Sell-side Ad Technology Platform PubMatic (NASDAQ: PUBM)These numbers are impressive, especially given the difficult operating environment. The company’s top line grew 25% year-over-year to $54.6million.
These are some of the most refreshing results from a digital marketing company after working with a variety of digital advertising companies. Meta Platforms (NASDAQ: FB), saw a decline in growth for the same period.
PubMatic’s strong growth is revealed in detail
PubMatic’s 25% year over year growth in its first quarter was especially impressive when investors consider the difficult year-ago comparison. tech companyAgainst. Revenue grew 54% year-over-year in the first quarter 2021. PubMatic’s first quarter 2022 revenue was also higher than the midpoint of management’s guidance range, despite the worsening macro environment for advertising budgets (primarily due to the conflict in Ukraine and uncertainty surrounding how rising interest rates will impact the economy). PubMatic provided its first quarter outlook.
“PubMatic maintained its outstanding track record for durable growth, GAAP profitability, and cash generation,” stated Rajeev Goel, co-founder and CEO of PubMatic in the company’s first quarter earnings release. “This consistent performance can be attributed to our unique infrastructure driven digital advertising approach.”
It is worth noting, however, that PubMatic’s revenue growth in Q1 was much higher than Meta’s 7% growth and sell-side platform rival. Magnite‘s 15% (NASDAQ: MGNI) Pro forma top-line growth excluding traffic acquisition expenses (TAC)..
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An upbeat outlook
PubMatic is optimistic about its future growth prospects. Management expected first-quarter revenue growth of 20% to 25% year-over year to $60 million to $62million. This guidance range’s midpoint represents 12% sequential growth.
Management stated in its earnings release for the first quarter that this guidance was “conservative” due to the headwinds advertisers are facing. These include the war in Ukraine and rising interest rates. COVID-related issues continue (e.g. Supply chain challenges and social distancing in some markets.
This is a positive outlook that is more optimistic than the one provided by Magnite and Facebook parent Meta. Meta’s second quarter guidance is only 4%. Magnite’s second quarter pro forma ex-TAC revenue guidance suggests 6% sequential growth.
PubMatic’s full-year guidance stated that total revenue would increase between $282 million to $286 million, which is a 25% growth rate at the midpoint.
But InvestorsPubMatic management noted in its first quarter earnings release that it assumed that the macroeconomic headwinds facing it for the first quarter as well as the whole year “doesn’t worsen or cause economic conditions to deteriorate significantly or reduce advertiser demand.”
Overall, Magnite’s strong momentum in a difficult operational environment highlights the tech firm’s position within a growing marketplace and management’s continued execution of key growth opportunity.
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Randi Zuckerberg is a former director for market development and spokeswoman at Facebook. She is also the sister of Meta Platforms CEO Mark Zuckerberg. She is a member on The Motley Fool’s Board of Directors. Daniel SparksHe does not hold any shares in any of these stocks. His clients might own shares in the companies mentioned. The Motley fool has positions in and recommends Magnite and Meta Platforms. The Motley Fool has a Disclosure policy.
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