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Google scuppers Team Internet acquisition after profit warning

Kevin Murphy, March 4, 2025, 15:02:30 (UTC), Domain Registries

A Norwegian private equity company has dropped its plans to acquire Team Internet after Google changed the way it handles advertising on parked domains, a key source of revenue for the company.

Oslo-based Verdane had a deadline of today to announce a formal offer for the company, but instead said it “does not intend to make an offer” because “there has been a material change of circumstances”.

While Verdane did not elaborate, there was a simultaneous announcement from Team Internet that Google’s recently announced changes to AdSense for Domains present a “challenge” that will harm its business faster than it can adapt.

Google said last week that as of March 19 it will start opting its advertisers out of AFD, the service domainers and registrars use to monetize many parked domain names. Advertisers will be able to opt back in, but are not expected to do so en masse.

Team Internet’s Search reporting unit made $72 million of its $91 million net revenue from AFD last year, which it expects to decline following the changes.

The company said it plans to instead monetize its domains using Google’s newer Related Search On Content product, which shows Google search results including paid results on the publishers’ own sites, based on the content of the page.

That presumably means Team Internet is going to have to populate its domains with spammy, low-quality and presumably AI-generated content, in order to trigger the RSOC contextual algorithm. Thanks, Google!

“The market development has been long-anticipated, though the announced acceleration is a challenge,” Team Internet told investors.

“It is anticipated that, during this transition period, contributions from AFD will decline faster than contributions from RSOC appreciate, meaning that the financial performance of Team Internet’s Search segment will see a trough in 2025 before it recovers from 2026 onwards and returns to the long-term pattern,” it added.

It expects adjusted EBITDA to more than halve for the year in its Search segment, from $57 million last year to between $20 million and $25 million this year. The company said its domains business, which includes its registry and registrars, should be unaffected.

But that domains business seems to be still up for sale. Team Internet said it has received “repeated approaches” for the domains unit and is carrying out a “comprehensive review of its asset ownership”.

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