Welcome to Nexxen's Second Quarter Earnings Call. At this time, all participants are in a listen-only mode with a question-and-answer session to follow at the end of the presentation. This call is being recorded and a replay of today's call will be made available on the Nexxen's Investor Relations website. I will now hand the call over to Billy Eckert, Vice President of Investor Relations, for introductions and the reading of the safe harbor statement. Billy, please go ahead.

Thank you, operator. Good morning, everyone, and welcome to Nexxen's second quarter earnings call. During today's call, we will discuss our financial and operating results for the three months and six months ended June 30th, 2024, as well as our forward-looking guidance. With us on today's call are Ofer Druker, Nexxen's Chief Executive Officer; and Sagi Niri, the company's Chief Financial Officer. This morning we issued a press release, which you can access on our IR website at investors.nexxen.com. During today's conference call, we will make forward-looking statements. All statements other than statements of historical fact could be deemed as forward-looking. We advise caution and reliance on forward-looking statements. These statements include, without limitation, statements and projections regarding our anticipated future financial and operating performance, market opportunity, growth prospects, strategy, financial outlook, partnerships, and anticipated benefits related to those partnerships and forward-looking views on macroeconomic and industry conditions, as well as any other statements concerning the expected development, performance, and market share, or competitive performance relating to our products or services. All forward-looking statements are based on information available to us as of the date of this call. These statements involve known and unknown risks, uncertainties, and other factors that may cause our actual results to differ materially from those implied by these forward-looking statements, including unexpected changes in our business or unexpected changes in macroeconomic or industry conditions. More detailed information about these risk factors and additional risk factors are set forth in our filings with the U.S. Securities and Exchange Commission, including, but not limited to those risks and uncertainties listed in the section entitled Risk Factors in our most recent Annual Report on Form 20-F. Nexxen does not intend to update or alter its forward-looking statements, whether as a result of new information, future events, or otherwise, except as required by law. Additionally, the company's press release and management statements during this conference call will include discussions of certain measures and financial information in IFRS and non-IFRS terms. We refer you to the company's press release for additional details, including definitions of non-IFRS items and reconciliations of IFRS to non-IFRS results. At this time, it is my pleasure to introduce Ofer Druker, CEO of Nexxen. Ofer, please go ahead.

Thank you, Billy. In the second quarter, we benefited from significantly improved execution while taking important steps to enhance the strength of our platform and advance our sales and marketing strategy to drive further momentum. Our improved ability to execute enabled us to generate strong performance across the business, resulting in record Q2 Contribution ex-TAC, programmatic revenues, and CTV revenue alongside significantly extended adjusted EBITDA. Our rebrand to Nexxen was clearly a catalyst that contributes to our better performance in Q2 and is continuing to position us for new and expanded partnerships with industry leaders. The rebrand has driven greater recognition in the market, clarified the holistic value proposition of our full-stack offering, and fueled a better understanding of how Nexxen addresses the industry's biggest challenges, including maximizing the value of data to generate better results and returns to customers. Nexxen is placing data firmly at the center of its strategy. Data has historically given Nexxen an advantage over other AdTech competitors as our full-stack platform has been unified by a robust data management platform that integrates directly with our DSP and SSP to improve activation. Through the integration of Amobee, we were able to improve our data capabilities further by integrating some of Amobee's products into our ecosystem. Today, on top of our data-rich activation elements, we offer other unique data solutions that provide comprehensive audience segmentation, insights, and data enrichment capabilities, as well as an ID graph. Since completing the integration, we have also been able to free up resources to invest more into driving innovation. This innovation has enabled the recent release of many of the data capabilities that have helped Nexxen gain greater recognition and win new partnerships with some of the leading forces in the industry. Our data capabilities are serving as a massive differentiator for us and as a base for some of this important new partnerships, and we believe they will continue to benefit Nexxen and its customers over the immediate and long term. Data is present in every component of our offering and drives enhanced outcomes across all steps of our advertiser and publisher customers' workflow. Our data sources and capabilities enable advertisers to better understand audiences and create valuable audience segments, find and target likely to engage or buy customers across platforms and devices, maximize reach, boost return, and measure effectiveness. Our exclusive advanced TV data access and unique capabilities alongside our premium supply roster are also materially enriching our customers' advertising results across CTV and other formats, and driving partners to increasingly choose to work with Nexxen. As I mentioned, our data sources and capabilities have been key along the journey to attracting advertisers and publishers to engage with Nexxen, and the number of partners seeking to work with us is growing, particularly following the launch of our new robust Nexxen Data Platform in Q2. Nexxen Data Platform combines and better unifies all our data assets and applications, resulting in an unrivaled full-stack end-to-end data offering that has strengthened our competitive positioning and amplified the effectiveness of our solutions. Through the Nexxen Data Platform, customers can now directly and securely onboard first-party data. After onboarding, customers can leverage Nexxen Discovery to create audiences, unlock insights, and enrich first-party data. Our customers highly value this tool. It has been adopted by important new partners like LG and Stagwell, who are using it to enhance insights for them and their customers, and is also attracting significant interest from other major players in the industry. Additionally, customers can also take advantage of our robust TV Intelligence solutions, which have the ability to meaningfully enhance their CTV targeting and measurement. Our full suite of data capabilities is unique to Nexxen and provides operational performance and economic benefits for our partners. Within the Nexxen Data Platform, we also launched our unified identity graph in Q2, which combines multiple identifiers into a merged graph, enabling increased scale and better targeting capabilities. While Google has pivoted from full cookie deprecation to an opt-in approach, our graph better positions Nexxen and its customers for changes in identity and privacy regardless. We were well positioned for cookie deprecation, but Google's recent decisions reduce risk and remove an industry overhang. That said, we continue to embrace the industry's need for alternative ID solutions like ours. Our agnostic identity strategy hasn't changed in the wake of Google's decision, nor is our preparedness for their evolving approach. We have also recently furthered our ID graph's capabilities by partnering with Experian to bring in PII data, which helps customers reduce costs and audience loss in the data onboarding process. Advertisers are now seeking to partner with our data platform, including our ID graph, as these solutions enable them to extract greater value from their budgets, reach a wider audience, optimize returns, and remain prepared for identity changes. Our data platform has already attracted key new partners to Nexxen while unlocking new data licensing and commerce media opportunities, and we expect it will serve as a long-term growth driver and differentiator. As a direct byproduct of our data platform and identity graph launch in Q2, Stagwell selected Nexxen as its AdTech and data partner and their relationship is off to a great start. The partnership enables Stagwell marketing cloud clients to utilize the Nexxen Data Platform to onboard and enhance their customer data, improve targeting and planning efforts, and extend audience reach across formats and devices. Stagwell's clients can then seamlessly activate this enriched data in campaigns across the Nexxen platform to improve return on ad spending. Since beginning the relationship, we have led training and education sessions with Stagwell employees and customers to accelerate the partnership's benefit. As the partnership continues to scale, we are optimistic our solutions will not only enhance Stagwell's customers' results, but also drive increased revenue and opportunities for both companies over time. Our Data Platform launch also led to Nexxen being selected as the first to market audience extension partner for United Airlines' commerce media network, Kinective Media. This partnership unlocks a new revenue growth opportunity for Nexxen in commerce media, where we weren't active previously. Kinective Media is leveraging Nexxen Data Platform's onboarding capabilities to extend travel and transaction data from United's Mileage Plus program to partners leveraging Nexxen for activation. United's Mileage Plus program reflects a massive database that is now accessible on Nexxen Data Platform and able to serve our advertiser customers with the guidance and cooperation of Kinective Media. Through the partnership, brands can unlock new offsite media network revenue streams, while Nexxen's advertisers' clients can leverage the data to efficiently extend audience reach. The Nexxen Data Platform is also driving new data licensing opportunities. Our platform features access to robust sources of advanced TV data for targeting and measurements, highlighted by exclusive access to global ACR data through our partnership with VIDAA, the CTV operating system for Hisense and Toshiba. VIDAA's growing global reach enabled us to recently enter into a global ACR data licensing partnership with The Trade Desk, creating new revenue opportunities and boosting our industry recognition. Nexxen is providing The Trade Desk ACR data segments to offer their clients advanced cross-channel and cross-device targeting capabilities, which are now available on their self-service platform for activation in the U.S., U.K., Canada, and Australia. We are in licensing discussions with a large number of other industry players, and we are optimistic about achieving additional new partnerships, particularly around international ACR data, given the scarcity of TV data in markets outside the U.S. We continue to believe data licensing is a huge long-term growth opportunity for Nexxen. We also recently released data-power tools for political advertisers, enabling them to leverage Nexxen's suite of tech and measurement capabilities to gain deeper campaign insights and maximize audience reach to enhance results and fully capitalize on the U.S. election cycle. New solutions include political district targeting, an action discovery-powered political dashboard providing candidates' issue and sentiment analysis and the ability to retarget custom audiences that have previously been exposed to political ads through a partnership with CommScope. In Q2, we didn't observe significant political ad spending on our platform. However, in Q3, we are seeing increased demand and expect this to accelerate in Q4 as we get closer to election day. Given our enhanced suite of tools, new partnerships, and increased sales focus on the verticals, in Q2, we added 86 new actively spending first-time advertiser customers. This included 60 new enterprise self-service customers and two new independent agencies leveraging Nexxen's self-service offering. We also added 78 new supply partners in Q2, including 74 in the U.S. In all, Q2 was a great quarter that indicates we have reached an inflection point in the business following the transformational milestones we have achieved over nearly the last two years. Our strategy to connect our cutting-edge data platform to our flexible, unified, full-stack AdTech solution to drive better customer outcomes is working and enabling us to win wallets and market share through increased spending and product adoption. It is also empowering us to gain traction with the world's top AdTech companies, agencies, and brands. On the sales front, we are continuing to focus on generating increased customer spending and full-stack product adoption, attracting major new partners to our platform, deepening relationships with streaming players, and scaling our data opportunities. From a product perspective, we will also continue to invest in innovation and focus on expanding our GenAI and machine learning utilization. We believe GenAI will advance the effectiveness of our data, audience, insights, and activation tools, as well as our health features. This is expected to benefit our customers, increase our platform's tech and data advantages, and create efficiencies. We remain excited for anticipated catalysts in the back half of 2024 and beyond, including our recent partnership generating increased revenues, data licensing revenue scaling, and potential modest tailwinds from the U.S. election cycle. I am more confident than ever that we have the right people and solutions in place to drive continued execution, capitalize on our long-term growth opportunity, and realize our vision of becoming the industry's goal strategic tech and data partner. With that, I am happy to turn the call over to Sagi to discuss our financial results and outlook.

Thank you, Ofer. In Q2, we generated contribution ex-TAC of $83.1 million, achieving 4% growth from Q2 2023 and 19% growth from Q1 2024. Programmatic revenue was $78.6 million in Q2, reflecting 3% growth from Q2 2023 and 20% growth from Q1 2024. While contribution ex-TAC from our non-programmatic business line was up slightly year-over-year in Q2 2024. Growth in Q2 was broad-based driven by enhanced sales execution, scaling partnerships, and improved market conditions. We observed strength in CTV, video, mobile, display, data products, and PMPs and across our finance, health, retail, government, and automotive verticals. On the opposite side, we observed the year-over-year decrease in our travel and technology verticals in Q2. CTV was a bright spot in Q2 as we generated $28.2 million in CTV revenue, reflecting 14% growth from Q2 2023 and 50% growth from Q1 2024. This was the second-best CTV revenue quarter in Nexxen's history, as CTV revenue represented 36% of programmatic revenue in Q2 2024, up from 32% in Q2 2023. CTV revenue growth was driven by a broad customer shift into our premium CTV solution and our partnership with Alphonso and LG Electronics beginning to scale. EMarketer projects U.S. CTV advertising spend will grow at a roughly 14% CAGR over the next several years, fueled by billions of dollars of linear budget shifting to advanced TV, new advertiser migrating to streaming as consumer services increasingly embrace ad-supported content and live sports going digital. We believe our long-standing streaming DNA, TV data capabilities and solution, access to premium supply, and flexible unified platform designed to enhance CTV results for customers across the ecosystem uniquely positions us to capitalize on this long-term growth opportunity and gain market share. Video revenue continued to account for most of our programmatic revenue, expanding to 74% in Q2 2024 from 71% in Q2 2023. This year-over-year increase was driven by video revenue strength, fueled primarily by CTV outpacing programmatic revenue growth. We continue to anticipate outsized video revenue growth over time due to our strategic video and CTV focus and capabilities, and believe we are amongst the most heavily indexed AdTech companies to video on the open internet. Contribution ex-TAC from display grew 14% year-over-year in Q2, while contribution ex-TAC from mobile increased 5%, contribution ex-TAC from data products increased 57% and contribution ex-TAC from PMPs increased 29%. Our ability to offer a variety of software solutions across formats and devices is a tremendous advantage, which enables us to retain customers, attract new partners, and proactively adapt to changing market conditions and the industry's diverse and evolving needs. Being able to service customers across formats and devices also allows us to capitalize on a larger total addressable market, while our data solutions are creating a flywheel effect that is opening new opportunities and attracting more spend to our platform. In Q2, we generated adjusted EBITDA of $26.8 million, which reflected a 27% year-over-year increase from Q2 2023 and a 126% increase from Q1 2024. Our adjusted EBITDA growth was a byproduct of higher contribution ex-TAC, improving cost efficiencies and our platform model's ability to generate increasing degrees of operating leverage. Our adjusted EBITDA margin in Q2 increased to 32% on a contribution ex-TAC basis from 26% in Q2 2023, and we remain confident in our ability to continue expanding our adjusted EBITDA margins over time. In Q2, we generated $20.9 million in net cash from operating activities after generating $11.9 million in Q2 2023. As of June 13, we had $151.9 million in net cash and $90 million undrawn on our revolving credit facility following the full repayment of our outstanding long-term debt in April. We also reported non-IFRS diluted earnings per ordinary share of $0.09 in Q2 2024, compared to $0.06 in Q2 2023. During Q2, we repurchased roughly 2.5 million ordinary shares through our completed $20 million repurchase program, a newly launched $50 million program reflecting an investment of GBP5.8 million, or $7.3 million. From March 1st, 2022, through June 30, 2024, we invested around $119 million in our repurchase program, buying back roughly 28.3 million ordinary shares, or 18.3% of shares outstanding. If shares remain at prices, the board believes reflect a discount to fair value at the end of our current repurchase program, we will consider initiating a new one. Finally, I'll turn to our outlook. For full-year 2024, we are reaffirming our guidance for contribution ex-TAC in a range of approximately $340 million to $345 million, adjusted EBITDA of approximately $100 million, and for programmatic revenue to reflect approximately 90% of full-year 2024 revenue. Our momentum from Q2 has carried over into Q3. We're seeing continued strength across our core growth drivers, solid spending trends, growing benefits from recently launched partnerships, increasing pipeline demand and improved visibility, reinforcing our confidence in our ability to meet our guidance. As a result, we expect contribution ex-TAC and programmatic revenue acceleration in H2, with year-over-year growth anticipated in Q3, Q4, H2, and full year 2024. We anticipate a record year for political contribution ex-TAC in 2024, with most of the benefits likely to be recognized in Q4. We also continue to anticipate CTV revenue acceleration in H2 with year-over-year growth expected in Q3, Q4, H2, and full year 2024, driven by increasing demand for our CTV solution and growing revenue tied to our partnership with Alphonso and LG. Additionally, we continue to expect growth in our data licensing revenue in full year 2024 compared to full year 2023, with further acceleration anticipated in 2025. We also anticipate adjusted EBITDA and adjusted EBITDA margins will be higher in Q3, Q4, H2, and full year 2024 than in the prior year period, driven by expectations for increased contribution ex-TAC. Our debt-free balance sheet and cash-generating capabilities enable flexibility to invest in share repurchases, sales growth initiatives, and innovation, and at this point in time we don't plan any major near-term acquisitions. We will continue shifting our focus to product innovation and expand our GenAI and machine learning utilization and expect GenAI to be a primary product investment focus in 2025. We will also boost our sales and marketing investments to further our commercial traction and ensure we continue expanding upon our recent momentum. As Ofer mentioned, the success we are seeing now is a byproduct of our hard work enhancing our holistic ability to execute. Our platform approach and ability to offer customers synergistic software and data solutions across the AdTech supply chain and across their workflows continues to differentiate Nexxen, enabling more shots on goal and positioning us for sustainable and accelerated long-term growth and expanded profitability. Our recently launched data platform is also unlocking new high-margin data licensing revenue opportunities and commerce media revenue opportunities and attracting more advertising spend as the industry increasingly takes a data-driven approach to achieve better results and returns. The industry's major players are now actively seeking the multi-solution data and tech partnerships across our platform, leading to more sizable and durable revenue opportunities, and their adoption and recognition is driving other big names to engage with us, accelerating our growth prospect. For some time, challenging market conditions and our focus on improving the business for the long term forced us to be on defense. Now we're back on the offensive and excellently positioned to realize our strategic vision of becoming one of the industry's most sought-after strategic AdTech and data partners.

Thank you. Ladies and gentlemen, we will now begin our question-and-answer session. Your first question comes from the line of Matt Swanson from RBC Capital Markets. Please go ahead.

Thanks for taking my questions and congratulations on the quarter. Great to see the rebound in CTV. I know we talked last quarter about some advertisers opting to lower-cost formats. Could you just dive in a little bit deeper on the dynamics that led to the growth? Kind of the mix of the benefit from more adoption of premium solutions versus the increased CTV supply that maybe makes some of these ads more affordable?

Hi, Matt. Of course, thank you for the question. For many years, we have been putting a lot of emphasis on CTV, and I think that a few things happened. Basically, one of them is that the market is in a better condition, so people are willing to spend more or to invest more on CTV channels instead of what we said before, that they were like running through cheaper channels in order to get results. Again, we see the movement of budget to CTV, which is good for us. The second thing is the amount of tools and technology that we created for CTV is really unparalleled. When you look at the abilities of our clients to target, to measure, and the major roster of publishers that we got is giving them a lot of opportunities, basically not just to target well, but also to reach a big audience, thanks to the spread of the publishers that we got. So they are getting much better results than usual when they are using our platform for CTV. We see that for a long time, but now it's even enhanced, thanks to the release of our data management platform and to our enablement of the discovery with the ACR data of VIDAA that is included and enabled to create segments and audiences and to learn more insights about the users. So all of that is coming together. There is still work to do, but we are on the right trend and we see that in the numbers.

Thanks. And then also great to see the margin expansion after all the heavy lifting you've done for the platform integration. So how should we think about margins moving forward as you reap the benefits from those previous investments, but then also highlighting some of the new investments, specifically around GenAI and sales and marketing?

Hey, Matt. I think that we did this quarter 32% of adjusted EBITDA margin out of contribution ex-TAC. I think that this, again, we are weighted as our peers in the industry and as the industry calls for H2. And, of course, it's all around a scale game. So as long as our scale will increase, for sure our margins will be better. Having said that, I think we are still reaffirming our guidance of around $100 million of adjusted EBITDA out of, let's take the midpoint of $342.5 million. So it's somewhere around 30%. I think that on a yearly basis, this will represent what we can do now. Of course, going into 2025, I think that we can do better. And again, the weighted margin between the different quarters is reflected and related to the seasonality. So I'm guessing that in Q4, we will do much more than 32%, but on a daily basis, and this is the way you should look at it, I think we should. Now we will settle it around the 30-ish and going forward, I think that we can do more than that.

Thank you.

Thank you, Matt.

Good morning. The first question I have is, could you talk about your GenAI roadmap, please? Where do you think you're going to be focusing first on integrating GenAI into your product portfolio?

Hi, Laura, of course.

Hi.

Our advantage when you look at GenAI is that we have a lot of points of data connected to our activation platform, which is giving us a lot of opportunities to integrate GenAI into our work stream and into our platform. The first place that we are going to integrate GenAI will be around our Discovery, which is basically the unit, the data platform that enables advertisers to source their audiences to learn about to get more insights and to get sentiment to their products and services and to create segments that they can operate on our platform. We believe that this is the first place that we need to invest and integrate GenAI, and it's in the process already. We believe that thanks to the fact that it's all around data that is connected to our activation tools, the GenAI will have more capabilities and power. Basically, the ability of the users to utilize the service will not just be based on the person that is operating the discovery tool, but from the GenAI and the cumulative knowledge and capabilities of our company.

Okay. Which cloud are you using? Are you using OpenAI or Google Cloud?

Google. We are using also Google and our own infrastructure for everything, but for certain purposes, we are using Google and Amazon Cloud.

Okay. And then, my second question is about, you talked about United Airlines, which is pretty exciting, but when you do a partnership with American Airlines, is there revenue in that for you immediately? Or is it more like you do a partnership with United and that then attracts new types of advertisers around e-commerce capability in new categories? How does the revenue work when with things like United Airlines and your partnership?

So basically, when we look at United Airlines, for us, it's the first step into the retail world, first of all, and commercial world, which is collecting data, which is a very important step that they gave us the trust and we, of course, honor them and respect this step. We do everything to meet their expectations from us and from the market. The idea is to enable, it's not that we are going to make you two sources of revenue. One, to operate their activity. Basically, they have their own sales team that is selling media, selling activation based on their data. The second one is that we will be able to offer this data also to our clients on the programmatic level. So these two levels, these two revenue channels will come into play in the near future. It's new to us, so it's hard to say how much revenue it will generate for us, but since it's a very interesting data set of more than 100 million travelers, we believe that it will be meaningful in the years to come.

Okay, perfect. Thanks so much. Thank you. Have a great day.

Thank you.

Thank you, Laura.

Thank you for taking my questions. My first one is just, you know, following the integration of Amobee, it seems that sales execution has improved. Can you just elaborate on this and maybe how you feel about the sales force and where it sits today?

Of course. Basically, about close to two years ago, we acquired Amobee, which was a bigger company than us. They had close to 1,000 people. We were 600 people. When you combine two sales teams, there is a lot of noise, work, integration, and synchronization that need to happen between the teams. That's one. The second thing is the offering that needs to be aligned because we are integrating new products, we are creating new offerings into the market. So first of all, we need to build the offering. The second thing is basically educate first of all our people about the new offerings and adjust them to the market needs. Sometimes you need to, it's a process. It's not that the first time that you create an offer that it works 100%, so you need to adjust it over time. What we saw lately is, first of all, the establishment of the team. People know their assignments. They believe they feel confident about the technology and products we are offering. We package it and tighten the packaging in a way that they can explain it to the other side in a more meaningful and simple manner. We feel their results, meaning people understand what we have to offer in the marketplace. They understand what is the value that our products can bring to them, and they sign in and grow their revenues with us. It's a process that I think will just get better over time because we are learning from the process. As I said, it's an ongoing process. The advantage we gained is that we integrated a lot of products into packaging that makes it a clear advantage for our clients to use. When our teams are aligned, educated, trained, and they come to the market with organized material and offering, it's working. That's why we're talking about better execution. We are hiring more people, we are training them better, and we are able to provide them more tools to win in the market.

Great, that's helpful. And then maybe my second one is, can you talk about the progress you're making with the Stagwell partnership and just how demand has trended, I guess, relative to your expectations?

Stagwell is an important partner for us. We believe they are a great company that challenges the market in many ways. We are in a process now of working together, training as we mentioned, educating, building together products that are helping us to improve some of our products because of their better experience working with clients. They are closer to clients since they are an agency, and in some ways, we are helping them on a technology level. I think it's a process and we believe that it will grow and it’s meaningful because we believe Stagwell is one of the leaders in this industry. We believe they will keep growing and we will be able to grow our business with them.

Great. Thank you so much.

You're welcome.

I wanted to revisit one of the issues that you brought up last quarter, and this was mentioned earlier in the call. One of the issues for Q1 was, and the CTV revenue was the customers, small and mid-sized agency customers that were opting for the company's lower-cost programmatic display and mobile and desktop video solutions. This recovery that we're seeing in that business is these same customers coming back because their end advertisers have budget, or is this kind of larger brands and agencies moving the needle for you?

Basically, when you look at business, it cannot grow so fast, Eric, just based on new money. It's always a mix of better revenues coming from your current clients. We have hundreds of clients, advertisers that are buying CTV media from us. What we feel is that, as I mentioned, better education and better sales processes that we have implemented are helping us. And, of course, there is something that is very meaningful in CTV that I mentioned in the first quarter is true. You can see that across the industry; when there is doubt or uncertainty, people are pulling their budgets more to the side of performance media and less to CTV. We see improvement in the sentiment of the advertisers to invest more. Together with our better capabilities, better organization, and more tightly packaged products and offerings, we see the upside and we see the results in the CTV front, which has led to a significant jump in revenues.

Okay. And then revisiting the free cash flow expectation for 2024. Sagi, I think you've said this, roughly $100 million of adjusted EBITDA. You expected that to translate into around $60 million free cash flow. Is that still the expectation for 2024?

Yes. I think it still holds true. It's like the, you know, the low range of what we are anticipating. It can go up to 65%. But yes, this is like the range that we anticipate that we can generate through 2024. Of course, we are still utilizing a lot of the cash through our buyback plans, the one that we already ended in Q1 of the $20 million that we announced already at the end of 2023 and issued a new one in April, May of $50 million. As long as the Board and Management think that the undervalue of the company is worth spending our money to buy back our shares, we will continue to do that as well.

Thank you.

Thank you, Eric.

Yes, thank you for taking my question. This is Mauricio Munoz for Andrew today. I just wanted to go back to the questions on margins. So, Sagi, obviously, margins were quite strong in the quarter, and I'm just trying to understand the sources of upside and how sustainable these are. You talked about your ability to capture cost efficiencies, and I'm assuming some headcount rationalization and maybe capability integrations now that Amobee has been fully integrated for over a quarter. But just wondering about any positive margin contributions from the revenue mix, particularly any margin upside from data licensing revenue or as VIDAA license revenues ramp with the platform scaling. So any color around that would be helpful.

Sure. I think you touched all of the right points we announced yesterday on our Nexxen and The Trade Desk partnership around ACR data in the U.S., Canada, U.K., and Australia. This is our foray into this vertical or line of business where we are generating money out of the data that we have exclusively. Over time we will have more partnerships on that front and the revenue generated from that will grow as partners utilize it more as they see the benefit. As VIDAA and Hisense sell more TV sets, this line of business is contributing directly to the EBITDA line. We don't have any extra costs around that. Everything in our industry has the right seasonality. We can have a better quarter or a much better quarter. The margin and adjusted EBITDA line will be better in that quarter. Again, we should look at our margins on a yearly basis. For that, I think that in 2024 we are going to generate something around the 30% range. Going forward, as you said and as Ofer mentioned, the Amobee integration is already complete, and now we are back on the offense, working towards more efficiency and cost leverage on our cost base. The headcount of the companies has been decreasing revenue quarter-over-quarter, and this is helping to increase our margin, and it will remain the same as we move forward.

Great, thank you. Very helpful. And then on capital allocation, maybe you can give us an update on your plans. Obviously, the retired $100 million in debt, now have $152 million in cash. So I'm assuming that following the acquisition of Amobee, you're probably going to pause on your M&A plans. But how should we think about the pace of the ongoing share buyback program and any plans to simplify your share structure? Thank you.

Yes. As I said before, we are generating money on a regular basis. Our net cash after we fully repaid our $100 million loan that we took to finance the Amobee acquisition is fully repaid. We will keep generating money. This is our DNA and our plan. As long as Management and Board believe that the company's value is undervalued in the market, we will keep buying back our shares. Regarding your first part of the question, yes, I think that now after the full integration of Amobee, we don't think we are missing any critical part. Of course, we may go into something that can add a crucial piece that we may need, but it will be a small acquisition or an IP acquisition to make fast progress instead of developing it ourselves. Again, we are not actively engaged in any M&A, and we are not looking for any M&A. We think that we have all the parts we need and now it's about executing and scaling our numbers.

Great. Thank you.

You're welcome.

Great. Thank you. Good morning, everyone. I want to ask you about just CTV bigger picture. Are you seeing more biddable open programmatic transactions or is it still primarily private marketplace deals? And then second, can you maybe expand a bit on the commerce media strategy over the long term? Do you see that more as like a data strategy, or is it going to be data paired with your ability to buy across disparate commerce media and retail media networks? Any help there would be great. Thank you.

I will start with your second question about the use of data with retail media and in general. We are not trying to become traders in data, but we are utilizing data in two elements. One of them is on the DSP side in order to enable better targeting for advertisers to reach better results. What we do is tie our ability to provide data to the money people spend moving to and using our platform from a technology and media perspective, which contributes to us. This is something we have been working on for a long time on the advertiser side. Publishers have started to use data in a meaningful manner to upgrade their capabilities to sell audiences, not just media. We see this trend growing and want to be part of it, as we believe in generating meaningful revenues from the combination of data and media. That's one thing we're doing. In some cases, we can sell data alone, but it will not be the majority of the revenues we generate from that activity. The major revenue will come when we merge it or connect it to media. Regarding CTV, if you could refine your question, it would be great just for me to understand what you are trying to ask.

Yes, of course. Sure. Yes, I guess in terms of how CTV inventory is bought today, are you seeing a shift towards more biddable and kind of open programmatic, or is it still primarily private marketplace direct deals that you're seeing primarily today? Thank you.

I think it's a mix. Advertisers are closing deals with publishers, and they want to run one-to-one, which requires the right technology. They can use our technology to do that effectively. Or sometimes they want to buy it programmatically. We are able to do both, enabling our partners to buy one-on-one or programmatically. The market is opening up, with many new publishers increasing their inventory and opportunities. Meanwhile, we see more and more advertisers interested in establishing one-on-one deals with certain publishers to buy their media. It's hard to say which one is bigger at this point; we see growth and a lot of programmatic activity, but we're also starting to witness growth in one-on-one deals as people utilize our technology effectively. Thank you.

As there are no further questions at this time, I would now like to turn the call over back to Mr. Ofer Druker for closing remarks.

Thank you. As we indicated in our PR and our message, after a long period of working very hard to integrate the company that we acquired, Amobee, into our company, to match the sales teams as mentioned here in our conversation, to build a unified offering and messaging, and to be able to package better, we see very good improvement in the parameters and the performance of the company from almost every aspect. We are happy about it, of course, because we worked hard to achieve this situation, and we truly believe in what we are doing. We still hold our strategy, which is around CTV video and enhanced data that unify our platform and touch every point of the journey. We are equipped with the right tools and partnerships to be a major player in this industry around the elements I just mentioned, which are video, CTV, and data. Thank you, everyone, and hope to see you soon again.

Ladies and gentlemen, this concludes today's conference call. Thank you for your participation. You may now disconnect.