TubeMogul Shares Dip More Than 20% After Earnings, Forecast Disappoint
- by Tobi Elkin @tobielkin, August 9, 2016
Shares were trading at $12.64. TubeMogul reported second quarter revenues increased 22% year-over-year to $55.4 million, which fell short of analyst expectations of $58.2 million. Analysts, on average, had projected annual revenue of $229 million and total spend of $579.4 million, according to FactSet.
In the second quarter, all data was lower than expected. TubeMogul reported a loss of $3.8 million, or 11 cents a share, on sales of $55.4 million, with total advertising spend on its platform reaching $139.3 million. Analysts, on average, forecast a loss of 8 cents a share on revenue of $58.2 million and total spend of $146.2 million, according to FactSet. For Q3, TubeMogul reduced its annual forecast to sales of $217 million to $221 million and total spend of $558 million to $562 million.
TubeMogul CEO Brett Wilson stated: “Total spend in Q2 came in slightly below our expectations. The transition in ad spending from desktop to mobile is accelerating, and while this impacted our results, this is precisely the trend we anticipated, and we are well-positioned over the long-term as brands require multi-screen solutions. In particular, the investments we have made in our mobile offering over the last two years evidence our leadership. In Q2, mobile spend through our platform grew 146% and now makes up nearly 30% of our spend. In addition, Programmatic TV spend grew 143% year over year to over $20 million, nearly twice the level of PTV spend in Q1 2016. Cross-screen platform spend now accounts for 48% of total spend as mobile and programmatic TV growth accelerates."
The company said it saw growth in non-desktop pre-roll channels, as brands increasingly turn to software that enables them to gain incremental reach with audiences beyond traditional TV.
You could see this coming. I think the best move for companies like TubeMogul, who are ultimatley dependent on traction in the linear TV space, is to partner with a company that has developed a transaction model which is not auction based and allows TV Networks to retain total control of the sales process. Yield optimization and the ability to handle complex decision making in terms of inventory allocation is what the TV Networks need. RTB is not a way to get there. A futures based aproach will win the space. That is how premium TV/video inventory is best bought and sold.
Exactly right, Long. Unless the system is adapted to suit the needs of buyers and sellers, not the other way around, one is courting disaster. The sooner that TubeMogul and the other digital-style "programmatic" buying models learn this and accept it they will continue to meet strong resistance.
I tend to agree with you Long Ellis. The auction-based model doesn't completely make sense for TV. I think TubeMogul's working on cross-screen initiatives though that will make a difference.
Ed, I think the process and "system" need a lot of work.