Catena Media reports 29% Q3 revenue drop amid AI search shift
The Malta-based affiliate's third-quarter revenue fell to €8.3m as generative search tools cut into organic traffic, with shares down 21% in Stockholm trading.
Catena Media has reported a 29% year-on-year decline in third-quarter revenue to €8.3m (£7m), with the affiliate group blaming the disruption of organic search by AI tools for continued pressure on its Google rankings.
Adjusted EBITDA for the quarter came in at €700,000, down 76% from €2.9m in the same period last year. Shares in the company dropped 21% to SEK2.52 (19p) in early Stockholm trading following the preliminary results, published on 16 October.
Management pointed to generative search reshaping how customers find brands, a shift it said is cutting new traffic across the wider affiliate sector. The company also said search engines were continuing to promote lower-relevancy content, further denting its organic visibility.
A summer slowdown in operator marketing spend added to the pressure. Catena Media noted that more than 90% of its new customers come through CPA arrangements, leaving it with little recurring revenue to absorb the combined impact of these market conditions.
The firm also flagged a forthcoming non-cash impairment charge on intangible assets of between €30m and €35m, to be recognised for the three months ending in September.
Across the first nine months of 2026, Catena Media's revenue edged down to €30.1m from €31m a year earlier, according to EGR. Adjusted EBITDA for the nine-month period fell to €4.6m, compared with €5.2m in 2025.
Given the weak quarter, the company said it no longer expects to hit its 2026 target of double-digit organic growth in both revenue and adjusted EBITDA.
Catena Media chief executive Manuel Stan described it as "a weak quarter" whose results "reflect that". He said the search landscape is undergoing "a rapid and fundamental shift", adding that as a predominantly CPA-based business, the group's results reflect the effects of these changes "immediately and in full".
The downturn follows an August announcement in which Catena Media said it intended to move beyond affiliation and lead generation towards becoming what it called a technical infrastructure and intelligence platform. Grandstand, formerly known as Gambling.com Group, has pursued a similar diversification strategy to reduce its reliance on Google-driven customer acquisition.
Stan said the latest results reinforce the strategic direction set out in the second quarter, pointing to efforts to reduce dependence on search through diversifying revenue streams. He cited the newly announced TraffiqX project, expansion into verticals such as prediction markets, and continued investment in customer loyalty programmes.
He added that these efforts will be supported further by TraffiqX, a new platform the company plans to launch in the first quarter of 2027.
Catena Media is scheduled to publish its full Q3 interim report on 10 November.