Criteo, the publicly traded adtech company, told staffers this week it would lay off up to 4% of its staff, people familiar with the matter told Business Insider.
The company had 3,563 employees as of December 31, meaning the reduction could affect around 140 people.
A Criteo spokesperson confirmed the news, saying in a statement that the company regularly reviews its business to ensure its resources align with its strategy and financial performance.
“As a result, we’ve made the difficult decision to reduce headcount by up to 4% globally,” the statement said. “This change provides greater operational efficiency and enables us to invest in our growth areas.”
Founded in Paris in 2005, Criteo became known as the poster child of retargeting, an advertising method where advertisers specifically target people who had shown an interest in their products — for example, hitting someone who had previously browsed a jacket on a website with an ad for the same item, enticing them to return.
But with the owners of web browsers and app operating systems clamping down on the tracking technology that powers retargeting, and global privacy laws making it easier to opt out of being tracked, retargeting has become much harder.
In response, Criteo has sought to pivot its business to focus on the commerce media space, offering retailers tools to help sell ads on their apps and websites. It’s also making a push in connected TV, letting its retail clients use data about their audiences to target users on TV and measure whether those ads drove sales.
But these efforts are still relatively new for Criteo. The company said in February that “more than 50%” of its revenue comes from “non-retargeting solutions,” but retargeting still makes up a sizable, more profitable chunk.
And its “performance media” segment, in which retargeting sits, is set to be dealt another blow in the coming months when Google’s Chrome is expected to turn off support for third-party cookies. Chrome is the world’s biggest web browser, used by around two-thirds of web users.
Criteo said the expected Chrome cookie deprecation would negatively impact its revenue by between $30 million and $40 million by the end of this year, if Google goes ahead with its scheduled timeline, set for the fourth quarter of 2024. Criteo has been working to test alternative technologies to cookies as part of Google’s Privacy Sandbox program. However, it’s unclear whether those will be able to provide the same level of targeting and measurement in the long run.
Industry speculation has grown in recent years that Criteo could become a prime takeover target. Its stock is currently trading at around $35, below its all-time high of nearly $59 in 2014.
In February, the European activist investor Petrus Advisers raised its holding in the company to 5.5%. It wrote a public letter to Criteo’s management team urging the company to perform a “comprehensive strategic review, including to evaluate all ownership options.” Criteo said in response that it was reviewing the letter and that it hoped to “engage constructively” with Petrus.
In its most recent quarter, Criteo reported a return to profit on flat revenue, having made $70 million in cost savings over 2023. The company said on its earnings call that it would continue to be rigorous on cost efficiencies to offset wage inflation, while continuing to invest in growth areas.
Criteo also made a round of layoffs last year, Digiday reported, though the company didn’t disclose the number of employees affected.
