Edouard Lassalle – Head of Investor Relations JB Rudelle – Chief Executive Officer and Co-Founder Benoit Fouilland – Chief Financial Officer and Delegated Director General Eric Eichmann – President and Chief Operating Officer.

Douglas Anmuth – JP Morgan Debs Schwartz – Goldman Sachs Ross Sandler – Deutsche Bank John Egbert – Stifel Patterson – Raymond James Richard Kramer – Arete Research.

Good day and welcome to the Criteo Q1 2015 Earnings Conference Call. Today' conference is being recorded. Throughout today’s presentation, all participants will be in a listen-only mode. After the presentation, there will be an opportunity to ask a question. At this time, I would like to turn the conference over to Mr.

Edouard Lassalle, Head of Investor Relations. Please go ahead sir..

Thank you. Good morning and good afternoon to all of you and welcome to Criteo’s Financial Results for the first quarter ended March 31, 2015. Joining us on the call today are JB Rudelle, Chairman and Co-Founder CEO, Benoit Fouilland, Chief Financial Officer, and Eric Eichmann, President and Chief Operating Officer.

After our prepared remarks Eric will participate in the Q&A session of this call. Please note that the earnings release issued before the opening of the U.S. market today, along with a live broadcast of this earnings call are both available on our Investor Relations website at ir.criteo.com.

A replay of the earnings call will also be available later today on our Investor Relations website. As usual, before we begin discussing our earnings, I'd like to remind you that some of our discussions today will contain forward-looking statements.

These may include projected financial results, our operating metrics, business strategies, anticipated future products and services, anticipated investment and expansion plans, anticipated market demand or opportunities and other forward-looking statements. As always these statements are subject to risks, uncertainties and assumptions.

Actual results and the timing of certain events may differ materially from the results or timing predicted or implied by such forward-looking statements, in addition reported results should not be considered as an indication of future performance.

Also I’d like to remind you that this – in this call we will discuss non-IFRS measures of our performance during the course of this call. Definition of these metrics and the reconciliation to the most directly comparable IFRS financial measures are provided in the earnings press release and accompanying financial tables issued earlier today.

Last, unless otherwise stated all gross comparisons made in the course of this call are against the same period in the prior year. With this in mind, let me now turn the call over to JB Rudelle, Criteo’s Chairman, co-founder and Chief Executive Officer. JB, the line is all yours..

Thank you, Edouard. Once again, I’m pleased to announce another record quarter of profitable growth. Delivering a sixth quarter in a row we exceeded the high-end of our guidance for both revenue ex-TAC and adjusted EBITDA. In the first quarter of 2015, our revenue ex-TAC increased 55% at constant currency to €105 million.

Over the same period, our adjusted EBITDA grew 89% at constant currency to €28 million. Let me like to say quickly [ph], performance is everything. What we mean by that, is that bringing the best possible performance to our clients at the very core of all our action.

We believe that our continued rapid growth is the direct result of this extreme focus on generating measurable sales for our clients. As our Q1 results show, we execute consistently on our growth plans. The investment we made in 2014 are paying off. They’re actually, quelling our growing leadership in the performance marketing world.

Talking specifically to our Q1 results, our strong performance in this quarter were driven by three things, first, the continued roll out on all devices of new improvements in our technology, second, another record in new client editions across regions while maintaining our client retention rate over 90%.

And third, continued momentum in expanding our publisher relationships. Regarding the first driver, we continue to roll out new tech improvements that generate better performance on all devices for our client. The latest generation of the Criteo Engine, not only predicts the likelihood of a user to buy, but also the basket value of this purchase.

This new engine was live with 22% of our client base at the end of the first quarter. During this year we plan to further improve our engine and to deploy this latest version with a broader base of our client. On mobile, we continue to be with a strong traction our multi-screen solution.

Our solution allows to systematically engage [ph] and convert customers across while devices and leading operating systems, both on mobile web and apps. By the end of the quarter, 84% of our clients were using our multi-screen solution.

Furthermore, the strong momentum in mobile commerce continues to be huge opportunity both for our clients and for us. As our latest state of mobile commerce report showed, in Q1, 34% of global e-commerce transactions were generated on mobile.

This is trending towards markets such as Korea or Japan, where already more than 50% of ecommerce transaction that now done on a mobile device. While the retailers increasingly embrace mobile commerce, they sometimes still find it hard to navigate through the complexity of marketing on their values, devices and platform.

Our full solution across Apple and Android, browsers and apps, greatly helps our clients to manage this complexity. In Q1, we strengthened our in-app solution by launching our first mobile measurement partnership program. This exciting program had to receive a lot of interest from the ecosystem.

Turning now to cost device, as you know the ability to match shopping data across devices has become increasingly important in this new mobile fragmented world of multiple devices. A cross-device solution is capable to take shopping intent from one device, showing that on another one and track sales on a third device.

This new ability broadens our addressable inventory and help our clients to better calculate their return on investment. Overall on proved technology and ability to convert consumers seamlessly across devices help generate more sales for our clients.

During this quarter, our clients continue to increase the spend with us, buying in particular clients that were live in both Q1 last year and Q1 this year generated 25% more revenue extract at constant currency this year compared with the previous year.

Our ability to maintain over 75% of our business from uncapped budget continues also to be a key success factor. Our second growth driver was new client addition. In Q1, we set a new record in Criteo’s history by adding over 640 net clients. We ended the quarter with more than 7800 clients.

While we continue to large clients in all regions, our investments, specific investment in mean market segments are paying off. In all regions, we maintain a strong mean market momentum, which continues to outpace the growth of the rest of the group.

As we have only penetrated a small fraction of the overall addressable mean market, we plan to further invest in this era in the coming quarters. The third growth driver was our continued success in expanding a publisher relationship. We continue our partnership with Facebook, especially on integrating the dynamic product and to reach users on mobile.

In the first quarter, we brought more clients into a solution, which we Facebook Dynamic Product Ad on mobile in-app inventory. As the capabilities of the Dynamic Product Ad expand, so that it’s performance for e-commerce clients.

In the quarter, we also further increased our ability to access inventory on mobile devices especially in the Apple World with the release of a new real-time users sync technology. When implemented by partners like The Rubicon Project, it allows them for the first time to access our important demand on Apple devices.

Our publisher marketplace also continues to enjoy positive traction and it’s generating an increasing share of our business. At the end of Q1, overall we had direct relationships with more than 10,000 publishers. Furthermore, according to comScore data, Criteo ads reach 1.1 billion unique users worldwide, just on the desktop in March 2015.

This is the second largest reach worldwide and represents a 15% increase compared to March last year. Moving now to our performance by region, we are once again very pleased with our consistent execution across all geos. Let me start with the Americas.

In the first quarter, revenue ex-TAC grew 101% at constant currency, compared to 66% in the first quarter last year. The U.S. market continues to be the primary driver of the regional performance. In the U.S. our positive traction is driven by best-in-class performance and increasing buying power to excess inventory.

Client adoption of our new products continue to be strong. In the U.S. we added the several important clients including Hubbub [ph] another Amazon company we’re working with. Our rapid ramp up in the mean market segments remains also a very significant growth driver in the region. Moving now to EMEA, our revenue ex-TAC grew 34% at constant currency.

We further expanded our client base across market segments and verticals in this region we continue to perform well in existing markets and the further potential in early stage markets such like Eastern Europe, Russia, and Turkey.

Our enhanced Criteo engine along with our multi-screen solution and email product, iDriving, incremental spans from our clients in the region, in particular, our email product represents now a meaningful power of our business in France. Moving now to Asia Pacific, we also maintain their rapid growth on large scale.

In Q1, revenue ex-TAC grew 61% at constant currency and 31% sequentially. In Japan, in particular, our strong performance was driven by the adoption of new products supported by the strong penetration of mobile devices and also by new sales origination focused on gaining even more new clients.

On top of that our South East Asian markets are now seeing strong momentum and now represent a greater share of our Asia Pacific business. Overall we are excited about the opportunity to capture incremental growth across this very dynamic region. Let's move now to our priorities for the rest of 2015. We remain very focused on three keen area.

First, continue to up-sale our clients to a full multi channel performance marketing solution. As you know for CMOS the ability to engage and convert seamlessly across all performance marketing channels is getting critical. Our solution already covers full key performance channel, display, native, in-app and email.

We plan to further role out this holistic approach across our client base. We are also putting an important focus to deploy on a much larger scale, our cross-device solution throughout the year, given a very large footprint both on the client and the publisher side we believe we can create lot of incremental value in this area.

In parallel we continue to rollout a full suite of product including our unique email marketing solution. Second area, is further innovate a rollout our core technology in order to generate more sales for existing clients. Those core innovations, they apply to all our marketing channel and create direct leverage into the mobile.

The first area, specific area is around constant improvements to the prediction engine focusing on conversion value. Another important area we are excited about is Criteo optimization, especially around native ad. The huge course in mobile is quickly transforming the publisher advertising landscape.

To maximize this new opportunity we are rolling out the theories of new creative capabilities both in-apps and in browsers. This combines very flexible creative elements of the banner with high degrees of real-time optimization for each of those elements.

So third, [ph] our focused we remain obviously very focused on further expanding global geo presence. We expect significant growth in major markets like the U.S. and also in early stage markets such as South Asia, China, Russia, and Latin America. We are also setting up new legal entities in Dubai, Turkey, and Canada.

Overall, our Q1 results are consistent with execution. Our tech investments are paying off, with exciting new products in the pipeline, we’re committed as ever to grow our leadership in performance marketing. In short, 2015 has begun well and we are confident it will be another exciting year for Criteo.

And as we progress through the year, we look forward to update new on our growth initiatives. With that, let me turn the call over to Benoit, our CFO..

Euro-U.S. dollars of 1.10; the Euro-Japanese Yen of 1.35; the Euro-British Pound of 0.75; and the Euro-Brazilian Real of 3.3. This guidance also assume no additional acquisitions are completely during the second quarter of fiscal year 2015. In closing, I’m very satisfied with our strong result on solid execution in the first quarter.

We are confident as we enter the second quarter and expect an exciting 2015 overall. As our raised 2015 guidance imply, we are pleased to reinvest a portion of our incremental revenue ex-TAC into strategic initiative to accelerate growth.

I look forward to continuing to build long-term trust with our shareholders and that they [indiscernible] every quarter on our story. With that I would now turn back the call to the operator to take you question..

[Operator Instructions]. And our first question comes from Douglas Anmuth from JP Morgan. Please go ahead..

Great, thanks for taking the question. First something you guys could talk a little bit more about Facebook and DPAs how those are going so far and if you could help perhaps give a breakdown of your Facebook business, in terms of what’s desktop, in terms of FDX and what has shifted over in terms of mobile and DPAs.

And then also how do you compare kind of the click-through rate and efficacy that you’re getting between those two and also the economics that you see as you go from desktop to mobile there? And then secondly I was hoping you could provide some thoughts on Twitter’s acquisition of TellApart and how you think that may or may not impact your ability to partner with Twitter going forward? Thanks..

Thanks very much Doug. First on Facebook, so as you know we’ve been working on the DeskPop for a quite long time now over a year EPA is still holistically new and we just start the ramp up.

So of course there is a lot of potential there, because and I’m sure one is aware there is a much more – now much more mobile inventory than desktop inventory on Facebook. So we’re very excited about this partnership.

This I would say taking away our Facebook is still relatively new, but we expect this to be got a significant contributor to our growth in the coming quarters and we will update you further on that later on. Acquisition of TellApart by Twitter your second question.

So just to put this into perspective if you look in the last two years, we have seen a general pattern of lot of our competitors whenever in the U.S. or in Europe, getting acquired one after the other. And this is something, I think, which is very usual, when a market is maturing and you have a very strong leader which is showing a lot of momentum.

It’s getting harder and harder for other players to twisting in par. And this is something in general that you see that smaller competitors tend to be acquired at some point, which usually creates even more momentum for the lead player.

And this is a repeat pattern that we have seen over the last two years and we had a lot of indicators whenever it had with as, we do with clients or other competitive intelligence showing that our holistic position compared to a [indiscernible] has been strengthening over the last two years. It’s very clear.

And these are I’d say illustration of this overall dynamic..

Thanks. If I could just follow-up quickly on CapEx Benoit, you mentioned that you’re increasing the CapEx or supporting the expansion in China.

Could you just talk for a minute about your business there and what’s going on there that requires you to increase the spending that much more?.

I mean, clearly from a CapEx stand point, I mean this is not new on the CapEx, I mean we have to indicated at the beginning of the year, if you remember in the last call that we would have more ambitious CapEx program for the year, moving from 5% of revenue, which has been pretty much average over the past years to 6%.

As a result of significant investment in infrastructure into redundancy in particular between datacenters as well as supporting new region.

China is clearly in order to be a player in China, significant player you need to have a datacenter in Mainland China, and you need to make that investment, I mean to add a bit about the business momentum obviously to be able to serve your customer there.

So that’s what we are doing as we speak, we are investing this quarter into China and we’ll continue to do so over the course of Q3 as well. Eric..

Yes, the only thing I would say is, when we started in China, we established a datacenter in Hong Kong and once we are in China we are seeing there’s true momentum in the market is favorable market for our product, we’ve decided to go into China and we’re setting up a datacenter.

And our expectation is that that will also improve our performance and will allow us to grow even faster..

Great, thank you guys..

Our next question will comes from Ross Sandler from Deutsche Bank. Please go ahead..

Great, thanks guys.

Just two questions, JB has the mix shifts towards mobile on your business, do you see the kind of 40% rev ex-TAC margin staying the same or in that same range given that a lot of this native mobile inventory is yet to find it’s way to exchanges and requires a little bit more heavy lifting to integrate and often times is a little bit more costly inventory than what is available on exchanges.

So that was the first question on mobile. And then Benoit, sales and marketing x stock based comp was up about 75% in the quarter and delivered a little bit, relative to delivering most of last year. So is that DataPop or is there some other stuff going on and is that a trend that we should expect in the rest of 2015? Thanks..

Thanks Ross. So regarding your first question, it’s true that for native adds specifically you have more complex on average, more complex technical integration process than for regular IME formats, which creates, I would say, higher bias by one-three of players because you have to manage this complexity.

It has zero impact on our margin and because this is technical integration is just one of course when you just start a new relationship with the publisher.

And generally speaking, I mean the second – the other side of this complex integration is that it’s harder for the publisher to scale demand because it creates more work on the demand side, and there are less players capable to go to do this integration. So relatively speaking, this inventory is then easier to access.

And as we come with full integrated demand we have typically a very favorable buying conditions and sometime more favorable than on the – I would say additional [ph] [indiscernible] one of the reason why we are so excited about native, even if it add some complexity, but also it creates a lot of new opportunities for us in growing our business.

So coming to the S&O [ph], it’s true that we have invested in S&O [ph] particularly in that headcount and a bit ahead of the curve, if you look at the total headcount increase, the majority of the 200 plus headcount increase that we have during the quarter that’s coming from a S&O [ph], whatever uncertainties three exactly coming from S&O [ph].

And that is the last portion of that is going into MMS investments that we are making in our various centers, we’ve opened, as you might remember an office in Barcelona that we are growing rapidly in MMS and we are also now covering MMS being mid market sell, just to remind everybody.

And we are growing also our office in Boston, as well as our presence in Asia Pacific. So all of that is going to yield result during the course of the year and it doesn’t change anything to the overall profile of operating leverage coming progressively out of sales and operation, as you’ve seen coming though over the prior years..

Our next question in the phone queue from Debs Schwartz from Goldman Sachs. Please go ahead..

Great, thanks. I wonder if I could ask a question about the new Criteo Engine rollout. You mentioned that is operational as for around 22% of your customer base given that it optimizes per basket size.

Wondering if it’s an optimal – wondering whether or not you’re planning on rolling out your full client base and what you expect the timeline there to be, a color on how different categories of advertisers performed in the quarter from retail to travel as well as your others, thanks..

So thank you Debra this is Eric, so yes we are 22% of our customer base and as you would expect we normally go after the bigger fish first. But our intent is obviously to deploy these across the board and we will be deploying these over the next few quarters.

In terms of performance, what we’ve seen is that we are seeing increased performance in the travel sector and there we’re seeing something around 20% incremental deliveries. So that’s quite exciting and we are continuing to deploy these across all channels..

Great, thanks.

And any commentary on different categories by advertisers?.

We are deploying it across all categories to a travel, retail and classified and generally what we are seeing in terms of results around retail is quite positive..

Great. Thanks..

Next question from Brian Pitz from Jefferies. Please go ahead..

Questions, a follow-up to Doug’s question on Facebook, you mentioned the significant amount of Facebook, mobile inventory coming from GPAs just curious if you can quantify the amount of inventories that has been unlocked here.

And maybe any broad comments on ad budgets are you seeing new dollars coming from offline or these dollars coming in from other online platforms. And then quickly on OpEx, any specifics on the much better G&A in the quarter and can you give us any additional color on spending plans or projects in Q2, given the lower EBITDA guide, thanks..

So exactly how much of the overall Facebook inventory – mobile inventory is accessible to GPA I think this is more question for Facebook than for us. We have access to the GPA and we see there is a huge potential. How much exactly of the whole Facebook opportunity it is, I think it’s for Facebook one service.

We are getting offline that is an interesting topic and we have been doing a number of tests with our clients to measure the offline impact on online companies. And I mean we were pretty shocked by the results that’s we have seen that on average for every sale we generate online.

There is an incremental – now their sales generating offline, which mean there is a lot of value that we are providing to our clients – received applies need to clients that have offline activities and not the pure line players.

There is a big piece of this value that today is not fully measured and understood and potentially a very interesting our growth for us. Once for clients have the right measurement tool to do base in this in a scalable way. But it’s definitely in where we are very exciting that we are looking at increasing year, especially in the U.S.

whether ecosystem is more mature. So with respect to the increase in expenses in Q2, I think, there are primary three factors there, I mean obviously we have a very strong hiring in Q1 as you’ve seen on there will be obviously a flow through into Q2 of the full impact of this hiring that will contribute to the increasing OpEx.

We also have traditionally in Q2, our worldwide summit, where we gather and this is a very important moment in the life of Criteo. We gather all of the employees and that will take place also in Q2 on being fully recorded its almost impact in Q2.

As I stated earlier in the prepared remarks, we also have an increase in hosting cost as we are ramping up our investments in datacenters, hosting costs are going to ramp up. So these are the three main factors of the increase – sequential increase in OpEx..

Great, thanks..

Our next question come from John Egbert from Stifel..

Thanks. It seems like weakness in non-performance display advertising has been a common trend for some other notable digital media companies in the first quarter.

Do you think you’ve been beneficiary of this trend and I know you see any noticeable dollar shifts from any advertiser verticals or categories in particular? And on second, now that you’ve been diving deeper in-app advertising are you starting the work with any advertisers that you hadn’t really done much business with before? Thanks..

When it comes to performance, as we’ve been reminding in the first part of the call, our business is driven by design the divestment which of our clients work with us on uncapped budget. So and they are driven by specific ROIs that they are targeting. And we provide them as much volume as possible.

So our focus is not really about stealing budgets from others, but maximizing the opportunity with existing clients. And the way we do this is by improving the technology and accessing new inventories.

These are the key drivers and the way our clients deal with us, is we’re truly independent from what they do on other channels where they measure things differently on. When it comes to in-apps, our approach is full multi channel solution, where we don’t sell specifically, purely in-apps, we sell a global multi-screen, multi device solution.

And what’s very exciting for our clients is their ability for Criteo to deliver consistently this ROI targets across all China, all devices, browser, apps the same way. And it’s really the focus we having today into our roll out..

Okay. Thank you..

Patterson from Raymond James. Please go ahead..

Great, thank you. So with respect to the e-mail product I believe your thoughts during the prepared remarks that you are seeing some pretty solid trends and trends with that.

Could you talk about whether that’s bringing in – getting more spend from your existing customers, bringing in new customers on that kind of what market segment that satisfying? And secondly, could you talk just more about verticals broadly? Within the mid-market segment it sounds like investments increase pretty meaningfully there.

Is that still kind of core e-commerce travel base or you setting gets more traction within [indiscernible] [01:29] *19 and other areas you talked about? Thanks.

All right great. This is Eric, thanks for the question. So on the e-mail product, which we are deploying quite rapidly in France. What we’ve seen is just like with our other cross channel solutions, the spend is mostly incremental for our clients and it is complementary to what they do today in display.

And so we are very excited and their performance is very good and very comparable to what we get in terms of ROIs on the display side, and intent obviously to deploy this more broadly initially in the U.S. and in the UK over the next few quarters.

And then for the mid-market segment, we continue to invest in that segment, we see a lot of potential and we see the potential to continue to accelerate our investment there..

And in terms – specifically in terms of vertical or productively similar to the mix we have in Q1 probably as we are at earlier stage in term of market penetration in mid-market. It’s probably even more focus in retail and travel.

Just because additionally these types of clients are early adopters, so they tend to adopt very quickly at solution and as we grow and we mature and we seeing this pattern are repeating over time in all geos We broadened step-by-step our client base to more verticals..

Great. Thank you. Operator [Operator Instructions] Our next question is comes from Richard Kramer from Arete Research. Please go ahead..

Thanks very much guys, JB could you talk about the rising number of new clients and within your guidance in your thought process, when should we expect transition from adding clients to trying to drive increased spending per client.

This would seem sort of a key proof point of talking about uncapped budgets, maybe I don’t know if you could divide the client base into cohorts and talk a bit in more detail about rising spend. And for Benoit, can you talk over what the rationale and cost would be for a U.S. listing that you mentioned briefly.

And also you’d previously guided to about €10 million negative impact from DataPop.

Is that – is the increase in guidance related to those figures being lower or is that €10 million cost still on track?.

Thank you very much.

So regarding your first question we are – we were very pleased in the first quarter that we had to read the combination of both, because on the one side, it was a record quarter in term of new net client addition as we said 640 – yes it’s – the biggest number we’ve ever seen in one single quarter and we are talking about net addition – net of the churn and that at same time, we are seeing a very solid momentum in term of average spend declines and particularly from a cost perspective.

As we mentioned earlier in the call, when we look at specifically as – on our clients as that for life in Q1 last year with Q1 this year, which really a just a light one. We have seen 25% increase in there we don’t expect. So clearly as we are expanding our portfolio of products as we are expanding our inventory.

Our existing clients are spending more and more with us, it’s a pretty clear trends where that we are seeing..

Yes, so Richard to – just cover and thanks for asking the question about these domestic fiber situation, it’s not the choice of the company. It’s - as is your rule is that if you get to the point where more than 50% of your shareholder base is U.S. You ask them to comply with the U.S. domestic finding requirements.

So we are anticipating even if we are not certain, but we are anticipating that we land up in this situation before the date of the measurement and that measurement takes place every year on 30 of June, still eased by the 30 of June we have more than 50% of our shareholders who are U.S.

citizens, we would be in a situation where on the 1 of January 2016, we would have to report according to not anymore as a private issuer, but as a domestic issuer, which would means that we would have to report in U.S. GAAP on that slightly more develop this quarter at that point.

So we are getting ready for it, we are not sure yet that this is going to happen.

With respect to the increase in guidance, no it is not linked to better forecast with respect to DataPop, I mean the dilution, indication that we gave you in the last call are still valid for [indiscernible] it is the direct performance of an improve outlook on the revenue ex-TAC.

And as I mentioned we have plan as part of the EBITDA guidance to reinvest part of these better outlook in revenue ex-TAC into expenses..

And maybe just one of the follow-up, I mean, you’ve been sitting now for any number of quarters on €280 million of net cash, I mean, at point does that become just revenue that are capital you’re not employing in the business, given that, as you mentioned, this sector seems to be consolidating around U.S.

as opposed to you having to drive consolidation on your own..

I mean it’s clear that it gives us a lot of financial flexibility to nearly €300 million of cash. I mean the fact that we’ve done an acquisition in the quarter and that despite this acquisition we were still generating increasing in our cash balances is a good illustration.

So we’ve been always very clear on the fact that, the use of cash for the company is smart acquisition, and we are doing acquisition in a very selective matter. It’s not because we are relatively material cash balances that we would do any type of acquisition, we are very selective.

But the pre-folds [ph] of having this cash is financial flexibility in order to cease opportunity of acquisition..

Okay, thank you..

There are currently no further questions in the phone queue. [Operator Instructions].

I think we are getting to the end of the call. So there is no last question, we’ll probably wrap up it..

Indeed thank you very much for attending this call..

Thanks everyone..

Thanks everyone..

Thank you..

Thank you..

That will conclude today’s conference call. Thank you for your participation, ladies and gentlemen, you may now disconnect..