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Spotting Winners: PubMatic (NASDAQ:PUBM) And Advertising Software Stocks In Q2


Radek Strnad /
2022/09/29 4:06 am EDT
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The end of the earnings season is always a good time to take a step back and see who shined (and who not so much). Let’s have a look at how the advertising software stocks have fared in Q2, starting with PubMatic (NASDAQ:PUBM).

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

The 5 advertising software stocks we track reported a mixed Q2; on average, revenues beat analyst consensus estimates by 2.37%, while on average next quarter revenue guidance was 0.28% above consensus. There has been a stampede out of high valuation technology stocks as raising interest rates encourages investors to value profits over growth again and advertising software stocks have not been spared, with share prices down 10.7% since the previous earnings results, on average.

PubMatic (NASDAQ:PUBM)

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

PubMatic reported revenues of $63 million, up 26.9% year on year, beating analyst expectations by 3.81%. It was a mixed quarter for the company, with a decent beat of analyst estimates but an underwhelming revenue guidance for the next quarter.

“We delivered another terrific quarter, with organic revenue growth of 27% year over year, well above market growth rates. Our results demonstrate the number and magnitude of growth opportunities we have incorporated into our business, as we continue to consolidate the market,” said Rajeev Goel, co-founder and CEO at PubMatic.

PubMatic Total Revenue

PubMatic pulled off the highest full year guidance raise of the whole group. The stock is down 5.45% since the results and currently trades at $16.80.

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

Best Q2: 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 $109.8 million, up 43.4% year on year, beating analyst expectations by 7.67%. It was a very strong quarter for the company, with an exceptional revenue growth and an impressive beat of analyst estimates.

DoubleVerify Total Revenue

DoubleVerify delivered the strongest analyst estimates beat and fastest revenue growth among its peers. The stock is up 16.5% since the results and currently trades at $27.85.

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

Weakest Q2: 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 a provider of marketing and monetization tools for mobile app developers and also operates a portfolio of mobile games.

AppLovin reported revenues of $776.2 million, up 16% year on year, missing analyst expectations by 5.18%. It was a weak quarter for the company, with a miss of the top line analysts' estimates.

AppLovin had the weakest performance against analyst estimates, slowest revenue growth, and weakest full year guidance update in the group. The stock is down 46.7% since the results and currently trades at $21.54.

Read our full analysis of AppLovin's results here.

LiveRamp (NYSE:RAMP)

Started in 2011 as a spin-out of RapLeaf, LiveRamp (NYSE:RAMP) provides software as a service that helps companies better target their marketing by merging offline and online data about their customers.

LiveRamp reported revenues of $142.2 million, up 19.4% year on year, beating analyst expectations by 2.35%. It was a weaker quarter for the company, with a full year guidance missing analysts' expectations and decelerating customer growth.

The company added 3 enterprise customers paying more than $1m annually to a total of 90. The stock is down 30.8% since the results and currently trades at $19.38.

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

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 $376.9 million, up 34.6% year on year, beating analyst expectations by 3.22%. It was a strong quarter for the company, with a meaningful improvement in gross margin and guidance for the next quarter above analysts' expectations. 

The stock is up 12.4% since the results and currently trades at $61.29.

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

The author has no position in any of the stocks mentioned