Criteo announced its Q1 2025 results on Friday—and unfortunately, the market isn’t reacting well.
To be clear, Criteo actually posted a slight gain in Q1, with $451 million in revenue compared to $450 million in Q1 2024—a 0.3% increase. For context, the company reported a 2% revenue decline in Q4. Essentially, as Criteo continues its shift from retargeting leader to retail media powerhouse, the business has been stabilizing.
The issue? Criteo disclosed that its “largest Retail Media client” (Albertsons?) informed them this week that, while it will continue using Criteo’s retail media technology platform, it plans to discontinue managed services and pull back remaining brand demand sales services starting in November. “Instead of a natural and gradual evolution of the support we provide them with, this is a sudden change that will result in a significant impact on the growth rates of our Retail Media business for a twelve-month period starting in Q4 2025,” said CEO Michael Komasinski, on the earnings call.
As a result, Criteo has revised its 2025 retail media outlook downward to low- to mid-single-digit growth—and the stock is dropping accordingly.
Why This Matters:
Here’s more background on the situation via a Criteo investor FAQ:
This is a blow, of course, especially as retail media overall continues to grow. U.S. retail media ad spend is expected to increase nearly 90% between 2024 and 2028, according to EMARKETER. And in a down economy, performance matters—so advertisers may continue shifting budgets toward performance channels like retail media.
That said, the broader market response to the macroeconomic environment remains uncertain. Earnings results have been mixed across the board (Meta up, Amazon down, Snap down, Google up, etc.).
Despite the loss of this piece of retail media business, Komasinski emphasized: “This near-term change does not affect our substantial opportunities to continue to grow faster than the market across the rest of our retailer base and for the long term.”
Experts React:
W Media analyst Karsten Weide has a solid writeup on Criteo’s earnings, which is worth a read. He acknowledges the short-term pain caused by the retail media client shift but sees a longer-term opportunity ahead. Here’s a key quote:
“Criteo may not be the headiest game in AdTech, but its Q1 2025 results show a company under a new CEO that’s playing the long game—one that prioritizes sustainable profitability, platform innovation, and strategic flexibility. While it still has work to do to reignite topline growth, the core business is healthy, the commerce media strategy is working, and AI is beginning to reshape how it serves advertisers.”
(Criteo has been doing some cool AI work, which we’ve written about here.)
Our Take:
A tough earnings report, driven by the contraction with Criteo’s largest retail media client. More broadly, it raises questions about what’s ahead for retail media advertisers—mostly CPG brands—as they navigate a complex, tariff-affected macroeconomic environment. Prices for goods have risen, but consumer spending hasn’t necessarily pulled back.
Will CPGs respond with caution, potentially pulling back on ad spend and hurting retail media growth? Or will they shift more budget into retail media to align with—or even surpass—the eMarketer projections we cited earlier? Right now, it’s hard to say.
