Criteo S.A. (CRTO) Fell on Increasing Investor Concerns

ClearBridge Investments, an investment management company, released its “ClearBridge Small Cap Strategy” second-quarter 2025 investor letter. A copy of the letter can be downloaded here. The small-cap stocks experienced volatility in the second quarter. The Russell 2000 Index rebounded 10% of its November 2024 record highs just 55 days after the “Liberation Day” decline. It was driven by growth, momentum, high-beta, and low-quality stocks. Even though small-cap stocks rose, they failed to outpace the larger-cap peers due to perceived sensitivity to macroeconomic shocks. The Russell 2000 returned 8.5% for the quarter compared to the 11.1% of the Russell 1000 Index. The strategy underperformed the benchmark in this backdrop. In addition, please check the fund’s top five holdings to know its best picks in 2025.

In its second-quarter 2025 investor letter, ClearBridge Small Cap Strategy highlighted stocks such as Criteo S.A. (NASDAQ:CRTO). Criteo S.A. (NASDAQ:CRTO) is technology company that offers marketing and monetization services and infrastructure on the open internet. The one-month return of Criteo S.A. (NASDAQ:CRTO) was -6.74%, and its shares lost 47.53% of their value over the last 52 weeks. On September 12, 2025, Criteo S.A. (NASDAQ:CRTO) stock closed at $22.01 per share, with a market capitalization of $1.152 billion.

ClearBridge Small Cap Strategy stated the following regarding Criteo S.A. (NASDAQ:CRTO) in its second quarter 2025 investor letter:

"Several holdings in the communication services sector also detracted from performance. Criteo S.A. (NASDAQ:CRTO), which helps businesses show personalized ads to people based on their browsing behavior, was hurt by growing investor concerns over the company’s long-term growth and profitability forecasts after its largest retail media client announced it would significantly reduce the scope of Criteo’s services beginning in November."

Criteo S.A. (NASDAQ:CRTO) is not on our list of 30 Most Popular Stocks Among Hedge Funds. According to our database, 18 hedge fund portfolios held Criteo S.A. (NASDAQ:CRTO) at the end of the second quarter, compared to 15 in the previous quarter. While we acknowledge the potential of Criteo S.A. (NASDAQ:CRTO) as an investment, we believe certain AI stocks offer greater upside potential and carry less downside risk. If you're looking for an extremely undervalued AI stock that also stands to benefit significantly from Trump-era tariffs and the onshoring trend, see our free report on the best short-term AI stock.

In another article, we covered Criteo S.A. (NASDAQ:CRTO) and shared the list of best cheap stocks that will go to the moon according to Reddit. In addition, please check out our hedge fund investor letters Q2 2025 page for more investor letters from hedge funds and other leading investors.

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Disclosure: None. This article is originally published at Insider Monkey.