Summary

• Perion Network reported largely disappointing first-quarter results with a surprise decline in core advertising solutions sales.
• On the conference call, management blamed macroeconomic headwinds which have continued into the second quarter.
• In addition, management's decision to no longer break out channel revenues makes it more difficult for investors to assess the trajectory of the business.
• Given lower transparency in combination with the risk of a sizeable guidance reduction in the second half of the year, I am moving to the sidelines for now.
• Consequently, I am downgrading my rating on Perion Network's shares from "Buy" to "Hold" while reducing my price target from $14.75 to $10.50.
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Note:

I have covered Perion Network Ltd. or "Perion" (NASDAQ:PERI), previously, so investors should view this as an update to my earlier articles on the company.

Earlier this week, Perion Network reported mixed first quarter results, with better-than-expected non-GAAP profitability offset

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