Perion shares slide after ad tech group slashes revenue guidance

Investing.com -- U.S.-listed shares in Perion Network (NASDAQ:PERI) shed around a fifth of their value in premarket trading on Monday after the advertising technology group slashed its revenue guidance.

In a statement on Monday, Perion said Microsoft (NASDAQ:MSFT)'s Bing internet search service had notified the company of its decision to "exclude a number of publishers from its search distribution marketplace." No other specific names were provided by Perion.

As a result, Perion warned that search revenue from Bing is now projected to represent less than 5% of its revenue in the second half of this year. Microsoft has been a key partner for Perion, accounting for 35% of its top-line returns in 2022.

"The recent changes Microsoft Bing implemented to its Search distribution marketplace are unfortunate and significantly impacted our Search Advertising business," said Perion Chief Executive Tal Jacobson in a statement.

Perion lowered its second-quarter revenue forecast to $106 million to $108 million, down from a prior outlook of $118 million to $122 million. The company is due to report its second-quarter results on July 31.

For the 2024 fiscal year, revenue is now seen at $490 million - $510 million, compared to earlier projections of $590 million - $610 million that were themselves previously reduced in April due to changes in Bing's ad pricing model.

Jacobson added that Perion will continue to push to expand its artificial intelligence-driven advertising solutions business through product innovation and partnerships. He also backed Perion's committment to "delivering shareholder value" and completing an ongoing $75 million share buyback program.