The Trade Desk reported third‑quarter 2025 revenue of $739 million, an 18% year‑over‑year increase that exceeded the consensus estimate of roughly $719 million. The lift was driven by robust demand in connected‑TV and retail‑media segments, where the company’s AI‑powered Kokai platform helped advertisers capture higher‑value inventory and achieve better targeting efficiency. The company’s pricing power in these high‑growth channels offset modest headwinds in legacy display advertising, allowing revenue to climb despite broader market softness.
Adjusted earnings per share reached $0.45, beating the consensus estimate of $0.44 by $0.01 or 2.3%. The beat was largely a result of disciplined cost management and the expansion of higher‑margin AI‑enabled services. While the company invested in new product features, it maintained a favorable cost structure, which helped preserve profitability even as total revenue grew.
The adjusted EBITDA margin held steady at 43%, reflecting continued operational efficiency. The margin stability was supported by a favorable mix shift toward higher‑margin AI and data‑analytics services, as well as scale benefits from the growing customer base. The company’s ability to keep operating costs in line with revenue growth demonstrates strong execution and a resilient business model.
Management reaffirmed its outlook for the fourth quarter, guiding revenue to at least $840 million—above analyst expectations—and announced a new $500 million share‑repurchase authorization. The guidance signals confidence in sustained demand for the company’s AI‑driven advertising solutions, particularly in connected‑TV and retail‑media markets. The share‑repurchase program underscores management’s belief that the company’s valuation is attractive and that it has sufficient cash flow to return capital to investors.
CEO Jeff Green highlighted the company’s strategic focus, noting that “AI, data, and the Kokai platform are rewriting the rules of media buying, and the world’s biggest brands keep turning to The Trade Desk for precision, transparency, and reach across the open internet.” He added that the firm’s competitive positioning in high‑growth areas like connected‑TV and retail media gives it a distinct advantage over larger advertising platforms that focus on different market segments.
Investors reacted with caution despite the strong results. The market’s muted response was driven by concerns about competitive pressure from larger players and the possibility of a slowdown in advertising spend. While the company’s revenue and earnings beats were clear, the broader context of intensified competition and macro‑economic uncertainty tempered enthusiasm for the outlook.
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