TTD
$95.72
Trade Desk
$6.09
6.79%
Earnings Details
3rd Quarter September 2021
Monday, November 8, 2021 7:30:00 AM
Tweet Share Watch
Summary

Trade Desk Misses

Trade Desk (TTD) reported 3rd Quarter September 2021 earnings of $0.18 per share on revenue of $301.1 million. The consensus earnings estimate was $0.15 per share on revenue of $283.5 million. The Earnings Whisper number was $0.19 per share. Revenue grew 39.3% on a year-over-year basis.

The company said it expects fourth quarter revenue of $388.0 million or more. The current consensus revenue estimate is $386.73 million for the quarter ending December 31, 2021.

The Trade Desk is a technology company that empowers buyers of advertising.

Results
Reported Earnings
$0.18
Earnings Whisper
$0.19
Consensus Estimate
$0.15
Reported Revenue
$301.1 Mil
Revenue Estimate
$283.5 Mil
Growth
Earnings Growth
Revenue Growth
Power Rating
Grade
Earnings Release

The Trade Desk Reports Third Quarter Financial Results

LOS ANGELES--(BUSINESS WIRE)--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, 2021.

“We again delivered outstanding performance in the third quarter. Revenue growth of 39% significantly outpaced worldwide programmatic advertising growth. The world’s leading brands and agencies are increasingly using our platform to apply data-driven strategies to drive precision and value across their campaigns,” said Jeff Green, founder and CEO of The Trade Desk. “More data-driven choices by advertisers led to record third quarter revenue of $301.1 million and adjusted EBITDA of $122.7 million. With the launch of Solimar, we are working with the industry to pioneer even greater data-driven precision, whether it’s the application of shopper data in a measurement marketplace, surfacing the right data for every advertising impression, or new approaches to identity that help advertisers make the most of their own valuable data. As a result, we’re seeing growth across all channels, and none more so than Connected TV, as viewers shift to new digital, streaming services and advertisers apply data to TV ad campaigns for the first time.”

Third Quarter 2021 Financial Highlights:

The following table summarizes our consolidated financial results for the three and nine months ended September 30, 2021 and 2020 ($ in millions, except per share amounts):

 

Three Months Ended

 

Nine Months Ended

 

September 30,

 

September 30,

 

2021

 

2020

 

2021

 

2020

GAAP Results

 

 

 

 

 

 

 

 

 

 

 

 

Revenue

$

301.1

 

$

216.1

 

$

800.9

 

$

516.1

 

Increase in revenue year over year

 

39

%

 

32

%

 

55

%

 

16

%

Net Income

$

59.4

 

$

41.2

 

$

129.7

 

$

90.4

 

Diluted EPS

$

0.12

 

$

0.08

 

$

0.26

 

$

0.19

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Non-GAAP Results

 

 

 

 

 

 

 

 

 

 

 

 

Adjusted EBITDA

$

122.7

 

$

77.2

 

$

311.2

 

$

130.7

 

Adjusted EBITDA Margin

 

41

%

 

36

%

 

39

%

 

25

%

Non-GAAP Net Income

$

89.2

 

$

62.7

 

$

247.4

 

$

150.8

 

Non-GAAP Diluted EPS

$

0.18

 

$

0.13

 

$

0.50

 

$

0.31

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Third 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 on July 7
    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. Recent pledges of support, integration and news associated with UID2 include:
    • Global provider of marketing solutions, Interpublic Group
    • Global media, marketing and corporate communications holding company, Omnicom Group
    • TrueData, a data platform specializing in cookieless identity resolution, first party data onboarding, and audience marketing
    • Netwise, a leading provider of multi-channel B2B marketing data
    • Snowflake, an enabler for organizations to mobilize their data with Snowflake’s Data Cloud
    • iCook, a leading online cooking information platform in Taiwan
    • Cookware maker, Made In, saw a 20% improvement in cost per action (CPA) for its campaigns and users converted faster when using UID 2.0 than without. Users converted 22% more when compared to 3P cookies and converted 33% faster.
  • Industry Recognition: The Trade Desk debuted at #6 on FORTUNE’s list of the 100 Fastest Growing Companies for 2021. 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:

Fourth Quarter 2021 outlook summary:

  • Revenue at least $388 million
  • Adjusted EBITDA approximately $175 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.

Third Quarter Financial Results Webcast and Conference Call Details

  • When: November 8, 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 “917520” 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: 43477). Outside the United States, please dial 1-919-882-2331 (replay code: 43477). The audio replay will be available via telephone until November 15, 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

 

Nine Months Ended

 

 

September 30,

 

September 30,

 

 

2021

 

2020

 

2021

 

2020

Revenue

$

301,091

$

216,113

$

800,869

$

516,128

 

Operating expenses (1):

 

 

 

 

 

 

 

 

Platform operations

 

53,400

 

 

44,826

 

 

154,709

 

 

127,167

 

Sales and marketing

 

59,278

 

 

44,637

 

 

176,797

 

 

116,002

 

Technology and development

 

55,847

 

 

41,079

 

 

163,301

 

 

117,931

 

General and administrative

 

52,120

 

 

42,789

 

 

155,884

 

 

117,252

 

Total operating expenses

 

220,645

 

 

173,331

 

 

650,691

 

 

478,352

 

Income from operations

 

80,446

 

 

42,782

 

 

150,178

 

 

37,776

 

Total other expense, net

 

1,470

 

 

223

 

 

1,560

 

 

834

 

Income before income taxes

 

78,976

 

 

42,559

 

 

148,618

 

 

36,942

 

Provision for (benefit from) income taxes

 

19,592

 

 

1,312

 

 

18,895

 

 

(53,473

)

Net income

$

59,384

 

$

41,247

 

$

129,723

 

$

90,415

 

Earnings per share:

 

 

 

 

 

 

 

 

Basic

$

0.12

 

$

0.09

 

$

0.27

 

$

0.20

 

Diluted

$

0.12

 

$

0.08

 

$

0.26

 

$

0.19

 

Weighted average shares outstanding:

 

 

 

 

 

 

 

 

Basic

 

478,101

 

 

465,819

 

 

475,496

 

 

460,747

 

Diluted

 

498,912

 

 

492,207

 

 

497,942

 

 

487,309

 

_______________________

 

 

 

 

 

 

(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,

 

 

2021

 

2020

 

2021

 

2020

Platform operations

$

2,518

 

$

1,639

 

$

11,624

 

$

5,459

 

Sales and marketing

 

9,099

 

 

6,916

 

 

37,362

 

 

18,549

 

Technology and development

 

11,269

 

 

7,911

 

 

41,337

 

 

24,345

 

General and administrative

 

11,573

 

 

10,386

 

 

41,687

 

 

25,398

 

Total

$

34,459

 

$

26,852

 

$

132,010

 

$

73,751

 

 

 

 

 

 

 

 

 

 

THE TRADE DESK, INC.

CONSOLIDATED BALANCE SHEETS

(Amounts in thousands)

(Unaudited)

 

 

 

 

 

 

As of

As of

 

September 30,
2021

December 31,
2020

ASSETS

 

 

 

 

Current assets:

 

 

 

 

Cash and cash equivalents

$

576,916

$

437,353

Short-term investments, net

 

221,685

 

186,685

Accounts receivable, net

 

1,624,759

 

1,584,109

Prepaid expenses and other current assets

 

92,557

 

102,170

Total current assets

 

2,515,917

 

2,310,317

Property and equipment, net

 

137,416

 

115,863

Operating lease assets

 

242,436

 

248,143

Deferred income taxes

 

46,405

 

50,168

Other assets, non-current

 

46,581

 

29,154

Total assets

$

2,988,755

$

2,753,645

 

 

 

 

 

LIABILITIES AND STOCKHOLDERS’ EQUITY

 

 

 

 

Current liabilities:

 

 

 

 

Accounts payable

$

1,304,971

$

1,348,480

Accrued expenses and other current liabilities

 

77,323

 

88,335

Operating lease liabilities

 

45,603

 

37,868

Total current liabilities

 

1,427,897

 

1,474,683

Operating lease liabilities, non-current

 

247,923

 

254,562

Other liabilities, non-current

 

10,121

 

11,255

Total liabilities

 

1,685,941

 

1,740,500

 

 

 

 

 

Stockholders' equity:

 

 

 

 

Preferred stock

 

 

Common stock

 

 

Additional paid-in capital

 

698,724

 

538,778

Retained earnings

 

604,090

 

474,367

Total stockholders' equity

 

1,302,814

 

1,013,145

Total liabilities and stockholders' equity

$

2,988,755

$

2,753,645

 

 

 

 

 

THE TRADE DESK, INC.

CONSOLIDATED STATEMENTS OF CASH FLOWS

(Amounts in thousands)

(Unaudited)

 

 

 

 

 

 

 

 

 

 

 

Nine Months Ended September 30,

 

 

2021

 

2020

OPERATING ACTIVITIES:

 

 

 

 

 

 

Net income

$

129,723

 

$

90,415

 

Adjustments to reconcile net income to net cash provided by operating activities:

 

 

 

 

 

 

Depreciation and amortization

 

29,969

 

 

20,777

 

Stock-based compensation

 

132,010

 

 

73,751

 

Allowance for credit losses on accounts receivable

 

520

 

 

2,722

 

Noncash lease expense

 

29,914

 

 

24,052

 

Deferred income taxes

 

5,044

 

 

(20,978

)

Other

 

6,730

 

 

1,242

 

Changes in operating assets and liabilities:

 

 

 

 

 

 

Accounts receivable

 

(48,637

)

 

21,063

 

Prepaid expenses and other assets

 

20,627

 

 

(23,919

)

Accounts payable

 

(44,105

)

 

47,728

 

Accrued expenses and other liabilities

 

(14,790

)

 

11,047

 

Operating lease liabilities

 

(31,886

)

 

(10,388

)

Net cash provided by operating activities

 

215,119

 

 

237,512

 

INVESTING ACTIVITIES:

 

 

 

 

 

 

Purchases of investments

 

(233,427

)

 

(127,254

)

Sales of investments

 

4,539

 

 

 

Maturities of investments

 

192,077

 

 

128,315

 

Purchases of property and equipment

 

(43,920

)

 

(57,721

)

Capitalized software development costs

 

(3,684

)

 

(4,246

)

Business acquisition

 

(13,261

)

 

 

Net cash used in investing activities

 

(97,676

)

 

(60,906

)

FINANCING ACTIVITIES:

 

 

 

 

 

 

Proceeds from line of credit

 

 

 

143,000

 

Repayment on line of credit

 

 

 

(71,000

)

Payment of debt financing costs

 

(1,924

)

 

 

Proceeds from exercise of stock options

 

39,559

 

 

54,038

 

Proceeds from employee stock purchase plan

 

22,758

 

 

15,035

 

Taxes paid related to net settlement of restricted stock awards

 

(38,273

)

 

(14,184

)

Net cash provided by financing activities

 

22,120

 

 

126,889

 

Increase in cash and cash equivalents

 

139,563

 

 

303,495

 

Cash and cash equivalents—Beginning of period

 

437,353

 

 

130,876

 

Cash and cash equivalents—End of period

$

576,916

 

$

434,371

 

 

 

 

 

 

 

 

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,

 

2021

 

2020

 

2021

 

2020

 

 

 

Net income

$

59,384

 

$

41,247

 

$

129,723

 

$

90,415

 

Add back:

 

 

 

 

 

 

 

 

 

 

 

 

Depreciation and amortization

 

8,952

 

 

7,517

 

 

29,969

 

 

20,777

 

Stock-based compensation

 

34,459

 

 

26,852

 

 

132,010

 

 

73,751

 

Interest expense (income), net

 

317

 

 

235

 

 

556

 

 

(740

)

Provision for (benefit from) income taxes

 

19,592

 

 

1,312

 

 

18,895

 

 

(53,473

)

Adjusted EBITDA

$

122,704

 

$

77,163

 

$

311,153

 

$

130,730

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Three Months Ended

 

Nine Months Ended

 

September 30,

 

September 30,

 

2021

 

2020

 

2021

 

2020

GAAP net income

$

59,384

 

$

41,247

 

$

129,723

 

$

90,415

 

Add back (deduct):

 

 

 

 

 

 

 

 

 

 

 

 

Stock-based compensation expense

 

34,459

 

 

26,852

 

 

132,010

 

 

73,751

 

Adjustment for income taxes

 

(4,616

)

 

(5,440

)

 

(14,305

)

 

(13,341

)

Non-GAAP net income

$

89,227

 

$

62,659

 

$

247,428

 

$

150,825

 

 

 

 

 

 

 

 

 

 

 

 

 

 

GAAP diluted EPS

$

0.12

 

$

0.08

 

$

0.26

 

$

0.19

 

Non-GAAP diluted EPS

$

0.18

 

$

0.13

 

$

0.50

 

$

0.31

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Weighted average shares outstanding—diluted

 

498,912

 

 

492,207

 

 

497,942

 

 

487,309

 

 

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

Source: The Trade Desk, Inc.