Yahoo is deepening its push into digital advertising, even as its competitors warn that the market is faltering. A man wears a blue plaid shirt and sunglasses as he walks with a coffee cup in hand.
Jim Lanzone, the chief executive of Yahoo, said the deal with Taboola puts both companies in a good position for when the ad market revives.Credit…Brendan McDermid/Reuters
The internet pioneer, which was taken private in a $5 billion deal last year, is taking a roughly 25 percent stake in Taboola, the company known for serving up attention-grabbing links on websites, the chief executives of the companies said in an interview. The deal is part of a 30-year exclusive advertising partnership that allows Yahoo to use Taboola’s technology to manage its sizable business in native advertising — ads that have the characteristics of traditional news and entertainment content.
Shares of Taboola have fallen nearly 80 percent over the past year, amid broader doldrums in the public and advertising markets, giving it a market capitalization of $455 million. In January last year, when Taboola struck a deal to merge with a special purpose acquisition company, or SPAC, it was valued at $2.6 billion.
Executives at companies like Meta and TikTok have warned that advertisers, skittish about the economy, have pulled back on their spending. But Jim Lanzone, the chief executive of Yahoo, said in an interview that the deal with Taboola puts both companies in a good position for when the ad market revives.
Yahoo, a giant of the early internet, was eclipsed over the years by tech rivals like Alphabet’s Google and Meta’s Facebook. The company endured a messy power struggle and shaky leadership as it matured, leading to layoffs and shifts in strategy.
The company was taken private by the investment firm Apollo Global Management in the hopes that new leadership and a respite from the public markets would give it a chance to grow. Yahoo says it has about 900 million monthly users of its properties, which include AOL, TechCrunch and Yahoo Sports, making it one of the largest destinations on the web.
Taboola, founded in 2007, specializes in native advertising, operating an advertising network over thousands of well-known websites, including CNBC, NBC News and Insider.
