During Q1 and early in Q2, Google made sizeable changes to its algorithms. These have brought considerable volatility, which we believe has affected how operators choose to invest in traffic from affiliates and in how webpages rank. We believe the effect on the sub-affiliation niche, where Raketech acts as an aggregator and drives traffic from numerous players, is lower. We thus believe Raketech has positioned itself well in the value chain for the long term but that it will be affected in the short term by these negative updates.

Given the increasing uncertainty in the industry, we lower our revenue estimates by 1% over the forecast period. We change our estimates for the mix in the coming years, taking down growth expectations for affiliate marketing, the area where margins are the highest. This causes EBITDA to come down by 6.5% on average over our forecast period and EPS to be reduced by an average of 11%. Our EBITDA estimate for the current year thus moves from the middle to the lower end of the guidance range of EUR24–26m.

Cash flows to shareholders remain robust