notes to the Unaudited Interim Consolidated Interim Financial Statements.

(1)The three and six months ended MarchJune 31,30, 20262026, included $4,082 and 2025 included $4,037$8,119 amortization expense of the non-cash based Commercial agreement asset.asset respectively, and $12,169 write-off of Publisher’s prepayments. See Note 1b1(b) and Note2 2respectively of Notes to the Unaudited Interim Consolidated Interim Financial Statements.

(23)The three and six months ended MarchJune 31,30, 2026, includes expenses related to a litigation matter in which the Company is the plaintiff and is not related to our ongoing business operations in the amount of $1,116 and the six months ended June 30, 2026 included a pre-tax income of approximately $77,000, net of legal fees and other related expenses related to a binding settlement agreement regarding a legal matter in which the Company acted as the plaintiff. The three and six months ended June 30, 2025, includes professional and legal expenses related to a litigation matter in which the Company is the plaintiff and is not related to our ongoing business operations in the amount of $904 and $2,876, respectively.

(1) The three and six months ended MarchJune 31,30, 20262026, included $4,082 and 2025 included $4,037$8,119 amortization expense of the non-cash based Commercial agreement asset.asset respectively, and $12,169 write-off of Publisher’s prepayments. See Note 1b1(b) and Note2 2respectively of Notes to the Unaudited Interim Consolidated Interim Financial Statements.

(2) The three and six months ended MarchJune 31,30, 2026, include expenses related to a litigation matter in which the Company is the plaintiff and is not related to our ongoing business operations in the amount of $1,116 and the six months ended June 30, 2026 included a pre-tax income of approximately $77,000, net of legal fees and other related expenses related to a binding settlement agreement regarding a legal matter in which the Company acted as the plaintiff. The three and six months ended June 30, 2025, include professional and legal expenses related to a litigation matter in which the Company is the plaintiff and is not related to our ongoing business operations it the amount of $904 and $2,876, respectively.

(4) Represents foreign currency exchange rate gains or losses related to the remeasurement of monetary assets and liabilities to the Company’s functional currency using exchange rates in effect at the end of the reporting period.

Traffic acquisition cost, or TAC, consists primarily of cost related to digital property compensation for placing our platform on their digital property and cost for advertising impressions purchased from real-time advertising exchanges and other third parties. Traffic acquisition cost also includes up-front payments, incentive payments, or bonuses paid to the digital property partners and the amortization of the non-cash based Commercial agreement asset (see Note 1b1(b) of Notes to the Unaudited Interim Consolidated Interim Financial Statements) which are amortized over the shorter of respective contractual terms and the economic benefit period of the digital property arrangement. For the majority of our digital properties partners, we have two primary compensation models for digital properties. The most common model is a revenue share model. In this model, we agree to pay a percentage of our revenue generated from advertisements placed on the digital properties. The second model includes guarantees. Under this model, we pay the greater of a percentage of the revenue generated or a committed guaranteed amount per thousand page views (“Minimum guarantee model”). Actual compensation is settled on a monthly basis. Expenses under both the revenue share model as well as the Minimum guarantee model are recorded as incurred, based on actual revenues generated by us at the respective month.

Sales and marketing expenses consist of payroll and other personnel related costs, including salaries, share-based compensation, employee benefits, and travel for our sales and marketing departments, advertising and promotion, rent and depreciation and amortization expenses, particularly related to the acquired intangibles. We expect to continueincrease to invest in salesselling and marketing expenses to support the overall growth in our business.

The statutory corporate tax rate in Israel was 23% for the threesix months ended MarchJune 31,30, 2026 and 2025, although we are entitled to certain tax benefits under Israeli law.

As of MarchJune 31,30, 2026, we have an accumulated tax loss carry-forward of approximately $1.2 million federal tax in the U.S.US. Those tax lossesloss can be offset indefinitely. Non-Israeli subsidiaries are taxed according to the tax laws in their respective jurisdictions.

The following table provides consolidated statements of income (loss) data for the periods indicated:

Comparison of the Three Monthsmonths Endedended MarchJune 31,30, 2026 and 2025

Revenues increased by $38.9$11.4 million, or 9.1%,2.4%, for the three months ended MarchJune 31,30, 2026, compared to the three months ended MarchJune 31,30, 2025, mainly as the result of an increase in the number of Scaled Advertisers. Revenue per Scaled Advertisers alsowhich increasedgrew year-over-year1.9% reflecting both growth in scale and quality ofversus the advertiserprior base.year. From a publisher perspective, new digital property partners contributed approximately $47.5$43.7 million of new Revenues on a 12-month run rate basis calculated based on their first full month on the network. Existing digital property partners, including the growth of new digital property partners (beyond the revenue contribution determined based on the run-rate revenue generated by the partners when they are first on-boarded) decreased by approximately $8.6$32.4 million.

Gross profit increased by $10.3$3.9 million, or 8.6%,2.9%, for the three months ended MarchJune 31,30, 2026, compared to the three months ended MarchJune 31,30, 2025.

Ex-TAC Gross Profit, a non-GAAP measure, increased by $16.3$20.2 million, or 10.8%,11.8%, for the three months ended MarchJune 31,30, 2026, compared to the three months ended MarchJune 31,30, 2025, primarily benefiting from growth in advertising spend as well as a margin increase on certain digital property partners.partners as well as growth in advertising spend.

Total cost of revenues increased by $28.6$7.5 million, or 9.3%,2.3%, for the three months ended MarchJune 31,30, 2026, compared to the three months ended MarchJune 31,30, 2025.

Traffic acquisition cost increased by $22.6$3.3 million, or 8.1%,1.1%, for the three months ended MarchJune 31,30, 2026, compared to the three months ended MarchJune 31,30, 2025.

The cost of guarantees (total payments due under guarantee arrangements in excess of amounts the Company would otherwise be required to pay under revenue sharing arrangements) as a percentage of traffic acquisition costs waswere approximately 17%13% and 18%16% for the three months ended MarchJune 31,30, 2026 and MarchJune 31,30, 2025.2025, respectively.

Other cost of revenues increased by $6.1$4.2 million, or 21.3%,13.0%, for the three months ended MarchJune 31,30, 2026, compared to the three months ended MarchJune 31,30, 2025, mainly as a result of $2.3 million increase in digital service tax expenses, a $2.0$1.3 million increase in content cost expenses, a $1.3$1.9 million increase in hosting and depreciation expenses and hosting.a $0.9 million increase in salaries and related expenses.

Research and development expenses increased by $3.6$1.0 million, or 10.1%,2.5%, for the three months ended MarchJune 31,30, 2026, compared to the three months ended MarchJune 31,30, 2025, mainly as a result of $3.5$1.0 million increase in salaries and related expenses.expenses, mainly due to the reduction in workforce.

GeneralSales and administrativemarketing expenses increaseddecreased by $1.3$4.1 million, or 5.6%,5.7%, for the three months ended MarchJune 31,30, 2026, compared to the three months ended MarchJune 31,30, 2025, primarilymainly attributableas a result of a $10.8 million decrease in amortization expenses related to $1.3acquired intangible assets which were offset by a $5.6 million increase in salaries and related expenses mainly due to the reduction in workforce and a $0.7 million increase in advertising and promotion expenses.

TaxGeneral and administrative expenses increaseddecreased by $12.1$0.2 millionmillion, (whichor led to $10 million tax expense)0.8%, for the three months ended MarchJune 31,30, 2026, compared to the three months ended MarchJune 31,30, 2025.2025, Thismainly increase is attributable to income fromas a oneresult timeof legala settlementdecrease income.in litigation matter expenses in which the Company acted as the plaintiff.

Our primary cash needs are for working capital, personnel costs, contractual obligations, including payments to digital property partners, office leases and software and information technology costs, capital expenditures for servers and capitalized software development, funding our share buyback program, payment of interest on our revolving loan and other commitments. We fund these cash needs primarily from cash generated from operations, as well as from cash and cash equivalents on our balance sheet when required. For the threesix months ended MarchJune 31,30, 2026 and 2025, we generated cash from operations of $108.7$139.9 million and $48.1$95.5 million, respectively.

As of MarchJune 31,30, 2026 and December 31, 2025, we had $150.3$133.1 million and $120.9 million of cash and cash equivalents, respectively, and $1.5 million and $1.5 million in long-term restricted deposits, respectively, used, mainly, as security for our lease commitments. As of June 30, 2026 we did not hold short-term investments. Cash and cash equivalents consist of cash in banks and highlytime liquid marketable securities investments and money market account and funds, with an original maturity of three months or less at the date of purchase and are readily convertible to known amounts of cash.deposits.

We believe that this, together with net proceeds from our engagements with Advertisers and digital property partners, will provide us with sufficient liquidity to meet our working capital and capital expenditure needs for at least the next 12 months. In the future, we may be required to obtain additional equity or debt financing in order to support our continued capital expenditures and operations. In the event that additional financing is required from outside sources, we may not be able to raise it on terms acceptable to us or at all. If we are unable to raise additional capital or generate cash flows necessary to expand our operations and invest in new technologies, this could reduce our ability to compete successfully and harm our business, growth, and results of operation On March 18, 2025 we entered into a revolving credit facility (the “2025 Revolving Credit Agreement”), which provides for borrowings in an aggregate principal amount of up to $270.0 million (the “Revolving Facility”). The proceeds of the Revolving Facility can be used to finance working capital needs and general corporate purposes. Borrowings under the Revolving Facility are subject to customary borrowing conditions and will bear interest at a variable annual rate based on Term SOFR or Base Rate plus a fixed margin. The 2025 Revolving Credit Agreement also contains customary representations, covenants and events of default as well as a financial covenant, which places a limit on our allowable net leverage ratio. As of March 31, 2026, the Company was in compliance with the Revolving Facility covenants.operation.

As of MarchJune 31,30, 2026, we had $66.4$72.0 million of outstanding principal amount under the Revolving Facility. Borrowings under the 2025 Revolving Credit Facility are voluntarily prepayable from time to time without premium or penalty except in certain cases. Borrowings prepaid may be re-borrowed prior to maturity of the 2025 Revolving Credit Agreement pursuant to customary conditions and restrictions. All borrowings under the 2025 Revolving Credit Agreement are due at maturity on March 18, 2030.

During the threesix months ended MarchJune 31,30, 2026, we repurchased 6.916.2 million of our Ordinary shares at an average price of $3.41$3.99 per share (excluding broker and transaction fees of $0.2$0.4 million). As of MarchJune 31,30, 20262026, the Company had remaining authorization from our board of directors to repurchase Ordinary shares up to an aggregate amount of $168.0$126.6 million.million, not including net issuances costs of $15.3 million as of June 30, 2026. See Part II, Item 2. Unregistered Sales of Equity Securities and Use of ProceedsProceeds, Note 8 and Note 811 of Notes to the Unaudited Interim Consolidated Interim Financial Statements.

During the threesix months ended MarchJune 31,30, 20262026, net cash provided by operating activities was $108.7$139.9 million, an increase of $60.6$44.4 million, compared to $48.1$95.5 million for the same period in 2025. The $108.7$139.9 million was related to our net incomegain of $59.1$63.4 million adjusted by non-cash charges of $34.3$62.9 million and positive changes in working capital of $15.3$13.7 million.

The $34.3$62.9 million of non-cash charges primarily consisted of depreciation and amortization of $16.1 million, share-based compensation expense related to vestedvesting of equity awards of $14.2$28.3 million, depreciation and amortization of $26.8 million and non-cash based Commercial agreement asset amortization expenses of $4.0$8.1 million.

The $15.3$13.6 million increase in cash resulting from changes in working capital primarily consisted of a $50.3$43.4 million decrease in trade receivables, net and a $16.3$16.0 million decrease in prepaid expenses,expenses partially offset by $42.2a $46.5 million decrease in trade payables, net, a $7.5 million decrease in accrued expenses and other current liabilities and a $1.5 million increase in deferred taxes, net.