Nexxen International Ltd DRC’s Earnings Call Contradictions: DSP Headwind Duration, VIDAA Revenue Clarity

Date of Call: Mar 4, 2026

Financials Results

• Revenue: $97.8M Contribution ex-TAC in Q4, down 7% YOY
• EPS: $0.33 non-IFRS diluted EPS in Q4, down from $0.48 YOY
• Operating Margin: 35% Adjusted EBITDA margin in Q4

Guidance:

• Contribution ex-TAC for 2026 expected in range of $375M-$390M, representing over 8% YOY growth at midpoint.
• Programmatic revenue for 2026 expected in range of $367M-$381M, representing ~10% YOY growth at midpoint.
• Adjusted EBITDA for 2026 expected in range of $122M-$132M, representing ~33% margin at midpoint.

Business Commentary:

Strong Start to 2026:

• Nexxen reported that contribution ex-TAC and programmatic revenue in Q1 2026 are trending ahead of initial expectations, with January and February being the strongest months in the company's history.
• This momentum is attributed to infrastructure investments made in 2025, new and expanded partnerships with leading DSPs, and strategic differentiation in CTV media assets and data.

Infrastructure and Platform Scaling:

• In the second half of 2025, Nexxen meaningfully upgraded its infrastructure and expanded platform scale, roughly doubling SSP capacity.
• This scaling is aimed at better monetizing publisher relationships and supporting growth in 2026 and beyond, as well as facilitating enterprise adoption through enhanced DSP and data capabilities.

Smart TV On-Screen Solution and Partnerships:

• Nexxen launched the industry's first programmatic Smart TV on-screen advertising solution, with VIDAA (now V) as its first OS partner.
• This innovation transforms the Smart TV home screen into a programmatic advertising opportunity, leveraging V's footprint and programmatic activation to drive brand impact and ROI.

AI Integration and Efficiency Gains:

• Nexxen's AI initiatives, such as the NexAI platform, are delivering significant efficiency gains, including up to 97% efficiency in DSP assistant and up to 45% reduction in audience research time.
• These advancements are streamlining workflows and enhancing supply chain-wide performance, positioning Nexxen to win larger enterprise budgets.

Growth in Enterprise Solutions:

• Nexxen more than doubled its enterprise customer base in 2025 by enhancing its DSP and data capabilities and shifting sales resources toward enterprise offerings.
• The company plans to continue investing in enterprise solutions to capitalize on the strength of its unique offerings built on proven technologies.

Sentiment Analysis:

Overall Tone: Positive

• "I’m pleased to report that we met our updated full-year guidance and are seeing strong momentum in early 2026." "2026 is shaping up to be an exciting year for Nexxen. The mix is improving, the model is scaling, our recognition is growing, and we are entering the year with momentum, operating leverage and multiple growth catalysts already working in our favor."

Q&A:

• Question from Matthew Swanson (RBC Capital Markets): Could you give more color on how AI reshaping has impacted 2025 results, and on CTV growth for 2026—is it about headwinds diminishing or company-specific tailwinds?
  Response: AI disruption is affecting open web traffic; Nexxen is countering by expanding less-affected channels like programmatic Smart TV on-screen (first in industry) and mobile in-app. CTV growth is driven by these new offerings, partnerships, and unique end-to-end solutions.

• Question from Laura Martin (Needham & Company): Can you update on data revenue stream and what is required to hit the 7%-8% growth guidance given IFRS revenue was down?
  Response: Data revenue is high-margin and integrated into >80% of campaigns, driving partner spend and media sales. The 2026 growth drivers include in-app mobile partnerships, V investment, and programmatic on-screen ecosystem, with early Q1 trends (best Jan/ Feb ever) supporting confidence.

• Question from Andrew Marok (Raymond James): How should we rank order the importance of macro, 2026 events, Ventura integration for the 2026 guide? How sustainable is desktop video growth?
  Response: Growth is broad-based; main 2026 revenue drivers are in-stream CTV and new native on-screen programmatic. Desktop video refers to in-stream CTV, which is core and less volatile; strong Q1 trends are supported by infrastructure upgrades and enterprise focus.

• Question from Jason Kreyer (Craig-Hallum): Which channels are driving Q1 strength, and how does Q1 align with the high single-digit annual guide given Q4 decline?
  Response: Strength is broad-based across partners and verticals, driven by infrastructure upgrades, enterprise sales execution, and improved market sentiment. The full-year guide is conservative; Q1 is off to a record start, and trends are extending into early Q2.

• Question from Maria Ripps (Canaccord): How should we think about incremental demand from Olympics vs. underlying trends? How will enterprise become a larger growth contributor?
  Response: Olympics are early in the year, but underlying trends are strong due to strategic shifts and product investments. Enterprise growth will accelerate as more clients adopt integrated data and AI tools over a longer sales cycle, representing a key future engine.

• Question from Barton Crockett (Rosenblatt Securities): What portion of 2026 growth is political? Are there early indications? Also, does the guide include acquisitions?
  Response: Political spend is a supportive factor expected to be strong in 2026 but not yet material in early months. The guide is organic; Nexxen is always open to acquisitions to accelerate growth but has no specific targets.

Contradiction Point 1

Nature and Impact of the DSP Headwind

Contradiction on whether the DSP issue is a temporary, isolated event or a persistent challenge requiring strategic shift.

Barton Crockett (Rosenblatt Securities) - Barton Crockett (Rosenblatt Securities)

2025Q4: The negative impact from a key DSP in 2025 was isolated to Q4. That customer's spend is now trending upward in 2026, which should help recoup the losses. - Sagi Niri(CFO)

What portion of 2026 guidance is from political advertising, how does early primary activity inform expectations, and what is the current stance on potential acquisitions? - Laura Martin (Needham & Company, LLC)

2025Q3: The DSP headwind is not expected to carry into 2026 because the customer's reduced Q4 spend is seen as a normalization, not a future trend. - Ofer Druker(CEO)

Contradiction Point 2

VIDAA Partnership Contribution Timeline

Contradiction on the quantification and near-term contribution expectations from the VIDAA partnership.

Matthew Swanson (RBC Capital Markets) - Matthew Swanson (RBC Capital Markets)

2025Q4: The company launched the first programmatic marketplace for on-screen native ads with VIDAA (now V), partnering with The Trade Desk. CTV growth is driven by this unique offering... - Ofer Druker(CEO)

How has AI reshaping the open internet impacted 2025 results, and is the CTV growth in 2026 driven by diminishing headwinds or company-specific tailwinds? - Tyler DiMatteo (BTIG, LLC)

2025Q3: VIDAA's contribution is expected to be much more meaningful in 2026, driven by ACR data licensing and exclusivity, but specific net revenue figures are not yet quantified. - Ofer Druker(CEO)

Contradiction Point 3

Stance on Potential Acquisitions

Contradiction regarding openness to and readiness for acquisitions.

Barton Crockett (Rosenblatt Securities) - Barton Crockett (Rosenblatt Securities)

2025Q4: The company is always open to acquisitions to accelerate growth, but has no specific targets to announce. Organic growth remains the primary focus. - Ofer Druker(CEO)

What portion of 2026 guidance is attributed to political advertising, how does early primary activity influence expectations, and what is the current stance on potential acquisitions? - Andrew Jordan Marok (Raymond James)

2025Q2: The company is now ready to evaluate acquisitions, having successfully integrated past acquisitions... They are actively looking at opportunities and view M&A as a complement to organic growth and buybacks. - Ofer Druker(CEO)

Contradiction Point 4

Primary Drivers of 2026 Revenue Growth

Contradiction in identifying the main catalysts for 2026 growth.

Andrew Marok (Raymond James) - Andrew Marok (Raymond James)

2025Q4: The main 2026 revenue growth will come from in-stream CTV (built in 2025). The new on-screen native ad marketplace is a key catalyst... - Ofer Druker(CEO)

How should we prioritize the importance of macro factors, 2026 events, and The Trade Desk integration for the 2026 outlook, and how sustainable is the 2025 desktop video growth? - Andrew Jordan Marok (Raymond James)

2025Q2: Confidence comes from: ... (3) investments in data and technology (like data licensing) that are building client relationships and generating new revenue streams. ... (5) investments in mobile app monetization through new partnerships... - Ofer Druker(CEO) and Sagi Niri(CFO)

Contradiction Point 5

Macroeconomic Outlook and Guidance Conservatism

Contradiction on the severity and impact of macroeconomic softness.

What are Jason Kreyer's key insights from Craig-Hallum regarding the company's earnings? - Jason Kreyer (Craig-Hallum)

2025Q4: The conservative annual guidance reflects the early stage of the year, but trends look strong into Q2. - Ofer Druker(CEO)

What factors are driving the early Q1 strength (record Jan/Feb) and how does the Q4 contribution decline align with the high single-digit growth guidance for the year? - Jason Kreyer (Craig-Hallum)

2025Q1: The full-year guidance is cautious, reflecting ongoing market uncertainty... - Sagi Niri(CFO)