The Trade Desk, Inc. (NASDAQ: TTD), a provider of a global
technology platform for buyers of advertising, today announced
financial results for its second quarter ended June 30, 2021.
“Revenue more than doubled year-over-year to $280 million in the
second quarter. Our growth speaks to The Trade Desk’s position as
the default DSP for the open internet. Nowhere is this more
apparent than in Connected TV, as more premium streaming inventory
becomes available to meet growing marketer demand for data-driven
TV advertising,” said Jeff Green, founder and CEO of The Trade
Desk. “From a customer perspective, more of the world’s leading
brands, and their agencies, joined our platform, or expanded their
relationship with us. This, and our robust international growth in
the second quarter, gives us tremendous optimism moving forward. We
also recently launched our new trading platform, Solimar, the
biggest product launch in our company’s history. Solimar allows
advertisers to take advantage of many opportunities in front of
them today, with features such as simple and secure onboarding of
first-party data; the industry’s most advanced cross-channel
measurement marketplace; and advanced, multi-level goal-setting
which allows our KOA AI technology to optimize campaigns for the
trader.”
Second Quarter 2021 Financial
Highlights:
The following table summarizes our consolidated financial
results for the three and six months ended June 30, 2021 and 2020
($ in millions, except per share amounts):
Three Months Ended
Six Months Ended
June 30,
June 30,
2021
2020
2021
2020
GAAP Results
Revenue
$
280.0
$
139.4
$
499.8
$
300.0
Increase in revenue year over year
101
%
(13
)%
67
%
7
%
Net Income
$
47.7
$
25.1
$
70.3
$
49.2
Diluted EPS
$
0.10
$
0.05
$
0.14
$
0.10
Non-GAAP Results
Adjusted EBITDA
$
117.9
$
14.6
$
188.4
$
53.6
Adjusted EBITDA Margin
42
%
10
%
38
%
18
%
Non-GAAP Net Income
$
88.2
$
44.8
$
158.2
$
88.2
Non-GAAP Diluted EPS
$
0.18
$
0.09
$
0.32
$
0.18
Second Quarter and Recent Business
Highlights Include:
- Strong Customer Retention: Customer retention remained
over 95% during the quarter, as it has for the previous 7
years
- Launched our new trading platform Solimar Features
include:
- Upgraded UI to help set better campaign goals
- The platform’s AI engine Koa™ then uses these goals as a guide
to optimize media spend, helping the advertisers to achieve goals
faster and more efficiently than ever before
- Enables onboarding and activating first-party data easier than
ever
- Growing an audience without sacrificing control over consumer
experience by utilizing an interoperable Unified ID 2.0 with some
of the biggest names in identity
- The most powerful measurement marketplace in the market today
providing marketers the ability to measure the impact of campaigns
across every channel and optimize in real time
- Continued Industry-Wide Collaboration and Support for
Unified ID 2.0: The Trade Desk is building support for Unified
ID 2.0 (UID2), a new industry-wide approach to identity that
preserves the value of relevant advertising, while putting user
control and privacy at the forefront. The ID is an upgrade and
alternative to third-party cookies. Recent pledges of support and
integration with UID2 include:
- Global provider of marketing solutions, Interpublic Group
- Global media, marketing and corporate communications holding
company, Omnicom Group
- AMC Networks, an American entertainment company
- Blockgraph, a technology company that makes the future of
data-driven TV advertising possible
- OpenAP, an advanced advertising company bringing simplicity and
scale to audience-based campaigns in television
- Snowflake, an enabler for organizations to mobilize their data
with Snowflake’s Data Cloud
- Industry Recognition: The Trade Desk was named one of
the Top 100 Software Companies of 2021 by The Software Report and
won Adweek Readers’ Choice: Best of Tech awards for both Demand
Side Platform and Innovator of the Year categories. Additionally,
The Trade Desk was included in this year’s Forbes Global 2000 list.
And for the fifth consecutive year, The Trade Desk was selected as
both a FORTUNE 2021 Best Medium Workplace and a Best Workplace in
New York by Great Places to work.
Financial Guidance:
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 additional 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 the following:
Third Quarter 2021 outlook summary:
- Revenue at least $282 million
- Adjusted EBITDA approximately $100 million
We have not provided an outlook for GAAP Net income or
reconciliation of adjusted EBITDA guidance to net income, the
closest corresponding U.S. GAAP measure, because net income outlook
is not available without unreasonable efforts on a forward-looking
basis due to the variability and complexity with respect to the
charges excluded from these non-GAAP measures; in particular, the
measures and effects of our stock-based compensation expense that
are directly impacted by unpredictable fluctuations in our share
price. We expect the variability of the above charges could have a
significant and potentially unpredictable impact on our future U.S.
GAAP financial results.
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 25% to 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.
Second Quarter Financial Results Webcast and Conference Call
Details
- When: August 9, 2021 at 8:30 A.M. Pacific Time (11:30
A.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: To access the call via telephone in North
America, please dial 888-506-0062. For callers outside the United
States, please dial 1-973-528-0011. Participants should reference
the conference call ID code “705293” 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 1-877-481-4010 (replay
code: 42356). Outside the United States, please dial 1-919-882-2331
(replay code: 42356). The audio replay will be available via
telephone until August 23, 2021.
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
Six Months Ended
June 30,
June 30,
2021
2020
2021
2020
Revenue
$
279,967
$
139,355
$
499,778
$
300,015
Operating expenses (1):
Platform operations
50,809
42,133
101,309
82,341
Sales and marketing
61,755
37,071
117,519
71,365
Technology and development
53,536
40,058
107,454
76,852
General and administrative
51,919
35,865
103,764
74,463
Total operating expenses
218,019
155,127
430,046
305,021
Income (loss) from operations
61,948
(15,772
)
69,732
(5,006
)
Total other expense, net
398
194
90
611
Income (loss) before income taxes
61,550
(15,966
)
69,642
(5,617
)
Provision for (benefit from) income
taxes
13,853
(41,077
)
(697
)
(54,785
)
Net income
$
47,697
$
25,111
$
70,339
$
49,168
Earnings per share:
Basic
$
0.10
$
0.05
$
0.15
$
0.11
Diluted
$
0.10
$
0.05
$
0.14
$
0.10
Weighted average shares outstanding:
Basic
475,512
461,356
474,172
458,184
Diluted
496,987
486,537
497,449
484,834
_______________________
(1) Includes stock-based compensation
expense as follows:
STOCK-BASED COMPENSATION
EXPENSE
(Amounts in thousands)
(Unaudited)
Three Months Ended
Six Months Ended
June 30,
June 30,
2021
2020
2021
2020
Platform operations
$
4,091
$
2,358
$
9,106
$
3,820
Sales and marketing
14,579
6,319
28,263
11,633
Technology and development
13,974
7,844
30,068
16,434
General and administrative
12,553
7,413
30,114
15,012
Total
$
45,197
$
23,934
$
97,551
$
46,899
THE TRADE DESK, INC.
CONSOLIDATED BALANCE
SHEETS
(Amounts in thousands)
(Unaudited)
As of
As of
June 30, 2021
December 31, 2020
ASSETS
Current assets:
Cash and cash equivalents
$
476,907
$
437,353
Short-term investments, net
228,150
186,685
Accounts receivable, net
1,527,651
1,584,109
Prepaid expenses and other current
assets
114,558
102,170
Total current assets
2,347,266
2,310,317
Property and equipment, net
124,809
115,863
Operating lease assets
245,674
248,143
Deferred income taxes
45,124
50,168
Other assets, non-current
30,075
29,154
Total assets
$
2,792,948
$
2,753,645
LIABILITIES AND STOCKHOLDERS’
EQUITY
Current liabilities:
Accounts payable
$
1,222,220
$
1,348,480
Accrued expenses and other current
liabilities
66,759
88,335
Operating lease liabilities
39,594
37,868
Total current liabilities
1,328,573
1,474,683
Operating lease liabilities,
non-current
252,995
254,562
Other liabilities, non-current
9,034
11,255
Total liabilities
1,590,602
1,740,500
Stockholders' equity:
Preferred stock
—
—
Common stock
—
—
Additional paid-in capital
657,640
538,778
Retained earnings
544,706
474,367
Total stockholders' equity
1,202,346
1,013,145
Total liabilities and stockholders'
equity
$
2,792,948
$
2,753,645
THE TRADE DESK, INC.
CONSOLIDATED STATEMENTS OF
CASH FLOWS
(Amounts in thousands)
(Unaudited)
Six Months Ended June
30,
2021
2020
OPERATING ACTIVITIES:
Net income
$
70,339
$
49,168
Adjustments to reconcile net income to net
cash provided by
operating activities:
Depreciation and amortization
21,017
13,260
Stock-based compensation
97,551
46,899
Allowance for credit losses on accounts
receivable
239
2,384
Noncash lease expense
19,553
15,825
Deferred income taxes
5,044
(11,697
)
Other
9,065
(2,372
)
Changes in operating assets and
liabilities:
Accounts receivable
49,802
293,577
Prepaid expenses and other assets
(6,812
)
(31,368
)
Accounts payable
(133,510
)
(214,396
)
Accrued expenses and other liabilities
(22,852
)
(7,418
)
Operating lease liabilities
(23,995
)
(4,735
)
Net cash provided by operating
activities
85,441
149,127
INVESTING ACTIVITIES:
Purchases of investments
(164,031
)
(90,080
)
Sales of investments
4,539
—
Maturities of investments
116,769
85,183
Purchases of property and equipment
(18,499
)
(37,720
)
Capitalized software development costs
(2,675
)
(2,317
)
Net cash used in investing activities
(63,897
)
(44,934
)
FINANCING ACTIVITIES:
Proceeds from line of credit
—
143,000
Repayment on line of credit
—
(1,000
)
Payment of debt financing costs
(1,852
)
—
Proceeds from exercise of stock
options
26,339
41,969
Proceeds from employee stock purchase
plan
22,758
15,035
Taxes paid related to net settlement of
restricted
stock awards
(29,235
)
(7,729
)
Net cash provided by financing
activities
18,010
191,275
Increase in cash and cash equivalents
39,554
295,468
Cash and cash equivalents—Beginning of
period
437,353
130,876
Cash and cash equivalents—End of
period
$
476,907
$
426,344
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
Six Months Ended
June 30,
June 30,
2021
2020
2021
2020
Net income
$
47,697
$
25,111
$
70,339
$
49,168
Add back:
Depreciation and amortization
11,006
6,783
21,017
13,260
Stock-based compensation
45,197
23,934
97,551
46,899
Interest expense (income), net
194
(158
)
239
(975
)
Provision for (benefit from) income
taxes
13,853
(41,077
)
(697
)
(54,785
)
Adjusted EBITDA
$
117,947
$
14,593
$
188,449
$
53,567
Three Months Ended
Six Months Ended
June 30,
June 30,
2021
2020
2021
2020
GAAP net income
$
47,697
$
25,111
$
70,339
$
49,168
Add back (deduct):
Stock-based compensation expense
45,197
23,934
97,551
46,899
Adjustment for income taxes
(4,682
)
(4,248
)
(9,689
)
(7,901
)
Non-GAAP net income
$
88,212
$
44,797
$
158,201
$
88,166
GAAP diluted EPS
$
0.10
$
0.05
$
0.14
$
0.10
Non-GAAP diluted EPS
$
0.18
$
0.09
$
0.32
$
0.18
Weighted average shares
outstanding—diluted
496,987
486,537
497,449
484,834
View source
version on businesswire.com: https://www.businesswire.com/news/home/20210809005222/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
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