PubMatic, Inc. Q3 FY2024 earnings call

• Growth driven by CTV solutions and political advertising; capitalized on surge of political ad demand on CTV. Work with 70% of top 30 streaming publishers. • Launched new tools using generative AI to unlock streaming inventory for political ads, enabling more than 250 publishers to open inventory. • Invested in sales and technology, adding over 100 team members since Q3 last year. • Hosted first AI-focused hackathon with over a third of employees participating, with AI/machine learning in one-third of submissions. • Recognized as an SSP leader in the Forrester Wave, achieving high scores in programmatic auctions, publisher protections, commerce media, and innovation.

Revenue in the third quarter grew 13% year-over-year. CTV monetized impression volume was up over 100% year-over-year for the third straight quarter. Omnichannel video revenue grew 25% year-over-year, with a share of 36% of total revenue. Mobile app business grew over 20% year-over-year for the fourth quarter in a row. Display revenues across mobile and desktop channels grew 9% year-over-year. Emerging revenue streams more than doubled year-over-year and contributed an incremental three-percentage points of year-over-year growth.

• Q4 revenue expected to be in the range of $86 million to $90 million. • Full-year 2024 revenue guidance: $292 million to $296 million (10% year-over-year growth at midpoint). • Q4 adjusted EBITDA expected to be between $34 million and $37 million (approximately 40% margin at midpoint). • Full-year 2024 adjusted EBITDA expected to be between $89 million and $92 million (approximately 31% margin at midpoint).

• Forward-looking statements subject to inherent risks, uncertainties, and changes in circumstances. • Impact of DSP change on revenue, which is a short-term phenomenon but will work through working capital by mid-2025. • Uncertainties in economy and business conditions affecting ad spend and performance.

Q: With budgets increasingly moving into video, can you talk through the impact to monetization and take rates for 2025 and longer term?

A: Omnichannel video trends are robust; we're advantaged due to marginal profitability from video impressions as cost to process video and display impressions is similar, expecting mix to grow in video with positive impact on monetization and take rates in future.