Innovid Corp.

Greetings and welcome to the InnoVid fourth quarter 2022 earnings conference call. At this time, all participants are on a listen-only mode. A brief question and answer session will follow the formal presentation. If anyone should require operator assistance during the conference, please press star zero on your telephone keypad. As a reminder, this conference is being recorded. It is now my pleasure to introduce your host, John Williams, InnoVid's Investor Relations. Thank you. Please go ahead.

Thank you, operator. Before we begin, I'll remind you that today's call may contain forward-looking statements and that the safe harbor statement in today's earnings release, available on our investor relations page, also pertains to this call. Changes in our business, competitive landscape, technological or regulatory environment, and other factors could cause actual results to differ materially from those expressed by the forward-looking statements made today. Our historical results are not necessarily indicative of future performance, and as such, we can give no assurance as to the accuracy of our forward-looking statements and assume no obligation to update them except as required by law. In addition, today's call may include non-GAAP financial measures. We use these non-GAAP measures in managing the business and believe they provide useful information for our investors. These measures should be considered in addition to and not as a substitute for our GAAP results. Reconciliations of the non-GAAP measures to their corresponding GAAP measures, where appropriate, can be found in the earnings presentation and earnings release available on our website and in our filings with the SEC. Hosting today's call are Zvika Netter, Innovid's co-founder and CEO, Tanya Andreev-Caspin, Innovid's CFO, and Tal Chalozin, co-founder and CTO, who will participate in our Q&A session. I'll now turn the call over to Zvika to begin.

Thanks, John, and thank you all for joining the call today. I'll start with a few comments on the current environment and its impact on InnoVid, some high-level thoughts about the fourth quarter, and some recent business highlights. Our CFO, Tania Andreev-Caspin, will then provide details on our performance and initial 2023 guidance, followed by Q&A. I'm excited to share with you an update on Innovit's progress, including our fourth quarter and full year 2022 results. We recently completed our first full year as a public company, and I'm proud of how our team has executed against our strategic objectives in a challenging environment. Innovit remains exceptionally well positioned as the clear leader in building the critical technology infrastructure for the future of TV advertising. We believe that the CTV segment is and will continue to be their area of growth in the advertising industry. And this is why it's our primary area of focus here at Innovit. In 2022, we had a number of important accomplishments. Our full year revenue grew 41% year over year. We continued our drive towards positive adjusted EBITDA and our balance sheet remained strong. Measurement became a significant revenue driver for Innovit this year. following our acquisition of TV Squared and represented 20% of our full year annual revenue. We're excited about the synergies realized through the acquisition as well as the growth opportunities ahead. We built meaningful client relationships and added a number of exciting wins. Our clients make a strategic decision to invest in our critical and independent infrastructure software and continue to do so despite headwinds in advertising volume and lighter spend across the overall market. We remain very focused on the things that we can control, executing against our strategic objectives, leveraging the synergies and accelerating the growth of our TV Squared acquisition, cross-selling, and deepening our customer connections. The shift from linear to CTV continues to drive our growth as we add more customers and gain more share. In Q4, we reported 13% revenue and 19% impression growth in CTV, compared to the same period in 2021. Our CTV accounted for 49% of revenue and 52% of total video impressions, excluding TV Squared. For the full year, total revenue grew 41% to $127.1 million, and we delivered $1.2 million in adjusted EBITDA. Our results offer clear evidence that demand continues to grow despite difficult advertising environment. Let me cover some additional highlights from the quarter. There are three key metrics that we report annually to demonstrate how mission critical our platform is for our customers, even in a challenging environment. Our net revenue retention or NRR in 2022 was 111% and our core client count in 2022 increased by 60% overall. Equally important, our core client retention rate was 90%. Simply put, our customer base is growing, and the customers we have are not only staying with us, they are using our platform more and more every year. I'm happy to note recent new wins, including CMI Media Agency, plus one other large player in the pharma and healthcare vertical. I'll also note several recent client cross-selling expansions, including Canva and Goodway Group. as well as several partnerships, including Fox, the Trade Desk, Visio, and Kinetic. We recently announced two very exciting leadership updates, an addition and a promotion, that further align our leadership around operational excellence. The addition of David Hendrick as Innovate New Chief Commercial Officer, who leads the commercial alignment across our revenue-related functions, including sales, marketing, and account management. The promotion of Ken Marcus, previously our Chief Client Officer to Chief Operating Officer, who now leads operational alignment across the organization. Both Dave and Ken are up and running in their new roles and are closely partnering to deliver on scale and profitability. I'm very excited to have them both in these new important positions. And finally, in November, we hosted our first ever Investor Day and the replay is still available on our website. It was a great event with members of our senior leadership team highlighting our strategic initiatives and the significant opportunity ahead of us. Innovative approach since day one has always been neutrality. We don't buy or sell media at all. And we firmly believe the advertising industry needs to separate critical infrastructure and measurement technology for advertisers from media buying and selling. That's how we built and run our business since day one. focus on advertisers' very clear desire and need for transparency and alignment of interest with their tech providers. The recent antitrust suit filed by the Department of Justice against Google for monopolizing multiple digital advertising technology products reinforces our view that neutrality in this industry is critical to our customers and to the industry at large. We'd encourage everyone looking to understand the current state of competition and the total addressable market opportunity in the advertising and advertising technology sectors to read the complaint. We're glad to see that the industry is becoming more aware of the risk of mixing both business models under one umbrella. And we're looking forward to showing our existing and potential customers just why our approach is better for them and better for the industry. As the industry evolves, Innovit is in a leading position. Let me focus on how we are directly addressing the current macro environment and why Innovate is positioned for success in 2023. First, I'm confident we'll continue to take market share from Google Campaign Manager. When the economy and the ad market bounces back, we believe we are well positioned to see growth multiplier effect as our growing customer base ramps back up and our clients activate more features of Innovate capabilities. Our platform remains mission critical for our customers and our ad server personalization and measurement capabilities remain highly differentiated. Second, we remain laser focused on profitable growth. We expect positive adjusted EBITDA for the full year of 2023, which Tanya will discuss later. And we reiterate our long-term and target of 30% plus adjusted EBITDA margin over the long run. And finally, we are maintaining a strong balance sheet focused on a maximum capital flexibility and optionality. We believe our quarter-end cash position provides more than enough runway to comfortably fund the business as we shift from burning to building cash. I'm proud of what Innovate and its team has accomplished in 2022, and I'm even more excited about the future. With that, I'll hand it over to our CFO, Tanya Andreev-Caspin, to discuss our fourth quarter results and the 2023 financial outlook. Tanya?