Good afternoon, and welcome to the BuzzFeed, Inc. First Quarter 2023 Earnings Conference Call. [Operator Instructions] Please note, this event is being recorded. I would now like to turn the conference over to Amita Tomkoria, Senior Vice President, Investor Relations. Please go ahead.

Hi, everyone. Welcome to BuzzFeed, Inc.'s First Quarter 2023 Earnings Conference Call. I'm Amita Tomkoria, Senior Vice President of Investor Relations. Joining us today are Founder and CEO, Jonah Peretti; President, Marcela Martin; and CFO, Felicia DellaFortuna. Before we get started, I would like to take this opportunity to remind you that our remarks today will include forward-looking statements. Actual results may differ materially from those contemplated by these forward-looking statements. Factors that could cause these results to differ materially are set forth in today's press release, our 2022 annual report on Form 10-K and in our Q1 quarterly report on Form 10-Q. Any forward-looking statements that we make on this call are based on assumptions as of today, and we undertake no obligation to update these statements as a result of new information or future events. During this call, we present both GAAP and non-GAAP financial measures, including adjusted EBITDA and adjusted EBITDA margin. The use of non-GAAP financial measures allows us to measure the operational strength and performance of our business to establish budgets and to develop operational goals for managing our business. We believe adjusted EBITDA and adjusted EBITDA margin are relevant and useful information for investors because they allow investors to view performance in a manner similar to the method used by our management. A reconciliation of these GAAP to non-GAAP measures is included in today's earnings press release. Please refer to our Investor Relations website to find today's press release along with our investor letter. And now I'll pass the call over to Jonah.

Thank you, Amita. Good afternoon, everyone, and thank you for joining us today. Last quarter, I shared my vision for the future of digital media, namely that content creation would be transformed by creators and AI. With a massive direct audience across our premium brands and IP portfolio, we are poised to benefit from these trends. We have built trusted brands with awareness that is the level of 100-year-old companies. U.S. Gen Z and millennials spend vastly more time consuming our content than that of any other digital media company in our competitive set according to Comscore. These competitive advantages have helped us carve out a strategic position in the ecosystem of audiences, advertisers, platforms and creators. The biggest beneficiaries of the shift to the creator economy and generative AI will be incumbents with recognizable brands and scaled distribution. In Q1, our content teams made great progress in launching new content formats to align with these trends. On creators, the next few years will be defined by creators partnering with the best media brands for credibility and community. For us, Tasty is leading this transformation in how media is made and distributed through the creation of programs to give creators the tools and skills to drive large audiences. Creator-led content has generated 2x the views per video and more than one billion views on Instagram alone. This gives us the conviction to extend this model to more brands. The results are amazing for everyone when creators and media companies work together, develop IP together, collaborate on new formats and frames and jointly brainstorm with analytics from the larger BuzzFeed, Inc. media network. To build on this success, we are rapidly expanding our Creators Program to increase both revenue and content output. Tasty recently welcomed a new class of creator residents,…

Thank you, Jonah, and good afternoon, everyone. I will recap our Q1 performance, including some of the progress that we have made in refocusing our sales efforts to unlock the full monetization potential of our combined brand portfolio. I also want to share with you the early results we are driving through our focus on creators and AI. But let's start first with our Q1 performance. We delivered first quarter results in line with our guidance range for both revenue and adjusted EBITDA. Q1 revenues declined 27% to $67 million, driven by the ongoing shift towards short-form, creator-led content, continued softness in the broader digital advertising market and the sales execution challenges I outlined last quarter. Looking ahead, we expect Q1 to be the trough in terms of both revenue growth and adjusted EBITDA. Felicia will provide more details shortly. But at a high level, in Q2, we expect to deliver a modest improvement in core advertising and content revenue trends year-over-year relative to Q1. In order to measure our progress, we will supplement our Time Spent reporting with a new metric on revenue retention. And as we execute against the cost savings plan that we have announced to date, we are driving towards significantly lower fixed cost structure positioning us to mitigate much of the bottom line impact from lower Q2 revenues and achieve full year adjusted EBITDA profitability. As I mentioned over the last few months, we have made significant changes to our sales team structure in order to improve execution, enable cross-brand synergies and bring the wider brand portfolio to market for our clients. First, we are now working horizontally with a centralized sales enablement and support teams set up to service all brands in the portfolio. Second, we are driving increased focus on traditional sales verticals…

Thank you, Marcela. We delivered first quarter results in line with our guidance range for both revenue and adjusted EBITDA. On a year-over-year basis, overall revenues for Q1 2023 declined 27% to $67.2 million, as expected, driven by the ongoing shift towards short-form creator-led content, continued softness in the broader digital advertising market and the sales execution challenges Marcela referenced earlier. Performance by revenue line is as follows: advertising revenues declined 30% year-over-year to $34.2 million, in line with fourth quarter trends as expected, primarily driven by both pricing and demand pressures on our owned and operated properties. Content revenues declined 33% year-over-year to $21.6 million with branded content performance decelerating versus the fourth quarter as expected. As a complement to our content revenues, we are introducing a KPI to represent net branded content advertiser revenue retention, which is a function of both the number of clients we serve and the spend per retained clients. This metric reflects current period trailing 12-month branded content revenue as a percentage of prior period trailing 12-month revenues for branded content customers that spent a minimum of $250,000 in the prior period. As we outlined last quarter, the steps we took to combine the BuzzFeed and Complex sales teams created operational challenges that negatively impacted our revenue performance in Q1. These impacts materialized in the form of lower revenue retention versus the prior year. However, average spend per advertiser remained relatively consistent year-over-year. Commerce and other revenues grew 6% to $11.3 million, driven by easing comps in our organic affiliate business. This revenue performance resulted in Q1 adjusted EBITDA loss of $20.2 million in the quarter, $3.5 million lower year-over-year, with the majority of the lower revenue year-on-year mitigated by the cost actions taken throughout 2022. We also incurred charges that did not impact…