Las acciones de Truecaller caen un 29% debido a una caída en los ingresos por publicidad impulsados por Google

Truecaller AB's stock hit a record low on Monday, capping a difficult 2025 for the Swedish caller-ID platform. Shares tumbled 29% after the company warned that fourth-quarter advertising revenue would be about 30% lower than the previous year. The decline pushed the stock to its weakest level since its 2021 IPO, worsening a year-long sell-off that has erased two-thirds of its market value.

The drop came as Truecaller attributed the continued weakness in advertising revenue to an algorithmic change by its largest demand partner, Google. The adjustment significantly disrupted ad performance, and the impact has proven more severe than previously anticipated. DNB Carnegie analyst Predrag Savinovic noted the unexpected scale of the issue, which has compounded existing challenges in India's ad market.

The company also highlighted regulatory pressures in India, where telecom regulators are reportedly moving to mandate the default display of caller names. This could reduce the need for Truecaller's services in one of its largest markets. Chief Executive Officer Rishit Jhunjhunwala acknowledged in a statement that while some stabilization has occurred since November, the recovery remains limited, and ad revenue is expected to stay weak for the near term.

Why the Standoff Happened

Truecaller's troubles began in mid-August when it started recording a sharp decline in advertising revenue. A major factor was an algorithmic change by its largest demand partner, which directly affected the platform's ability to monetize its services. The shift caused a significant drop in ad visibility and performance, and although the impact has been reduced, it remains unresolved. Additionally, the Indian ad market has struggled, further compounding the company's challenges.

Analysts have pointed to the sudden nature of the decline as a key concern. DNB Carnegie's Savinovic noted that while the company had flagged the possibility of the algorithm change, the scale of the negative impact exceeded expectations. This has led to a reassessment of the company's future performance, with forecasts for 2026–2027 now predicting revenue declines of up to 9%.

What This Means for Investors

The recent developments have cast a shadow over Truecaller's future growth. While the company emphasized that its recurring revenue streams—primarily from premium subscriptions and its business offerings—remain strong, the drop in advertising revenue has severely impacted investor sentiment. The stock has been in a prolonged slump, with shares falling sharply in October following a string of disappointing earnings reports.

Investors are now watching closely how the company navigates the transition. Truecaller has outlined a strategy to reduce dependency on specific partners or markets, increase growth outside of India, and focus more on direct sales and reseller partnerships. CEO Rishit Jhunjhunwala said the company is making progress in restructuring its advertising business and expects long-term benefits to materialize gradually.

Still, the uncertainty has led to a more cautious outlook. DNB Carnegie's Savinovic suggested that extrapolating the weak fourth-quarter performance is reasonable and could lead to 2026 revenue levels falling significantly below 2025. The company also faces additional costs related to its 2022 incentive program, further pressuring short-term profitability.

Risks to the Outlook

Truecaller's long-term viability depends on its ability to adapt to the shifting landscape. The regulatory changes in India present a structural risk, as the mandated display of caller names could reduce demand for its services in a key market. The company must now pivot to other regions to maintain growth, a challenge given its heavy reliance on advertising for revenue.

Additionally, the algorithmic change with Google may have lasting implications. While the impact has been reduced, the issue has not been fully resolved, and similar disruptions could occur in the future. This raises concerns about the company's reliance on a single partner for a significant portion of its ad revenue.

Despite these challenges, Truecaller remains optimistic about its user growth and recurring revenue streams. With more than 450 million active users, the platform continues to expand, and the company's premium offerings and business services are showing promising momentum. However, the path to recovery will require a sustained effort to diversify its revenue base and navigate regulatory and market headwinds.