Principles and Accounting Methods |
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| Accounting Policies [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Principles and Accounting Methods | 1. Principles and Accounting Methods Basis of Presentation We prepared the consolidated financial statements in accordance with the U.S. generally accepted accounting principles ("GAAP"). The consolidated financial statements include the accounts of Criteo S.A. and its subsidiaries where we have controlling financial interests. Intercompany transactions and balances have been eliminated. The table below presents at each period’s end and for all entities included in the consolidation scope the following information: the country of incorporation and the percentage of voting rights and ownership interests.
(1)Criteo Holdings Inc. includes a French Branch (2)Liquidated during the twelve months ended December 31, 2025 Functional Currency and Translation of Financial Statements in Foreign Currency The Consolidated Financial Statements are presented in U.S. dollars, which differs from the functional currency of the Parent, the Euro. The statements of financial position of consolidated entities having a functional currency different from the U.S. dollar are translated into U.S. dollars at the closing exchange rate (spot exchange rate at the statement of financial position date) and the statements of income, statements of comprehensive income and statements of cash flow of such consolidated entities are translated at the average year-to-date exchange rate. The resulting translation adjustments are included in equity under the caption “Accumulated other comprehensive income (loss)” in the Consolidated Statements of Changes in Shareholders' Equity. Conversion of Foreign Currency Transactions Foreign currency transactions are converted to U.S. dollars at the rate of exchange applicable on the transaction date. At period-end, foreign currency monetary assets and liabilities are converted at the rate of exchange prevailing on that date. The resulting exchange gains or losses are recorded in the Consolidated Statements of Income in “Other financial income (expense)” with the exception of exchange differences arising from monetary items that form part of the reporting entity’s net investment in a foreign operation, which are recognized in "Other comprehensive income" in the Consolidated Statements of Comprehensive Income. They will be recognized in profit or loss on disposal of the net investment. Use of Estimates The preparation of our Consolidated Financial Statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the consolidated financial statements and the reported amounts of revenue and expenses during the period. We base our estimates and assumptions on historical experience and other factors that we believe to be reasonable under the circumstances. We evaluate our estimates and assumptions on an ongoing basis. Actual results could differ from these estimates. On an on-going basis, management evaluates its estimates, primarily those related to: (1) revenue recognition (2) income taxes, (3) assumptions used in the valuation of long-lived assets including intangible assets and goodwill, and (4) assumptions surrounding the recognition and valuation of contingent liabilities and losses. Operating Segments We report our financial results based on two reportable segments: Retail Media and Performance Media. The reported segment information is based on internal management data used for business performance analysis and resource allocation, following the management approach. An operating segment is a component of the Company for which separate financial information is available that is evaluated regularly by our Chief Operating Decision Maker ("CODM") in deciding how to allocate resources and assessing performance. Refer to Note 3 Segment information for further discussion. Business combinations We include the results of operations of the businesses that we acquire as of the acquisition date. We allocate the purchase price of our acquisitions to the assets acquired and liabilities assumed based on their estimated fair values. The excess of the purchase price over the fair values of these identifiable assets and liabilities is recorded as goodwill. Acquisition-related expenses are recognized separately from the business combination and are expensed as incurred. Internally Developed Software and Software as a Service We capitalize external costs and directly attributable internal development costs to acquire or create internal use software which are incurred subsequent to the completion of the preliminary project stage. These costs relate to activities such as software design, configuration, coding and testing. Costs related to post-implementation activities such as training and maintenance are expensed as incurred. Capitalized costs are included in Intangible Assets on the consolidated balance sheets. These costs are amortized over the estimated useful life of the software, which is typically three years, on a straight-line basis, which represents the manner in which the expected benefit will be derived. We also enter into cloud-based software hosting arrangements, which are accounted for as service contracts. The Company capitalizes certain implementation costs, which are consistent with costs incurred during the application development stage for on-premise software. The capitalized costs are presented within prepaid expenses and other current assets on the consolidated balance sheets, and are amortized on a straight-line basis over the fixed, non-cancellable term of the associated hosting arrangement plus any reasonably certain renewal periods. The Company applies the same impairment model to both internal-use software and capitalized implementation costs in a software hosting arrangement, which is accounted for as a service contract. Property and Equipment Property and equipment is accounted for at acquisition cost less accumulated depreciation and any impairment. Depreciation is calculated on a straight-line basis over the assets’ estimated useful lives. Our estimate of useful lives represents management's best estimate and is evaluated periodically. If the estimated useful life of an asset changes, the remaining carrying amount of the asset is depreciated over the revised estimated useful life. The estimated useful lives of property and equipment are described below: Servers and Networking equipment .................................................................................................. 6 years Furniture and IT equipments............................................................................................................... 3 to 5 years Leasehold improvements are depreciated over their useful life or over the lease term, whichever is shorter. In January 2025, we completed an assessment of the useful lives of our servers and network equipment, resulting in a change in the estimated useful life of certain servers and network equipment from to six years. This change in accounting estimate is effective beginning fiscal year 2025. The Company reviews long-lived assets for impairment whenever events or changes in circumstances indicate that the carrying amount of an asset is impaired or the estimated useful life is no longer appropriate. If an asset is deemed to be impaired, an impairment loss is recorded to write the asset down to its estimated fair value. Fair value is estimated based on discounted future cash flows. Goodwill and Acquired Intangible Assets Goodwill represents the excess of the aggregate purchase price paid over the fair value of the net tangible and intangible assets acquired. Goodwill is allocated to reporting units based on the expected benefit from the business combination and is tested for impairment at least annually or whenever events or changes in circumstances indicate that the carrying value may not be recoverable. The Company has two reporting units, Retail Media and Performance Media, that are subject to goodwill impairment testing. In the impairment assessment of its goodwill, the Company performs a quantitative test that involves estimating the fair value of each reporting unit using a discounted cash flow model, which requires significant assumptions, including projected future cash flows, discount rates and long-term growth rates. The estimated fair value of each reporting unit is then compared to its carrying value, including goodwill. If the carrying value exceeds the estimated fair value, the Company would be required to recognize an impairment loss in the Consolidated Statement of Income. Changes in estimates or underlying assumptions could affect the determination of fair value and may result in a future impairment. Acquired intangible assets are accounted for at acquisition cost less cumulative amortization and any impairment loss. Intangible assets that are not considered to have an indefinite useful life are amortized over their useful lives. Acquired intangible assets are amortized over their estimated useful lives of to nine years on a straight-line method. Intangible assets are reviewed for impairment whenever events or changes in circumstances such as, but not limited to, significant declines in revenue, earnings or cash flows or material adverse changes in the financial and economic environment indicate that the carrying amount of an asset may be impaired. Leases The Company leases space under noncancellable operating leases for offices and data centers. Office leases typically include rent free periods and rent escalation periods, and may also include leasehold improvement incentives. Leases for data centers may also include rent free periods and rent escalation periods. Both office and data center leases may contain both lease components (rent) and non-lease components (maintenance, electrical costs, and other service charges). Non-lease components are accounted for separately. Leases typically contain options to renew, and/or early terminate the lease. Options have been included in the lease term if management has determined it is reasonably certain that they will be exercised, at lease commencement. Operating lease liabilities are recognized based on the present value of the future minimum lease payments over the lease term at commencement date. As most of the leases do not provide an implicit rate, the Company uses its incremental borrowing rate at lease commencement to determine the present value of future payments. It is then adjusted in consideration of the currency of the lease and the lease term as of the lease commencement date. Lease expense is recognized for minimum lease payments on a straight-line basis over the lease term. Variable costs include changes in indexation and are expensed in the period incurred. Accounts Receivable The Company carries its accounts receivable at original invoiced amount less an allowance for any potential uncollectible amounts. Receivables are presented on a gross basis and are not netted against the payments we are required to make to advertising inventory publishers. The Company applies ASC 326, Financial Instruments — Credit Losses, which requires the measurement and recognition of expected credit losses for financial assets held at amortized cost that an entity does not expect to collect over the asset's contractual life, considering past events, current conditions, and reasonable and supportable forecasts of future economic conditions. For accounts receivable measured at amortized cost, the Company uses aging analysis, and probability of default methods to evaluate and estimate the expected credit losses. A receivable is considered past due if we have not received payments based on agreed-upon terms. Allowances for credit losses on trade receivables are recorded in “Sales and operations expenses” in the Consolidated Statements of Income. The Company generally does not require any security or collateral to support its receivables. Derivative financial instruments The Company buys and sells derivative financial instruments in order to manage and reduce exposure to the risk of exchange rate fluctuations. The Company only deals with major financial institutions. Financial instruments may only be classified as hedges when we can demonstrate and document the effectiveness of the hedging relationship at inception and throughout the life of the hedge. Generally, derivatives are not designated as hedging instruments and mainly consist of forward buying contracts that are used to hedge intercompany transactions and other monetary assets or liabilities denominated in currencies other than the local currency of a subsidiary. The Company recognizes gains and losses on these contracts, as well as the related costs, in financial income (expense), net, along with the foreign currency gains and losses on monetary assets and liabilities. This results in the cash flows from derivative instruments to be classified in the same category as the underlying cash flows. Derivative instruments are considered level 2 financial instruments as they are measured using valuation techniques based on observable market data. Fair value measurements Fair value is defined as the market price that would be received from selling an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. To determine the fair value measurements for assets and liabilities which are required to be recorded at fair value, observable inputs are given preference over unobservable inputs. Fair value measurements are based on the following hierarchy, which prioritizes the inputs used to measure fair value into three levels: •Level 1: fair value calculated using quoted prices in an active market for identical assets and liabilities •Level 2: fair value calculated using valuation techniques based on observable market data such as prices of similar assets and liabilities or parameters quoted in an active market •Level 3: fair value calculated using valuation techniques based wholly or partially on unobservable inputs such as prices in an active market or a valuation based on multiples for unlisted companies. Cash, Cash Equivalents and Investment Securities Cash and cash equivalents include cash on hand, demand deposits, money market funds and other highly liquid investments with a remaining maturity at the date of purchase of three months or less, or with a maturity of more than three months that can be early withdrawn without significant penalty or foregoing of interest, for which the risk of changes in value is considered to be insignificant. We hold investments in marketable securities, including term deposits with banks, not meeting the cash equivalents definition. We classify marketable securities as either available-for-sale or held-to-maturity investments, depending on whether we have the positive intent and ability to hold them to maturity. Our available-for-sale marketable investments are carried at estimated fair value with any unrealized gains and losses, net of taxes, included in accumulated other comprehensive income in stockholders' equity. Our held-to-maturity marketable investments are carried at amortized cost, and are subject to impairment assessments. Interest income generated from held-to-maturity investments is recorded as financial income. We also invest in nonmarketable securities, consisting mainly of private equity investments, which are classified as equity investments and reported within Other noncurrent financial assets. Equity investments without a readily determinable fair value that do not qualify for the practical expedient to estimate fair value based on net asset value are recorded at cost, less impairment. Concentration of Credit Risk Financial instruments that potentially subject the Company to significant concentrations of credit risk consist primarily of cash, cash equivalents, marketable securities and accounts receivable. The Company’s cash, cash equivalents and marketable securities are held and foreign exchange contracts are transacted with major financial institutions that the Company's management has assessed to be of high credit quality. The Company has not experienced any losses in such accounts. The Company mitigates its credit risk with respect to accounts receivable by performing credit evaluations and monitoring agencies' and advertisers' accounts receivable balances. During the years ended December 31, 2025, 2024 and 2023, no individual customer represented 10% or more of revenue. Employee Benefits Depending on the laws and practices of the countries in which we operate, employees may be entitled to compensation when they retire or to a defined benefit following their retirement. For state-managed plans and other defined contribution plans, we recognize them as expenses when they become payable, our commitment being limited to our contributions. The liability with respect to defined benefit plans is estimated using the following main assumptions: •discount rate; •future salary increases; •employee turnover; and •mortality tables. Service costs are recognized in profit or loss and are allocated by function. Actuarial gains and losses are recognized in other comprehensive income and subsequently amortized into the income statement over a specified period, which is generally the expected average remaining service period of the employees participating in the plan. Actuarial gains and losses arise as a result of changes in actuarial assumptions or experience adjustments (differences between the previous actuarial assumptions and what has actually occurred). Contingencies We are involved in legal proceedings, claims, and regulatory, tax or government inquiries and investigations that arise in the ordinary course of business. Certain of these matters might include speculative claims for substantial or indeterminate amounts of damages. With respect to these matters, asserted and unasserted, we evaluate the associated developments on a regular basis and accrue a liability when we believe that it is both probable that a loss has been incurred and the amount can be reasonably estimated. If we determine there is a reasonable possibility that we may incur a loss and the loss or range of loss can be reasonably estimated, we disclose the possible loss in the accompanying notes to the consolidated financial statements to the extent material. We review the developments in our contingencies that could affect the amount of the provisions that have been previously recorded, and the matters and related reasonably possible losses disclosed. Revenue Recognition We sell personalized digital display advertisements featuring product-level recommendations either directly to clients or to advertising agencies. We also provide technology to retailers and other companies in the ad-tech industry which enables them to monetize on their advertising properties, or connect them to other players in the ad-tech industry. Revenue is recognized when control of the promised services is transferred to our clients, in an amount that reflects the consideration we expect to be entitled to in exchange for those services. Variable consideration is included in the transaction price only to the extent that it is probable that a significant reversal of cumulative revenue recognized will not occur. We determine revenue recognition by applying the following steps: •Identification of the contract, or contracts, with a customer; •Identification of the performance obligations in the contract; •Determination of the transaction price; •Allocation of the transaction price to the performance obligations in the contract; •Recognition of revenue when, or as, we satisfy a performance obligations. Our pricing models include click- and impression-based pricing, and percentage of spend pricing. Click and impression based pricing model For campaigns priced on a click or an impression basis, we bill our customers when a user clicks on an advertisement or an advertisement is displayed to a user. For these pricing models, we recognize revenue at a point in time when a user clicks on an advertisement or an advertisement is displayed, as our performance obligation is the delivery of clicks or displays to the customer. Percentage of spend pricing model For campaigns priced on a percentage of working media spend basis, we bill our customers when customers buy and sell digital advertising inventory through our platform. For these pricing models, we recognize revenue at a point in time when the transactions occur through our platform, as our performance obligation is to provide access to our platform to allow customers to buy and sell advertising inventory. We also provide professional services to our customers, such as campaign management and billing and administrative services. Revenue for professional services is recognized over time as customers simultaneously receive and consume the benefits of the services as they are performed. Principal versus Agent Considerations The determination of whether we are acting as principal or agent requires judgment. We assess whether we act as principal or agent based on whether we control the specified services or advertising inventory before it is transferred to the customer. In making this determination, we consider factors such as our level of control, responsibility for fulfillment, and discretion in establishing prices. When we determine that we act as principal, we recognize revenue and related costs incurred on a gross basis. When we act as an agent, we recognize revenue on a net basis. In our Performance Media segment, we may act as principal or agent depending on the nature of the contract. In our Retail Media segment we act primarily as agent. Rebates and Incentives Criteo offers rebates and incentives to certain customers that could be either fixed or variable. Fixed incentives may represent payments to a customer directly related to entering into an agreement, which are capitalized and amortized over the expected life of the agreement on a straight-line basis. Variable incentives are calculated based on the expected amount to be provided to customers and recognized as a reduction of revenue. Contract Assets and Liabilities Contract assets are recognized when we do not yet have unconditional rights to payment. Contract liabilities are recognized when there is an obligation to transfer services to a customer. Contract assets and liabilities are presented on a net basis at the contract level. Contract assets and contract liabilities are not material to our consolidated financial statements, and changes in these balances during the period were not significant. Practical Expedients We do not disclose the value of unsatisfied performance obligations for (i) contracts with an original expected length of one year or less and (ii) contracts for which we recognize revenue at the amount to which we have the right to invoice for services performed. Our contracts do not include a significant financing component, as payments are less than one year, typically between 0 and 90 days. We expense sales commissions as incurred as the amortization period would have been one year or less. These costs are recorded within Sales and operating expenses within the Consolidated Statements of Income. Cost of Revenue Our cost of revenue primarily includes traffic acquisition costs and other cost of revenue. Traffic acquisition costs consist primarily of purchases of impressions from publishers on a CPM basis, incurred to generate our revenues, primarily for the Performance Media segment. We purchase impressions directly from publishers or third-party intermediaries, such as advertisement exchanges. We recognize cost of revenue on a publisher by publisher basis as incurred. Costs owed to publishers but not yet paid are recorded in our Consolidated Statements of Financial Position as trade payables. Other Cost of Revenue includes expenses related to depreciation of data center equipment, lease cost of data centers, cost of data purchased from third parties, digital taxes, and third-party hosting fees. The Company does not build or operate its own data centers and none of its Research and Development employments are dedicated to revenue generating activities. As a result, we do not include the costs of such personnel in other cost of revenue. Operating Expenses The Company categorizes its operating expenses into three functional categories: research and development, sales and operations, and general and administrative expenses. Research and development expenses consist primarily of headcount-related expenses for our employees working in the engine, platform, infrastructure, engineering , product, analytics and other teams, including salaries, bonuses, share-based compensation and other personnel related costs. Also included are non-personnel costs such as subcontracting, consulting and professional fees to third-party development resources, allocated corporate overhead, and depreciation and amortization costs. These expenses are partially offset by the French research tax credit (CIR). The CIR offsets the income tax to be paid and the remaining portion (if any) can be refunded at the end of a three-fiscal year period. The CIR is calculated based on eligible R&D expenditures. As of December 31, 2025, 2024, and 2023, we recorded $6.6 million, $7.2 million, and $9.5 million of CIR tax credits against these expenses. Sales and operations expenses consist primarily of headcount-related expenses for our employees working in our sales, business development, marketing, creative services and other teams, including salaries, bonuses, share-based compensation, and other personnel-related costs. Additional expenses in this category include provisions for doubtful accounts, consulting and professional fees paid to third parties, and allocated corporate overhead. General and administrative expenses consist primarily of headcount-related expenses, including salaries, bonuses, share-based compensation, pension benefits and other personnel-related costs for our administrative, legal, information technology, human resources, facilities and finance teams. Additional expenses included in this category include professional fees, audit fees, tax services and legal fees, as well as insurance and other corporate expenses, along with allocated overhead, including internal IT costs. Advertising and Promotional Expenses Advertising costs are expensed when incurred and are included in sales and operations expenses on the consolidated statements of income. We incurred advertising expenses of $4.4 million, $1.9 million, and $1.7 million for the years ended December 31, 2025, 2024, and 2023, respectively. Share-Based Compensation Share-based compensation expense consists of the company's restricted stock units (RSUs), and performance stock units (PSUs) expense and Lock-Up Shares "LUS" expense. RSUs and PSUs granted to employees are measured based on the grant-date fair value. The PSUs expense is updated to reflect the Company’s expectation of the likelihood of meeting the performance conditions of the granted instrument. In general, our RSUs and PSUs vest over a service period of to four years. LUS were issued to the Iponweb seller as partial consideration for the Iponweb Acquisition. Share-based compensation expense is generally recognized based on a graded vesting basis over the requisite service period for each separately vesting tranche. We account for forfeitures as they occur. Financial and Other Income (Expense) Financial and other income (expense) consists of investment gains and losses, foreign currency exchange differences, and interest income and expenses. Income Taxes Income taxes are accounted for under the asset and liability method. Deferred tax assets and liabilities are recognized for all temporary differences between the financial reporting and tax bases of assets and liabilities, and for tax losses. Differences are defined as temporary when they are expected to reverse within a foreseeable future. Deferred tax assets are recognized to the extent that management determines it is more likely than not that such assets will be realized. In assessing realizability, management considers all available evidence, both positive and negative, including historical and projected future taxable income, the reversal of existing temporary differences, and available tax planning strategies. A valuation allowance is established for deferred tax assets that are not expected to be realized, and adjustments to the valuation allowance are recorded in income tax expense in the period such determinations are made. Tax assets and liabilities are not discounted. Amounts recognized in the Consolidated Financial Statements are calculated at the level of each tax-paying entity included in the consolidation scope. The effect of changes in tax laws or tax rates on deferred income tax assets and liabilities is recognized in the period in which such changes are enacted. Deferred tax assets and liabilities are measured using enacted tax rates expected to apply in the periods in which temporary differences reverse. Certain tax credits, including research and development tax credits, are accounted for as a component of income tax expense in accordance with ASC 740, Income Taxes. Uncertain Tax Positions We record uncertain tax positions in accordance with ASC 740, which requires a two-step process in which determinations are made (i) whether it is more likely than not that the tax positions will be sustained on the basis of the technical merits of the position and (ii) for those tax positions that meet the more-likely-than-not recognition threshold, we recognize the largest amount of tax benefit that is more than 50% likely to be realized upon ultimate settlement with a tax authority. We recognize interest and penalties related to unrecognized tax benefits within the income tax expense line in our consolidated statement of operations. Accrued interest and penalties are included within the related tax liability in the consolidated balance sheet. Earnings Per Share Basic earnings per share (“Basic EPS”) is calculated by dividing the net income attributable to shareholders of the Parent Company, Criteo S.A., by the weighted average number of shares outstanding during the period. Diluted earnings per share ("Diluted EPS") is calculated by dividing the net income attributable to shareholders of the Parent company, Criteo S.A., by the weighted average number of shares outstanding, including the dilutive effect of share-based awards as determined under the treasury stock method, during the period. Reclassifications Certain prior period amounts have been reclassified to conform to the current period presentation. In 2024, the Company changed the presentation of value-added tax ("VAT") receivables and payables within Other taxes in the Consolidated Statement of Financial Position from a gross to a net presentation. For the fiscal year ended December 31, 2023, this change resulted in a reclassification of $40.4 million between Other Taxes Receivables and Other Taxes Payable. Recently Adopted Accounting Pronouncements In November 2023, the Financial Accounting Standards Board (FASB) Issued Accounting Standards Update ("ASU") 2023-07, Segment Reporting (Topic 280) - Improvements to Reportable Segment Disclosures. The ASU requires that an entity disclose significant segment expenses impacting profit and loss that are regularly provided to the CODM. The adoption of this ASU did not have a material impact on our consolidated financial statements. In December 2023, the FASB issued ASU 2023-09, Improvements to Income Tax Disclosures, which improves the transparency of income tax disclosures. The standard requires disaggregated information about a reporting entity's effective tax rate reconciliation as well as information on income taxes paid. The adoption of this ASU was applied on a prospective basis and did not have a material impact on our consolidated financial statements. See Note 17 Income Taxes for more information. Accounting Pronouncements Not Yet Adopted In November 2024, the FASB issued ASU 2024-03, Income Statement—Reporting Comprehensive Income— Expense Disaggregation Disclosures, which requires disaggregated disclosure of income statement expenses. This standard is effective for annual periods beginning after December 15, 2026, with early adoption permitted. We do not expect the adoption of this standard to have a material impact on our consolidated financial statements. In September 2025, the FASB issued ASU 2025-06, Intangibles - Goodwill and Other - Internal-Use Software, which simplifies the capitalization guidance by removing the references to project stages, among other changes. The new standard is effective for annual periods beginning after December 15, 2027. We are currently evaluating the impact of the adoption of this standard on our consolidated financial statements. In December 2025, the FASB issued ASU 2025-10, Government Grants, Accounting for Government Grants received by Business Entities, which establishes guidance for business entities on how to recognize, measure, present and disclose government grants received. The new standard is effective for annual periods beginning after December 15, 2028. We are currently evaluating the impact of the adoption of this standard on our consolidated financial statements.
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