Over 50% of Criteo's revenues originate from suspect sources (e.g. clickbots, fake/low quality websites, etc). Criteo takes credit for clients' sales it did not contribute to, and in some cases, that never actually occured. Clients will leave or demand reimbursements from Criteo, due to brand safety & revenue misattribution concerns. Sales& profits will decline because of Criteo's behavior, leading to a 67%-77% decline in its share price.

Gotham City Research was initially skeptical of the skeptics: how bad could Criteo be? Aren’t all adtech vendors fleecing clients? Perhaps Criteo is the cleanest dirty shirt? We tuned out other opinions, and conducted our own systematic analysis. The results surprised us. According to our analysis of websites using Criteo: Over 50% of websites using Criteo are of suspect quality. Criteos is NOT “just as bad” as its peers: Criteo is twice as bad. This explains why Criteo refuses to disclose to clients where ads are placed.

Criteo’s Apple ITP workaround – the HSTS (HTTP Strict Transport Security) super cookie – is being used in violation of Section 5 of the FTC Act. Criteo will abandon their Apple ITP workaround due to the FTC, client pressure, Apple, and/or our efforts. Apple is working on defeating Criteo’s privacy abuses, based on Apple’s response to us from ~1 week ago. Criteo’s user tracking & consent practices are in violation of coming European regulation (GDRP, article 7 recital 32) in May 2018, and will face fines of up to 4% of revenues. Criteo’s acts of desperation show that Apple’s ITP is a game changer for Criteo and other ad targeting firms. Most advertisers, including Criteo clients, would not risk losing the trust of their customers by employing nefarious tracking mechanisms like super cookies.

Note by QT: an opposing-view report has been published by another investment research firm (Anonymous Analytics) which we feel should be shared here as a subsequent report. Please go to Deails Link to read the opposing-view report.