The Trade Desk (TTD) Reports Q4 Earnings: Revenue Falls Short, Stock Plummets

The Trade Desk (TTD) released its Q4 and fiscal year 2024 financial results on February 12, 2025.

While the company reported strong overall growth for the year, Q4 revenue fell slightly short of analyst expectations, leading to a significant drop in the stock price.

By the Numbers

• Revenue: $2.4 billion for the year (26% YoY increase). Q4 revenue reached $741 million (22% YoY growth), but missed the expected $759.56 million.
• Earnings: Q4 net income was $182 million, a 25% margin.
• Customer Retention: Remained strong at above 95% for the eleventh consecutive year.
• Platform Spend: A record $12 billion.
• Share Repurchase Program: Expanded to $1 billion, with $57 million used for buybacks in Q4.
• Q1 2025 Guidance: Expects revenue of at least $575 million and adjusted EBITDA of approximately $145 million.

Hits

• Overall Growth: The Trade Desk outpaced much of the digital advertising sector, delivering $2.4 billion in revenue for 2024, marking a 26% increase year-over-year.
• Profitability: The company achieved significant profitability and cash flow.
• Customer Retention: Maintained a customer retention rate above 95% for the eleventh consecutive year.
• Strategic Investments: Undertook a reorganization in December to accelerate opportunities across CTV, retail media, identity, supply chain optimization, and audio.

Misses

• Revenue Shortfall: Despite strong growth, Q4 revenue of $741 million missed analyst expectations of $759.56 million.
• Stock Reaction: Following the earnings release, the stock price dropped 23.3%, reflecting investor disappointment.
• Expectations: The company acknowledged falling short of its own expectations in the fourth quarter.

Market Impact

The Trade Desk’s stock experienced a sharp decline following the earnings announcement, signaling investor concerns over the revenue miss.

Despite strong yearly growth and high customer retention, the market reacted negatively to the Q4 results, highlighting the pressure on growth stocks to meet high expectations.

Future Outlook

Looking ahead, The Trade Desk is focusing on innovations such as Kokai and the Ventura Operating System to capitalize on the shift of advertisers to premium scalable channels.

The company is positioned to leverage data-driven advertising on the premium internet to drive growth and brand loyalty for its clients in 2025 and beyond.

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