• by Wayne Friedman , November 8, 2024

Advertising deal-making for connected TV and video platforms via The Trade Desk -- the largest independent demand-side advertising platform -- continues to show massive revenue gains, increasing 36% to $301 million in the third quarter.

In the previous two quarterly periods, video rose 34.4% (in the second quarter) and 34.2% (in the first quarter). Guggenheim Securities estimates video ad revenue will rise 33.6% in the fourth quarter to $368 million. CTV/video is the company's biggest media segment.

Overall revenue at the programmatic media platform grew 27% to $628 million, and net income more than doubled to $94 million (from $39 million) versus the year-ago period.

Cash flow -- adjusted earnings before interest, taxes, depreciation and amortization -- grew 29% to $257 million.

The Trade Desk also posted 21% higher revenue from mobile media dollars, to $221 million.

Speaking with analysts during the company’s third-quarter earnings call on Thursday, Trade Desk CEO Jeff Green said the company expected its AI-fueled digital advertising platform Kokai would be fully adopted by brands the end of 2025 -- currently around 50% of its advertising partners.

The Trade Desk has over 225 partners worldwide. In June 2023, the launch of the ad platform, the company signed on with 71 partners.

The platform looks to help marketers make decisions on their campaigns -- offering budget optimization and key performance indicator (KPI) scoring, as well as providing new digital advertising measurements including a "retail sales index," a "TV quality index" and a "quality reach index," among other tools.

The Trade Desk’s claim is to offer an "open" transparent tool in contrast to other big digital media platforms' "walled-garden" approaches.

Green believes Google is likely to become less competitive in markets that overlap with the Trade Desk, nS Aya its connected TV channel -- with increasing levels of quality advertising inventory -- will continue to be its largest and fastest-growing channel.

The Trade Desk is optimistic about the expectations of its new ad-sales partnerships with major streaming video platforms, including Netflix and Roku. It also has high expectations for its new deal with Spotify.

The Trade Desk pulled in $17 million in political advertising revenue deals in the third quarter. Guggenheim estimates this will rise to $28 million in the fourth quarter.

Total revenue gains are projected by the company to pull back somewhat in the fourth quarter with an increase of 25.4%, due to decelerating political ad business post-election, to $759 million.