Q1 2024 Trade Desk Inc Earnings Call

Greetings and welcome to the trade desk first quarter 2024 earnings conference call. At this time all participants are in a listen only mode. A question and answer session will follow the formal presentation. If anyone should require operator assistance during the conference. Please press star zero.

<unk> on your telephone keypad.

Please note. This conference is being recorded I will now turn the conference over to your host Chris tooth.

Chris Toth: You may begin.

Chris Toth: Thank you operator, Hello, and good afternoon to everyone and welcome to the trade desk first quarter 2024 earnings conference call on the call today are founder and CEO, Jeff Green and Chief Financial Officer, Laura Shanghai <unk>.

Copy of our earnings press release can be found on our website at the trade desk Dot com in the Investor Relations section before we begin I would like to remind you that except for historical information some of the discussion and our responses in Q&A may contain forward looking statements, which are dependent upon certain risks and uncertainties. These forward looking statements represent our beliefs and assumptions.

Only as of the date such statements are made.

Actual results may vary significantly and they expressed today assume no obligations to update any of our forward looking statements should any of our beliefs or assumptions prove to be incorrect actual financial results could differ materially from our projections for those implied by these forward looking statements I encourage you to refer to the risk factors referenced in our press.

The release and included in our most recent SEC filings.

In addition to reporting our GAAP financial results, we present supplemental non-GAAP financial data a reconciliation of the GAAP to non-GAAP measures can be found in our earnings press release, we believe that providing non-GAAP measures combined with our GAAP results provides a more meaningful representation of the company's operational performance with that I will now turn the.

Call over to founder and CEO, Jeff Green Jeff.

Jeffrey Terry Green: Thanks, Chris and thank you all for joining us today.

Jeffrey Terry Green: <unk> seen from the press release, we are off to a very promising start once again this year for the first quarter revenue grew 28% compared with last year, marking strong revenue growth acceleration on both a sequential and a year over year basis.

Outpacing the industry for a quarter or two is a great accomplishment, but I'm. So proud of our team for now having outpaced the digital advertising industry for a couple of years straight.

I believe our revenue growth acceleration in the first quarter speaks to the innovation and value that we're delivering to our clients with co. Cai. It also reflects growing awareness among the worlds, leading advertisers of the value and power of the best of the open Internet.

Put a final point on this more than 90% of the AD age top 200, the largest 200 advertisers in the world have run advertising campaigns on our platform over the last 12 months.

Even with his considerable size CTV continues to be our fastest growing channel.

Over the past few months industry Giants like Disney NBC, you, Walmart Amazon and now Roku and LG electronics have all made deeper pivots into CTV many of them in partnership with us, bringing more opportunity for advertisers.

Jeffrey Terry Green: <unk> has become ubiquitous across the premium parts of the open Internet and along with greater first party data deployment and advances and emerging data markets, especially retail data. We are building the new identity and authentication fabric of the internet.

In doing so the open internet is getting refund and revalued.

Especially in contrast to the value offered by walled gardens.

Jeffrey Terry Green: And the innovation in our <unk> platform will help our clients take advantage of this reevaluation and fully leverage data driven buying to fuel their own business growth as a result, I've never been more optimistic about the future of the open internet and our ability to gain more than our fair share of the nearly one.

Trillion dollars advertising Tam let.

Let me dig into this a little deeper I would like to frame my remarks, with just a little context on how our industry has advanced over the years at least in part because of some of the significant and disruptive events today.

I think just framing is important because I believe we may be in the midst of another period of major disruption right now and perhaps most important I believe our ability to anticipate and innovate in these moments positions us very well moving forward.

<unk> said that the programmatic industry as we know it today came to life as a result of the global financial crisis, just over 15 years ago.

At that time, there was tremendous pressure on all businesses to do more with less and to find new ways to differentiate automate and grow more efficiently with those pressures the precision and value. Our programmatic became more immediately apparent to major brand advertisers and this proved to be fertile.

The environment for our business and so many others.

Jeffrey Terry Green: Similarly, the rapid rise of CTV is the driving force of programmatic would not have happened. So quickly were it not for the Covid pandemic with stay at home directives around the world consumers shifted in mass to the convenience of streaming.

Jeffrey Terry Green: And the media world hasn't been the same.

TV has always been the central element of major brand advertising campaigns. So the shift from linear to CTV was always going to be disruptive what's perhaps more important is how quickly. The TV industry has evolved as a result, <unk> is now a driving force and how we think about things like authentication.

Identity.

Jeffrey Terry Green: Use of retail data relevance and attribution and advertising.

And while it may not be as apparent as a global financial crisis or a global pandemic I believe were now in the middle of another great disruption in our industry.

Jeffrey Terry Green: This disruption is very different because it is driven from major tectonic shifts within our own industry instead of from macroeconomic and pandemic forces.

Today shift is largely driven from the conflict Apple and Google are having with governments and domino effects that are coming from new draconian policies and tactics coming from wounded Big Tech.

For the last couple of years now we've delivered consistent durable revenue growth over 20% significantly outpacing the broader market, including the major walled gardens.

And it is because the contrast between the best of the open Internet, but you might call the premium Internet.

And the content and characteristics of walled gardens has never been more apparent.

The details of the Texas Attorney General suit against Google and the approaching trial of the department of Justice versus Google have shined, a light on a few things inside of Google, but it's created a lot of clarity on things outside of Google as well.

There is a wider understanding of a few immediate themes facing advertising.

First there is a broader understanding of the role that walled gardens are playing as major purveyors of low grade made for advertising inventory.

Second there is a much wider understanding of how bad add to content ratios within walled gardens, and the brand suitability risk of user generated content or UGC.

This is in part due to the Stark contrast that premium content has right now to UGC.

The industry has growing awareness of consumers spend most of their quality time with premium content on the open internet versus the walled gardens.

Advertisers are making better use of their first party data and retail data as they explore contemporary cross channel alternatives to cookies.

And lastly in advertising and marketing like in many other sectors.

There is a broad industry frenzy around AI and what it means for our industry.

Taken together I don't know that I've ever seen the industry in such a state of transition.

In some corners of our industry I also sent some panic and confusion about what to do next but for US. It gives context to our recent outperformance as well as our conviction for why I'm. So confident about the opportunity in front of us in 2024 and the years ahead.

Jeffrey Terry Green: One insight that reinforces the shift that is happening is found in where I'm spending my time.

Jeffrey Terry Green: Over the last six months or so I have been spending more and more of my time with Ceos Cmos and heads of media companies, helping them make sense of the issues that I just outlined.

And the bottom line across all of these discussions there is consensus that the value is shifting to the open internet.

There should be more specific is shifting to the best of the open internet.

What we might call the premium internet it won't all happen overnight, but it is starting.

In 2022.

It marked the first year in a decade that the majority of digital AD spending took place outside of medicine, Google with the proliferation of CTV and retail media that trend accelerated last year and I believe the trend will only continue moving forward.

The role of CTV and digital audio and all of this should not be understated for many people movie television and audio consumption is a very important part of their daily lives.

It's premium quality content that captivated consumers, who spend significant amounts of time engaging with it.

No one watches mandel oriented or curb your enthusiasm or March madness casually no one listened to their favorite podcast passively.

In every aspect of my life I can't talk to anyone about premium CTV content or the best up music without people sharing a passion for some form of those mediums. We are all highly invested in it.

That's very different than how consumers engage or talked about social media content, which is often short form UGC video such as cat videos, our 14 year olds filming themselves falling off of bicycles.

However people spend much more time with premium content.

Such as streaming television and digital audio than they do with UGC. Our research shows consumers spend about 60% of their online time on the open internet.

To content ratios are much better and therefore, the experience is much better but walled garden still command the bulk of digital advertising spend because those tech Jive have made it super easy to reach consumers at mass scale and the performance results are equally simplified.

Jeffrey Terry Green: Book Your ads that Greg we told you. So so it must be true.

But that's changing advertisers now have scaled alternatives on the open Internet one of the major innovations in Cotai is the sellers and publishers 500, plus this is a curated marketplace that represents the best of the open Internet the premium Internet, where consumers spend the majority of their time on line, it's a live sports.

Events, such as March Madness, why are we saw 200% increase in spend compared to a year ago. Its the latest movies and hot TV shows, it's music and podcasts on platforms like Spotify, it's trusted journalism.

Jeffrey Terry Green: Now our advertisers kind of access that premium marketplace at scale easily and with confidence.

In doing so they don't have to cede control of their valuable first party data they get to measure effectively and they can be sure that their ads are showing up against high quality content. That's consistent with their brand advertisers now have a scaled way to control their own future.

Jeffrey Terry Green: Of course, our ability to buy the best of the open Internet is based on close working relationships with the world's leading publishers.

Across the board publishers are working with us to make the advertiser access to their inventory as attractive as possible, which means making it as transparent and objective as possible.

You only have to look at the list of expanded partnerships that we've signed over the last few weeks.

We are integrating directly with the Disney real time AD exchange, which includes Hulu and Disney plus via our open path technology.

Jeffrey Terry Green: For the first time ever NBC, you will make the Olympics available programmatically to advertisers and is doing so with the trade desk LG electronics has adopted UAV to Vizio and Cox media group are connecting with US via open path Tia.

T F. One and six two of the largest broadcasters in France have integrated EU IV as they make their content available programmatically.

Jeffrey Terry Green: And just a week ago Roku announced that it is expanding its demand strategy to include the trade desk or is premium content.

Jeffrey Terry Green: Just to go one click deeper on Roku I think it makes a ton of sense for roku to embrace the open internet with their premium content.

Early on when CTV inventory was scarce it made sense for many of the premium CTV streamers to sell most of the inventory themselves with the proliferation of CTV content over the last couple of years those same companies now need to find ways to maximize the advertiser demand and that means opening up to a broader range of demand.

Sources, such as the trade desk, and embracing solutions, such as <unk>, which help advertisers find their target audience.

Currently as possible.

Jeffrey Terry Green: We are excited to be roku as partner in this and we believe this move is a win win win for Roku.

Jeffrey Terry Green: Advertisers and for the trade desk.

As a reminder, last year on 606, we started shipping Coca this platform launch is different for us because six six last year Mark just the beginning and we've been shipping new features ever since.

We are quickly approaching some of the biggest UX and product rollouts of Cotai that nearly all of our customers will begin to use and see benefits from over the next few quarters, including our game changing AI fueled forecasting tool.

Another major innovation that we're bringing to market with Coca is a completely new approach to audience based buying we're able to do this because of the broad availability of new identifiers, such as <unk>, along with easier on ramps for first party data. This means advertisers can now take what they know about their most loyal customers.

And find new customers, who look just like the loyal ones and find them anywhere across the open internet advertisers no longer have to use content as a proxy for audience instead of simply advertising against the NBA playoffs to reach pizza lovers advertisers can find pizza lovers wherever they are across all digital channels.

In Asia, Unilever and their agency ph D.

Leveraged our retail partnership in Coca with food Pander to increase sales of their nor food sources, you don't lever was able to onboard. It's all first party data on our platform than do lookalike modeling purpose Panthers retail conversion and loyalty data to target new customers more precisely on the open internet.

This new audience based approach resulted in a 229% improvement in customers, adding nor products.

Jeffrey Terry Green: To their shopping basket, and an 81% improvement in customer conversion.

Just like you know they are more and more advertisers are prioritizing at opportunities where they can be sure. They are reaching their target audience and increasingly that means activating their first party data effectively and leveraging AD impressions were USD two is present.

This is a new identity fabric of the internet, taking shape and it's revaluing the internet and the process recently target, Australia and their agency OMD worked with us to upload their first party customer data into our platform.

<unk> targeted new customers using <unk> to their conversion rate improved 66% versus using traditional identifiers and their cost per action decreased 36%.

Jeffrey Terry Green: And there are huge benefits to publishers, who offer transparency and authenticated audience data to advertisers unwind media is one of the world's leading gaming platforms. They recently reported that they saw a 47% improvement in the value of AD impressions when deterministic identifiers, such as UAV too are.

Present at 107% improvement when users are authenticated with Sso's such as open pass.

Jeffrey Terry Green: Let me also spend a moment on AI not because we're trying to get on the bandwagon, we've been deploying AI and our platform since we launched color in 2016.

Given the frenzy around AI I think it's important to talk about how it is actually helping advance the work of programmatic advertising too much discussion on AI today is about AI in the abstract instead of practical details about implementation.

We're starting to get better at explaining how our AI investments will actually help people do their jobs better.

To that end, we've known since before our company existed that the complexity of assessing millions of AD opportunities every second along with hundreds of variables for each impression is beyond the scope of any individual human we.

We have always thought about AI co pilot for our hands on keyboard traders and with Coca we are bringing the power of AI to a broader range of key decision points than ever whether it's in relevant scoring forecasting budget optimization frequency management or upgraded measurement.

Jeffrey Terry Green: AI is also incorporated into a series of new indices that score relevance, which advertisers can use to better understand the relevance of different AD impressions in reaching their target audience.

For example, U S cellular worked with their agency hormone media to leverage our television body index to better reach new customers their conversion rates improved 71%. They reached 66% more households by optimizing frequency management and their cost per acquisition decreased 24%.

It's important to understand how we're putting AI to work and cocaine because this kind of tech dislocation will bring new innovators we.

Jeffrey Terry Green: We see that now where major tech players are inviting scrutiny because they are behind the innovation curve on AI and more agile players and I would include the trade desk in that bucket are.

Are figuring out how to apply it to help humans make better more data driven decisions.

We are also developing AI branded with Colette to make data driven refinements on it's all within the confines of human defined guardrails.

Let me close by trying to bring all of this together and help you understand why I believe this positions the trade desk, so well going forward I can't explain it any better than Jamie power. The SVP of addressable sales that Disney who spoke at our recent forward 24 event in New York City.

Disney is one of the pioneers of CTV technology, and Jamie talked about how <unk> is helping Disney offer advertiser match rates that are three to four times higher than when <unk> is not present and higher CPM are clearly following higher match rates.

Jeffrey Terry Green: <unk> machine statement about where the Internet is headed there.

Disney deals with an authenticated audiences and theyre leveraging UAV too so advertisers can find the right customers with much more precision and TV than ever before.

Against what many would consider some of the most premium content on the open internet.

With the growing ubiquity of USD, two with new approaches to authentication with better deployment of first party data with easier access to the premium internet and with major advances in AI the ability for advertisers to reach the right audience at the right time in the right place and convert those customers has never been greater.

And all of that is happening in our platform.

All of that happens with the advertiser in control of their data understanding more precisely where their dollars are going how they should optimize and how those ads are performing in service of their kpis.

None of what I just ran through it's really possible in a walled garden.

Jeffrey Terry Green: It might not go as far as to say, we're seeing the early days of the follow up Rob at the current macro and Tech forces are creating an important moment of reckoning for everyone in our industry and advertisers are shifting more dollars to us as a result.

Advertisers want a competitive market with price discovery, because they want to own their own future.

It is easier than ever for advertisers to understand who is delivering value at all points of the digital advertising and supply chain and they will increasingly gravitate to those who are helping them make the most of every advertising dollar with transparency and objectivity.

Of course this is all made possible by our profitable business model, which generates significant cash flow, which in turn allows us to invest in the major platform upgrades that characterized coca.

So while I believe 2024 will be remembered as a year of great Tech driven disruption in our industry. I also believe it is a year that the trade desk will continue to differentiate itself from its competitors and continue to outpace the market.

Jeffrey Terry Green: As the industry races toward a trillion dollars 10, we are incredibly well positioned to take more than our fair share.

With that I will hand, it over to Laura who will take you through more of the financial details.

Laura: Thank you, Jeff and good afternoon, everyone. The.

Laura: The trade desk delivered another strong quarter as revenue was 491 million and 28% increase year over year.

Laura: I regret this further evidence of the durable value like the trade desk, Bruce our clients and we continue to outperform the industry as a result.

Laura: All of our progress in areas, such as CTV retail media co pay and you I need to help deliver another quarter of consistently strong growth and profitability to start 2024.

Laura: In addition to strong top line performance I am proud of $562 million of adjusted EBITDA, we generated during the quarter.

Laura: Presenting a margin of 33%.

Laura: Our strong growth in Q1 was broad based in terms of geography and channel bankruptcy.

Laura: Strength in CTV continued as the channel, let Ark restaurants scaled channel perspective once again.

Laura: We also continue to see strong momentum in retail media as we continue to win shopper marketing budgets and it's more of our existing clients utilized third party retail data for targeting and measurement.

Laura: You wanted to is being deployed by major advertisers and publishers in a larger scale than ever.

Laura: And we continue to see the benefits from strengthening our relationships with major brands and their agencies.

Laura: From a scale channel perspective in Q1 video, which includes CTV represented a mid 40% share of our business and continue to grow as a percent of our mix.

Laura: Mobile represented a mid 30% share of spend during the quarter.

Laura: Display represented a low double digit percent share of our business and audio representing around 5%.

Laura: Geographically North America represented about 88% of spend and international represented about 12% of spend for the first quarter.

Laura: We saw strong consistent year over year growth across all of our regions in Q1 with international growth Outpacing North America for the fifth quarter in a row.

Laura: We continue to execute our growth playbook internationally led by CTV and retail media.

Laura: We remain optimistic that our business outside North America continues to be a strong contributor to our overall group this year and for years to come.

Laura: In terms of verticals every category of greater than 1% of spend grew double digits in Q1.

Laura: It's exciting to deliver such consistent growth across the business and we're proud to see the value of the open internet for premium Internet resonating with clients for many industries.

Laura: Turning now to expenses.

Laura: Q1 operating expenses, excluding stock based compensation were 352 million up 20% year over year.

Laura: We continue to make investments in our team and platform, particularly in areas like sales and marketing and platform operations as we position the organization for long term growth.

Laura: Income tax expense was $14 million in the first quarter, driven primarily by our profitability and non deductible stock based compensation.

Laura: Adjusted net income for the quarter was $131 million or 26 cents per fully diluted share.

Laura: Net cash provided by operating activities was $185 million in free cash flow was $176 million in Q1.

Laura: Yes. It was exiting Q1 were 86 days down two days from a year ago.

Laura: <unk> were 70 days down two days per meter ago.

Laura: We exited Q1 with a strong cash and liquidity position.

Laura: Cash cash equivalents and short term investments ended the quarter at $1 4 billion, we have no debt on the balance sheet.

Laura: Finally in Q1, we repurchased one 5 million shares of class a common stock for an aggregate amount of $125 million.

Laura: The company will continue to approach the repurchase program opportunistically, depending on market conditions and capital priorities.

Speaker Change: Now turning to our outlook for the second quarter.

Speaker Change: We continue to see strong spending are key areas, such as CTV and retail media we.

Laura: We estimate Q2 revenue to be at least $575 million, which would represent growth of approximately 24% on a year over year basis.

Laura: We estimate adjusted EBITDA to be approximately $223 million in Q2.

Laura: In closing we are encouraged about the momentum of our business. We're executing on large long term growth drivers, including CTV International expansion retail media. Our recent platform upgrade eco Guy you already too as well as the upcoming U S election cycle.

Laura: We continue to generate strong free cash flow for our head count efficiently and maintain a balance sheet that positions us to continue investing in achieving durable growth.

Laura: We remain optimistic about the prospects for our business and the remainder of 2024 and beyond.

Speaker Change: That concludes our prepared remarks, and with that operator, let's open up the call for questions.

Speaker Change: Thank you.

Speaker Change: At this time, we will be conducting a question and answer session. If you would like to ask a question. Please press star one on your telephone keypad.

Speaker Change: Confirmation tone will indicate your line is in the question queue. You May press star two if you'd like to remove your question from the queue.

Speaker Change: For participants using speaker equipment, it may be necessary to pick up your handset before pressing the star keys, one moment, please while we poll for questions.

Speaker Change: Okay.

Speaker Change: Once again, please press star one if you have a question or comment.

Speaker Change: First question comes from Justin Patterson with Keybanc. Please proceed.

Justin Tyler Patterson: Great. Thank you very much and good afternoon.

Justin Tyler Patterson: At the last Investor Day, you spoke about connected TV, forming a tidal wave we're now starting to see Disney Roku and even NBC with the Olympics leaning more on programmatic, suggesting that CTV won't be just a walled garden and world here. It will actually be more open so where do you think you are right now and just that that tipping point from linear TV spend flowing into connected.

Justin Tyler Patterson: TV and how are you thinking about the right investment level to seize that opportunity. Thank you.

Speaker Change: Well, thanks, Josh I appreciate the question so far.

Speaker Change: First I think it's just important to take a step back and just look at where we've come from has been a few years.

Speaker Change: Isn't that long ago that people were saying Oh cable has got a long life, it's not going to be that long and then the pandemic accelerated everything then we started talking about a new currency like <unk>. Two and then there was a fair amount of well are you sure you can get adoption on that it seems like CTV has.

Speaker Change: A lot of Av.

Speaker Change: Defences or ways that it's going to be reluctant to adopt something new when you look at it now and every streaming service has enabled operating except for Apple we've been saying for almost 10 years that Netflix would be showing ads and of course. They are today in the last month, we've talked about how Disney plus.

Speaker Change: The Olympics are coming to NBC, but they're also coming to programmatic for the first time and they're doing that via the trade desk.

Speaker Change: Then of course, a roku partnership, but I think even during the height of the pandemic people would not have predicted that we would be in a place that we are those.

Speaker Change: Those three big announcements, our Disney plus announcement beam to integrate directly with them have all come in roughly the last month.

Justin Tyler Patterson: And then of course <unk> is the primary currency of connected TV.

Justin Tyler Patterson: With that backdrop I think we're in a phenomenal position and once again the consumer is leading in the sense that as they move away from traditional television and cable and.

Justin Tyler Patterson: Linear TV they are moving in.

Justin Tyler Patterson: Streaming in connected TV and all of those are filled without options.

Justin Tyler Patterson: So the content owners and the streaming wars are more dependent on programmatic than ever.

Justin Tyler Patterson: So we're seeing things like profitability in Hulu Disney Excel Thats in large part because of them leaning into programmatic and we're super proud of our partnership there and across the board.

Justin Tyler Patterson: As I said last quarter I believe there will be an increase in inventory. This year I think we've heard that theme from for most of the content owners throughout the.

Justin Tyler Patterson: For the year.

Justin Tyler Patterson: And the scale of identity is going to continue to go up and Thats in part because of that inventory going up.

Justin Tyler Patterson: All of that.

Justin Tyler Patterson: Tips the scales, even more towards the buyer's market there is going to be more supply.

Justin Tyler Patterson: It makes it so that buyers can be more selective in what they buy that makes it more important for everything to be layered with new IV too, but also makes it more important for them to be very deliberate about what they are buying.

Justin Tyler Patterson: And most of the streamers hostile rely on programmatic so that they don't add to the AD load and therefore shrink or slow their growth.

Justin Tyler Patterson: So I think this puts us in a tremendous.

Justin Tyler Patterson: <unk> to thrive and we are seeing more and more pressure on anybody who tries.

Justin Tyler Patterson: To create a walled garden light strategy in CTV, So I think youre going to see more and more of the open internet led by connected TV.

Justin Tyler Patterson: And I think this year, so far even just the headlines from this year, so far our underlying underlying at that point.

Speaker Change: Thanks, Jonathan.

Speaker Change: Okay. The next question comes from.

Justin Tyler Patterson: Sean Patel with <unk>. Please proceed.

Shyam Vasant Patil: Hey, guys congrats on another really strong quarter and outlook.

Shyam Vasant Patil: I had a two part question.

Shyam Vasant Patil: Jeff I guess following up on the first question.

Shyam Vasant Patil: Do you think about the impact of Amazon's AD supported prime video offering from a competitive perspective, and then for the second part of this is related.

Shyam Vasant Patil: Disney called out in their earnings call that there's a lot more supply in the market as a result of a competitor entering the AD supported here and I think everyone's assuming that that's Amazon and Theyre just some concerns out there that you know a massive influx of inventory yet lower cpm's get depressed the CTV market overall without necessarily.

Speaker Change: Really driving more demand. So I'm, just curious kind of your thoughts on how all this affects you guys and the industry.

Speaker Change: You bet.

Speaker Change: Uh huh.

Speaker Change: Can you remind me of the first part of your question. So how does the increase in supply I get on the second part remind me of the first part of your question, Yes. The yeah I know, it's a long one yeah. The first part was just.

Speaker Change: Just how youre thinking about the impact of Amazon's ad.

Speaker Change: At supported Prime video offering.

Speaker Change: From a competitive perspective.

Speaker Change: Yeah. So.

Speaker Change:

Speaker Change: So today, we don't buy.

Speaker Change: Amazon Prime video that is the only available from Amazon selling it themselves.

Speaker Change: As you pointed out I believe they are adding a significant amount of supply, but then only selling it themselves.

Speaker Change: Which does put some pressure on the objectivity problem.

Speaker Change: Thus, our DSP in particular house.

Speaker Change: And when I say the objectivity problem I mean, it is very difficult to go to a buyer and say give me your money and I will help you objectively figure out where to put it and by the way I own a lot of it.

Speaker Change: So I would of course bias towards selling my own everybody who does that.

Speaker Change: <unk> tends to have a problem when they are wrapping other people's inventory.

Speaker Change: That makes it difficult for them to partner with but their objectivity problem that I just described.

Speaker Change: It could also be similar to a Google or somebody else, but they take it even one step further which is that at Google. They don't make products that compete with all of these people that are selling.

Speaker Change: And because they are white label soap and baby wipes and diapers and whatever else at Amazon Dot also competes with many of the CPG. So we're doing all the advertising and so it makes it even even more difficult. So when you have more supply than you have demand and you have an objectivity problem.

Speaker Change: <unk>.

Speaker Change: I think it puts a fair amount of pressure on them, what I do think it's likely to happen over time, though and we're seeing that happen inside of Amazon is them.

Speaker Change: Creating more separation between their different entities I don't think it's good for Amazon or Amazon users.

Speaker Change: The AD experience to be in theory are simply because they own the DSP.

Speaker Change: What I anticipate will happen over time is that they will make their inventory available to everyone. That's what I would love to see I would love to have access to the inventory and I would love for them to adopt new IGT and.

Speaker Change: And until then I believe there are operating at an anemic market I think they are going to struggle because <unk> has become a ubiquitous currency for everyone in the CTV space, because advertisers want to bring their own data to the table and they want to buy very deliberately and make certain that it's going to work and with the objectivity problem.

Speaker Change: Mike just described they are going to struggle to get the high <unk> and the data driven high CPM that could come if they were operating in a more objective ecosystem. So I'd love to see them evolve it actually not too dissimilar Lee from what we've seen from Roku.

Speaker Change: To see them evolved to a place where they embrace the open internet.

Speaker Change: Embraced those common currency, so that advertisers can bring their own data to bear and then they would get higher CPM that could have a lighter AD load. They can have a better AD experience and all of that would be good for prime video customers.

Speaker Change: But there's a lot that has to happen until that happens.

Speaker Change: I actually don't think that that competitive and I think all the other players have a much more competitive offering to the most premium advertisers, which is what TV is really all about so until then I think the.

Speaker Change: Premium supply.

Speaker Change: It doesn't have quite as much of a surplus as there could be if Amazon embrace that and I think we're going to see it take a little while before we get there.

Speaker Change: Thanks, Sean.

Speaker Change: Okay. The next question comes from Brian Fitzgerald with Wells Fargo. Please proceed.

Brian Nicholas Fitzgerald: Thanks, Jeff it looks like there.

Brian Nicholas Fitzgerald: Third party cookies, I won't be going away now for at least until 'twenty five.

Brian Nicholas Fitzgerald: Your thoughts on the Cookie deprecation delay once again and how if at all it impacts the industry and then maybe secondarily.

Brian Nicholas Fitzgerald: Could you can.

Brian Nicholas Fitzgerald: Could they continued delays have any impact positive or negative on <unk> adoption.

Brian Nicholas Fitzgerald: Okay.

Brian Nicholas Fitzgerald: Great.

Brian Nicholas Fitzgerald: And so.

Speaker Change: First I'm glad to get this question on Cookie deprecation, not because I haven't heard it before but in an effort to hopefully put it to bed.

Speaker Change: For at least a little while until the next headline fit I've been blown away by how much in trade press. There has been discussion about cookies and maybe it's because.

Speaker Change: I felt like it was a very important topic to talk about two or three years ago.

Speaker Change: Uh huh.

Speaker Change: I just feel like we already have all of these conversations.

Speaker Change: So I was on record I remembered during the pandemic I'm, saying I think it is a strategic mistake for googles to offer Google to deprecate cookies I don't think the risk reward is worth it for them and I would not be surprised to see them delay. This.

Speaker Change: And again.

Speaker Change: As they continue to buy more time.

Speaker Change: I think that's exactly what we saw because we werent surprised by this we predicted this.

Speaker Change: It's been sort of quick to move on.

Speaker Change: I do want to give Google a little bit of credit, though I mean, Apple took away cookies.

Speaker Change: Nothing gave no announcements offer no alternatives.

Speaker Change: <unk> said were going to take away cookies I gave some headstart now they move the data bonds, both forward and backward, which to me didn't make any sense.

Speaker Change: But they did at least tried to propose something else, which was a privacy sandbox. The unfortunate thing with what they proposed was half bake and not investing in a solution and.

Speaker Change: And so the industry has just been criticizing it us included for the better part of the year because those criticisms I think we're pretty unanimous even from industry bodies like the IV that I never expected to take such a strong position.

Speaker Change: Obviously sandbox.

Speaker Change: I think it is forest Googles hand.

Speaker Change: To delay.

Speaker Change: Cookie deprecation.

Speaker Change: So we were not surprised by the net effect of that is that it gives the open internet a bit more runway to adopt things like UAV too.

Speaker Change: And come up with authentication and identity strategies, so that they can thrive in an environment outside of cookies.

Speaker Change: I think this is very good for some of those that moves slow some of the legacy media companies, especially those in journalism journalism is being hit from so many sides.

Speaker Change: Actually a big tax sort of pulling away from them.

Speaker Change: Which makes it harder and harder for them to monetize and they had a whole pile of problems before theyre Cpm's went down so I do think that this delay it makes it so that things will function a little bit longer, but I don't think it actually slows down you IV to adoption, we haven't seen any of that and the reason why I don't think it slows it down.

Speaker Change: The world knows Theyre serious the world knows that it's not going to last forever. They are looking for a way to get out of this.

Speaker Change: And so.

Speaker Change: The average publisher.

Speaker Change: But exactly what we were saying four or five years ago that while we think it's a strategic mistake for coke for Google to get rid of cookies. We also think it's a strategic mistake for all the rest of us to do nothing.

Speaker Change: So everyone else I think has bought into that.

Speaker Change: That strategic fact that everyone has to be.

Speaker Change: Moving and operating and adjusting so.

Speaker Change: I do think that prevent any sort of deaths or drop offs were.

Speaker Change: 20% of slow adopters get meaningfully hurt I think it helps give them a bit more runway.

Speaker Change: But I don't think.

Speaker Change: Decelerate the adoption of <unk> in any way.

Speaker Change: In part because you might need to adoption has been led by CTV and CTV providers are on.

Speaker Change: Are competing with each other and that is a way that they differentiate from one another.

Speaker Change: Do I make it easy for the biggest brands in the world to put their own data to work as they buy my media and if I do that I won't get higher CPM all of them need that.

Speaker Change: Streamer X y and Z irrespective.

Speaker Change: What happens at the New York times, or the La times or anywhere else like that so hopefully that answer the question on cookie deprecation.

Speaker Change: Excited to be moving on from us. Thank you.

Speaker Change: Brian Thanks.

Speaker Change: The next question John.

Speaker Change: Absolutely the next call.

Kara Sea: It comes from facility Kara Sea of with Cannonball Research. Please proceed.

Kara Sea: Thank you, Jeff I would like to ask you to talk about the your depot partnership with raw crude that was announced last week.

Kara Sea: We had heard some.

Kara Sea: Commentary from local and from your perspective, what would you highlight for us that is.

Jeffrey Terry Green: Significant for the street to know.

Jeffrey Terry Green: And in addition, as this progresses I think the timeline is a couple of quarters out.

Kara Sea: Can this lead to increased volume of television advertising for the trade desk and if so how would that mechanics work.

Kara Sea: Yes.

Speaker Change: Yes. Thanks.

Speaker Change: So it's early days and the specifics of our partnership but we're very excited about the long standing relationship that we've had with roku and seen it finally materialize into something.

Kara Sea: Meaningful and I do believe this is something meaningful.

Kara Sea: The Roku channel has grown tremendously over the last couple of years, so as they become more and more in into content and that includes having.

Kara Sea: More ads, we're excited to have.

Kara Sea: Access to those.

Kara Sea: In large part because we view Roku is a key premium publisher in the connected TV space.

Kara Sea: A couple of things that I think are incremental about the partnership.

Kara Sea: We anticipate that our adoption of <unk>. So we think that'll be an important.

Kara Sea: Our relationship has strengthened during the most recent discussions and we believe that we will play the role as their most strategic demand partner.

Kara Sea: I think for the first time ever advertisers can get access to roku as ACR data directly and the trade desk platform and perhaps as significantly as any of those things I think us getting access to Biddable inventory is a very big deal too much on CTV is still sold.

Kara Sea: On our programmatic guaranteed basis or a fixed rate basis, and that is becoming increasingly undesirable as more inventory comes online buyers want the option to pick and choose that is why they will pay a premium that is the way to get a premium and that requires a strong persistence.

Kara Sea: Our sense of identity or identity currency.

Kara Sea: And that also means making the inventory biddable so.

Kara Sea: The strength of the partnership and the relationship is the best that it's ever been with Roku I'm really excited about the change that this represents for them.

Kara Sea: And we're excited at the partnership.

Kara Sea: <unk> added for what it means for the future.

Kara Sea: Yes.

Kara Sea: Thanks.

Speaker Change: Next question John.

Speaker Change: The next question comes from.

Kara Sea: James Keaney with Jefferies. Please proceed.

James Edward Heaney: Great. Thank you for taking the question can you just talk more about the expanded open past partnership with Disney streaming properties curious how this impacts just the amount of CTV inventory that you're now able to access compared to what you had before.

Speaker Change: You bet so.

Speaker Change: Let me, let me just take a step back to explain what open path is.

Speaker Change: Sure.

Kara Sea: Over the years.

Kara Sea: The supply path in in digital advertising has gotten more and more convoluted and sometimes it's because of the tactics used in companies like Google where.

Kara Sea: The Doubleclick AD exchange was once a pure thing and then they introduced things like open bidding an open bidding there's really the backdrop whereby they created a lot of funky auctions that are described in the Texas Attorney General's complaint.

Kara Sea: So I think there's been a whole bunch of things that have made the supply chain complicated not least of which is Google but also the incentives that that has created for SSP.

Kara Sea: And the way that they process auctions in an effort to make the supply chain more efficient.

Kara Sea: Created an offering called open path, which is essentially going to the largest publishers in the world often in connected TV, but but.

Kara Sea: Any channel, where they want to plug in directly with us.

Speaker Change: So I wanted to be Super clear, we are not in the yield management business that is a function for.

Speaker Change: Publishers and their technological representatives, we are representing the buyers, but were willing to give them visibility into our demand directly.

Speaker Change: So that an intermediary can't make it more convoluted more opaque.

Kara Sea: And in some cases.

Kara Sea: Charge more than theyre, adding value.

Kara Sea: So.

Kara Sea: We've connected open past this pure pipe of visibility into our demand directly into <unk>.

Kara Sea: To Disney's Drax.

Kara Sea: So that they have you Ivy pipe directly to them and we have better visibility into the way that the auction works.

Kara Sea: We expect.

Kara Sea: 100% visibility eventually Disney we're moving in that direction.

Kara Sea: Sure.

Kara Sea: We they said on stage at 424 by the way that 50% of the business is automated and addressable and by 2027 and they expect that to be 75%. So we are we're on the path towards 100%, but that is all made possible by us plugging indirectly and having a clear sense of.

Kara Sea: Whereas you Ivy present, whereas it not how can we think can make things more addressable and how do we make the connection between us or said another way how do we make the supply path as clean clear transparent and efficient as possible and by us plugging in directly with Disney I.

Kara Sea: I think we're setting yet another model for the way that the most optimal integrations can be done in connected TV. So very excited to be doing that with one of the biggest in the space. So thanks for the question. Thanks, James next question John.

Kara Sea: Okay.

Speaker Change: Next question John.

John: Hi, John.

John: Sorry about that technical difficulties. The next question comes from Jason <unk> with Oppenheimer. Your line is live.

Jason: Thanks, I wanted to ask a question about social video.

Jason: It seems that it's been gaining share.

Jason: And as a linear dollars are kind of leaving linear.

John: Right.

Jason: Definitely competing with CTV for a share of those dollars.

Jason: Just any thoughts about how you think about that and how you can kind of utilize that channel for your customers and then.

Jason: It also seems to be perhaps pushing CTV to embrace more data to.

Speaker Change: Try to be competitive with that and so maybe comment on that agree disagree et cetera. Thank you.

Speaker Change: You bet so.

Speaker Change: In the move from from offline advertising, which of course pre internet with everything.

Speaker Change: And the world of digital everything has been shifting towards Digitization and eventually.

Speaker Change: And all advertiser will be transacted digitally even for the small minority of that that is not absolutely executed digitally so well.

Speaker Change: Well use digital pipes, even if we're going to run an AD in print for instance, so everything is moving to digital.

Speaker Change: As it has been moving to digital it's gone and there have been sort of two poles are two centers of gravity.

Speaker Change: One is around user generated content.

Speaker Change: That has.

Speaker Change: Exponentially more supply than demand orders of magnitude more supply than demand because theyre uploading.

Speaker Change: Thousands of hours every second tour, whatever whether it's on tick tock or Youtube.

Speaker Change: The amount of content is off the charts.

Speaker Change: And what those platforms are often done really well is made it really easy for you to spend money.

Speaker Change: They often report the results on their own in other words grading their own homework to tell you how they did.

Speaker Change: When you use those metrics and partly because of the supply demand.

Speaker Change: Reach is really cheap.

Speaker Change: When you contrast that to premium content.

Speaker Change: It can seem very cheap, especially when you're.

Speaker Change: Sure.

Speaker Change: When you are relying on the metrics that are provided by the companies that are selling you the inventory.

Speaker Change: We have focused all of our efforts on the premium side of the Internet and more and more Youll hear us talk about our goal is to monetize the premium side of the internet in large part because thats where people spend all their time.

Speaker Change: We mentioned in the prepared remarks that add to content ratio in your user generated content is worse than its ever been.

Speaker Change: We think that there is going to continue to get worse, even though the amount of inventory goes up.

Speaker Change: As a result, youre seeing more and more advertisers sort of fleet of safety I want to be associated with premium content.

Speaker Change: And I want to be associated with adds that I know, we're getting visibility and as theyre getting to be more and more of those ads. It makes it easier for them to say I want to be associated with those where I know I'm getting a 32nd spot I know I'm getting people's attention I know theyre not skipping it I know they don't hate my AD in front of that 14 year old.

Speaker Change: Following off of something.

Speaker Change: So increasingly you'll see us talk about the premium side of the Internet because we know that that's where the most premium advertisers in the world want to go and there is more and more a question about UGC as it becomes more and more of the epicenter for Cape speech and all the worst parts of the Internet.

Speaker Change: So I expect that that separation to continue it doesn't mean that there won't be budgets going there, but I think.

Speaker Change: The majority of the growth is going to go to the premium side of the internet because.

Speaker Change: The premium side of the Internet is getting so much better at making those available in a data driven way, which kind of gets to the second part of your question you're exactly right actually that one advantage to these.

Speaker Change: To sort of the social media video as you put it is that the supply chain as one company end to end and large park.

Speaker Change: So if they don't get demand and then they execute it themselves.

Speaker Change: So while there well, we can criticize them for not having objectivity.

Speaker Change: Like Crazy and then to some extent for making it super easy.

Speaker Change: And it is easier when your ecosystem is really just one company.

Speaker Change: Now we're doing integrations like the one we just talked about with Disney we're making the supply chain of the open internet. So much more effective when you couple that with the most premium content, whether we're talking about a music or in journalism or especially in CTV all of those things.

Speaker Change: The premium internet more accessible to the most premium advertisers in the world and as the amount of inventory goes up in that World. We also expect more of the dollars to do that to move in that direction. So I think all of this is good for us, but I just wanted to paint a picture of that contrast, there are those two centers of gravity they will.

Speaker Change: To get spend that the one that is growing most I believe is the premium side of the internet.

Speaker Change: Thanks, Jason next question John Please.

Speaker Change: The next question comes from Laura Martin with Needham. Please proceed.

Laura Anne Martin: Hey, Jeff.

Laura Anne Martin: I believe that great leadership creates great value and I really appreciate your leadership they open internet. So I wanted to say that first.

Laura Anne Martin: Well my question is.

Laura Anne Martin: Mike My question is on CTV full funnel. So it feels to me like with your deal with Walmart on the R&D, and then buying vizio and Amazon training all of its $200 million.

Laura Anne Martin: Try and video.

Laura Anne Martin: I think driven it feels like the Tam expansion going on in CTV is bottom of funnel, which is making connected television and omni channel channel not just top of funnel, which was sort of the historical thesis. My question is is part of your growth is 28% industry, leading growth Youre reporting because you actually have.

Laura Anne Martin: Final option in connected TV.

Speaker Change: So the short answer is yes. So.

Speaker Change: It is true that the easiest dollars to move over our top of funnel because that is of course, where the biggest advertisers in the world have historically spent.

Speaker Change: And so they are moving over budgets. The previously they had put in linear and those would come over to CTV, they're taking the same assets and in some cases, even the same way of thinking about it now.

Speaker Change: Improve the metrics a bit and then they improve the targeting a lot and they are in as the new.

Laura Anne Martin: Sort of ported over.

Laura Anne Martin: TV budgets. However, as you pointed out you don't have to spend that way very long to say now what do we do next how can we improve on that and thats, where bringing retail data to bear.

Laura Anne Martin: Really is just showing amaze.

Laura Anne Martin: Amazing advantages for those that have historically sold in brick and mortar stores that have historically had difficulty getting data online that now they can partner with many of the biggest retailers in the world who are also trying to compete with big pack and in large part they are trying to compete with the Amazons of the world. So all of them are saying how can I put my data to work so.

Laura Anne Martin: But we can sell more products at a walgreens or a dollar general or a walmart or a target where so many others albertsons. So many others Kroger so many.

Laura Anne Martin: If they can sell more product in their stores by making their data available on our platform.

Laura Anne Martin: Then the advertiser is getting a bit more bottom of the funnel the retailer is being able to provide proof.

Laura Anne Martin: Their data is actually selling more product in their own four walls and that makes it easier for them holistically to spin their flywheel faster, which is exactly the way they think about it at places like Amazon. So it ends up being a win win between the retailer as well as the advertiser as they get data and insight and efficiency, but they haven't had before.

Laura Anne Martin: And that is by its very nature, a bit more bottom of the funnel I think we merely scratched the surface on what's possible. There I think there is so much ahead for that not dissimilar from what we were just talking about in supply chain. There's a lot of work we need to do to unlock that data to make it easier there's way too many manual processes.

Laura Anne Martin: Today.

Laura Anne Martin: I had a meeting with a very large.

Laura Anne Martin: Data company today about just.

Laura Anne Martin: Making certain that the pipes are very connected so that.

Laura Anne Martin: We can make it easier for the biggest advertisers in the world to use their own data to keep it safe to do only things that they would want to do with it that are respecting the very sacred relationship that they have with consumers.

Laura Anne Martin: They can leverage that data top and bottom of the funnel to be more efficient and the amount of unlock and things that are that are possible in large part started by retail media are just things that we hadn't even imagined even just a couple of years ago. So it's a really exciting time.

Speaker Change: Thanks, Laura next question Jon.

Speaker Change: Next question comes from Mark <unk> with the benchmark company. Please proceed.

Mark: Thank you good evening Jeff.

Mark: Just maybe a follow up to Jason's question on social walled gardens.

Mark: If you look at.

Mark: Your mix across all of your AD categories, it's been relatively unchanged since December of.

Mark: 22, this quarter you indicated mobile dropped from.

Mark: A high 30%.

Mark: Yeah.

Mark: To mid thirties, but we havent seen video move up from the mid Forty's since.

Mark: December 22, so I'm, just curious what's sort of driving that dynamic would've.

Speaker Change: I guess expect to see a video mix moving higher as all these CTV initiatives are in play thanks.

Mark: Hum.

Speaker Change: Honestly I don't spend that much time on measuring the mix of course I'm very interested in seeing.

Speaker Change: Our CTV continue to grow and I am interested in the overall growth rate, but because when you're looking at the growth rates against each other.

Speaker Change: When one is doing really well it doesn't necessarily mean the other good badly even though that the slice of the pie goes down because of the pie is getting bigger we're excited about that growth.

Mark: Across the board, so whether it's a high 30% to mid thirties, and mobile and whatnot, we're still heading an amazing direction of growth.

Mark: And honestly, we spend a lot of time trying to actually properly categorize inside of things like video.

Mark: And sometimes small moves like people watching video on.

Mark: Phones or offline versus watching them on CTV.

Mark: Yes.

Mark: Ah.

Mark: In effect on.

Mark: What we described as growth in CTV versus video or otherwise when the content is almost the same it's just a device.

Mark: So creating distinction between premium content and devices can sometimes muddy the waters in the numbers, which is not what we intended to do well. We're simply just trying to show the value of premium content. We know that that trend overall is very good irrespective of what devices are used up.

Mark: And in fact, even if you look at it on a device basis. The trends are also very good so.

Mark: The small.

Mark: Yes.

Mark: The changes that you're describing.

Speaker Change: I honestly don't spend that much time thinking about it.

Mark: And Mark this is Laura I would just add that video does continue to increase we just don't break out the exact percentages.

Speaker Change: Thanks Mark.

Speaker Change: Next question John.

John: Absolutely. The next question comes from Mark Mahaney with Evercore. Please proceed.

Mark Stephen F. Mahaney: Be followed from analogy.

Mark Stephen F. Mahaney: Theres been rising regulatory scrutiny of Google I think end up.

Mark Stephen F. Mahaney: I know and I admit it for a couple of years, but it's really kind of comes home. This year you mentioned some of the stuff. That's been disclosed you've got two trials that will probably have decisions between now and the end of the year. So it was that actually causing a notable material acceleration or shift of AD budgets away from Google towards the trade desk have you actually seen that.

Mark Stephen F. Mahaney: Now that the.

Mark Stephen F. Mahaney: The.

Mark Stephen F. Mahaney: Whatever the whatever they right now just the chickens come home to roost. Thank you.

Speaker Change: Yeah. Thanks, Mark I really appreciate the question so.

Speaker Change: When you get an incremental dollar its sometimes hard to figure out why you got it to where it came from but.

Speaker Change: So.

Speaker Change: It's hard for us to attribute how much of that is coming from.

Mark: From People's Fear of Google I mean, I know that we win money from Google's DSP all the time.

Mark: Sometimes we think that's because our product is better sometimes I think it's because our objectivity is better.

Mark: Sometimes it's because we're not going to spend most of your money on Youtube, there's a whole bunch of reasons why that's the case.

Mark: And.

Mark: Regulatory scrutiny is one of those.

Mark: But I will speak to the sentiment, which I think is just easier to speak to as I have more and more conversations.

Mark: With C suites at some of the biggest companies in the world and talk about it in the context of either partnership or.

Mark: Sure.

Mark: Seeking their advertising dollars.

Mark: The acknowledgement.

Mark: Handing over a year data in your money to Google and hoping for the best and especially when that is a critical part of your future is increasingly viewed as a risky strategy.

Mark: People have to take their own faith in their own hands and that's one of the things that I think is so compelling about our offering right. Now is that we are not saying trust us instead of them and we will do the same thing they do just with more focused because we.

Mark: We don't own Youtube.

Mark: That is not what we do we actually tell them. We will give you. The details of all of your performance. It's your data you would take it with me you own it.

Mark: And that way you learn a new always own your future.

Mark: That part where advertisers want to own their own future.

Mark: It feels like that is more important to them than it ever has been and I do believe that the regulatory scrutiny and all that there are a lot of people that have read the Texas Attorney General's complaint.

Mark: <unk> thought about the effect that that has on the ecosystem and it does make them.

Mark: <unk> want to be more deliberate about where they spend and it does make them in many cases, I think a better partner for us and it helps us to see what kind of partner, we want to be to them.

Mark: But I do believe it has contributed to our growth, but it's really hard to quantify so short answer thanks for the question.

Speaker Change: Thank you Jonathan.

Mark: Thanks, Mark and then one last question, Jonathan John and our last question comes from Matt Swanson with RBC capital markets. Please proceed Matt.

Matthew John Swanson: Yeah, great. Thank you so much for squeezing me in Jeff.

Matthew John Swanson: Jeff I feel like we've spent a lot of time on the call kind of thinking through CTV publishers and why strategically it makes sense for them to open up more but I guess thinking of it from the advertiser side as CTV continues to scale and just the complexity of buying.

Matthew John Swanson: Gets larger how important is it for them to get back to a single pane of glass and you've used this term currency a bunch in terms of data consistency and kind of how can that drive more programmatic versus direct as maybe advertisers start to pressure those publishers.

Speaker Change: Uh huh.

Mark: When you say a single pane of glass can you elaborate what what.

Speaker Change: Do you mean, just yes, I mean on CTV.

Speaker Change: Yeah, so in CTV as opposed to the idea of when your budgets are small direct might seem more feasible and as CTV budgets grow and the complexity grows and the number of suppliers grow how much more important to them to start to create more automated processes.

Speaker Change: I see.

Speaker Change: I Love. This question. Thank you.

Speaker Change: So.

Speaker Change: Sure.

Speaker Change: When you.

Speaker Change: Isn't that long ago that as consumers, we were just using one or two apps on a roku.

Speaker Change: Where.

Speaker Change: 567.

Speaker Change: Maybe 10 years ago I just used the Amazon.

Speaker Change: Netflix.

Mark: Now Theres a lot more options.

Mark: Almost all of them have ads there wasn't that long ago that it was one or two and then it was only a few others and then most of them had limited ads.

Mark: Now, there's a lot more and they all have ads.

Mark: So if you're an advertiser you can't just go to one company and say I want to buy some ads and then have an understanding of the way of frequency caps in particular will be used you have to be thinking across all of these apps and you have to think about how many times in my showing the same user this AD irrespective of what show or what.

Mark: Profile or what they're using to watch it on.

Mark: And so as the number of options goes up and the amount of AD inventory goes up the need to automate and be data driven and have a persistent.

Mark: Anonymised identity.

Mark: Is greater than it's ever been before.

Mark: And that's partly because the AD prices Havent gone down and in fact.

Mark: For the premium stuff for the things they really want they've gone up and that's not necessarily any longer because of scarcity. The scarcity has actually gone away. The amount of inventory has gone up but there is scarcity when it relates to having.

Mark: All of the amount of data that you want in order to make an informed decision and their will to some extent always be scarcity around the exact audience that people want to reach.

Mark: So by making that more available that's how you get the premium.

Mark: So all of the streamers have figured this out this is the way to get the premium.

Mark: And I think they're all on a path.

Mark: That to me makes sense like all of them are doing the right things and that is one of the things that we have said about CTV really from the beginning is that it's perfectly fragmented.

Mark: It is fragmented enough that no one could be draconian and create a walled garden.

Mark: People doubted us when we said that initially and I think that's proven to be true.

Mark: But it also has consolidated enough.

Mark: You have dairy.

Mark: Smart people running those and they're going to be hyper rational.

Mark: And as a result, we're seeing them all do in my view what is the.

Mark: The right thing some of them are different parts of the world.

Mark: The sort of adoption or innovation curve. They are on different parts of the journey different places in the journey, but.

Mark: But theyre all on the right path.

Mark: So I'm very excited about the state of CTV I really do think it has huge implications answering on the entire open internet and using his leaving the open internet as it relates to the premium content and I'm optimistic.

Mark: Digital audio.

Mark: Right behind it there are lots of leaders in digital audio that are doing more than what <unk> has done, but there's still a lot of catching up to do as well and I am Super optimistic about what that means for things like journalism is they're really starting to think about it the right way.

Mark: But.

Mark: Very optimistic about the open Internet led by CTV really appreciate the question.

Speaker Change: Thanks, So much Matt you can close out the call now John Thank you.

Speaker Change: Thank you. This concludes today's conference and you may disconnect. Your lines at this time. Thank you for your participation.

Mark: Rich.