12279

A Look Back at Advertising Software Stocks' Q1 Earnings: PubMatic (NASDAQ:PUBM) Vs The Rest Of The Pack


Anthony Lee /
2024/07/10 4:57 am EDT

Wrapping up Q1 earnings, we look at the numbers and key takeaways for the advertising software stocks, including PubMatic (NASDAQ:PUBM) and its peers.

The digital advertising market is large, growing, and becoming more diverse, both in terms of audiences and media. As a result, there is a growing need for software that enables advertisers to use data to automate and optimize ad placements.

The 6 advertising software stocks we track reported a solid Q1; on average, revenues beat analyst consensus estimates by 5.2%. while next quarter's revenue guidance was 1.6% above consensus. Stocks, especially growth stocks where cash flows further in the future are more important to the story, had a good end of 2023. But the beginning of 2024 has seen more volatile stock performance due to mixed inflation data, and advertising software stocks have held roughly steady amidst all this, with share prices up 1.9% on average since the previous earnings results.

PubMatic (NASDAQ:PUBM)

Founded in 2006 as an online ad platform helping ad sellers, Pubmatic (NASDAQ: PUBM) is a fully integrated cloud-based programmatic advertising platform.

PubMatic reported revenues of $66.7 million, up 20.4% year on year, exceeding analysts' expectations by 7.3%. Overall, it was a very strong quarter for the company with a significant improvement in its net revenue retention rate and strong sales guidance for the next quarter.

“We delivered another quarter of outstanding results, with accelerated revenue growth of 20%, highlighting our strong customer relationships, our breadth of solutions and growth across all formats and channels,” said Rajeev Goel, co-founder and CEO at PubMatic.

PubMatic Total Revenue

The stock is down 15.7% since reporting and currently trades at $20.27.

Is now the time to buy PubMatic? Access our full analysis of the earnings results here, it's free.

Best Q1: AppLovin (NASDAQ:APP)

Co-founded by Adam Foroughi, who was frustrated with not being able to find a good solution to market his own dating app, AppLovin (NASDAQ:APP) is both a mobile game studio and provider of marketing and monetization tools for mobile app developers.

AppLovin reported revenues of $1.06 billion, up 47.9% year on year, outperforming analysts' expectations by 8.6%. It was an exceptional quarter for the company with an improvement in its gross margin.

AppLovin Total Revenue

AppLovin scored the biggest analyst estimates beat and fastest revenue growth among its peers. The market seems happy with the results as the stock is up 14.3% since reporting. It currently trades at $84.67.

Is now the time to buy AppLovin? Access our full analysis of the earnings results here, it's free.

Weakest Q1: DoubleVerify (NYSE:DV)

When Oren Netzer saw a digital ad for US-based Target while sitting in his Tel Aviv apartment, he knew there was an unsolved problem, so he started DoubleVerify (NYSE:DV), a provider of advertising solutions to businesses that helps with ad verification, fraud prevention, and brand safety.

DoubleVerify reported revenues of $140.8 million, up 14.8% year on year, exceeding analysts' expectations by 1.8%. It was a weak quarter for the company with underwhelming revenue guidance for the next quarter and a decline in its gross margin.

DoubleVerify posted the weakest performance against analyst estimates, slowest revenue growth, and weakest full-year guidance update in the group. As expected, the stock is down 34.7% since the results and currently trades at $19.99.

Read our full analysis of DoubleVerify's results here.

The Trade Desk (NASDAQ:TTD)

Founded by former Microsoft engineers Jeff Green and Dave Pickles, The Trade Desk (NASDAQ:TTD) offers cloud-based software that uses data to help advertisers better plan, place, and target their online ads.

The Trade Desk reported revenues of $491.3 million, up 28.3% year on year, surpassing analysts' expectations by 2.2%. Looking more broadly, it was a very good quarter for the company with an impressive beat of analysts' billings estimates and strong sales guidance for the next quarter.

The stock is up 18.5% since reporting and currently trades at $101.94.

Read our full, actionable report on The Trade Desk here, it's free.

Zeta (NYSE:ZETA)

Co-founded by former Apple CEO John Scully, Zeta Global (NYSE:ZETA) provides software and data analytics tools that help companies market their products to billions of customers.

Zeta reported revenues of $194.9 million, up 23.7% year on year, surpassing analysts' expectations by 4.2%. Looking more broadly, it was a strong quarter for the company with an impressive beat of analysts' billings estimates and optimistic revenue guidance for the next quarter.

Zeta scored the highest full-year guidance raise among its peers. The company added 8 enterprise customers paying more than $100,000 annually to reach a total of 460. The stock is up 31.5% since reporting and currently trades at $17.1.

Read our full, actionable report on Zeta here, it's free.

Join Paid Stock Investor Research

Help us make StockStory more helpful to investors like yourself. Join our paid user research session and receive a $50 Amazon gift card for your opinions. Sign up here.