Content recommendation firm Outbrain agreed to acquire adtech firm Teads Thursday for $1 billion, with the newly combined company aiming to offer a “true end-to-end, full-funnel platform for the open internet,” said Outbrain chief executive David Kostman.
The deal comes after weeks of speculation, and it is the latest in a string of tie-ups sweeping the adtech ecosystem, following the acquisitions of Pathlabs, Influential, Leaders, Cannes Lion and Possible in recent weeks.
Kostman will serve as CEO of the combined company, with current Teads co-CEOs Bertrand Quesada and Jeremy Arditi serving as co-presidents.
“The combination of our highly complementary offerings accelerates our vision to become the preferred partner to deliver meaningful brand outcomes across premium, quality media environments —while scaling the industry-leading offerings Teads is known for,” said Kostman in a statement.
Combining branding and performance
Combining Teads’ video and branding capabilities with Outbrain’s performance solutions means marketers won’t be limited to choosing between either branding or performance objectives on the open web, the new company claims. This puts it in a position to vie for the $175 billion open internet advertising spend.
The two companies claim that they bring together 20,000 direct advertisers with more than 10,000 premium media environments, creating one of the largest direct supply paths across the open internet and connected TV.
It’s pitting itself against rivals—that base their value to marketers primarily on views and impressions—by claiming to deliver more tangible outcomes such as attention and ecommerce conversions across open web and CTV.
The combination gives Outbrain, a publicly traded company, a library of video inventory to complement its recirculation business and expand the suite of content services it can provide to its publisher partners.
For Teads, which debt-strapped Altice International owns, the exit offers its parent company cash to clear up its balance sheet and the stability of consolidation. Altice NV acquired Teads in 2017 for $307 million and has since sought to spin it out at least twice.
In 2023, Outbrain generated $184.8 million in gross profit. Teads generated $383.7 million in gross profit, according to the companies’ filings.
Adtech consolidation
Despite both Outbrain and Teads being profitable, seismic shifts in the digital media ecosystem have prompted marketers, adtech firms and publishers to take steps to anticipate the new landscape.
Dwindling search traffic has made on-site recirculation more valuable to publishers, increasing the appeal of partners like Outbrain and its rival, Taboola.
Meanwhile, uncertainty around the future of third-party cookies, which Google will now leave up to user choice, has left marketers and adtech companies scrambling to predict how measurement and attribution benchmarks will shift in the next year.