Q4 2024 Integral Ad Science Holding Corp Earnings Call
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Speaker Change: I would now like to hand, the conference over to Jonathan Schaffer Senior Vice President Investor Relations. Please go ahead.
Speaker Change: Thank you good morning, and welcome to the <unk> fourth quarter and full year 2024 financial results Conference call I'm joined today by Schneider, CEO and Jill Putman interim CFO before we begin please note that today's call and prepared remarks contain forward looking statements.
Speaker Change: We refer you to the company's filings with the SEC posted on our Investor Relations site at investors Dot integral adds dot com for more details about important risks and uncertainties that could cause actual results to differ materially from our expectations.
Speaker Change: We will also refer to non-GAAP measures on today's call.
Speaker Change: Reconciliation of non-GAAP measures to the most directly comparable GAAP measures is contained in today's earnings release available on our Investor Relations site.
Speaker Change: All financial comparisons unless noted otherwise are based on the prior year period.
Speaker Change: So with these formalities out of the way I'd now like to turn the call over to our CEO Lisa Hood Schneider, Lisa you may begin.
Speaker Change: Thank you Jonathan and welcome everyone to our 2020 for fourth quarter and year end call. We deliver positive fourth quarter results with double digit revenue growth across our measurement optimization and publish our businesses.
Speaker Change: Revenue in the fourth quarter increased 14% to $153 million at a 40% adjusted EBITDA margin.
Speaker Change: Full year 2024 revenue grew 12% to $531 million at a 36% adjusted EBITDA margin our profitable growth in 2024 enabled us to significantly exceed the rule of 40 for the fourth consecutive year since our IPO in 2000.
Speaker Change: 'twenty one.
Speaker Change: 2024 was a year of innovation that we believe positions <unk> for continued double digit growth in 2025, we advanced our industry, leading technology grew our relationships with key advertisers platforms and publishers and enhanced our leadership team with the addition of a new.
Speaker Change: Chief operating officer, and Chief product Officer.
Speaker Change: We introduced several new capabilities in our core measurement offerings and increase our reach on key platforms to capture additional AD spend across channels. We also expand our pre bid optimization product suite to drive performance for advertisers.
Speaker Change: In 2024, we successfully scaled our premium AI, driven total media quality or TMT measurement products and social media.
Speaker Change: We are integrated with major platforms, including meta Youtube tick tock snap Pinterest and most recently read it which we launched in December.
Speaker Change: <unk> selected Ias to integrate into their limited inventory safety tiered based on Ias has market leading <unk> capabilities.
Speaker Change: We also closed loop on the social platforms with the launch of our pre bid optimization solution.
Speaker Change: Advertisers on the leading social platforms can now optimize their AD placements customize their suitability settings eliminate waste and drive higher returns on their ad spend.
Speaker Change: October Ias announced testing of our first to market content level avoidance optimization solution for advertisers on meta across Facebook and Instagram feed in Reals.
Speaker Change: During testing our content block lit solution on meta delivered a 71% reduction in wasted AD spend unsuitable content.
Speaker Change: Earlier this month, we announced new features and increased global availability for our content block this optimization solutions on meta.
Speaker Change: We now support nine additional content categories for a total of 45 and six additional languages for a total of 34. In addition, Ias's currently in Alpha testing in partnership with Tic Toc for its new video exclusion list solution.
Speaker Change: Also participants can partner with Ias for both measurement and optimization on tick tock.
Speaker Change: We remain on track and look forward to delivering these social optimization capabilities on tictoc from the first half of 2025.
Speaker Change: In 2024, we launched our differentiated quality attention measurement product for advertisers publishers and Sps.
Speaker Change: Quality attention is the first product to unify impression level media quality signals and lumen researches eye tracking technology with machine learning brands can utilize these attention scores to drive up to 130% lift in conversion rates for their ads when comparing high attention impressions versus.
Speaker Change: As low attention in the fourth quarter, we released our quality attention optimization product in beta.
Speaker Change: With this pre bid expansion Ias now offers complete coverage for retention metrics across postpaid prepaid and social media.
Speaker Change: We continue to rollout our quality sync pre bid segment, which is now available across all major DSP.
Speaker Change: In the fourth quarter, we announced the availability of our quality sync pre bid segment and Amazon DSP. We are delighted to continue this momentum in 2025 with the launch earlier this month of quality sink in Google display and video of <unk> 16.
Speaker Change: With quality think advertisers can simplify their workflows by automatically thinking their prepaid and postpaid settings across all channels for programmatic buys.
Speaker Change: In CTV, our clients are leaning into our solutions and integrating more deeply with our publica, an ias measurement offerings.
Speaker Change: According to E marketer data as of November 2024, the UFC TV market is expected to reach over $47 billion by 2028, we are focused on driving publisher performance and increased efficiencies with publica.
Speaker Change: On last quarters call I discussed the introduction of new product features to increase bidding competition in AD auctions. These are powerful and superior product differentiators, which along with the contribution from Oracle wins contributed to 30% publisher growth in the fourth quarter, we look forward to scaling.
Speaker Change: The offering in 2025.
Speaker Change: Ias leads the industry globally with 32% of our fourth quarter revenue from markets outside of the Americas, we consistently find that our global coverage as a differentiating factor in winning rfps across verticals in December we announced plans to expand into China, where we are currently in.
Speaker Change: <unk> for testing this initiative unlocks the world's second largest advertising market with an estimated $140 billion in digital AD spend in 2024. According to E marketer data as of November 2024.
Speaker Change: We will also offer local support to Chinese advertisers looking to grow their reach beyond China's borders. The announcement follows the expansion of Ias's operations in four key APAC markets, Hong Kong, Taiwan, Thailand and Vietnam.
Speaker Change: Also in December we announced an exclusive first to market partnership with <unk> for business one of the most popular content communities and social platforms in Brazil, with 1 billion active users our brand safety and suitability measurement solutions, including <unk> are now available for advertisers.
Speaker Change: On <unk> in Latam and APAC.
Speaker Change: In 2024, we signed major new customer wins, and renewals, including former Oracle customers across brands platforms, and publishers, where driver having the integration and activation of these oracle wins and see an exciting opportunity to provide additional ias capabilities to these customers.
Speaker Change: To this end we have successfully on boarded over 30 previous hires from Oracle, who bring extensive programmatic mid market indeed experience.
Speaker Change: Since our last call, we secured several new wins, including in the luxury financial services and automotive verticals as well as renewals and expansions with existing partners.
Speaker Change: We're no Nissan Mitsubishi our strategic alliance between the three global automakers renewed and expanded their multi year global partnership with Ias to include <unk> attention and sustainability. The renewal builds on Ias has longstanding exclusive partnership with Renault and global.
Speaker Change: Relationships with Nissan and Mitsubishi based on our innovative product offerings and superior service.
Speaker Change: Marriott renewed their global social measurement partnership with Ias and switch to Ias from an incumbent provider for our optimization offerings.
Speaker Change: <unk> was selected based on our differentiated total visibility offering and our superior service.
Speaker Change: Essilor Luxottica home to leading global vision care and eyewear brands renewed and expanded its agreement with Ias. The renewal includes <unk> attention sustainability and total visibility as well as our pre bid social optimization offering they value our service and consider.
Speaker Change: Our ias as a crucial partner in protecting their brands digital exposure.
Speaker Change: <unk> renewed their global partnership with Ias across our team queuing attention offerings, while expanding to include social optimization product Trust Ias's technology and team to safeguard their brand and maximize the impact of their ads.
Speaker Change: All four of these renewals are testament to our global leadership in the importance to brand marketers of Ias's established coverage across markets.
More than ever brands are seeking both protection and performance solutions to drive efficiency and maximize outcomes on their ad spend.
Speaker Change: We believe we are proving that higher quality media leads to higher ROI for both large and mid market customers.
Speaker Change: As in the unparalleled position of seeing every digital media interaction with our measurement offerings. As a result, we can leverage insights and data to drive performance with our premium optimization products in.
Speaker Change: In 2025, we are focusing our product roadmap on three key objectives, delivering performance and AD effectiveness, expanding our reach to better serve our customers and innovating further immediate efficiency and protection.
Speaker Change: We recently announced total media performance or TMP, a suite of pre bid optimization insights products that maximize AD performance, while protecting brand equity.
Speaker Change: The TMP suite includes dynamic performance profiles, our DPP DPP delivers performance or brand outcomes by automatically adjusting targeting segments based on Ias as unique quality path and customer outcomes data Dpp's offered on all major DSP through our pre built integrations and.
Speaker Change: <unk> is designed to seamlessly aligned pre and postpaid media quality controls.
Speaker Change: We are expanding our reach in several ways, including the scaling of our pre bid optimization solution across the largest social platforms. In addition, mid market represents a meaningful opportunity for a measurement and optimization offerings, we have dedicated resources to developing products specifically for mid market customers.
Speaker Change: Who require seamless self serve solutions that are easy to activate.
Speaker Change: We are innovating our offerings to prioritize media efficiency and protection.
Speaker Change: In the fourth quarter, we launched Ias curation with Google AD manager with Ias curation advertisers can now consolidate bidding on high quality inventory and precisely target contextually relevant content to drive efficiency for their advice, we look forward to expanding Ias curation to more ssp's.
Speaker Change: In 2025.
Speaker Change: In CTV, we are excited to build on our momentum in this high growth market. We are focused on helping advertisers extend the capabilities. They used for open web and social media to drive efficiency and performance for their fast growing CTV spend we expect to scale adoption of public because new products.
Speaker Change: Features built to increased bidding competition in AD auctions.
Some public hub will continue to focus on supply path optimization to connect buyers and sellers in the most efficient ways possible.
Speaker Change: AI and data strategy is critical to driving both product innovation and cost efficiency. We are advancing our data science capabilities by deploying cutting edge AI models that are designed not only to accelerate time to market and scale new products, but also to reduce processing costs.
Speaker Change: By harnessing the power of our data, we empower brands and publishers to unlock new innovative use cases to maximize AD performance and operational efficiency.
Speaker Change: We made significant progress in 2024, as we advanced our technology and deepened our partnerships across the online advertising ecosystem.
In 2025, we believe we will see new opportunities to deploy ias's technology and deliver impact for brand marketers, we expect to deliver double digit profitable growth in 2025, as we expand our coverage across formats channels and markets.
Speaker Change: Last month, we announced the appointment of Joe Putman as interim Chief Financial Officer.
Speaker Change: Bill has served as <unk> Board member since 2021 and was also our audit Committee chair. She has a proven finance leader with over 30 years of experience, including as CFO of Jam holding Corp. We think gel for stepping into the role and we have engaged with in executive search firm to find it.
Speaker Change: Permanent CFO.
With that I'll turn the call over to Joe to review the financials and then we'll take your questions.
Speaker Change: Thanks, Lisa and welcome everyone I'm excited to step in as interim CFO. In addition to my role as an Ias Board member I've been very impressed with the team and look forward to supporting the company through this transitional period.
Speaker Change: Let me walk through our 2020 for fourth quarter results before turning to our financial outlook for the 2025 first quarter and full year.
Speaker Change: Total revenue in the fourth quarter increased 14% to $153 million.
Speaker Change: Ahead of our prior outlook of $148 million to $150 million.
Speaker Change: In addition, we achieved an adjusted EBITDA margin of 40% in the fourth quarter.
Speaker Change: For the full year 2024, total revenue increased 12% to $531 million.
Speaker Change: Ahead of our prior outlook of $525 million to $527 million.
Speaker Change: 2020 for full year, adjusted EBITDA was 191 $3 million at a 36% margin.
Speaker Change: Fourth quarter revenue growth was driven by double digit gains across all three of our major revenue categories.
Speaker Change: Advertiser spend in the retail and CPG verticals improved from the third quarter and we saw continued strength in financial services.
Speaker Change: As Lisa noted we began to recognize the positive impact of recently won Oracle business across our advertiser and publisher businesses.
Speaker Change: Optimization revenue grew 11% to $76 million in the fourth quarter.
Speaker Change: Improved advertiser spend on our leading optimization product drove volumes in both our contextual and non contextual segment.
Speaker Change: Measurement revenue increased 12% to $59 1 million in the fourth quarter.
Speaker Change: Looking at measurement revenue by channel Social media revenue growth increased to 25% with continued adoption of <unk> across platforms, including snap and Pinterest that were launched in the second half of the year.
Speaker Change: Social media represented 54% of measurement revenue and 21% of total revenue in the fourth quarter open.
Speaker Change: Open web revenue was consistent with the prior year period and represented 46% of measurement revenue.
Speaker Change: Turning to measurement revenue by format video grew 14% in the fourth quarter and accounted for 56% of measurement revenue with display representing 44% of measurement revenue.
Speaker Change: Publishing revenue increased 30% to $23 4 million.
Speaker Change: Driven by the adoption of new public of products by large OEM partners as well as increased political spend.
Speaker Change: Publisher revenue represented 15% of total fourth quarter revenue.
Speaker Change: We continue to expand our international footprint, which is a key competitive differentiator as customers prioritize global coverage.
Speaker Change: International revenue growth accelerated in the fourth quarter up 13% to $49 million or 32% of total revenue in.
Speaker Change: In addition, 45% of measurement revenue in the fourth quarter came from outside of the Americas for the full year, 31% of revenue or $166 million came from outside of the Americas.
Speaker Change: Gross profit margin for the fourth quarter was 78%.
Speaker Change: Gross profit margin for the full year was 79% at the high end of our prior outlook of 77% to 79%.
Speaker Change: On a combined basis, our operating expenses for the fourth quarter, excluding noncash expense items were flat year over year due primarily to increased capitalization of internally developed software and lower than anticipated bad debt expense.
Speaker Change: Stock based compensation expense for the period was $13 million lower than our prior outlook of $15 million to $16 million.
Speaker Change: Adjusted EBITDA for the fourth quarter, which excludes stock based compensation and one time items increased 29% to $61 $4 million above our prior outlook of $55 million to $57 million.
Speaker Change: Adjusted EBITDA margin for the fourth quarter increased to 40% from 35% last year.
Speaker Change: Adjusted EBITDA for the full year 2024 increased 20% to $191 3 million.
Speaker Change: At a 36% margin up from $159 $5 million at a 34% margin last year.
Speaker Change: Net income for the fourth quarter with $15 3 million or <unk> <unk> per share compared to $10 2 million or <unk> <unk> per share in the fourth quarter of 2023.
Speaker Change: Moving to our performance metrics.
Speaker Change: Our fourth quarter Advertiser net revenue retention or NR was 107%, which reflects lower advertising revenue growth for the trailing 12 months period and excludes our publisher growth.
Speaker Change: The total number of large advertising customers, which includes both mid tier and top tier clients with annual revenue over $200000 grew to 237 compared to 222 in the prior year period, and 232 and the 2020 for third quarter.
Speaker Change: Revenue from large customers with 85% of total advertising revenue on a trailing 12 month basis consistent with recent periods.
Speaker Change: We continued to generate strong cash flows and maintain a healthy balance sheet with cash and cash equivalents at the end of the fourth quarter of $84 million.
Speaker Change: During the quarter, we reduced our long term debt by $30 million to $35 million.
Speaker Change: Turning to guidance for the first quarter ending March 31, 2025, we expect total revenue in the range of $128 million to $131 million or.
Speaker Change: Or 13% year over year growth at the midpoint.
Speaker Change: We expect the quarterly revenue spread for 2025 to be similar to recent years.
Speaker Change: Adjusted EBITDA for the first quarter as expected in the range of $38 million to $40 million or 30% margin at the midpoint.
Speaker Change: For the full year 2025, our revenue outlook is $588 million to $600 million.
Speaker Change: Our 12% year over year growth at the midpoint.
Speaker Change: Full year 2025, adjusted EBITDA is expected in the range of $200 million to $210 million or a 35% margin at the midpoint.
Speaker Change: A few additional modeling points, we expect to maintain gross margin for the full year 2025, and the range of <unk>, 77% to 79%.
Speaker Change: First quarter stock based compensation expense is expected in the range of $15 million to $17 million and $77 million to $81 million for the full year.
Speaker Change: We expect weighted average shares outstanding for the first quarter in the range of 163 to 164 million shares and.
Speaker Change: And 165 to 167 million shares for the full year.
Speaker Change: We expect an effective tax rate of approximately 30% for the full year 2025.
Speaker Change: In conclusion, we reported solid fourth quarter results, which enabled us to achieve the rule of 48 for the full year 2024.
Speaker Change: In 2025, we will continue to invest in differentiated product, while managing our costs.
Speaker Change: Our 2020 outlook calls for double digit revenue growth and strong adjusted EBITDA profitability.
Speaker Change: And with that Lisa and I are now ready to take your questions.
Speaker Change: Operator.
Speaker Change: As a reminder, if you'd like to ask a question at this time. Please press star one one on your telephone and wait for your name to be announced to withdraw your question. Please press star one again.
Speaker Change: Please standby, while we compile the Q&A roster.
Speaker Change: Our first question comes from the line of Mark Kelly with Stifel.
Mark Kelly: Great. Thank you and good morning, everyone.
Mark Kelly: First of all nice quarter, especially given what we've heard from the broader ads that community over the last few weeks. So so well done first.
Mark Kelly: First question is your main competitor called out political as a headwind.
Mark Kelly: With brands really not coming back post election.
Mark Kelly: Curious to hear what you saw in the quarter around political and then just second question on CTV.
Mark Kelly: CTV scales and continues to shift towards more.
Mark Kelly: Real time bidding and less on direct deals I guess, how does that impact your business overall in terms of.
Mark Kelly: Volume and pricing thanks very much.
Mark Kelly: Good morning, Mark.
Speaker Change: Happy to take both questions. So the first one around political spending couple of call outs. The impact from political was limited to the lead up to elections in November.
Speaker Change: On the Advertiser business side, we did see some political headwinds while the publisher side it actually benefited from increased political spend.
Speaker Change: We were also pleased to see advertiser spend uptick in retail and CPG verticals, they improved in fourth quarter.
Speaker Change: With continued strength in the financial service sector.
Speaker Change: With your second question related to CP.
Speaker Change: <unk>.
Speaker Change: The ongoing shift to real time bidding, we actually see that as a tailwind for our business as we continue to invest in our CTV product offerings.
Speaker Change: Especially in public as we noted in our fourth quarter results. We are seeing strength in publisher across the board in particular, CTV with a 30% year over year growth from fourth quarter.
Speaker Change: Great. Thank you Lisa.
Speaker Change: Our next question comes from the line of Joseph Squali with Truest.
Speaker Change: Greg Good morning, everyone and congrats on the impressive quarter all things considered maybe just two questions on one on on pricing can you maybe talk about what you've seen in part on pricing, maybe delineating pricing and measurement, particularly from the moat wins versus not.
Speaker Change: <unk> clients and then still on the measurement did measurement and get it.
Speaker Change: A lift in growth from maybe.
Speaker Change: Having the pre bid products on meta in in Q4 already which was a bit ahead of where your competitor was thank you.
Youssef: Hi, Youssef. Thank you for the question. So the first question related to pricing on managed measurement from moat versus non mode.
Youssef: We were thrilled with the win that we put up on the board during last year's summer of <unk>, you might remember the win rate was north of 70% with 75 plus wins.
Youssef: It was a competitive jump ball situation, but.
Youssef: But we were able to demonstrate both with the differentiation of our products the value that we offer these new customers coming from moat.
Youssef: We were able to see a high win rate, but there were pricing dynamic storing.
Youssef: Those RFP jump balls and then the second question related to.
Youssef: The uptick in measurement couple of callouts, there we continue to see nice adoption of total media quality across all of our social platforms, where we're seeing the adoption.
Youssef: Is within the top 100 advertising customers think of those as the enterprise accounts, especially from top 51 to 100 advertisers. The sales teams are very focused on driving <unk> adoption across all the major markets for these global advertise.
Youssef: <unk> the.
Youssef: The second callout with <unk> as we also announced last year in the back half of the year, new social platforms that we rolled out <unk>, including platforms like snap Pinterest.
Youssef: And read it and being able to.
Youssef: Spanned reach in new platforms Thats also driving.
Youssef: <unk> growth and adoption of our social measurement.
Youssef: Revenue and then in terms of the launch of the pre bid social optimization, we were thrilled when meta selected Ias last summer I'm sure you remember that they selected us to be the beta partnered to co build the pre bid social optimization product we launched in beta.
Youssef: Last September we launched in fourth quarter Gea, where.
Youssef: Very pleased with the ramp that we're seeing in pre bid social on matter through fourth quarter.
Youssef: Into first quarter, it's early days with that launch, but a few things to call out in terms of what we are.
Youssef: Learning is we're seeing a 71% reduction in wasted AD spend in unsuitable content with the brands that have adopted the product again, a demonstration of the value that we're driving but its early days. So the team. We're just focused on <unk>.
Youssef: Driving the adoption, ensuring we're demonstrating the value and the other thing that's important to call out is that.
Youssef: The clients that are adopting the product they're already running our postpaid measurement solution on meta and again, we're running the pre bid social both on med and on tick tock.
Youssef: Got it thank you Lisa.
Youssef: Okay.
Youssef: Our next question comes from Jason <unk> with Oppenheimer.
Speaker Change: Hi, Thanks, Good morning, everyone two questions so Lisa.
Speaker Change: Would seem that pre bid could have much higher coverage I don't want to say, 100%, but.
Speaker Change: Much higher coverage, where relevant whereas post bid and verification potentially is much smaller coverage similar to the way Nielsen measures TV with limited sampling given that I started with postpaid and is now expanding much more significantly with pre bid across all the different areas you've talked about how does it change your visibility and long term.
Speaker Change: Outlook for the business and then second.
Speaker Change: Could you, perhaps give us your outlook for the full year by segment and format. If you can give any color there. Thank you.
Speaker Change: Yeah. Thanks, Jason.
Speaker Change: Thank you for the question. So I'll take the first question around pre bid postpaid and visibility that we have into the business.
Speaker Change: Couple of things to call out there. The first is exactly to your question, we are doubling down and investing heavily.
Speaker Change: In performance and our performance capabilities in programmatic as I mentioned earlier in the call in 2025, when we think about our product roadmap. We're focused on three key objectives that includes delivering performance as brands are doubling down on things like performance.
Speaker Change: Efficiency transparency ROI second thing we're focused on is expanding reach expanding reach both in terms of new platforms, New inventories International expansion and then the third key area is innovation, both with media efficiency and protection.
Speaker Change: By leveraging AI. So we are all hands on deck when it comes to programmatic and performance and in particular linking performance and media cost data and with that because we are doubling down on all things related to performance and pre bid.
Speaker Change: We're seeing really nice adoption from several key pre bid products that we launched total visibility being one of them and because we're seeing nice adoption of total visibility, where we're able to link up media quality signals with cost data.
Speaker Change: We are getting closer.
Speaker Change: Our understanding to advertisers and how they're planning their pre bid buying and with that it gives us greater visibility.
Speaker Change: In terms of revenue forecast, both on the postpaid side and the pre bid side. One other point tied to that I made earlier about social pre bid a matter is that advertisers who are adopting pre bid social optimization in meta.
Speaker Change: They have to be running postpaid measurement solutions on meta so with that because we already know what theyre running postpaid and theyre adopting the pre bid product. That's another great example of how we're seeing transparency both at the prepaid and postpaid level, Joe would you like to take Jason second question.
Joe Putman: Yes, sure Hey, good morning, Jason So as far as how we're thinking about growth across the business. In 2025 total advertising revenue is expected to have double digit growth. We're seeing improved optimization performance in the first quarter relative to the fourth quarter and expect this growth rate to outpace supposed to Q1 and the full year guidance that we've provided for the tone.
Speaker Change: <unk> revenue growth for.
Speaker Change: For measurement, we expect single digit growth in the first quarter. So that will be below the guide was provided again for the total revenue with improvement throughout the full year and then for publisher, we expect double digit growth here as well in both Q1 and for the full year and to outpace the forecast in CTV growth rates. Thanks, Jason. Thank you.
Speaker Change: Our next question comes from Raimo <unk> with Barclays.
Speaker Change: Thanks.
Speaker Change: Congrats from me as well and welcome Joe.
Speaker Change: Lisa.
Speaker Change: On the industry like since the election, and we've only seen like a change in terms of how some of the social media companies want to.
Speaker Change: Look at their content has that changed any discussions with clients because it does feel like that should kind of improve the spending for you guys tremendous.
Speaker Change: Tremendous lead because you can help them.
Speaker Change: And have more evolving environment, there and then I had one follow up.
Yes. Thank you for the question Raimo.
Speaker Change: So when you look back CES CES is every year in early January and it's.
Speaker Change: It's when we spend time with some of our biggest advertisers the whole coast platform.
Speaker Change: And during that week.
It was both win.
Speaker Change: <unk> announced that they were doing away with fact checking and then also there was the unknown of whether or not tick tock would be banned in the U S and that gave us the opportunity to have many face to face discussions with our largest advertisers and whole COSE.
Speaker Change: And have the conversation about their social strategy in 2025 and with that.
Speaker Change: It's too early to say whether or not some of these shifts were seeing with the social platforms is opportunity for Ias, but I will say our role in the digital ecosystem our role in providing a best in class multimedia classification in all of the major.
Speaker Change: Live feeds of social platforms is a tailwind for our business. The brands, we're very clear during CES Ias Youre in the business of Trust, We trust the accuracy of your multimedia attack, we trust the efficiency the velocity the granularity of it and they are lean.
Speaker Change: Ming into us to help navigate with them.
Speaker Change: The environment that we're operating in right now and that's a big reason why we continue to invest deeply in our tech.
Speaker Change: Yes, perfect. Okay. Thank you that's very clear and then.
Speaker Change: I have a question on the Oracle wins like can.
Speaker Change: Can you talk a little bit about the progression there. It does look like you're having good progress in terms of converting them and kind of getting them on the platform, but what's the.
Speaker Change: Or are we on that journey, Thank you and congrats again.
Speaker Change: Yes. Thank you so with Oracle and I spoke to before our win rate and the.
Speaker Change: The fact that fourth quarter, you might remember oracle they shutdown shut off their solution to their entire customer base at the end of September So fourth quarter of 2024 was very much the quarter to drive the integrations get all of the new customers onboard adopting our products.
Speaker Change: <unk>.
Speaker Change: And where we see nice upsell cross sell opportunity is with the brands in particular, because Oracle did not have a robust brand safety suitability solution also important to call out where we see additional runway is in the mid market channel Oracle.
Speaker Change: <unk> had robust mid market base and it's great to have mark for about the onboard as our COO, who was formerly the global CRO of Oracle, who has a deep background in mid market mid market is an area that we're investing heavily in and then the third call out is we did have a few more wins with <unk>.
Speaker Change: Or call.
Speaker Change: Following our earnings call last November in particular in the luxury and financial services verticals.
Speaker Change: Thank you.
Speaker Change: Thanks.
Speaker Change: Our next question comes from Robert <unk> with Evercore ISI.
Speaker Change: Thank you.
Speaker Change: Wanted to ask a couple please.
Speaker Change: Going back to a number of years to the IPO you talked about performance measurement is a potential Tam expander, we've seen a competitor get involved in the MTA space just recently.
Speaker Change: I think just generally across the industry, we're seeing a lot of interest in increments.
Speaker Change: You talked a lot last quarter I think about your data assets in particular and how they can be leveraged over time as measurement or MTA in area that you're looking at more closely and maybe you can tell us about that.
Speaker Change: Yeah, Robert Thank you for the question. So as I mentioned before we're very focused on doubling down in performance and what I mean by performance is activation. Our working thesis is helping brands find higher quality media leads to higher Y and the way we are.
Speaker Change: Doing that is by leveraging the media quality signals our contextual signals.
Speaker Change: And marrying that up with cost data tied to outcomes in terms of our data assets.
Speaker Change: We have a robust.
Speaker Change: Data because we're classifying so much data billions and billions of web events.
Speaker Change: Every single day, and with our data assets, we're doing a lot of interesting work right now layering our media quality data with third party audience signals and first party brand signals. This is focusing on more of that performance activation.
Speaker Change: That I spoke to before and that.
Speaker Change: That's our primary area of focus in 2025 is performance and activation.
Speaker Change: Got it. Thank you and then a second one if I could ask are there a couple of recent industry developments. We begin questions about one is the sort of acquisition.
Speaker Change: And then secondly, Amazon had some I think some of our new page level reporting so we'd been questions about that are you seeing any movement of the DSP used to be vertically integrated some some part of verification and what are you seeing there. Thank you.
Speaker Change: Sure I'll take both questions since Sara so since Sara.
Speaker Change: Has been a really important strategic partner for the company power.
Speaker Change: Powering several portions of several of our products.
Speaker Change: We will continue in.
Speaker Change: In the first half to be a partner of ours in the Amazon question related to <unk>.
Speaker Change: Is it the.
Speaker Change: Level reporting are you referring to the U R U R L transparency reporting.
Speaker Change: Yes, that's the one yet.
Speaker Change: Yeah.
Speaker Change: So with you we're all transparency.
Speaker Change: We actually have offered urls transparency since 2021.
Speaker Change: This is a capability that we've offered our customer base for several years.
Speaker Change: It's an area, we'll continue to stay close to and innovating.
Speaker Change: Got it thank you so much.
Speaker Change: Yep.
Speaker Change: Our next question comes from Justin Patterson with Keybanc.
Justin Patterson: Great. Thank you Lisa could you talk about how youre thinking about the pipeline for new business.
Justin Patterson: This year versus prior years as you've introduced more.
Justin Patterson: So across the market it can be social capabilities. It seems like there might be an opportunity to just engage customers that you might not have been able to reach previously thank you.
Justin Patterson: Yeah sure Justin Thank you for the question. So I would say that question is tied to the three goals I spoke to before around performance expanding reach and innovation. It's in the expansion of reach so when you take a look at the robust Sam.
Justin Patterson: For the industry. There are a couple of levers that we're going hard at.
Justin Patterson: The first is our enterprise customers those are the top 100 advertisers that's all about cross sell up sell.
Justin Patterson: Launch innovative products launch adoption.
Justin Patterson: But more.
Justin Patterson: More importantly to continue the engagement with those top brands.
Justin Patterson: Is launching new channels new platforms. So that we are expanding the volumes of inventory that the largest customers can adopt the products second really important channel for Ias that we are investing heavily this year is mid market there is.
Justin Patterson: Hans of Green space in mid market, both in the U S and internationally, we define mid market.
Justin Patterson: As customers, who are spending between 200, K and $1 million with Ias.
Justin Patterson: With Mark on board as CFO, we are investing both in the front end in investing in more sellers more support more technical support and on the back end performance really matters to the mid market advertisers, so pouring fuel on our performance.
Justin Patterson: Products.
Justin Patterson: <unk> and automation and self serve so I would say its those two <unk>.
Justin Patterson: Drivers for the pipeline enterprise, it's more of an expansion play midmarket tons of new business.
Justin Patterson: And then the third area that's important to note that I called out in the script is expansion into emerging markets and new markets, China being the most recent where we launched in December and we're currently in Alpha both in a chat with the China in strategy and the China out.
Justin Patterson: Great. Thank you.
Justin Patterson: Okay.
Justin Patterson: Our next question comes from James <unk> with Jefferies.
James: Great. Thanks for taking the question how are you thinking about hiring in 2025, but I think we heard from trade dogs get off the desire to double the number of senior people within the organization. So we would just be curious how you think philosophically about balancing profitability with the head count needs to continue growing the business. Thank you.
Justin Patterson: Yeah. Thank you for the question James.
Justin Patterson: So there are a couple of areas that we're focused on when it comes to hiring in.
Justin Patterson: In 2025 and again these are the areas that drive accelerated growth for the company drive the greatest value for our customer base and set us up for long term profitable growth.
Justin Patterson: So the first area is R&D R&D and data Science Sciences, and the name of our company.
Justin Patterson: You have differentiated tech and we will continue to invest in best in class Engineers and data science to focus in particular on all things related to performance classification and leveraging AI. The second bucket of hiring is in sales and go to market.
Justin Patterson: <unk> in particular performance programmatic and mid market. So I would say those are the two areas and then again, where we see opportunity to expand in new emerging markets and it makes sense to put boots on the ground, we will continue to invest in emerging markets.
Justin Patterson: Great. Thank you.
Justin Patterson: You.
Justin Patterson: Okay.
Speaker Change: Our next question comes from Andrew in Morocco, with Raymond James.
Andrew: Thanks for taking my question.
Speaker Change: From your main competitor about a major CPG customer going through some idiosyncratic issues and I've heard some shakiness in CPG and some other reports although one of your answers to your previous question seem to indicate that CPG was doing pretty well for you.
Speaker Change: From your seat how is your view on the health of the AD market and what's baked into your <unk> were full year assumptions around economic health and impacts of things like tariffs et cetera. Thank you.
Speaker Change: Good morning, Andrew Thank you for the question.
Speaker Change: So we are confident in the guide that we put out for Q1 and 2025 as you noted in heading from Q3 into fourth quarter, we started to see strength, both in CPG retail financial services or vertical.
Speaker Change: <unk>.
Speaker Change: Profile is fairly consistent and predictable.
Speaker Change: <unk>.
Speaker Change: And also when you take a look at the stickiness of our business. Our top 100 advertisers have been with IHS for over eight years and so we're very leaned into ensuring that we're driving value for those top accounts, we're keeping them in what I call. The Ias boat and we continue to.
Speaker Change: Bring new advertisers and publishers onboard.
Speaker Change: And one more note about macro one more note that's important and I know I keep hitting the playing the performance drum, but performance efficiency ROI and ensuring that we are driving the value. We are helping the brands drive better outcomes with the.
Speaker Change: Investments that we make in our solutions, we take the black box out of programmatic buying so they truly understand how media quality.
Speaker Change: Could lead to keeping them away from media wastage and drive higher ROI. It is just so critical that we continue to invest in this area.
Speaker Change: Because the brands are so laser focused on ensuring that every dollar they invest in digital advertising they see a higher return.
Speaker Change: Great. Thank you.
Yeah.
Speaker Change: Our next question comes from Omar <unk> with Bank of America.
Omar: Hi, Thanks, Thanks for taking my questions here.
Speaker Change: Lisa I wanted to play Devil's advocate.
Speaker Change: For a minute here and ask more of a strategic competitive question.
Speaker Change: Given that the markets that you play in seems to be a two horse race between you and double verified.
Speaker Change: And activation customers generally are also measurement customers and you have to have wanted works without the other.
Speaker Change: Why does it makes sense to.
Speaker Change: I'd be first to market with our activation solutions.
Speaker Change: Rather than be a fast follower.
Speaker Change: And waited until you know the competition takes the risk of those products in the market and it makes the investment.
Speaker Change: To put those products in the market.
It would seem that there would be some kind of potential to perhaps be more efficient optimize or scale back investment without losing market share.
Speaker Change: So it's again just playing Devil's advocate here wanted wanted to see how you think about that.
Speaker Change: Yeah.
Speaker Change: Thank you for the question Omar so on that one what's interesting about that question is.
Speaker Change: We are a culture of test and learn where a culture of planting seeds early.
Speaker Change: Patiently testing and learning with our clients invest in the product ensure theres or customer feedback loop. So we can improve the product over time, and then launch it to Jay So.
Speaker Change: So for example, my remarks before around activation, our total visibility product we.
Speaker Change: We've had that product to market for several years have we did we have a big unveiling several years ago no. It came off of the immuno payments acquisition that we actually made that acquisition before going public in 'twenty, one and we quietly just built that activation.
Speaker Change: Engine over time did a lot of test and learns and last year is when we really start to see rapid adoption of the product and that's how we'll operate moving forward. So we.
Speaker Change: We will continue to invest in performance and activation, we build products and prioritize our product and tech roadmap based on the feedback from our customers and we're hearing loud and clear from our customers right now they want to play both in insurance protecting brand equity and brand reputation.
And in performance and we're doing both.
Speaker Change: So if I just interpret what you said I mean are you, saying that there's potentially a risk of market share loss, if you're not first to market, but it's really the question I'm asking but how important is it to be first to market.
Speaker Change: I think it entirely depends on the product.
Speaker Change: And it depends on the opportunity Ias historically, we've also had plenty of first to market matter being the most recent example, the largest social platform selecting ias because of our sophisticated technology of course, we're going to take advantage of that and law.
Speaker Change: Launch of first to market product, but if there are other areas, where it makes more sense to test and learn until we have a viable product in place.
Speaker Change: And we need to do both.
Speaker Change: Well said, thank you very much.
Speaker Change: Thank you.
Speaker Change: Our next question comes from Jason <unk> with Craig Hallum.
Speaker Change: Great. Thank you.
Just wanted to double click on the ramp and publisher growth that you've seen over the last couple of quarters can you just highlight what public our products are resonating that are driving that resurgence there.
Speaker Change: Yeah.
Jason Oppenheimer: Thank you for the question, Jason So with publisher again, we were pleased to see our 30% growth.
Jason Oppenheimer: Fourth quarter and there are a couple of areas with public.
Jason Oppenheimer: Where we're seeing nice uptick.
Jason Oppenheimer: And keep in mind publishers, both public hot and offering our Ias solutions, but with public <unk> in particular and this is coming off the heels of you might remember we hired Cam Millie.
Jason Oppenheimer: Last June from Freewheel, who is our new publica.
Jason Oppenheimer: Crowe he has brought a fresh perspective really interesting innovative ideas and is bringing the customers closer to the product team and in particular, where we're seeing scaled adoption of public cloud is new product features that are built to increase bidding competition.
Jason Oppenheimer: <unk>, India auctions, and we're seeing nice adoption, we're continuing to invest in public hub, which is the leading differentiated CTV platform and when we're ready to share more about probably because product portfolio will do just that.
Jason Oppenheimer: Thank you.
Jason Oppenheimer: Thank you.
Speaker Change: This question comes from the line of Rob Sanderson with loop capital.
Speaker Change: Thank you. Thank you good morning, everybody I want to ask a little bit more about your plans to expand into China. It can be tricky market to penetrate.
Speaker Change: What can you say about your go to market strategy you mentioned in the script.
Speaker Change: Size of the domestic market, but you also mentioned the cross border are you are you sort of going after the domestic China opportunity cross border sellers or both and then in terms of the strategic priority. Lisa you kind of listed emerging markets. There's like a 0.3 in terms of.
Speaker Change: Growth initiatives does that sort of the right framing of the strategic priority around China is it sort of a.
Speaker Change: We'll put some seed see how they develop and maybe lean in more if it looks.
Speaker Change: More promising or how should we think about your expansion into China.
Speaker Change: Sure.
Speaker Change: For the question so on China, the way to think about exactly what you just said planting seeds test and learn we have the opportunity to be first to market in China.
Speaker Change: We announced it publicly December 24, our partnership with RTP Asia, the way to think about our opportunity in China and we've been hearing loudly for some major global brands. When are you going into China, but there are two sides to the China strategy there is China.
Speaker Change: In in China.
Speaker Change: China out is offering our verification solutions outside of China for Chinese advertisers, who are advertising to consumers outside of China, China N is for global brands Major Global Fortune 500 brands, where China is a really important.
<unk> market for them and their advertising in China, and they want to leverage our verification solutions two verticals in particular.
Speaker Change: Have been loud and clear about us getting into China has been CPG and luxury.
Speaker Change: And as I mentioned before we're currently running an alpha in China, The way I view, China. It is a long game a long play, but again, it's in the spirit of our test and learn culture planting the seeds early having doing seeing the product adoption getting that.
Speaker Change: The option wheel flying and then launching a viable product over time in G. I.
Speaker Change: In that complex Lisa is there at all.
Speaker Change: <unk> sort of opportunity like Youre seeing China in China, but what about <unk>.
Speaker Change: China to China is that something that is not on the plan for now is that something that may be in the future or is that kind of thinking about that.
Speaker Change: The framework you are trying to articulate.
Speaker Change: Yeah, the way we view China in particular is.
Speaker Change: Crawl walk run and.
Speaker Change: The areas, we're focused on right now with our China and in China out strategy that I spoke to before those seem like the right seeds to plant the right areas to focus on especially with the big marketers. We've had several who have proactively raised their hands and say, yes, we would love to test with you in China. So.
Speaker Change: We're just focused on those two areas right now as we continue to focus on our entire plan for 2025 and make sure that.
Speaker Change: We hit our deliverables across our product and tech roadmap.
Speaker Change: Thank you very much.
Speaker Change: Thank you.
Speaker Change: That concludes today's question and answer session I'd like to turn the call back to Lisa with Schneider for closing remarks.
Speaker Change: Thank you everyone for joining today's call. We were pleased to deliver positive results for the fourth quarter, our 2025 financial outlook calls for double digit revenue growth and strong profitability driven by our industry, leading technology and product innovation I'd like to thank the entire <unk>.
Speaker Change: <unk> team for their hard work and dedication will be at two investor conferences in San Francisco next week and look forward to updating you on our progress have a great day and a great weekend.
Speaker Change: This concludes today's conference call.
Speaker Change: You for participating you may now disconnect.