The Trade Desk, Inc. (NASDAQ: TTD), a global technology company
that empowers buyers of advertising, today announced financial
results for its third quarter ended September 30, 2020.
“So far in 2020 we’ve seen several years of advertising
disruption and innovation compressed into a few months. As a
result, advertisers have become more deliberate and data-driven
with every advertising dollar. That helped us deliver record
quarterly revenue of $216 million and adjusted EBITDA of $77
million.” said Co-Founder and CEO of The Trade Desk, Jeff Green.
“This is the result of our long-term strategic investments to build
a compelling Open Internet alternative for advertisers. As
advertisers come under pressure to prove the ROI of their
campaigns, to take advantage of the mass consumer shift to
streaming TV, and to consider alternatives to user-generated
content, our investments in these areas are paying off. Whether
it’s our focus on measurement capabilities, CTV inventory or the
future of identity, advertisers can count on us as the industry’s
most innovative and complete demand side platform.”
Third Quarter 2020 Financial
Highlights:
The following table summarizes our consolidated financial
results for the quarters ended September 30, 2020 and 2019 ($ in
millions, except per share amounts):
Three Months Ended
Nine Months Ended
September 30,
September 30,
2020
2019
2020
2019
GAAP Results
Revenue
$
216.1
$
164.2
$
516.1
$
445.1
Increase (decrease) in revenue year over
year
32
%
38
%
16
%
40
%
Net Income
$
41.2
$
19.4
$
90.4
$
57.4
Diluted EPS
$
0.84
$
0.40
$
1.86
$
1.20
Non-GAAP Results
Adjusted EBITDA
$
77.2
$
47.8
$
130.7
$
130.4
Adjusted EBITDA Margin
36
%
29
%
25
%
29
%
Non-GAAP Net Income
$
62.7
$
36.1
$
150.8
$
104.8
Non-GAAP Diluted EPS
$
1.27
$
0.75
$
3.10
$
2.19
Third Quarter and Recent Business
Highlights Include:
Impact of COVID-19 on our
Outlook:
Our business has been impacted by the COVID-19 pandemic that has
significantly impacted advertiser demand. Like many companies that
are ad-funded, we are facing a period of higher uncertainty in our
business outlook. We expect our business performance could be
impacted by issues beyond our control, such as changing economic
conditions or shelter-in-place orders that may or may not occur.
Assuming that the economy continues to recover and we do not have
any major COVID-19 related setbacks that may cause economic
conditions to deteriorate, we estimate Q4 revenue to range between
$287 million and $291 million. Under this assumption, we estimate
adjusted EBITDA to be at least $115 million in Q4.
Fourth Quarter 2020 outlook summary:
- Revenue range between $287 million and $291 million
- Adjusted EBITDA of at least $115 million
Use of Non-GAAP Financial Information
Included within this press release are the non-GAAP financial
measures of Adjusted EBITDA, Non-GAAP net income and Non-GAAP
diluted EPS that supplement the Consolidated Statements of Income
of The Trade Desk, Inc. (the Company) prepared under generally
accepted accounting principles (GAAP). Adjusted EBITDA is earnings
before depreciation and amortization, stock-based compensation,
interest expense (income), net and provision for (benefit from)
income taxes. Non-GAAP net income excludes charges and the related
income tax effects for stock-based compensation. Tax rates on the
tax-deductible portions of the stock-based compensation expense
approximating 30% have been used in the computation of non-GAAP net
income and non-GAAP diluted EPS. Reconciliations of GAAP to
non-GAAP amounts for the periods presented herein are provided in
schedules accompanying this release and should be considered
together with the Consolidated Statements of Income. These non-GAAP
measures are not meant as a substitute for GAAP, but are included
solely for informational and comparative purposes. The Company's
management believes that this information can assist investors in
evaluating the Company's operational trends, financial performance,
and cash generating capacity. Management believes these non-GAAP
measures allow investors to evaluate the Company’s financial
performance using some of the same measures as management. However,
the non-GAAP financial measures should not be regarded as a
replacement for or superior to corresponding, similarly captioned,
GAAP measures and may be different from non-GAAP financial measures
used by other companies.
Third Quarter Financial Results Webcast and Conference Call
Details
- When: November 5, 2020 at 2:00 P.M. Pacific Time (5:00
P.M. Eastern Time).
- Webcast: A live webcast of the call can be accessed from
the Investor Relations section of The Trade Desk’s website at
http://investors.thetradedesk.com/. Following the call, a replay
will be available on the company’s website.
- Dial-in with passcode: To access the call via telephone
in the United States, please dial 800-459-5346. For callers outside
the United States, please dial 1-203-518-9544. Participants should
reference “The Trade Desk Call” after dialing in.
- Audio replay: An audio replay of the call will be
available beginning about two hours after the call. To listen to
the replay in the United States, please dial 877-481-4010 (replay
code: 38371). Outside the United States, please dial 1-919-882-2331
(replay code: 38371). The audio replay will be available via
telephone until November 12, 2020.
The Trade Desk, Inc. uses its Investor Relations website
(http://investors.thetradedesk.com/investor-overview), its Twitter
feed (@TheTradeDesk), LinkedIn page
(https://www.linkedin.com/company/the-trade-desk/), and Facebook
page (https://www.facebook.com/TheTradeDesk/), and Jeff Green’s
Twitter feed (@jefftgreen) and LinkedIn profile
(https://www.linkedin.com/in/jefftgreen/) as a means of disclosing
information about the company and for complying with its disclosure
obligations under Regulation FD. The information that is posted
through these channels may be deemed material. Accordingly,
investors should monitor these channels in addition to The Trade
Desk’s press releases, SEC filings, public conference calls and
webcasts.
About The Trade Desk
The Trade Desk is a technology company that empowers buyers of
advertising. Through its self-service, cloud-based platform, ad
buyers can create, manage, and optimize digital advertising
campaigns across ad formats and devices. Integrations with major
data, inventory, and publisher partners ensure maximum reach and
decisioning capabilities, and enterprise APIs enable custom
development on top of the platform. Headquartered in Ventura, CA,
The Trade Desk has offices across North America, Europe, and Asia
Pacific. To learn more, visit thetradedesk.com or follow us on
Facebook, Twitter, LinkedIn and YouTube.
Forward-Looking Statements
This document contains “forward-looking statements” within the
meaning of the Private Securities Litigation Reform Act of 1995.
These statements relate to expectations concerning matters that (a)
are not historical facts, (b) predict or forecast future events or
results, or (c) embody assumptions that may prove to have been
inaccurate, including statements relating to the industry and
market trends, and the Company’s financial targets, such as revenue
and Adjusted EBITDA. When words such as “believe,” “expect,”
“anticipate,” “will”, “outlook” or similar expressions are used,
the Company is making forward-looking statements. Although the
Company believes that the expectations reflected in such
forward-looking statements are reasonable, it cannot give readers
any assurance that such expectations will prove correct. These
forward-looking statements involve risks, uncertainties and
assumptions, including those related to the Company’s relatively
limited operating history and the impact of COVID-19 on the Company
and its customers and partners, which makes it difficult to
evaluate the Company’s business and prospects, the market for
programmatic advertising developing slower or differently than the
Company’s expectations, the demands and expectations of clients and
the ability to attract and retain clients. The actual results may
differ materially from those anticipated in the forward-looking
statements as a result of numerous factors, many of which are
beyond the control of the Company. These are disclosed in the
Company’s reports filed from time to time with the Securities and
Exchange Commission, including its most recent Form 10-K and any
subsequent filings on Forms 10-Q or 8-K, available at www.sec.gov.
Readers are urged not to place undue reliance on these
forward-looking statements, which speak only as of the date of this
press release. The Company does not intend to update any
forward-looking statement contained in this press release to
reflect events or circumstances arising after the date hereof.
THE TRADE DESK, INC.
CONSOLIDATED STATEMENTS OF
INCOME
(Amounts in thousands, except
per share amounts)
(Unaudited)
Three Months Ended
Nine Months Ended
September 30,
September 30,
2020
2019
2020
2019
Revenue
$
216,113
$
164,203
$
516,128
$
445,114
Operating expenses (1):
Platform operations
44,826
39,932
127,167
108,913
Sales and marketing
44,637
36,142
116,002
89,951
Technology and development
41,079
29,185
117,931
83,949
General and administrative
42,789
37,017
117,252
102,755
Total operating expenses
173,331
142,276
478,352
385,568
Income from operations
42,782
21,927
37,776
59,546
Total other expense (income), net
223
(1,892
)
834
(2,979
)
Income before income taxes
42,559
23,819
36,942
62,525
Provision for (benefit from) income
taxes
1,312
4,397
(53,473
)
5,152
Net income
$
41,247
$
19,422
$
90,415
$
57,373
Earnings per share:
Basic
$
0.89
$
0.43
$
1.96
$
1.29
Diluted
$
0.84
$
0.40
$
1.86
$
1.20
Weighted average shares outstanding:
Basic
46,582
44,771
46,075
44,363
Diluted
49,220
48,037
48,731
47,728
_______________________
(1) Includes stock-based compensation
expense as follows:
STOCK-BASED COMPENSATION
EXPENSE
(Amounts in thousands)
(Unaudited)
Three Months Ended
Nine Months Ended
September 30,
September 30,
2020
2019
2020
2019
Platform operations
$
1,639
$
1,507
$
5,459
$
3,894
Sales and marketing
6,916
5,036
18,549
13,094
Technology and development
7,911
7,146
24,345
18,579
General and administrative
10,386
5,753
25,398
20,801
Total
$
26,852
$
19,442
$
73,751
$
56,368
THE TRADE DESK, INC.
CONSOLIDATED BALANCE
SHEETS
(Amounts in thousands)
(Unaudited)
As of
As of
September 30,
2020
December 31,
2019
ASSETS
Current assets:
Cash and cash equivalents
$
434,371
$
130,876
Short-term investments, net
122,909
124,112
Accounts receivable, net
1,139,860
1,166,376
Prepaid expenses and other current
assets
58,847
27,857
Total current assets
1,755,987
1,449,221
Property and equipment, net
111,862
64,012
Operating lease assets
202,172
173,449
Deferred income taxes
39,928
18,950
Other assets, non-current
28,479
23,129
Total assets
$
2,138,428
$
1,728,761
LIABILITIES AND STOCKHOLDERS’
EQUITY
Current liabilities:
Accounts payable
$
919,694
$
868,618
Accrued expenses and other current
liabilities
57,724
47,178
Operating lease liabilities
34,735
14,577
Total current liabilities
1,012,153
930,373
Operating lease liabilities,
non-current
205,408
174,873
Debt, net
72,000
—
Other liabilities, non-current
16,240
10,998
Total liabilities
1,305,801
1,116,244
Stockholders' equity:
Preferred stock
—
—
Common stock
—
—
Additional paid-in capital
510,017
380,079
Accumulated other comprehensive income
145
—
Retained earnings
322,465
232,438
Total stockholders' equity
832,627
612,517
Total liabilities and stockholders'
equity
$
2,138,428
$
1,728,761
THE TRADE DESK, INC.
CONSOLIDATED STATEMENTS OF
CASH FLOWS
(Amounts in thousands)
(Unaudited)
Nine Months Ended September
30,
2020
2019
OPERATING ACTIVITIES:
Net income
$
90,415
$
57,373
Adjustments to reconcile net income to net
cash provided by operating activities:
Depreciation and amortization
20,777
15,246
Stock-based compensation
73,751
56,368
Allowance for credit losses on accounts
receivable
2,722
1,647
Noncash lease expense
24,052
15,394
Deferred income taxes
(20,978
)
—
Other
1,242
(2,945
)
Changes in operating assets and
liabilities:
Accounts receivable
21,063
(2,739
)
Prepaid expenses and other assets
(23,919
)
(19,024
)
Accounts payable
47,728
(21,401
)
Accrued expenses and other liabilities
11,006
(3,178
)
Operating lease liabilities
(10,388
)
(8,468
)
Net cash provided by operating
activities
237,471
88,273
INVESTING ACTIVITIES:
Purchases of investments
(127,117
)
(178,179
)
Maturities of investments
128,315
55,819
Purchases of property and equipment
(57,721
)
(21,659
)
Capitalized software development costs
(4,246
)
(3,849
)
Net cash used in investing activities
(60,769
)
(147,868
)
FINANCING ACTIVITIES:
Proceeds from line of credit
143,000
—
Repayment on line of credit
(71,000
)
—
Payment of debt financing costs
—
(6
)
Proceeds from exercise of stock
options
53,942
21,911
Proceeds from employee stock purchase
plan
15,035
8,648
Taxes paid related to net settlement of
restricted stock awards
(14,184
)
(4,744
)
Net cash provided by financing
activities
126,793
25,809
Increase (decrease) in cash and cash
equivalents
303,495
(33,786
)
Cash and cash equivalents—Beginning of
period
130,876
207,232
Cash and cash equivalents—End of
period
$
434,371
$
173,446
Non-GAAP Financial Metrics (Amounts in thousands, except per
share amounts)
The following tables show the Company’s non-GAAP financial
metrics reconciled to the comparable GAAP financial metrics
included in this release.
Three Months Ended
Nine Months Ended
September 30,
September 30,
2020
2019
2020
2019
Net income
$
41,247
$
19,422
$
90,415
$
57,373
Add back:
Depreciation and amortization
7,517
5,969
20,777
15,246
Stock-based compensation
26,852
19,442
73,751
56,368
Interest expense (income), net
235
(1,480
)
(740
)
(3,763
)
Provision for (benefit from) income
taxes
1,312
4,397
(53,473
)
5,152
Adjusted EBITDA
$
77,163
$
47,750
$
130,730
$
130,376
Three Months Ended
Nine Months Ended
September 30,
September 30,
2020
2019
2020
2019
GAAP net income
$
41,247
$
19,422
$
90,415
$
57,373
Add back (deduct):
Stock-based compensation expense
26,852
19,442
73,751
56,368
Adjustment for income taxes
(5,440
)
(2,777
)
(13,341
)
(8,985
)
Non-GAAP net income
$
62,659
$
36,087
$
150,825
$
104,756
GAAP diluted EPS
$
0.84
$
0.40
$
1.86
$
1.20
Non-GAAP diluted EPS
$
1.27
$
0.75
$
3.10
$
2.19
Weighted average shares
outstanding—diluted
49,220
48,037
48,731
47,728
View source
version on businesswire.com: https://www.businesswire.com/news/home/20201105006090/en/
Investors Chris Toth Vice President Investor Relations, The
Trade Desk ir@thetradedesk.com 310-334-9183
Media Ian Colley Vice President Public Relations, The Trade Desk
ian.colley@thetradedesk.com 914-434-3043
The Trade Desk (NASDAQ:TTD)
Historical Stock Chart
From Mar 2024 to Apr 2024
The Trade Desk (NASDAQ:TTD)
Historical Stock Chart
From Apr 2023 to Apr 2024