Home Mobile AdColony Cuts More Jobs In The Name Of Profitability – But Can It Compete?

AdColony Cuts More Jobs In The Name Of Profitability – But Can It Compete?


AdColony laid off roughly 10% of its US workforce late last week amid struggles to gain a foothold in the app-install space. Headcount now stands somewhere around 350.

The cuts were across sales, IT, finance and product, including the chief product officer position. AdColony confirmed the layoffs, but not the exact number.

The beleaguered mobile video ad network denies it’s slimming down to get ready for a sale.

“We remain focused on profitability for AdColony,” the company told AdExchanger in a statement.

It said it needs to reduce headcount to get there, and several operational roles will move to global offices, including, sources tell AdExchanger, AdColony’s Istanbul location. Ostensibly, this will help the company save on salaries.

During the second quarter, AdColony restructured its performance sales team into a single group across North America and Europe to make it easier for its supply to compete across regions.

The hope is that these “ongoing changes” will help “keep AdColony competitive in the global mobile advertising marketplace,” the company stated.

But it’s been a bumpy road, and over the past couple of years layoffs have become par for the course at AdColony.

The company cut around 250 jobs between July and November of last year, amounting to a more than 35% reduction in overall headcount. The November layoffs accompanied the shutdown of AdMarvel, the ad server and mediation company AdColony acquired in 2010.

“Those areas have dried up,” said then-AdColony CEO Will Kassoy at the time. A little over a month later, Kassoy himself was shown the door and Lars Boilesen, CEO of AdColony parent company Otello (formerly Opera Software), took over his duties.

In April, AdColony trimmed a handful of senior staff, including its newly hired VP of performance, Tim O’Neil, leading to questions about the company’s ability to keep pace in the highly competitive mobile performance ecosystem.


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Andrew Dubatowka, a product market exec who had been with AdColony for more than four years, was given responsibility for the company’s North American performance business, including driving app-install revenue. Just two months after his April promotion, Dubatowka left AdColony to become Visa’s senior director of programmatic.

Despite the tumult, AdColony says its soldiering on in the face of change. The mobile industry’s shift away from mediation toward programmatic hasn’t been easy. As more mobile publishers begin to adopt in-app header bidding-like technology and get equal access to supply, ad networks like AdColony need to differentiate.

In March, AdColony made the majority of its inventory, apart from its more custom video units, available through unified auction technology in partnership with app monetization platform Fyber. AdMob is also in the process of adding AdColony to its unified auction beta.

Otello reported during its second-quarter earnings call in August that AdColony’s revenue contribution was down year over year from $96.1 million to $58.4 million. The decrease was blamed on slower product launches and a more disciplined focus on fewer and “more profitable” products and markets.

Brand performance and programmatic, however, accounted for more than 55% of AdColony’s brand revenue for the quarter. Otello said it expects the ad network to be profitable this year on an adjusted EBITDA basis.

Otello reports its third-quarter earnings on Nov. 8.

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