Open-Web Advertising Is Trading Scale For Supply Quality

Taboola reported second-quarter results on August 5 showing revenue rose 2.4% to $476.8 million while ex-TAC gross profit increased 11.8% to $192.4 million. The company also said it had removed low-quality publishers from its network and lost its Explore More product after a Google policy change.

That combination matters more than the modest revenue growth. Taboola accepted less inventory and a short-term revenue drag while producing stronger economics from what remained. For CMOs and agency leaders, the quarter turns supply quality from an ad-operations concern into a media investment question.

What Taboola Changed

Chief executive Adam Singolda called the quarter "another important step forward for Taboola." The more consequential detail was management's decision to cut publisher relationships that were not delivering value for advertisers.

Chief financial officer Steve Walker said the company "took a more aggressive approach" to removing publishers that did not meet its standards. Taboola also stopped offering Explore More, which surfaced sponsored content after a user clicked a browser's back button, because of a Google policy change.

Those moves suppressed revenue, but they improved the mix. Ex-TAC gross profit grew nearly five times faster than revenue, while adjusted EBITDA rose 22.8% to $55.5 million and its adjusted EBITDA margin expanded to 28.8% from 26.2%.

Mission Media has previously documented the open web's automation gap with Google and Meta. Taboola's latest quarter shows that comparable automation is only half the requirement. Buyers also need confidence in where ads appear and whether each placement contributes to an outcome.

Why Less Inventory Can Improve Economics

Open-web platforms have traditionally sold reach as a counterweight to closed ecosystems. The weakness in that pitch is that more supply does not automatically mean more useful supply.

Taboola said its cleanup contributed to higher ad rates and a shift toward higher-margin business. The company still reached more than 600 million daily active users through publishers and device makers including NBC News, Yahoo, Samsung and Xiaomi, according to its results release.

The practical implication is that quality controls can support yield even when they reduce reported scale. Media leaders should therefore ask vendors how much inventory they have removed, what performance thresholds triggered removal, and whether supply-path changes are visible in campaign reporting.

This is especially relevant across APAC, where device makers and publisher partnerships create large, fragmented routes to audiences. A regional plan spanning markets such as Indonesia, Japan and South Korea can look efficient at aggregate level while hiding major differences in publisher quality, format and measurement.

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Where The Open Web Is Consolidating

Taboola is also expanding its role with publishers. Management said an existing media partner plans to let it monetize a broader set of display, vertical and native formats, while Fox News is joining its network. The company estimates display advertising at the unnamed partner could represent two to three times the revenue of the native placements it historically managed there.

That points to consolidation around fewer technology partners with wider mandates. Publishers gain simpler operations and potentially stronger demand. Platforms gain more control over inventory, data and yield. Smaller point solutions risk losing access to premium supply.

Criteo's results on the same day show why the market should not be treated as one category. Its media spend rose 9% at constant currency, but revenue fell 11% and Performance Media contribution ex-TAC declined 10%. Chief executive Michael Komasinski said its top-line performance was "disappointing." Independent ad platforms are diverging according to client concentration, product mix and the quality of their supply relationships.

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What APAC Media Leaders Should Review

For CMOs, regional marketing leaders and agency CEOs, the decision is not whether to abandon Google and Meta for the open web. It is which independent platforms can prove that broader reach does not dilute performance or brand safeguards.

Procurement and media teams should put three checks into platform reviews: placement-level transparency, documented publisher-removal standards and evidence that margin gains come from better outcomes rather than higher prices alone. They should also test whether consolidated publisher access improves incremental reach across APAC markets instead of simply repackaging inventory already available elsewhere.

Taboola's quarter suggests the open web may become more competitive by becoming smaller, cleaner and more concentrated. The executive question is whether a platform can show disciplined control over supply before it asks for a larger share of performance budget.