Looking back on advertising software stocks' Q4 earnings, we examine this quarter's best and worst performers, including LiveRamp (NYSE:RAMP) and its peers.
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 6 advertising software stocks we track reported a weaker Q4; on average, revenues beat analyst consensus estimates by 1.42%, while on average next quarter revenue guidance was 0.74% under consensus. There has been a stampede out of high valuation technology stocks as raising interest rates encourage investors to value profits over growth again, but advertising software stocks held their ground better than others, with the share prices up 9.64% since the previous earnings results, on average.
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 $158.6 million, up 12.8% year on year, in line with analyst expectations. It was a weak quarter for the company, with a decline in net revenue retention rate and decelerating customer growth.
"We continue winning with the world's largest brand marketers, reinforcing that we are essential infrastructure for the advertising ecosystem," said LiveRamp CEO Scott Howe.
LiveRamp delivered the weakest full year guidance update of the whole group. The company added 2 enterprise customers paying more than $1m annually to a total of 94. The stock is down 18.3% since the results and currently trades at $22.26.
Read our full report on LiveRamp here, it's free.
Best Q4: 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 $175.1 million, up 29.9% year on year, beating analyst expectations by 9.06%. It was a decent quarter for the company, with an impressive beat of analyst estimates but underwhelming guidance for the next year.
Zeta pulled off the strongest analyst estimates beat, fastest revenue growth, and highest full year guidance raise among its peers. The stock is up 18.2% since the results and currently trades at $10.71.
Is now the time to buy Zeta? Access our full analysis of the earnings results here, it's free.
Weakest Q4: 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 $74.3 million, down 1.67% year on year, missing analyst expectations by 3.07%. It was a weak quarter for the company, with declining revenue and underwhelming guidance for the next quarter.
PubMatic had the weakest performance against analyst estimates in the group. The stock is down 9.29% since the results and currently trades at $13.76.
Read our full analysis of PubMatic'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 $490.7 million, up 24% year on year, missing analyst expectations by 0.22%. It was a mixed quarter for the company, with a meaningful improvement in gross margin but a miss of the top line analyst estimates.
The stock is up 21.7% since the results and currently trades at $60.73.
Read our full, actionable report on The Trade Desk here, it's free.
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 $702.3 million, down 11.5% year on year, beating analyst expectations by 1.71%. It was a weak quarter for the company, with declining revenue and gross margin.
AppLovin had the slowest revenue growth among the peers. The stock is up 29.9% since the results and currently trades at $16.5.
Read our full, actionable report on AppLovin here, it's free.
The author has no position in any of the stocks mentioned