Independent demand-side advertising platform The Trade Desk continues to see strong results from advertising deals for connected TV media -- even as total second-quarter revenues sank 13% overall due to the COVID-19 pandemic.
After a weak first-quarter period, the company has seen a 40% rise in CTV advertising billing activity, after an expected increase of 80% in the third quarter of this year. The Trade Desk did not break out revenue details or the CTV share of its revenues.
Although there have been double-digit percentage revenue declines, Needham & Co. media analyst Laura Needham writes that The Trade Desk benefited from a Facebook ad boycott because brands want to avoid ads being placed adjacent to hate speech content.
Second-quarter revenues for The Trade Desk were down 13% -- a bit better than analysts' estimates -- to $139.4 million versus a year ago, and down from the first quarter’s total of $160.7 million. Net income was down 8% to $25.5 million.
Gross advertising billings through its system amounted to $663.6 million -- down from $751.8 million in the first quarter.
Looking at specific areas of rising billing after CTV’s increase of 40% were mobile deals up 15%; and audio gaining 20%.
Jeff Green, chief executive office of The Trade Desk, says that while CTV cost-per-thousand views (CPMs) can be three times those of linear, it delivers a return on investment 2.5 times higher for an advertiser.
Speaking with analysts during its second-quarter earnings call, he added: “Even more eye opening for the brand, using CTV on our platform, they were able to reduce ad frequency to the consumer by over 80% compared with their previous linear campaigns.”
One of its biggest efforts is around the company's identity metric push for targeted advertising. It intends to replace publisher cookie-based browser data. Data for ID metrics come from a database that holds customer profiles and all the known identifiers that correlate with individual consumers.
The company’s Unified Open ID is an open-source tool that uses an anonymized identifier, not wedded to browsers. The ID can be used across devices including CTV and mobile.
Macquarie Research estimates revenues for all of 2020 to get to $739.8 million for 2020 (up from $661.1 million in 2019), rising to $1.02 billion in 2021.