Transcripts
The Trade Desk, Inc.'s management answers for the business every quarter. These are the exchanges that explain it best — verbatim, from the call transcripts preserved in Sources. Each link opens the full transcript at that page in a new tab.
Q1 2026 Earnings Call — Q1 FY2026
The current state of the story in management's own words: a decelerating guide, the Publicis dispute, and where growth is supposed to come from. · Open the full transcript →
Why a record year of new ad supply is the core of the bull case, and why publishers copying the walled-garden model hit a ceiling.
Jeffrey Terry Green (CEO and Co-Founder): In 2025, the advertising ecosystem globally added more supply than perhaps any year previously. It is probably the most lopsided market in advertising history, with multiples more supply than demand. This supply-demand imbalance creates the biggest buyers market in the history of advertising. Buyers have the option to be selective, but they need to leverage data and great real-time technology to know what they are buying. Premium advertisers and premium publishers often have been at odds for most of the internet’s history. But at this moment, both are heavily invested in making the supply chains and market dynamics of the premium open internet successful. In this buyers’ market, some publishers are mistakenly copying the Facebook and YouTube walled garden business model. For most of them, it has a couple of years, and then it hits a scale ceiling. The walled garden strategy only works when a publisher is massive, and a must-have on a media plan. […] Most marketers now have a clear definition of the open internet that includes media beyond the browser. The best of movies, TV, sports and all live events, journalism, and music are all the anchor tenants of the open internet. As a result of this dynamic, the open internet is thriving and evolving very fast. We are convinced that the evolution and changes being made in the open internet today will make it soon become a place where, consistently, an advertiser’s first dollar is spent, not the walled garden leftovers.
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The commercial engine in numbers: JBP signings, and a named win-back from Amazon that shows what the pitch actually is.
Jeffrey Terry Green (CEO and Co-Founder): We are seeing these behaviors translate directly into business. March was our biggest month on record for JBP signings. We signed 45 JBPs in March alone. For Q1, our total JBP count grew 55% year over year. And excluding renewals, new JBP deal spend grew 40% year over year during the quarter. To highlight one of these deals, our pharma team recently went head-to-head against Amazon for one of the largest pharmaceutical advertisers in the world. Lured by seemingly low rates, this brand shifted some investment to PG on Amazon last year. Over the past nine months, our team delivered consistent partnership and focused on driving real business outcomes for the client. In Q1, our team won back the business and signed a JBP for 2026 that will increase their spend on our platform by 114% year over year.
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The retail-data asset sized against Amazon, and the first hard numbers on the new flat-fee data product.
Jeffrey Terry Green (CEO and Co-Founder): Over the last five years or so, we have created the world’s largest and richest marketplace of retail data. Combined, we believe the retailers in our data marketplace represent more than 80% of sales from top U.S. retailers, compared to Amazon, who represents less than 15% of U.S. retail spend. This is a huge advantage for us. For example, a leading travel brand recently ran a test to evaluate campaign performance with and without activating our new product Audience Unlimited. The results across all KPIs were fantastic. Audience Unlimited delivered 30% lower CPMs on media, 38% lower data costs, a 75% more efficient CPA, and a 2.7x increase in conversion rate compared to the control group. Most importantly, Audience Unlimited increased campaign performance while simultaneously reducing manual effort in the audience selection process.
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The two questions that opened the call: the Publicis dispute, which he declines to detail, and the implied Q2 slowdown.
Shyam Vasant Patil (Susquehanna); Jeffrey Terry Green (CEO and Co-Founder): Hey, guys. Good afternoon. Jeff, I had a couple of questions. First one, can you provide some comments on the Publicis discussions? And then second, can you talk about the factors that you see driving the deceleration in your Q2 outlook? Thank you. […] But I will say that since 2018, we have done billions of dollars of business with Publicis through the agreement that we have. And we continue to have great dialogue with Publicis about the next chapter of our partnership. Our negotiations are ongoing. It is probably not prudent for me to say more about it in this forum, so I will just leave it at that on Publicis. […] As to the specifics, some of the fast-growing verticals we believe would be growing even faster if they were absent the current macro uncertainty, where there is geopolitical instability, there are tariffs, there are broader consumer pressures that are impacting growth. But what gives me confidence, really, is that nearly every major brand we speak with is focused on the right question right now, which is how do we get back to growth as a brand?
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How a 40% full-year margin is defended off a 30% Q1: headcount below revenue growth, and pacing flexibility rather than named cuts.
Justin Tyler Patterson (KeyBanc); Tahnil Davis (Interim CFO and CAO); Jeffrey Terry Green (CEO and Co-Founder): Great. Thanks. Good afternoon. I am curious to hear more about investment priorities against that 40% EBITDA margin target. Obviously, revenue and margins are both off to a softer start in the first half. I am curious how we should think about the levers to achieve that target. Thank you. […] As a company, we have always been very disciplined around hiring and reinvestment in the business. 2026 is a year of disciplined reinvestment for us. We expect our full-year adjusted EBITDA margin percentage to be at least 40%, approximately in line with last year. We again expect headcount growth to remain below revenue growth, reflecting continued operating discipline and increasing productivity across our business. At the same time, we will continue investing in areas where we see the highest long-term ROI, particularly around platform innovation, AI, retail media, and measurement. One advantage of our model is that we generate strong cash flow and can maintain significant flexibility in how we pace our investments and expenses, which allows us to maintain those high levels of profitability. So our focus is clear: maintain strong profitability, invest where ROI is the highest, and continue positioning the business for greater leverage over the long term. […] And I will just add that maintaining strong profitability has always been a part of our culture at The Trade Desk, Inc., even when we were a much smaller company. In fact, I was very obsessed when I founded the company with racing to profitability. It was my view that that is how we could own our future, but it is also how we could establish a culture that was extremely disciplined.
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The clearest statement of why he thinks AI search reopens the search TAM that programmatic was locked out of.
Jeffrey Terry Green (CEO and Co-Founder): I think some people have wrongly assumed that their monetization will look like, "legacy search." Legacy search was born when the average search query was less than two words. No good AI prompt is two words or less. They are much more detailed. And when you have many sentences and are asking a very specific question or prompt, obviously, the answer often is much more valuable as well to the user. So it is not unreasonable to think that many of the LLMs are going to try to get as much ad monetization as possible. If you look at it as there is a subscription, which is quite expensive, and that either needs to be offset or substituted by an ad experience that is extremely profitable, that extremely profitable ad experience cannot just be keyword-based or like legacy search. In fact, in order to make the most amount of money, it might, in some cases, need to include video. If there is a lot of compute cost that goes into that answer, it probably is somewhat correlated to the value of the response to the user, which might make it easier to put on the other side of a video. In both of those cases, I do believe that it can unlock a greater amount of TAM for the LLMs in the sense that they can participate in top-of-the-funnel activity and bottom-of-the-funnel activity, which is different than what search has done.
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Asked whether to move into the sell side, he draws the permanent boundary of the business model — and why OpenPath is not that.
Jeffrey Terry Green (CEO and Co-Founder): Coming to the second part of your question, which was about should The Trade Desk, Inc. get into the supply side: the reason we have not is not because we could not technologically. It is not because it would not further shorten the supply chain. It is because we do not want to create the conflict of interest of saying to one group of customers, we want you to get the lowest CPM cost, we are looking for value, and then going straight from advertisers to publishers saying, we want to give you the highest CPM possible, and then trying to serve two masters. This is the flaw of every ad network business model, which, by the way, hundreds of companies are trying to replicate in a lot of ad tech business models today—the flaws of the ad network business model that we disproved twenty years ago. This is a lesson that unfortunately not enough have learned. That said, there are hundreds of publishers who want to do their own yield management, and many companies in CTV are doing their own yield management. They built their own tech to do this, and we plug into that tech directly. This is the reason we built OpenPath in the first place: to plug into companies like that who want to do their own yield management. So we will absolutely look for that opportunity. But as it relates to going all the way to the sell side and doing the yield management for them, we will never do that.
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Q4 and Full Year 2025 Earnings Call — Q4 FY2025
The annual framing call — the CPG and auto drag quantified, the take-rate bear case answered, and OpenPath's fee disclosed. · Open the full transcript →
A head-to-head test against the Amazon DSP, quantified — the cleanest illustration of what owning no inventory is worth.
Jeff Green (CEO): Let me give you a couple of examples of how the supply-demand imbalance has helped us. One of the world's leading appliance manufacturers recently ran a test between The Trade Desk and the Amazon DSP, focusing on CTV ad performance in one of their most important markets. They found that, with The Trade Desk, they were able to reach 70% more unique households because we gave them access to a much wider range of relevant touch points with those consumers. With The Trade Desk, they were able to reach those consumers at 30% lower total cost, so significantly better reach for meaningfully lower cost. And the kicker is The Trade Desk platform performed six times better in terms of delivering their campaign goals. All of this happened because we provided the client with objective decisioning across the open Internet. We didn't prioritize our own impressions because we don't own any. We were able to help the client find the ad impressions that were most likely to lead to conversions.
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Why the third-party data market stayed small, and the flat-fee structure meant to fix it — a pricing model laid out first here.
Jeff Green (CEO): I have argued that the data marketplace is anemic for one primary reason. There is no price discovery for data. The cost has really been complicated for marketers, so generally, they don't use it. We can see, though, that the value is obvious, especially leveraging AI. And using a flat cost structure, Audience Unlimited helps advertisers use a wider range of the most relevant data to any given campaign for an all-in cost, where value and impact is clearly understood. This innovation wasn't possible before advances in AI, particularly Agentic AI in this case, which allows us to surface the right data segment at the right moment. Of course, Audience Unlimited is completely optional. Clients can use it or continue to buy third-party data a la carte. We are already seeing very positive results with early adopters, and I'm excited for more advertisers to get access as this year progresses.
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Management's answer to the decade-old take-rate compression bear case, stated plainly.
Jeff Green (CEO): Finally, I'd like to zoom out and provide a little more perspective. For as long as we've been public, which is around ten years now, there's been a narrative that our margin or take rate must compress because other platforms offer lower upfront prices for non decisioned, non-data-driven buying. In reality, those business models deliver less value overall. Their business model is focused on selling owned and operated inventory. Walled gardens can more than make up for the lower fee on supply side as they mark up and prioritize their owned and operated inventory.
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Why he rejects the brand-versus-performance split, and what last-touch attribution does to top-of-funnel spend.
Jeff Green (CEO): There is this narrative on Wall Street that performance budgets are more DTC or they're more mid-market and then there's brand budgets that are separate from that. That paradigm, I just reject. I think everything is performance now; it's just a matter of where you are in the funnel. The problem with framing it that way is you reinforce a serious problem in the ecosystem, which is that all of the measurement frameworks that have existed to date just give credit to the last person who touched the ball before it went in the net. The rest of the team gets nothing. In the brand-building business, it is by its very nature at the top of the funnel where you win hearts and minds; it tends to be more expensive media. Nobody types in 'Buy Mercedes-Benz' into Google without seeing the commercial or hearing about the company before that. Giving all the credit to the last touch has been a serious mistake. Brands like Hershey’s and others are creating a better framework to reward the things that matter and make everything perform. Of course, the players on the back of the field—if we're using the sports analogy, the goalie and the defender—they matter as much as the striker. But let's not just give all the money to the person who kicked the goal. Otherwise, we all play sports like five-year-olds. We hover around the ball and try to be the last one to touch it before it goes in. That, unfortunately, is too often the state of marketing.
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Q3 2025 Earnings Call — Q3 FY2025
The best single explanation of the products and the market structure: what each supply-chain tool does and why a rival pricing to zero doesn't scare him. · Open the full transcript →
The definition the whole thesis rests on: the open internet is where price discovery exists because buyer and seller are different entities.
Jeff Green (CEO): A reminder, the open Internet is the portion of the Internet where price discovery and competition exists. In the open Internet, every transaction is arm's length. Walled gardens are built around owned and operated inventory instead of third-party inventory. Price discovery comes when the buyer and seller are different entities.
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Antitrust-trial evidence used to argue DV360 became a YouTube buying tool — the competitive claim with numbers attached.
Jeff Green (CEO): Nearly every big tech player in advertising, Amazon, Apple, Google, Facebook, is primarily focused on expanding and monetizing their owned and operated inventory and content. Google is clearly focused on search, their AI chatbot Gemini, and YouTube. Amazon's primary advertising efforts are focused on growing sponsored listings, and secondarily on Prime Video. Both are putting Amazon-owned and operated inventory first. Facebook continues to focus on monetizing Instagram and Facebook as destinations, and TikTok the same. None of these companies are focused on monetizing the open Internet. This was helpfully made public throughout the antitrust trial of the Department of Justice versus Google when they revealed numbers that Google normally does not report on. Exhibits and industry experts estimated that in 2019, the open Internet and owned and operated inventory on YouTube were equally split in share of wallet on DV360. However, between 2019 and today, roughly all of the incremental dollars and growth from DV360 has gone to YouTube. YouTube spend increased by about 800%, while Google's buying of the open Internet stayed essentially flat for the same period of time. During that time, the Trade Desk seems to have surpassed Google in the amount bought on the open Internet, again, according to others.
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Kokai adoption and the measured performance delta versus the prior platform — the case for why clients migrate.
Jeff Green (CEO): Today, nearly all of our clients have tried Kokai, with nearly 85% using Kokai as their default experience. When we build a new iteration of our platform, our primary goal is to deliver more value to our customers by increasing their performance. By this standard, Kokai is the best upgrade we have ever made to our product relative to all previous versions and certainly relative to Solimar. Campaigns that have switched to Kokai are seeing impressive results. Since its launch, Kokai has delivered, on average, 26% better cost per acquisition, 58% better cost per unique reach, and a 94% better click-through rate compared to Solimar.
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The supply-chain product stack explained in one pass: what OpenPath, OpenAds, Pubdesk and Deal Desk each do.
Jeff Green (CEO): This year, we've launched and grown several products that are solely focused on substantially upgrading supply chains so that buyers get more for their money. OpenPath is an integration between TTD and a direct source of inventory. OpenPath plugs into auctions we trust. It is a collection of clean pipes for connections that are directly into inventory. We have grown OpenPath by many hundreds of percentage points this year, which means our clients are getting clear views of exactly what they're buying, and publishers have a clearer sense of what advertisers are willing to pay when they describe their inventory in a transparent and accurate way. OpenAds is an auction that we develop and sometimes host as an option for publishers. We then bid into a fair auction and even enable other buyers or DSPs to do the same thing too. The market needs a healthy auction, and some sell-side players have continually weakened the integrity of the auction. So we're developing an open-source option that raises that bar. We just launched it, and we're already working to integrate with more than 20 of the biggest publishers on the web. We expect this to dramatically improve the supply chains of mobile in-app ads and browser-based ads, which, of course, can use the help in an AI scraping world. Pubdesk is improving the supply chain by publishing data for the sell-side. Resellers, sellers, and publishers can log into the platform and see what we paid the supply chain, what signals we value, and adjust their sites and inventory to get more. This is largely fueled by the Sincera team and data that we acquired earlier in the year. Deal Desk is a better way to manage one-to-one deals. Not only does it facilitate the buy, but using AI, it predicts how a deal will perform relative to the open market. This product enables them to do deals, but also gives them the unprecedented data and tools to avoid bad deals. It is important to note that this product will be foundational to a healthy forward market that can replace the outdated upfronts.
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Amazon's ad revenue decomposed — sponsored listings versus Prime Video versus DSP — to argue the overlap is small.
Jeff Green (CEO): Amazon has made significant strides in advertising recently, and it's important to take a closer look at their approach. This year, they're projected to generate around $70 billion in advertising revenue. Based on our analysis, it appears that approximately 90% of this revenue comes from sponsored listings, likely more than 95%. In my opinion, these sponsored listings are in direct competition with Google Search and the new AI-driven search engines. Amazon’s advertising efforts are focused on competing with Google, which is driving most of their advertising revenue and growth. The second source of their advertising revenue is Prime Video, which we estimate generates a couple of billion dollars at most, significantly less than that 10% of their total advertising revenue. This revenue source competes with platforms like Netflix, Disney, and Paramount. While their advertising growth is impressive, the story of Amazon's advertising primarily revolves around their growth in owned and operated ad inventory. Their demand-side platform (DSP) is definitely a lower priority. To clarify, our DSP targets a crucial question in advertising: what ads should brands or advertisers purchase on the open Internet? Ideally, we define DSPs as platforms for purchasing across the open Internet. Amazon's DSP, however, is primarily focused on buying ads for Prime Video, with minimal investment geared towards the open Internet. Our estimates indicate that only a small fraction of their DSP activities involve decision-making for the open Internet; the majority is either for Prime Video or nondecision buying such as programmatic guaranteed. In my estimation, close to 97% to 99% of Amazon's advertising efforts center around monetizing their owned and operated inventory, with only a small portion dedicated to the open Internet. In the advertising space, Amazon competes first with Google and then with Netflix and Disney, leaving us with minimal competition.
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Asked whether rivals can simply price the DSP at zero, he gives the answer he has given since the IPO roadshow.
Jeff Green (CEO): Shyam, let me also just answer the other part of your question that you directed towards me, by the way, extra points for the multipart question. I just wanted to also answer the part about the question on pricing. I actually love this question as well in part because when we were on the IPO roadshow, I remember getting into a discussion with a very large room full of people, where one of the— in my view, one of the smarter PMs on Wall Street asked the question, doesn’t, in the end, Google just kick your app because they can price it at zero? I will answer it now the exact same way that I answered it then, which is something to the effect of — I hope they do eventually price it at zero because it will be easier to point out then the problem of advertising today. Google doesn't break out the money they make from their DSP buying the open Internet because the Google P&L — this isn't material on the Google P&L. They make their money in other ways. So pricing the DSP at zero will inspire the question, is this a trick? If you make the DSP zero, where are you making your money? In my opinion, DSPs that price at near zero or at discounts to get close to zero only do that because they're primarily selling owned and operated inventory that has a cost of goods sold of near zero, and that's where they make the money. So when we orient the conversation around price, I think it's a trap for us and the buyers. If we orient the conversation around value, we win nearly every time.
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Q1 2025 Earnings Call — Q1 FY2025
The recovery quarter, where the founding thesis, the OpenPath economics and the post-reorg evidence are all set out together. · Open the full transcript →
The founding thesis restated from the original business plan: few scaled DSPs, most conflicted, one objective winner.
Jeff Green (CEO): I want to share something that we put in The Trade Desk business plan 16 years ago, before we'd written even a single line of code. We argued to potential investors then that at the end state, there will be 10 or fewer scaled DSPs. We think most of them will be conflicted. We thought then that most DSPs would compromise their objectivity with buyers in order to promote their own content. Walled gardens bias their own content at the expense of media buyers who look to seek value and performance across the entire ecosystem. Their business models are inherently flawed because over the long-term, their fiduciary duty to grow for shareholders is at odds with what is in the best interest of the agencies and advertisers, which is to objectively buy media from all over a competitive, massively scaled digital media landscape where no single company can possibly own all of the good media.
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The guidance philosophy in a downturn — measure the quarter in share taken, not growth delivered.
Jeff Green (CEO): When the large brands are facing comparatively tough times, we are focused on grabbing land. In macro environments with headwinds, our short-term success is better measured in how much land we grab. In this environment, we want to win market share from our competitors. We did the same thing during the pandemic. While consumers stayed home to stay safe, they also accelerated their move to streaming. We adjusted our business to work-from-home, and we grabbed land. In other words, we won share from everyone else.
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OpenPath's results on the publisher side, and the explicit limit: it is not a move into the sell side.
Jeff Green (CEO): We are seeing example after example of the benefits that OpenPath is providing. Arena Group publishes major titles such as Men's Journal and Parade. They boast more than 100 million visitors per month. With OpenPath, they were able to increase their fill rates by 4x and improve programmatic revenue by 79%, all because they are able to provide advertisers, our clients, with clear visibility into what they're buying. I could list dozens more examples. The New York Post saw its digital advertising fill rate increase more than 8x, and programmatic revenue increased 97% with OpenPath. In the world of CTV, VIZIO saw its programmatic revenue increase by 39%. And another major network saw their fill rate increase 7x, leading to a revenue increase of over 25%. To be clear, OpenPath does not represent The Trade Desk getting into the supply side of the market. OpenPath is not built to help publishers with yield management or ad serving.
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The measurement gap that drives demand for the open internet, stated as a concrete example.
Jeff Green (CEO): Let me outline a conundrum that marketers are currently facing, and I hear this from CMOs and agency leaders on an almost daily basis. Walled gardens are easy to use, and marketers can use them for easy access to what I would call cheap reach, or put another way, let me reach as many people as possible as quickly and cheaply as possible, all as measured by those walled gardens themselves. The problem begins when the metrics provided by those walled gardens don't line up with actual business outcomes over time. So for example, walled garden measurement may tell an advertiser they've accounted for one million toothbrush sales this quarter, but they only actually sold half a million. Those measurement disparities over time create misalignment for marketers and the businesses they're supporting, all because of the attraction of cheap reach.
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What clients actually get from the platform migration, in campaign metrics rather than adjectives.
Jeff Green (CEO): And across all verticals, clients that are adopting Kokai are realizing major benefits. For example, on average, clients that have shifted over have seen a 42% reduction in cost per unique reach. We're also working with clients beyond typical brand and reach metrics. Kokai is delivering on lower funnel KPIs, including 24% lower cost per conversion and 20% lower cost per acquisition. These improvements are helping unlock performance budgets from new and existing clients. And thanks to the work we've done in our data marketplace to increase the discoverability of third-party data, campaigns on Kokai use roughly 30% more data elements per impression.
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One quarter after the miss, the specific evidence offered that the reorganization worked.
Shyam Patil (Susquehanna); Jeff Green (CEO): Can you elaborate on the progress that you're seeing from the product and go to-market changes that you implemented towards the end of last year? I mean, it sounds like those efforts are beginning to gain traction and contributed pretty meaningfully to the strong start. […] I want to highlight a couple of green shoots we're observing. Kokai adoption picked up momentum as we exited December, and now about two-thirds of our clients are utilizing Kokai, which is ahead of our timeline. Additionally, we’ve focused on integrating AI across the platform, making significant strides in the last quarter like never before in our company's history. Since we started introducing Koa in 2017, these investments in AI and our platform improvements, including Kokai, have led to outstanding campaign performance. Kokai is achieving lower funnel KPIs, such as a 24% reduction in cost per conversion and a 20% decrease in cost per acquisition. These enhancements are unlocking performance and budgets from existing clients, as well as attracting new clients who are more performance-focused. Our product and engineering teams have become more collaborative and effective than they have been in years, and we now have over 100 scrums operating and delivering products weekly. The new reporting structures are successful and fostering greater engagement with brands and agencies. We have more work ahead and have yet to fully benefit from these upgrades, but the trend is promising, confirming that we’ve made the right decisions. Our strong JBP pipeline also supports this. Over 40% of our spending is now aligned with JBPs, which are partnerships built on long-term commitments and visions for collaboration, growing 50% faster than overall spending. This synergy enables our business to grow at a faster pace.
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Why walled gardens can charge high take rates and still win on cost — the supply-chain economics the open internet must match.
Jeff Green (CEO): As it relates to OpenPath itself, it's been pretty amazing. We've just been in the market for a couple of years now, but we've been obsessed with improving the visibility and transparency of our supply chain. Really what we're trying to do is make certain that the supply chain is efficient. So if you just zoom out, really all we're trying to do is make it so that there aren't so many middlemen, so many taxes, especially those that don't add more value than they extract, so that the open internet isn't operating at a disadvantage. Because we always look at this as, to a large extent, this is the open internet competing against walled gardens. Walled gardens lose on objectivity, they lose on transparency, but in some cases, they've won on supply chain efficiency because they control it all. So even with really large take rates that they all have, their cost of goods sold is so low that they can make very healthy margins, and then they have short supply chains because they control those too. So in order to compete with that, we need a supply chain that is quite efficient.
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Q4 and Full Year 2024 Earnings Call — Q4 FY2024
The call where the thesis was tested: the first shortfall in 33 quarters, what management blamed, and what it changed. · Open the full transcript →
The admission that broke an eight-year streak, and his framing of the cause as execution rather than market or competition.
Jeff Green (CEO): While we’re proud of these milestones, I want to acknowledge upfront that for the first time in 33 quarters as a public company we fell short of our expectations. During COVID, we revised our expectations once like many in the market, but for the first time in 8 years, we missed the expectations we set, and it was our fault. When we contemplated going public about 10 years ago, many advised against it, often due to concerns over low valuations because no ad tech company had earned Wall Street’s trust for an extended period. I saw that as a challenge and still do. I knew we had the business model, the total addressable market, the vision, the determination, and the team to break that mold and achieve what had never been done before. The only way to do that was to make commitments and follow through. Many said it couldn’t be achieved. Our success has been partially driven by our ability to earn the trust of investors, partners, our industry, and our clients. Few things are as important to us. I want to emphasize that we take this moment seriously. We assure our investors, partners, and clients that their trust is well-placed and deserved. Our best days lie ahead, but before discussing that, I want to share what went wrong and the changes we are implementing to mak the most of our unique and growing opportunity. To begin, let me clarify what falling short of our expectations does not signify. This wasn't due to a smaller opportunity than anticipated, nor did competition play a role. In Q4, we faced challenges due to a series of small execution missteps while also preparing for the future. If this were a sporting event, we would still have a championship caliber team, but in this particular instance, we made too many turnovers.
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The four structural changes made in response — reorg, brand coverage, JBPs, and a rebuilt engineering process.
Jeff Green (CEO): First, we implemented the largest reorganization in company history in December. While we usually make structural changes at year-end to enhance our business, this one was larger than usual. We clarified roles and responsibilities for most employees, resulting in a change in reporting structures. Additionally, we streamlined client-facing teams, minimizing complexity and clarifying duties. Some teams now focus on brands, while others concentrate on agencies. Our commitment to agencies remains strong, while we expand direct relationships with brands, particularly through Joint Business Plans, which grow 50% faster than the rest of our business. […] Fourth, we revamped our product development process, returning to smaller, agile teams that provide weekly updates instead of relying on waterfall methods, which are less suitable for our fast-changing industry. Our engineering team is divided into nearly 100 scrum teams, enhancing collaboration with the business team on what has been accomplished and what’s upcoming. I anticipate this will continue to boost Kokai enhancements and complete the transition of all clients from Solimar to Kokai this year.
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The CFO's own account of the miss, plus the take-rate disclosure investors watch most closely.
Laura Schenkein (CFO): However, for the first time, in our 8.5 years as a public company, excluding the first quarter of 2020, our results came in below our expectations. As a company, we take great pride in our ability to forecast accurately, and we take full ownership of this shortfall. Importantly, this miss was not due to lack of opportunity or increased competition, it was on us. We are implementing the strategic changes Jeff outlined in our business and I believe that will give us an opportunity to continue delivering strong revenue growth throughout this year and beyond. For 2024, we ended the year with $12 billion in spend on our platform and $2.4 billion in revenue, representing a 26% increase in revenue year over year. Full year adjusted EBITDA margin was above 41% and full year free cash flow was over $630 million. As expected, our take rate in 2024 once again remained within a very consistent historical range.
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The first and hardest question of the call — what went wrong — and the answer given to a long-time covering analyst.
Shyam Patil (SIG); Jeff Green (CEO): Hi, Jeff, as you know, I've been covering you guys since you've been public and following the company long before that. And until now, for over eight years, you guys have had an amazing run where you've hit your guidance every single time. Just wondering, can you just talk about what went wrong in the fourth quarter where you guys came in below your expectations. Thank you. […] I acknowledge that we fell short of our expectations, which is different from missing Wall Street's projections. When we outline our guidance, it feels like a commitment to us. It's understandable for shareholders to question what this means for our potential. I want to clarify that our shortfall was due to a series of minor execution errors. We were trying to execute while preparing for the future, leading to several small mistakes that compounded. To draw a comparison, we have a championship-caliber team, as proven over the past eight years, but we turned over the ball too many times this time, resulting in our loss.
p. 6 · Read in context →
Where he concedes the org was thin — no COO — and the TAM arithmetic he points to for reacceleration.
Jeff Green (CEO): I want to highlight one area where I believe we can enhance our team. I’m very proud that we have achieved this for 32 quarters in a row. While I’m disappointed we didn’t succeed this time, we anticipated that eventually we would miss. I’ve encouraged the team, and I’m eager to show everyone what comes next; we know people will be watching our response. I am genuinely thankful for this experience. I think we need to continue expanding our team and looking for ways to improve our go-to-market strategy. Unlike basketball, where you can only have five players on the court, in business, we have the opportunity to add more people to our team. I see potential for us to become more efficient. We have managed to operate without a COO for a while, and there is no reason we shouldn’t bring in a top-tier COO. As we aim for greater operational rigor, we will need someone to assist us in that effort. This is an obvious area for us to improve our operational efficiency. […] We have a $1 trillion TAM. We currently control a little over 1% of it. We think we have 98% of the TAM left, and the CTV should be fast-growing outside the United States should be growing faster than the United States for obvious reasons. Audio is untapped. I think Spotify highlighted this in their earnings. I think there's a tremendous opportunity for them and for us and for the open Internet. That can come from that. I think there's a lot of inefficiencies in the supply chain, but now we're just at the right size where we can change it, where we're big enough to create changes. And those are four of them, but honestly, I think I'm leaving out a whole bunch of them.
p. 12 · Read in context →
More calls
Q2 2025 Earnings Call — Q2 FY2025 · 12 pages · The fullest single answer on Amazon as competitor versus potential partner, plus mid-year Kokai adoption and the Deal Desk beta. · Open →
Q3 2024 Earnings Call — Q3 FY2024 · 14 pages · The ten macro tailwinds framework that management referenced for the next year running — the pre-miss statement of the growth case. · Open →
Q2 2024 Earnings Call — Q2 FY2024 · 13 pages · Go here for the UID2 and retail media build-out at the peak of the 26%-growth era, before the Kokai migration slipped. · Open →
Q1 2024 Earnings Call — Q1 FY2024 · 13 pages · The Kokai rollout and UID2 adoption described while everything was still on plan — a useful baseline against later calls. · Open →
Q4 and Full Year 2023 Earnings Call — Q4 FY2023 · 19 pages · Prepared remarks only, but the fullest early statement of the CTV and retail media strategy that later chapters build on. · Open →
Q2 2023 Earnings Call — Q2 FY2023 · 21 pages · Where Kokai is introduced as the platform overhaul — the origin of the migration that dominates 2024 and 2025. · Open →
Q1 2023 Earnings Call — Q1 FY2023 · 22 pages · The original case for OpenPath and supply path optimization, laid out before it became a contested initiative. · Open →
Q4 and Full Year 2021 Earnings Call — Q4 FY2021 · 21 pages · The Solimar, UID2 and Walmart DSP era — how management framed the platform and identity bets at the start of the decade. · Open →