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Trade Desk (TTD) Beats Q1 Earnings & Revenues, Guides Up
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The Trade Desk Inc. (TTD - Free Report) shares have surged more than 34% in the last three trading sessions following an impressive first-quarter 2017 results.
The company reported earnings (including stock-based compensation) of 13 cents per share, much better than the Zacks Consensus Estimate of a loss of 3 cents. Excluding stock-based compensation, non-GAAP earnings doubled from the year-ago quarter to 18 cents per share.
Total revenue was $53.4 million, up 75.6% from the year-ago quarter, which exceeded the Zacks Consensus Estimate and company’s guided figure of $43 million quite comfortably.
The Trade Desk Inc. Price, Consensus and EPS Surprise
Management noted that on a year-over-year basis, international operations grew twice as fast as North America in the reported quarter. Moreover, mobile continued to lead all channels in terms of growth.
Trade Desk also raised full-year 2017 top-line guidance. Notably, the stock has outperformed the Zacks Internet Services industry on a year-to-date basis. While the industry gained 17.2%, the stock appreciated 93.5%.
Revenue Details
During first-quarter 2017, mobile (In-App, Video and Web) comprised nearly a third of Trade Desk’s total business and witnessed a phenomenal growth of 113%, which is almost four times the projected growth rate of 30% for mobile advertising industry.
Omni-channel solutions still remains the bread and butter segment for Trade Desk as the industry keeps gradually shifting to transparency and programmatic buying. On a year-over-year basis, Mobile in-app, Mobile video and Connected TV grew 150%, 220% and 200%, respectively.
Native spending was very strong in the reported quarter and surpassed all Native spending in 2016. Customer retention rate was 95% in the first quarter.
Trade Desk continues to expand internationally. Management noted all-time record level of spending at three of its biggest international offices in London, Sydney and Hamburg. The company also noted significant higher spending in Singapore, Tokyo, and Hong Kong.
The company opened two new offices in Paris and Madrid during the reported quarter.
Operating Details
Adjusted EBITDA surged 44.7% year over year to $6.3 million, much better than management’s guidance of break-even profits. The growth was primarily driven by higher revenues in the quarter.
Reported operating expenses as percentage of revenues surged 760 basis points (bps) to 96.4% in the quarter, primarily due to higher general & administrative (G&A) expense that soared 880 bps from the year-ago quarter. Further, technology and development expense increased 430 bps.
These increases were partially offset by lower platform operations and sales & marketing (S&M) expenses, which declined 120 bps and 440 bps, respectively.
As a result, reported operating margin contracted 760 bps from the year-ago quarter to 3.6%.
Balance Sheet & Cash Flow
Trade Desk entered into an amended credit facility that enables the company to borrow up to $200 million on its revolver, which increased from previous limit of $125 million.
Net cash used in operating activities was $23 million in the first quarter.
Guidance
For second-quarter 2017, Trade Desk anticipates revenues of $67 million and adjusted EBITDA of $14.5 million.
Trade Desk now anticipates revenues to be at least $291 million, up from previous guidance of $270 million, for 2017. Despite continuing investments in hiring and fast growing areas like mobile and video along with global expansion plans, management expects adjusted EBITDA to be $78 million, up from $72 million for the full year.
Long-term earnings growth for Alphabet, TiVo and Autohome is currently pegged at 16.7%, 10% and 16.5%, respectively.
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Trade Desk (TTD) Beats Q1 Earnings & Revenues, Guides Up
The Trade Desk Inc. (TTD - Free Report) shares have surged more than 34% in the last three trading sessions following an impressive first-quarter 2017 results.
The company reported earnings (including stock-based compensation) of 13 cents per share, much better than the Zacks Consensus Estimate of a loss of 3 cents. Excluding stock-based compensation, non-GAAP earnings doubled from the year-ago quarter to 18 cents per share.
Total revenue was $53.4 million, up 75.6% from the year-ago quarter, which exceeded the Zacks Consensus Estimate and company’s guided figure of $43 million quite comfortably.
The Trade Desk Inc. Price, Consensus and EPS Surprise
The Trade Desk Inc. Price, Consensus and EPS Surprise | The Trade Desk Inc. Quote
Management noted that on a year-over-year basis, international operations grew twice as fast as North America in the reported quarter. Moreover, mobile continued to lead all channels in terms of growth.
Trade Desk also raised full-year 2017 top-line guidance. Notably, the stock has outperformed the Zacks Internet Services industry on a year-to-date basis. While the industry gained 17.2%, the stock appreciated 93.5%.
Revenue Details
During first-quarter 2017, mobile (In-App, Video and Web) comprised nearly a third of Trade Desk’s total business and witnessed a phenomenal growth of 113%, which is almost four times the projected growth rate of 30% for mobile advertising industry.
Omni-channel solutions still remains the bread and butter segment for Trade Desk as the industry keeps gradually shifting to transparency and programmatic buying. On a year-over-year basis, Mobile in-app, Mobile video and Connected TV grew 150%, 220% and 200%, respectively.
Native spending was very strong in the reported quarter and surpassed all Native spending in 2016. Customer retention rate was 95% in the first quarter.
Trade Desk continues to expand internationally. Management noted all-time record level of spending at three of its biggest international offices in London, Sydney and Hamburg. The company also noted significant higher spending in Singapore, Tokyo, and Hong Kong.
The company opened two new offices in Paris and Madrid during the reported quarter.
Operating Details
Adjusted EBITDA surged 44.7% year over year to $6.3 million, much better than management’s guidance of break-even profits. The growth was primarily driven by higher revenues in the quarter.
Reported operating expenses as percentage of revenues surged 760 basis points (bps) to 96.4% in the quarter, primarily due to higher general & administrative (G&A) expense that soared 880 bps from the year-ago quarter. Further, technology and development expense increased 430 bps.
These increases were partially offset by lower platform operations and sales & marketing (S&M) expenses, which declined 120 bps and 440 bps, respectively.
As a result, reported operating margin contracted 760 bps from the year-ago quarter to 3.6%.
Balance Sheet & Cash Flow
Trade Desk entered into an amended credit facility that enables the company to borrow up to $200 million on its revolver, which increased from previous limit of $125 million.
Net cash used in operating activities was $23 million in the first quarter.
Guidance
For second-quarter 2017, Trade Desk anticipates revenues of $67 million and adjusted EBITDA of $14.5 million.
Trade Desk now anticipates revenues to be at least $291 million, up from previous guidance of $270 million, for 2017. Despite continuing investments in hiring and fast growing areas like mobile and video along with global expansion plans, management expects adjusted EBITDA to be $78 million, up from $72 million for the full year.
Zacks Rank & Key Picks
Trade Desk carries a Zacks Rank #3 (Hold).
Some better-ranked stocks in the broader technology space include Alphabet (GOOGL - Free Report) , TiVo Corp and Autohome (ATHM - Free Report) . While Alphabet and TiVo sports Zacks Rank #1 (Strong Buy), Autohome carries a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.
Long-term earnings growth for Alphabet, TiVo and Autohome is currently pegged at 16.7%, 10% and 16.5%, respectively.
5 Trades Could Profit "Big-League" from Trump Policies
If the stocks above spark your interest, wait until you look into companies primed to make substantial gains from Washington's changing course.
Today Zacks reveals 5 tickers that could benefit from new trends like streamlined drug approvals, tariffs, lower taxes, higher interest rates, and spending surges in defense and infrastructure. See these buy recommendations now >>