The Trade Desk, Inc. (TTD) 8 Aug 242024 Q2 Earnings call transcript

Greetings. Welcome to The Trade Desk Second Quarter 2024 Earnings Conference Call. [Operator Instructions] Please note this conference is being recorded. I will now turn the conference over to Chris Toth, you may begin.

Thank you, operator. to afternoon good and everyone. Hello, Trade Welcome Conference Quarter Earnings Second to The Call. XXXX Desk

subject and call These and that responses of may On and results are incorrect, section and and our If results today could statements. the date Founder these today. our from the uncertainties Investor actual the historical statements financial disclaim assumptions as our Officer, such statements release available forward-looking to update reflect Relations Schenkein. our implied include information, website press discussion prove by made in and views significantly, any expressly of Chief thetradedesk.com. Please risks of CEO, Q&A are may Laura we to materially A those from earnings during copy statements note the forward-looking are the our at made. differ is or statements. on and aside Financial our obligation Green; Actual Jeff today's beliefs any forward-looking projections assumptions vary or

detailed risks, in most please mentioned the factors and risk release press our SEC of a filings. recent discussion refer to For our

will In addition supplemental Jeff? of financial is of company's alongside and CEO, measures, present offer GAAP turn comprehensive results, to Green. results financial call a now reconciliation I We measures Jeff the earnings operational A view available the presenting GAAP to non-GAAP our press these non-GAAP we the in over performance. With data. to release. non-GAAP that our believe our Founder that, GAAP

and the to Thanks, call. thank for joining you Chris, everyone

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Thank afternoon, quarter good growth. second delivered million, We XX% of you, everyone. Jeff, strong with representing and $XXX a year-over-year revenue

digital During both advertising the quarter, by agencies environment and we benefited from a brands. stable supported relatively

results, to continue CTV market as more stock measurable We advertisers share Retail and and in particularly greater Media. gain efficiency

its of range large with model, wide also markets, advertisers business to and Our contributed our vertical success.

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we While still in spend see small relative verticals. share opportunities capture America, produced significant to to the North in share these of CTV

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to now expenses. Turning

operating compensation, stock-based QX in $XXX up million, Excluding were expenses XX% year-over-year.

objective there ample within are our market. our on to more on spend the share our growing leverage While expenses, opportunities of gaining remains platform operating global achieve more and primary advertising

ended a flow cash year quarter and activities million for our $X.XX expense million stock-based $XX XX fully days were Net was from quarter, to platform million. teams support second by technologies we and invest net cash infrastructure about innovate strong the platform, XX Cash, further cash exited at cash our a primarily the was DSOs a positioned free recent our with in AI, our were careful to for our from position. like sustained invest per quarter, management exiting liquidity and quarter provided year quarter profitability by the team, was competitors. Income days, second day share. expand nondeductible $XX down about or Thanks down driven tax equivalents days, we income to years, growth. well QX, and ago. We and in distance $XXX diluted compensation. our cutting-edge billion. $X.X Adjusted million $XX continued DPOs X short-term and from operating ourselves X the to ago. are pretax the investments expenses second During was operating our of in

shares the We A QX, have not we common did no Class In any sheet. repurchase stock. of our debt balance on

to the on and market opportunistically will priorities. capital We depending continue conditions approach program repurchase

our to for turning quarter. the third Now outlook

with approximately be revenue more million, throughout closing, has are We never represent XX% strong in media. the estimate estimate CTV continue adjusted be would to in key including first we second and million basis. of and We to areas, promising. QX performance a in retail half $XXX at on opportunity strong to least see growth spend year-over-year us ahead which quarter our $XXX extremely EBITDA The of the QX. In been year. of pleased the We

product We a major flow. With business supported growth, and international are within expanding cash a significant a by consistently top model key robust delivers line and strong up identity optimistic CTV, of half and XXXX call future about second navigate for with upgrade forward that, remarks. such and we with the remain beyond. That operator, Kokai, we year prepared expansion, drivers positioned look as confident And our strong our a to open questions. retail growth this and concludes and large that profitability media, market, the strategy let's as

question with SIG. first Patil The Instructions] Shyam comes [Operator from

provide thoughts what's kind continue digital going the here? right everyone now? maybe else allowing another current on of to in what back gains great Could start And at kind high-level on the of outperform you meaningfully Trade the ad to your quarter. call, of mentioned Congrats so environment to Desk you

question. the appreciate Really Shyam. Thanks,

think thing to I us well. firing I at in really the me talk it teams, our the I that environment, we good things engineering change, to destination, been we coming the to had. especially but had entire essential are responding this that that I want is the never that at, players because done company. we've more about in on has more all X-month do proud before we of space are right let to in we've something other in that All that just I of we've team than first, that company not a have X- ever One but just is not has way don't our are macro been opportunity, all makes our all absolutely highlight ever talk CTV, board, it level course, environment, think team period really, we the that a in sell-side. that and our different go-to-market now. And our don't of been cylinders know in So about throughout know and not I team macro just across lots adjusting the and

on to So often in that inventory People or destinations then a and a dependent whether are to are whether added app they they website. they're have we other trying or they ads, they're companies are have company whether but they go to to mobile sell those get that moments. those compared are destinations, an

represents a We a not that buyers. destination are or company BXB

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Next from question comes Truist. Youssef Squali with

rise Can for -- CTV CPMs talk Thanks the the Video's of in the ad particularly Prime the and budget of of with terms within pricing to color shifts. on with rise seeing Amazon in business impacts or competitors, you're and all both little I'd a ad if environment terms bit double-click on like mind. on don't you the you that, CTV. about competitive

question. You bet. the for Thanks so much

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a those. highlighting couple worth it's of think I

this frame MX as work in across we of with put France, EMEA, platform. And intently UIDX, FOX content is platform. personally to and I UIDX, launched. which or technology course, implement that owners adoption, time in precise more course, course, them all of to to just So of they're new one advertisers capabilities single leading and their brands will media Scripps to to EUID they adopt AdRise sign-on is of to on TFX of buying the OpenPath announced expanded their main expand programmatic that include Desk the Roku Trade on players first the and for going CTV The Roku expand E.W. an forward. FOX one that partnership, announced Netflix its the targeting, data like is major are in is as with instance. OpenPass, CTV buying which a work adopting allowing launching of partners

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where price believe better and is that everybody capture than of no difficult. think, to Thanks with and one the question. for it But is the that of marketplace data makes with that us. I very competition interest, I biddable discovery, there's heading, positioned value conflict So a

with The from KeyBanc. Justin next comes question Patterson

settling in does strategy Great. cookie going your that on around And change guess now forward? UIDX Jeff, and Privacy level the how deprecation is really dust investment Sandbox, I the

the Thanks so question today. much, Justin. I appreciate

than there's quips past. was lot, matter interviewing only to I by doesn't he somebody say it consistent. talking as respect recently from take pointed a love I know of was things the cookies that I've don't said a more what because to one already and is I always I out said, lot First, me They're you what about to that the

in today. I good saying that. rid of not to get Google X that was cookies it years thing for same the said a stand for You XXXX, idea by ago that said today. I you're

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we becoming irrespective quickly could it's a or decisions result, as made ubiquitous. so with the UIDX of And Apple, purpose making live of and built something the at Google that

still Where the publishers they give slow effective it personalization enough Safari time, of people is a lot in and and a that the namely Google -- it been work that take do browsers, could most in authentication, to is quickly say good audio, wanted makes mean as and in and advertising where I delay, that's is replace the not bit CTV includes in [indiscernible] believe on. sense their why cookies. I idea. they are as a -- because places becoming log-ins, consent, not to there reason the there's also been logged to becoming down have in some has it's which when created ubiquitous. of extremely ubiquitous, Where valuable are that part way I Now UIDX creating deprecating a CPMs there that a can but Chrome, has well which log-ins, especially are of in

they Given change. to UIDX, the like efficacy compete, of in puts need them to to order continue which some more for adopt sophisticated them pressure a technology, things on to

for hopefully, deprecation? us, So for at the you in down all. [indiscernible] question. how Not But slow is for doesn't this bottom much cookie this, so line result them Thank the regard. the that is of change

Karasyov with comes question next Cannonball from Research. Vasily The

market Jeff, will on wanted short-term about entering concerns the Video because impact the I midterm? your the years in next TV to revenue Netflix on in and Prime premium platform. the you in Roku in is and your happen about what talk what the sources ask possibly here. connected of going does spoke to X and space the Disney X growth available with all and midterm more inventory like others this or How becoming trajectory you

for much the so question. Thanks

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from comes question Mark Mahaney next The Evercore. with

have changed. last that And that to have the want except to be to Okay. do is on the that you to and almost DOJ certainly negative regulatory And face. all since on going the market that's an CMOs scrutiny. to up coming in Google they X their time, asked And the the just what alternative a I and regulatory had really like months dislocation negative one I X. events particularly negative, another X looking were the seeing increasing revenue related next a legal and for light declining -- probably to changes we've base I if more aggressively Network probably of of wonder than just is is was to for maybe the past, quarter, And you're decision. in on follow Google are that declining. in Jeff, kind now and with We'll Google question have and in obviously base the market you had in

right world changed about this ago. be and last question, roughly couldn't we Mark. a I time you the the days really that lot appreciate the talked this call XX since Thanks, more on

upcoming is where yes, of everyone to Google probably very the is hearing their you're relates this a almost year Search. And be XXXX up ad on of there's big is to on begin case Google the my the search So suing right, ad September, as practice Justice in compelling regulatory suit will it knows in won side, against Google and of trial is over course, Department was shaping even on another Justice's the in or there, trial anticompetitive In the Department Justice is side likely against Department Google opinion, tech. the it that tech side. more than of

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question Next comes Khajuria Wolfe Research. Shweta from with

it on First you give think and their on you we line is Trade about and questions the of share? are one then partnership, as dollars seeing, even social are perhaps that's advertisers contribution ROIs how your scaling that second very with should earlier on we XXXX? And couple is that about either the raised are ago the up could update an on played consideration please seeing time the in now, potential think where gaining than they're and comparable, Jeff, a Netflix. why ad Is fair higher on are you're comments, to advertisers. being assume nonsearch Desk that by

Thanks for the question.

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So a Thanks much so it's bit the question. of for double-edged sword. a

Macquarie. question comes from with Next Tim Nollen

mind, I Jeff, don't. on hope don't you question CTV. sure Another I'm you

we've on the we've ongoing if others TV, to seller's And bidded the you have programmatic in really toward up year, I to season decision now now actually towards seeing sellers -- or programmatic, that Prime observations comment, there open linear and this appetite the from flood just to programmatic. as markets delivery of any you this less if the Roku tools? earlier you that more seen Netflix are the weakness seen and adopt of CTV. I wonder are more upfront QX, a CTV programmatic was bidded for even more Amazon appetite think could Given and through through reporting ads programmatic not done ads, auction-based using but CTV biddable on

You bet. Tim, question. Thanks, for the

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towards see for trend Thanks definitely the that come, in of to is more biddable. more and years we'll So question, Tim. but the

Capital. The is next BMO with question Pitz from Brian

for advertisers publishers maybe LinkedIn then and of Desk separately, How how demand media thoughts need about partnerships demand strategy enable developing you timing retail and see an around need And both best an position and around CTV, there? on post, Jeff, itself authentication does bringing bringing Trade to to strategies lot sides? identity strategy. you more essentially a any but talking said recently to discussion and transitions identity these

so much. Thanks Yes.

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that media, with and companies scratched and our have and And just what of many the the merely proud exist are great those companies others. so of Target I'm with others surface. we and examples Walgreens so in Walmart partnerships and opportunities like retail done So the we've

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part add our In the and think ahead. think proud team future deployment yet a you is our shipping just am such at not Kokai, on fair that's bright of both of side So that buy we product side of whole and my career, all in the best change has us product opportunity the times. Desk. sell have when unprecedented fast, what of of at is so amount all pressure get I created an there's but for pace, I we're the And an I of of for and Trade sort happening a reason to certainly bullish. just And with most so this that why The

of So thanks for the from question and for all the discussion today you.