TTD - Earnings call transcript Q1 2019

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Operator

Greetings. Welcome to The Trade Desk's First Quarter 2019 Earnings Conference Call. At this time, all participants are in a listen-only mode. A question-and-answer session will follow the formal presentation. [Operator Instructions]. is conference this note being recorded. Please now your host, would like Investor to to over conference the Chris turn Relations. I Toth, President, Vice Thank you.

begin. may You

Chris Toth

here conference morning Thank Europe The North Trade operator. Hello quarter good to to you, XXXX first earnings and America. Welcome and everyone to everyone good Desk in call. the afternoon in

Our is place taking call from today our London office.

Ross. found press our Founder thetradedesk.com, Investor and our Officer, Paul Green, release at and Chief earnings our be Jeff is A CEO, line in of the Relations on On website section. can copy Financial the

Before you our you dependent matters are we historical most refer factors risk to in be begin, our that I except the which encourage would statements, upon like to release the certain will to information, and in describing included forward-looking that, recent referenced remind risks we and press filings. be will SEC I for uncertainties.

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

Jeffrey Green

The Chris. Desk's operations. London for you to hub joining from our all to And European you Trade thank be office, Thanks, us. I'm speaking excited of the

continues to region very this in growth Our be solid.

surpassed historically numbers quarter quarter, budgets am report often results even for XX Our that start the but our are QX again expectations. This More challenging quarter. later, reset spend have in most over advertising I on let's in well for QX, XXX% over offices and months. because extremely the we the last Madrid predict. to was Hamburg grew own to year, both outstanding XXXX with pleased the been the that another

spend. of largest their majority in our holding advertising are platform, our All world. us behalf vast advertisers the now the companies increased in and with We under existing XXX the customers add to advertisers new platform. on companies S&P campaigns on MSA run have major continued of to The agency spending and

executing well. are We

in the was an which XXXX, revenue increase to they we retention $XXX million. $XX.X seen upside. of compared the result, increased client to of have be record to continued of our of When million that Adjusted tended to ago. continued a maintain our This in surprises quarter, past, a the $XXX QX Because first we've trend. XX% EBITDA quarter As is own expectations XX%-plus million. to beat this a year

one We today. profitable fastest-growing software continue world to the companies be in and of the

in in GAAP quarters Our a for has black net the income row. the XX been last

on about about XX% of of growing years. advertising most global before according times to But be is current X growth global spending transacted Now, and that, industry XXXX, trillion-dollar let's big look global at it year-over-year, and our will advertising. in maintain total nearly digital, growing It will long, advertising than estimated Magna $XX is billion to We around pie. programmatically. be all prediction XXXX Global. faster it seven be picture. In $XXX Programmatic a at step relatively according total over the a rates, up from advertising is in advertising X% IDC, will billion, be about and back small still part XXXX. At will

consumers greater guessing. advertisers love to that Programmatic content measurable is transforming and Data-driven bought offers parties. We the way. along experience racing primarily transparency bulk on better their by are support transactions toward the all better transactions are that how investment outcome a that with they fueled media sold are ad return and and micro than for a for

the in XXx global significant as channels fast In is capture any share grew and and nearly to market is the most. company than huge QX, we as about The twice Trade advertising other the of addressable programmatic pace regions positioned better and growth. Desk growing. matter Our industry that

We XX% QX platform mobile. our the on future. expect of to market was in gain foreseeable spend share to for continue

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has customers. incredible has many about times been already an paid XXX% You environment, acquisition see it we our has selective Cross-device in becoming of added Trade up quarters continue like last a now. the Since year-over-year to The spend for row headlines. look late in this will for This part over. for in Desk two Adbrain's for XXXX, the value acquisition Adbrain. technology In opportunities cross-device itself

to our Trade from other advertisers as Internet. premier the The are to as industry independent platforms As migrating we the evolves, gateway Desk solidify

gardens model and the an source become compelling objectivity major the independence, alternative advertisers make walled increasing us of business frustration for to of transparency, that have Our worldwide.

these recognize and trends. customers Our industry pundits

our This platforms one in sector. in launched that technology revolutionary The to adds AdExchanger's at today. This best growing validates last In platform market technology fastest saying DSPs. the all recognized our other Conference, and architecture among what other factoring been I/O profitable software Next most outpaces was have long. bid all we the of we up From fact, week from DSPs engineering any demand-side last make built June, has the team Trade as to Programmatic Desk all agile Wave us the

I As of from America. rapidly of growth that North outside is earlier, expanding mentioned much coming markets

end the record the XXXX. in of just growth CPGs, seen not is continued drink office Europe. And in We've there, record major company, outsized large and offices their does Here to These see the food company, our momentum multinational its video in That we December in surpassing technology accomplishment. had to wins Europe. and month London, brands our company. a our all quite several move a in gaming set in platform the they all-time included over spend March, recent a broke previous

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spend how guiding marketers. pro it Internet to companies the by a and relevance for GDPR From Europe quo of diminished privacy perspective, principles seen create both not helps as It establishing GDPR. have be quid are to and pushed works. attainable. of consumer the result better clearer We in a our Internet about

has the relationships strengthened to proactive data our Our approach in privacy region.

implement region built have with its with and to general for have that leadership and senses had data success We relationships GDPR customers this regions trust publishers spend continue privacy win owners. We in build we we think and new and be closer blueprint regulations. the can a content and other

are ever possible my here in the the the and about Europe. years what is more additional We to in UK out this and Coming than for meetings I Europe come. success week, am optimistic laying continental groundwork in in months of

where the for our consuming region emerging in two key history unprecedented middle-class launched years in the content largest officially laying is is digital foundation, China The QX. and we Desk After platform in Trade rates. Another at of Asia,

advertisers. content the also premium Our and all We've appropriate law. Baidu, inventory must-have out Chinese built data conforming include Tencent, partners regional with inventory Alibaba, to providers for iQiyi, infrastructure

launch wanted management and that campaign their so latest account core like China visits to was reach the to XX%. reach brands for could to Data we campaign Our are consolidated the brand campaign, agency Solutions, many days After is was a reporting Trade platform. to great example of luxury China retail of onboarding are by on Strategy this the Desk business stated teams per is the Benson just of few to showcase Their in One to event luxury cost It collection. The There one global a global the all Desk Trade with running platform. March, consumers. opportunities agency clear Marketing approach more a visit decreased to on procedures. China principles. the equipped for our advertiser's The of consumers be success. Chief Ho, retailer's Chinese huge Officer wanting aligned are outside-in global in fully the used At drive goal on three open Tencent The our that brands site.

mutual for First is desire transparency. our

business the inventory Second great And of The out advertisers. third in Hong stage Trade also use. Shanghai is by to a to properly that delivering put on offices. pointed and global Desk combined ability team driven is He focus our data has is on third-party people built premium our the said Kong He relationships. to

true this foundation While how This long-term are success especially true China. is laying investment. China. we is a for the this long-term everywhere, is China in is in

I have to as also of business forward look of in business. I you to our at We our prospects the our highlight been China. want grow about on beginning, continue are I more to long-term. we some our optimistic key the initiatives the only over but updating growth never progress more

exception. breakthrough in key are TV in we exponential our is report again every gains connected have QX XXXX some business. to channel. First, quarter, seeing no we Nearly this

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the more The any to and Trade is we event and live nature and monetization. one major we perhaps suited event inventory overtime breaks live Madness every successful fewer advertising. just before. have on Basketball of events, our for effective is Madness to programmatic nearly ads. saw in We better available commercial traditional Now, TV more than for programmatic unexpected accessing more on is monetized date. NCAA than demand March Tournament live was real-time Unpredictable accompanied spend ever Live are better are In The by incredibly example. than platform March sporting Desk. in other

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before of a will TV virtually be that upward ad transacted While that, we long, solid buying believe trend, programmatically. represents XXX%

collectively the trend could why their services this to million current over As X.X we ads, have more fewer television barely are an to started. to stand lose subscribers lose If upfronts. and have connected QX ground an model. There Cord to year. and focused News, Ultimately, we over pay unsustainable presence TV and Linear TV the XXX,XXX in TV Comcast, alone. cancel is channels. higher continues, Verizon, AT&T at That's this According had a CPMs. viewers, people other continues industry, they Cutters

ago. upfronts. upfronts, content it's where an have to of These their present providers you're their commitments familiar Advertisers commit spending TV with not annual annual shows bulk often If other advertisers. the these networks old-school, and relationships at the based gathering new It's a ad sense wasn't will buying instinct advertising doing an on years at Programmatic of measurable been the radar way the on and perform. even no that how business. of upfronts few analog with

biggest to connected growth the portion environment. This As stair-step programmatically. asked programmatic. have of season transacted may upfronts help represent TV is devices, upfront first early Because is and advertising brands the more the new our in on that apply consumed TV TV data-driven be ever industry the Trade and of of them us of been to digital we approach investment process content upfront place for as the actively trend and TV growing where become upfront advertisers now this, A to content agencies see. we've require much navigate involved campaigns. a Changes advertisers Many they realize to is CTV like Desk needs to shift continue. the expect in to started entire convergence this but right the CTV, shift the opportunity in meet programmatic their of to more both more number providers can toward they buying. The the precise Internet has and The to a TV generational

to advertisers in proposition massive. is CTV Our value

XX currently just years least from a worldwide of through million We largest have is scale. scale inventory, the that's incredible zero ago. households of size few our at MVPD. our Xx We CTV the up reach reach The and

In this fact, but at it's point. nothing upside

launch that So, initiative platform. XX% our excited we're when advertisers The It's Next we usage us data-driven buyers spend has data in are about be just consumer advertisers growth privacy. is in for growth again their and wins product clear, of The for data-driven tools data guessing every is and campaign, it guessing. decision-making a driver to or on time. in Since key that increased. a comes With data increased the Media last expect accelerated. data have second a way to spend Wave also year, all in the A decisions Trade fact a significantly become spend data-driven to than Data our better XXXX. data-driven growth key Desk, using protects the choice CTV year-over-year. have

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and today the working, of initiative to enhancing is effectiveness the strategy Our providing advertising want highlight industry. a winning. ID are The entire by to I commitment programmatic for unified our final we is

the ad-funded The experience. of using targeting, and the efficiency publishers, has more Desk giving Our data in giving technology. ID for more SSPs largest and ecosystem SSPs, Unified effective number auctions entire involves than to us giving bidding Trade of to away all the cookie so ID our providers. seeing solution our advertisers the Today, are with improve in DMPs, DSPs, improved, massively of match the ad accelerated. consumers a performance up better of Doing rates rates ID Internet. are reduced, are half helps free Unified XX%. Momentum world syncs independent Match and completed place header taking are The

becoming open for is a ID open the unified our hoped, Internet. we As common currency

investments future. Finally, The Desk continuing in to always been areas about our we has Trade large are make critical innovation. to

our than pushing more to to quickly the and are We metal others innovate in pedal industry. the grow

environment. global invest safer are creating data, in and programmatic such expansion, as We a can areas we confident CTV,

worldwide. term. We business and grabbing our additional All support continue areas to processing these data the growth critical infrastructure to over share invest are long in to also

to beyond. strong We results and XXXX, investments a in are The In expect extending quarter we making from Trade conclusion, strong our the now yield significant run in had XXXX XXXX. first Desk

contrast the the between business validated momentum. objectivity, to marketplace. independence, our in and walled and The propel gardens foundational Our model transparency be continues to continues our offering of

has regions will so investment opportunities key Our yielded emerge. as in great wisely invest new channels we to and gains, continue

There our significant beyond. secular the XXXX are and we see in for well tailwinds every executing and are indication continued business We growth will strong. is

to our going discuss Now turn to to over financials. am Paul I the call

Paul Ross

Thanks, us investors North everyone. those to good Jeff. morning joining from And good afternoon, America. And

to in which our XXXX quarter addition million. prior the as adding the seen in customers, and increased and growth, you've net we this plus first million, and start while XX% by while We $XX.X to in for we spend advertisers. to with year-over-year. As and numbers, aggressively achieved such million Revenue talent. above and great expectations, QX are a GAAP financial $XX.X Adjusted increased platform, critical income was the performance sales areas our continued customers on our off EBITDA increased increased invest to Revenue strong our execution. reflected engineering to future of was new existing to $XXX

XX% our year. who on spend for For the gross quarter, first came existing from over a been platform approximately have quarter our of customers

of QX in be $X.X the awards, employee variable. half tax QX in per million income share. With to a our of and $XXX due higher we increase we reflected G&A $XX.X of as benefits for diluted the business, sales revenue million quarter, mainly also for percentage can moderate or year. to net was increase million. back as the expect GAAP G&A tax stock-based to Income expenses, takes stock-based of of marketing a expenses with to and account scale was in the comp, growth. was future timing growth benefit associated and The fully the $X.XX our into operating grew which due year-over-year which This year-over-year the

period. fully offset in our with about $X.XX our XX% income of investments QX and cash a with net during corresponding free for increase million product, share operating people, adjusted expenses. adjusted adjusted global expansion, million net per were comparable million provided $XX million, QX. operating share of months by of $XX.X reflects flow income and corporate our of EBITDA $XX.X was strong of revenue margin respectively. $X.XX or compared flow XX was $XX Net the growth in was increasing EBITDA activities or million trailing top by $XX.X the Our dollars line, in The Adjusted and $XX.X cash per and diluted million cash

total short-term is on investments opportunity new short-term We return and cash, continue our on equivalents, $XXX unused exiting to our have a and cash. a note sheet million. was the and an our on that Please balance cash debt zero balance item represents quarter sheet, our to investments earn

Our DSOs X same ago. a the days, of QX decrease were DPOs same of the X period were at days the period ago. a year from days, of end a a year from QX day decrease XX for XX

XXXX, revenue are million. For we of QX of $XXX of adjusted and expecting $XX million EBITDA

be the course, at from revised back we XX% at For quarter. now turn comments million, will and, I expected million $XXX Adjusted Jeff is Jeff? EBITDA revenue. to full-year final least to now last Q&A. the revenue of least of XXXX, now for upward expect be call $XXX percent to

Jeffrey Green

of solid Thanks, for Desk. year. Paul. first The the XXXX great scale is raising exceeded to expectations fundamentals quarter the them continue Trade off are we to our up for business for The well. are our and and start a We

key increased our never far well-positioned in poised of portion share our As it invested initial brighter. success while open future remarks. with to market. indications the we a The are beyond. early advertising we of And, has let's a are more All questions. concludes to yet Operator, a few and moves see prepared up markets channels. win the and for market gains, That are large come. business XXXX that dollars towards for years, been worldwide in in our pleased that programmatic trillion We is we upside

Operator

Thank you. [Operator Instructions].

with first Robinson comes question Humphrey. Our SunTrust from Youssef Squali

Youssef Squali

track One really, we Great. cookies this ultimately of very and first around advertisers as which Jeff, ability is to question to target. driver – may much. mobile the get Thank mentioned for you a often the spend hamper you to past use Chrome as upcoming changes driver growth quarter. the

affect really, Trade just general of in you guys a wondering and outside in ad online may the how Thanks mobile expect particular? So, The environment Desk Google that lot.

Jeffrey Green

Thanks, question. Awesome. Youssef, for the

fact prepared of fortunate feel So, we're little I remarks usual. shorter than bit like our the a were minutes in that a couple actually

I few I've take to going this lot actually little changes I’m so minutes time many have a because so something more have to talked So, to a otherwise we would happened spend. quickly, of last has extra over a days. bit of couple just change this about extra Because the than explain been

little of First, give context. let a me bit

least no Apple first matter of third of both money it of through a And advertising, third-party made called of decided to that use to algorithm you and persist course, cookies ITP, challenge. browser XX% this just an market replace allowed be and much Apple year to what cookies has at or know, third-party existing Chrome ITP was essentially changes Google what all on what different parties instead their many what. and Google they Because, of course, some advertising, well where the about of through doing ago more its they makes share. As matter no would directly. of of decide block a would call doesn't has which make with the browser not money any

announcement. been out I'd Chrome, like being and saying what of make. some of have And changes did. they Google set of last they just exactly watching people days, So, they've what privacy going a explain lot the to made and pressure the their In are the to couple of things

that they – more control. and basically, good they between thread a think give I did So, privacy, Google they gave is to tried and job thing, privacy amazing an users very decided and which the relevance did needle to

go who off and third-party can turn consumer to any wants cookies. in So,

user it. it, exposed And case, the hid who was want been where they that they cookies when a this the lot the can cases, remove interface don't to of sort they I and take will was consumers. default, do behind they it, user they or users hidden will So, in decisioning themselves kind ability the by unlike do manage this hid it the have decisioning of behind behind that – but to. Apple behind Not algorithm the Apple, then to don't hidden that other expect that given so algorithm. have In and a will of of control. but advantage decisioning now users did that have

they've asked us place and to tech Second, relationship to this isn't plug The other Trade an data. into use direct we've share that ad basically allow Desk consumers their our we And, honestly, API will how consumers. to players disclose because a consumers to never with with had

knows, rid are So, the consumer Google basically actually transact this don't a and struck put insights We between we too them we are data company the things we've Google is because benign essentially and we them this to and in don't share delighted can to information, at relevance. the share that Facebook have. we know privacy opportunity impact fingerprint. or even excited front we that of also balance or how because the to got identifiable all personally of the how share we ability think with

mechanics us. a sort companies any Google envelope that of ways We to on impact they are further least what at don't were like. understand pushing have at both who and, So, they've found expect the look to the objective to that from going restrict and there extract in the meaningful it. We are the way data high number level, the just of

thrive, for the have thing in change don't position you you get is to then, order revenue to – we premium so, And to have in Internet ads Google's material recognize Internet create want last if publishers expect XX% that to better us. to also a and So, the and and any of through your you're CPMs. comes premium that

if away New Then a take out be at of were is CPM. $X and $X New Times stake. York targeted today advertising into The, Times on to turns So, going to York That's is The what's they an business. what CPM

So, that to Google didn't screw up. want

this they publishers it, implemented basically they They New think like actually a announced which But that's – cookie. which whether didn't like they York site, and and it. a is or implement haven't The my Times payment party in porting, or go the to third on gateway they tech my them implemented partner, same announced So, gives say it. vendor, to ability that's ad CRM first-party my treat treat that's

So, with burden makes possible to cookie out same this own the as and my it third-party putting the prevent on the bathwater the and baby algorithm. essentially site, the is throwing all actually that

I advertising, you quid $X net risk same and of say there's that don't users to privacy the pro $X run opting it of to quo their balance Internet, if beg you site between then think the to been technology or any help the This you striking the I my the York and them Internet, consumers the if with any question me meaningful New the so discussion for discussion, always between adoption The I've they the will like force giving companies Times you business get rid quid of service need turn of relevance. pro targeted and into CPMs of run CPMs I same way that to anymore, become can't quo explain the safety the messing to give in. has that you a so me Please at to opt up need while time find out, you.

It expect here's impact have this on number that controls more changes, were because shoulders our not lot our shrugging consumer a have make business and better And of this others at any know, but the change they material for have Internet punchline. did minor do impact which relevance. on investors better. not negative their business and will We a business. most any to of the our we of welcome of any want Google detailed perhaps on of changes, increased privacy all. these a made up, those made is to than All significant don't

is a positive specific terms of is And the is More like it. coming major headlines, very spoke question is it. very there good these for this but in change my the they more is, It's this I is or overall, industry. it. this things, first for on So, said, us. to come yesterday, of this Google bulk details When to

super as issue privacy. actually a Chrome I fraud very privacy I'm being and both wanting years So, a for on on of change has excited in to at prevention in wanting – pay the the on better the We've and partner look monetization the on are at a same made. Internet, Internet relevance preserve boat for to lot also Google over the we but itself. order and much done

huge The it. So, benefit I for have on steps you and this I'm Trade this bit think little go so that in me and forward the Desk glad from longer week, question one. thanks been there letting will asked last

Chris Toth

you, Jeff. Thank

Next question?

Operator

question next is Brent from Thill Jefferies. Our with

Brent Thill

just into at spend just XX. what and you a Maybe any you just on if up TTD's how highlight? should Thanks. year in lay to question how Kind other notable items unified the that Investment you. first plays inning the follow-up on ID that of I we and follow-up. as Thank evolve? quick could Jeff, the curious was out OTT. is you're strength

Jeffrey Green

You bet.

on the extension So, answer the I'm to question ways them actually because is changes. reverse some question the Chrome unified ID in of just going first an order in

to which more that it this ago site, Unified same And be example, created treated all enables – first-party ago. ID to makes strategic year more The whose York that important asset my a advantage us because So, called excited. or mechanism has even Times like or announced even should partners in work was It week Google a or New I'm a publishers as we've this the done identify cookie. and cookie the in

header forms have we fully in the two known transacted bidding that Some that bidding. the of as this been header that, major of ID quarter, in you announced we've gets may investors adopted in

of to you used bidding their header So, some that there's want server a means some that may technology ad means, ID to not use of to common you bidding every with standards test most form in that you what two And wants a those. follow to there especially for most most publishers, of fact auctions market get that participate monetize publishers, that ad all and is today, have to currency, that in before opportunity allow because of of only publisher the if we it. header or sort And integrate for those basically, a both the header implement an that premium bidding. means called they

those. found was we across match for header lion's we ago, currency actually the implementation, transacted one with has ID, in means which we rate our month with and And is header. is ID first announced which that a share. index our open then, a The that all the there source XX% of And now, partnership integrated a common that

SSPs, view, or are which no that, figure means the have press all even that and become Internet. going that months. you releases question now the the and is the to the going you're an means the over the headlines trying the ID in there can partners just and New look York and now which back we've last open adopted DSPs more ID that many we've standard the currency all and and open Internet major currency standard fact made DMPs of if that six that more to cookie – you're that protected And controlled The open Times, in the So, at the And you keep my to go environment, that, our use out ID. you're your and is of

becoming it implementations we're checkmate, wasn't ubiquitous. believe, And both when to is if quickly ID it close I header adopted our the of Our ID.

journalism important had I important we've all an the monetizeation the to mask But amazing. a rate Times best is lot think and it. on mentioned The directly our there's pressure open the example is of trend I so adopted New Internet. as the York sure just because So, very the just they have at with chance journalism IV several XXX% that biggest make of names actually in also of

So, it. are with that not we're on at of I close of to if believe the this initiative, very being pace unstoppable sort we momentum,

We remind The over of or second your hundreds year-over-year XX XX inventory. part everybody now of on and – I'll connected spending a growth spend month. of that advertisers question just sorry we on your announced I'm TV, question first growth the on year-over-year have $XXX,XXX part

think right. I month, A right. that's that's

Paul Ross

last quarter. the Over

Jeffrey Green

just cannot indicative. frame. last to that the And be growth quarter, Xx the continues I okay. remember time Over

when to TV. measure connected us heard comes [indiscernible] You it

and directly exciting happening content at it So, I the MVPDs it's the conversations in the of sort and and at we're to just redesigning strong television. are that Everything bullish can in just growth owners share. is owners, upfront with conversations all that putting most this more in – or very future way More of Those growth experiencing. more more our as most and the conversations having having of aggregators conversation – is the upfront especially indicative potential our having and thing numbers relates perhaps the But of with that bullish with And the the me just and so we're are digital the the live business. the to the parts amount upfronts beyond qualitative players in virtual about biggest work and content programmatic. bullish. because

right TTD biggest the that now. are very conversations ever So, on we've happening had

Chris Toth

Brent. Thanks,

question, Next operator.

Our next Susquehanna. question is from Shyam with Patil

Shyam Patil

quarter. on what Hi, in your you're great mentioned if more about Europe, prepared market. bit the was talk achieve you seeing wondering most? remarks can in guys. I what on the on little you're what about you that, confident a could that just Congrats just ground, Thank excites you the you you. more Jeff, that

Jeffrey Green

bet. You

start talking about to like I'd So, by Germany.

call While this in London, from I've spent last I'm week the doing Germany.

has I XXX%. year, years each over things I'm UK. again So, the has traditional incidentally mentioning that connected who that bigger Last of that in And while YouTube for had television. share. represented like rev of than and very healthy a spent the they would as approach decision television shared noted TV in market, record It they're very that over YouTube, should aggressive quarter bold the would grew RTL MVPD that a as companies with biggest XXX% actually the the last by taking even Germany, have week. and for Germany, treat one players Google think richer they than take produce the the of if in two But some is it to it optimistic mind grown traditional that content, perhaps I around the YouTube ever we they a learn premium in especially did as don't year. that many that's RTL you none a – economic the this deal most time distribution the from, world approach sort made very

not of they and sacrifice for go the millions long any the made So, to their term. let on YouTube of content dollars decision

make off better YouTube. long they felt into That our term, them the that both directly that consumer the millions create more made but in them, became other paid relationships it's partnership. short for in as on cost them with term, they would also like the never would dependent well and, on So, so them focus it as distribution, too lean

And so, can but we about huge the spent upfront, talking together, that's business. had our also impact of do can we time a redefine more how a how lot we on

and So, because, we ProSieben similar that part access if and get to RTL, not that's for Germany, in just want conversations some premium of have most XXX% others. reason to with content growth the of is you to isolated the

to through brought most If you lot sorry, DVXXX of get that's premium us. – a or want And to can't YouTube. to a inventory, access that DBM customers the get you

it or mature of the are minority to but global we represents the in of growth. grow mature We slightly the and XXX% the still to see sort and both entire one of lot Spain. I continue faster to who of growth the mean the market, because that a in macroeconomy sort represents to small also our of believe world time term provide. best or over of growth secular about the are term, than we half But to are ground. that, to some facts like had outpaced talking us Both more of US places so I more continue believe gain Paris, Europe EMEA tailwinds and By best around media EMEA. decade for grow. of I total going UK what A, but that spend are tailwind a short the continuing the economic are short Asia, continue very again a the spend, markets, opportunities those will is I in a that's for

I roughly a with pie. to I channels the we XX% that leaving CTV. – time in forms and it's for been were to just in more had now optimism in the that now, company, our were just of said, made global So, video youngest that. see expect things in ourselves wow, CTV – than as in amazing were One I guys part define that been given last all delighted you me business when well its company. video early I've one conversation should forms spent Which in we in in expanding display video be and Europe, thought that started our the in we've to of It's we channels video I've than especially oh, here ever all CTV the talking anecdote, in. about so a our done we a and that [indiscernible] that we've and of in of video do Europe London They partnership, too, our on just – had and so because while pie especially other do EMEA despite we Germany fact said, hey, just you market, CTV not not or that. being more video,

Chris Toth

Thanks, John. Operator? Next question.

Operator

Mark with Capital Our next Markets. Mahaney RBC question from is

Mark Mahaney

thanks. questions. Great, Two

lot a China. questions had setting on call expectations about China on and You on last the of earnings materiality quarter

the calls. the last it's do haven't Next it's call, – more indirectly So, talked part on just I your you've or that about will talk expect helpful. really maybe in growth just color from embedded comments that's talked an material more it's to of be repeat about just this that, Thank adoption specific and the spend your been data and but maybe secondly, you would you the matter, just on now contributions spend, realistic quarter. this market? When couple doesn't digital, about you impact but product, maybe any And of Wave of question integral And about seen you. think can that you've but but

Jeffrey Green

Awesome. Thanks, Mark.

the play have China to been for long Tencent. that and we've, we we long with time, think to business something first, for expectations Alibaba, China game. in when materiality So, establishing And as relates will relationships is the it of a and Baidu, come,

make keep them I to in will, taxing – And incremental the them if it, leveraging by it by around. us we've expectations think be setting want and not incremental make of incremental, with China clear incentivized also so would then done seem spend. simply sort they of we're focus which taking to Baidu, would by that getting instead, we on restricted And meeting here job we've a we've incremental like relationships saying start the great and you world, done especially our growth, the and that to bring and brands had it so only of to to to very Tencent. already headquarters it are getting bringing Alibaba, London doesn't that they we with both dollars about But, is I in a today. global all spend. that agencies over have very money thing

we the total But material we because our that just numbers spend something we it's to be amount in expect I started, big and don't spend and So, of time we're are lot about. talking it that at so I getting a that at end launched stage of – chief strategy time said, I the our prepared was QX, on mentioned for as GA. product in Tencent officer data March, now. Tencent our some But with remarks. in

better when is as to needle slow go I'm move to dialogue a on big started, ours, expect P&L than really Our it's I take ever the Alibaba and Tencent, with optimistic, as getting Baidu, and it going years. you're companies like but to it's been. just

I time. expect So, to take that

fast Wave when product so support new launch Next the you when see rare adoption On you a happen both. launch, you it's that

what want just support we now classic. clear, we I to be call So,

to just totally they would it's We Wave, a fine, new system. to workflow old to make can Next use people our want that product adopt old tried so our our because choose So, it. good that's new system they use

of a on to XXXX, reducing report to. we force we're and very us, to I'm And just on it. excited first clients. choose really wanted So, we today, the of That to have has XX% our XX%. But, them CPMs didn't the we like how them feel remaining over us had adoption We clear huge end want XX%. over all, we've visibility that, in at get impact to for been

spend But come So, buying. lowered with more the media layered cost is the of inventory were data, have money made for is up to algos in again also product both the and for QX. us why QX, it was XXX% which sort [indiscernible] up go XXX% good of in them. was have It's and which ultimate they actually on working that that the more same explanation is in win-win is for and best the XXX% QX

So, it a how XXX% offering a but to is how important strong our global quarters is commentary both row. Wave, in in That is your offering. on two and be omnichannel also in Next

build end by off And the that continue the adoption. the goes by our more So, will supporting us have actually and classic and separation we'll early next incidentally, off more effort because have to I mark. all engineering expect full And, of to and year, into it, and turning by the create to year just between more turning go XX% to resources that differentiation classic competitors. unlock XXX% much closer it

Chris Toth

much. Thank question. very Operator, you next

Operator

Research. Cannonball next with question Karasyov from Our is Vasily

Vasily Karasyov

marketplace that Hulu. have sales partner. automating investor refers in ad they where Hulu I of that a day private question Desk Disney process. called that first And launched Trade CEO I actually investing at The is Good The that morning, this to and on January the be a in heavily held will out believe the they

how if in was tell process. Desk you about focused to to marketplace automating in on really that Disney and and the of So, marketplace evolve that the this expect us private is role can control now The wondering more private head sales Trade I

Jeffrey Green

to of and Hulu in one most representing ad-funded the therefore is if the give or things box exciting most your Fire And why, top just first, It's were which box people's are third, to would likely the app second see would line reason little Amazon many happening stack go rank. be Netflix TV. color, just in that Amazon the your TV a likely Roku Yeah. be be you on and and popular, would first aps down

is against give And put they one partner because actually the we will them market and they better to Hulu access fully each other. pricing than Hulu be study. more all been, channel between than important past, – of one automated I've media. an conflict we've the, inventory, ever think years. consolidate is that, pointed two able influence you to announced and very case because we've us to then that programmatic because, they've expect then us dynamically I Hulu, us been of that It's and for They up if for And team been the really so I'm it's so we've will tea compete. programmatic, is all it years give in saying demand, This represent have. asking that leaf companies tea leaf. those a and in become there's two. January there beyond great sure not into exciting of rid compete great But for bigger we means their So gotten companies that most important been leaf biddable which to partner that out, to for the opening so direct And And tea it companies of, sales and Spotify are all any one that of as are a you think more their marketplace. are a chance buyers not Hulu I they some important is been. our

expect I price amazing an combination. discoverable source to premium and of is inventory the content most demand long term important So, be and

innovative what opportunity. be think the our more and about excited I couldn't they're So, doing and is I really partnership

Brent Thill

Thank you.

Chris Toth

Vasily. Thanks,

Operator

from Our Tom Davidson. is next question D.A. with White

Thomas White

of for how that has that. expounding say significantly. those there raise for to that, segments Does just these been of that think campaign like changes? the within regulatory data products, my profile you kind about data kind that it you all? to Thanks. question. hoping help the – of I'm part of Great, unique And me your growing out Google from context could changes? the Thanks pointed Is understand think I increasing the business at exposure per data about data number your data, was risk Chrome how to the of mix your of in on kind offerings analyst thanks think just changes. your Related seems taking your on business of you curious I of

Jeffrey Green

Yeah.

creates So, believe meaningful risk. it I don't any that

In the opposite. fact, I think kind of it's

has a I going think come do And the what afraid space I there's how been are very hearings everybody and Mark that it in respond need Washington. talk fear. in to of and to changes we Zuckerberg publicly, about

Facebook. I think it scared

part in so I scared US, them. companies don't it technology the more scared of especially the because And think [indiscernible] the understand legislators, are mechanics it really afraid Google. in all them

are fear of do sort And both has so, people do raised And with. to And light XX% that shoes, to about in been advertising you that's has if and deal changes, Google's from to that I figure on Because out have fretting it. you what something Facebook, it. are than do? the Google's revenue our saying do have also to sides comes Google of of in better at we looking that. we are not trying think Apple What about probably

to territory so, they figure did, sort And industry. And unchartered view, do. they are what, out trying to what my the to of did they in clarity

they to consumers privacy will their And the privacy to pay try And don't itself want also and Internet. want relevance somehow. broken violated. does Internet have balance between and a We don't for

to ads, they more benign them share insights great upon our that relevant is show privacy contingent leave the position consumers that if especially coexist it, than we that feeling users, with we confident welcome nearly are Internet all to and relevant, using we of of, content make me, just I this And hey, ever the with long-term access can understand to if will so, it. the that,

not well. Internet. So, done clear. They work steps make clear, just unnecessary it that and not measures made data explained large make has do, ID, made not your Google know clear. least that Google I that risks, has type certain not beginning more not of quid the why. makes but weaker, taking consumers. really Every stronger, and more very Apple lot They've the you more of actually we think our taken business But to pro There doing something confident is are don't of not we've to we made quo a transact time thing the because it still directly don't think to the in that right is from I more it I'm have in just information part do that which Apple we're in identifiable you

addresses So, social or I and don't consumer data email that. even numbers company every does have in name, alone nearly the security let world

I So, world. the one for consider data and in in some of benign lack most us safest, your companies volume. in up scariness, of what And the I in make specificity I what

ever So, I'm portion your business been. of data more bullish on than our I've

Chris Toth

Tom. Thanks,

question please. Next

Operator

with question next Brian Oppenheimer. Our Schwartz is from

Brian Schwartz

Yeah. taking a bit little today. of Jeff, strategy for you here. to wanted just my here ask thought long-term Hi, thanks a question

margin. I even about very you see given profits. are, make Assuming going potentially what like it's especially still seeing could it talked go-to-market this profile investment on to that realize, comments, the you're outsized almost point. effect like at all even at you're out have an fast for feels in and efforts prepared of to today that But in what your if your opportunity there sense some more, this it grow increase and you're you especially going you've growth to continues to, your continuing obviously, does

given you opportunity Thanks. about do how today? think that So, the

Jeffrey Green

great this is glad Brian, a I such that say, I you is global this on this, so I'm the growth at one be. and secular look and a and hand, asked to point because place at tailwind

are hand, running every to that possible. want faster make And make as it sure dollar get and want else that On as I we're we than the we I possibly just certain can. anybody we running to other fast of

quickly business. who the much same are spending by way and and can or many too us and hiring of all point either too both cultures many, or have by too time, ruin destroyed their culture And ways to to so, companies companies spending of much acquisition, your ruin at by your their way of

because business. and I time high do single refuse would the I to numbers business. ambition our reinvest report money as kills our as grow reinvest every grow business ruin me the so, the let rather at – and quarter or But the to it we same EBITDA And

there Is I it better go Is of it? to risks. look do go look going selling? every of opportunity is Is and, preserve and to after at our space to simply continue We're there now. right [indiscernible] an because, that this, unnecessary culture. to culture the focus. to look trading opportunity money servers trading we it theme course, in saying so, And what's happening business else? buy those We're opportunities out and this But of for how opportunity I'm cost. that. here. not the it to our own? do a most we build And And some to and like of the better one doesn't. we closely partner it course, with Ad here. in important somebody one at we're assume extent, it Is isn't doesn't say, to to the of team take in matter Is on So, We're an There's in one? clients? do things is constantly lot trading of in. we're consolidation trading our to in to calculus, the get our That it say the

believe And invest get more. so, we I ways to do will

we're I think at getting it. better

we there. able at invest still look opportunity it. want But for are the to how more to delighted quickly trend with to and I I'm do So, I'm line unhappy

Chris Toth

much, so Thank Brian. you

question Next operator. please,

Operator

with Raymond Our Aaron from James. question is next Kessler

Aaron Kessler

of quick couple A Thanks, Great. Jeff. question.

guys? internalize traction their some work of going for there. about kind with Thank talk lot that is brands just mentioned kind you maybe not at You functions, limiting of good lot Obviously, you them kind kind through of that are there's some unicorns Can of generally? DTC also of reports all advertising of a you. traction agencies. of you you of factor the having a seeing What and a

Jeffrey Green

Yeah.

the is that. significant there's of we saying, position the it sort pretty the maintain as of always just I would the have you to of topic, that agency. XXX,XXX-ish develop will, resources employees. some Omnicom, headlines a has Publicis, last the been in-housing, the there over of years hard especially of and between delta WBC less major to if that. really much reality. It not a the is So, that couple same. than relates

to instead channels me most of outside of that regions, struck, But a I efforts, have bringing if I came on talking about strategy going are excitement future. Europe, lots here, about about that the you talking they brand us. as is the anybody our every of There about the share if of rely instead see of ask as instead far in-house. But can those question. can talking specific amounts So, got massive just so to likely or reaching micro-enhancing to out resources of somebody I world And into Asia major oftentimes, CTV are more bullish are will. or they of one the things sorry, in for companies –

walked just somebody Sorry, in.

Aaron Kessler

think trends some about most seeing. you're you talking of were I that the exciting

Paul Ross

Oh, yeah.

With the agencies and…

Jeffrey Green

Yeah, yeah, yeah.

But us trends two those one businesses. of them to me. to are walked the is that grow the in most help exciting leaning number of unicorns completely beyond their things just and Somebody blindsided

generation just or through going are doing and going companies the of through companies are sort us sort it's into are job trying routes transition going that. that of not of that doing amazing that brands of traditional digital. we're the make of themselves traditional public, who We're So, and either reinvent companies, the next to the an the

are the the of emerging bread next economy, that and generation sort could that when But the companies of all butter. look even our surprises and us around to growth and happening to are most well where we're the growth exciting things business. power as one the new in of coming fact the that's at You you argue are see those we their places of those and getting -- our That's often those clients.

Operator

with Our next from Kelley is question Nomura. Mark

Mark Kelley

are taking to Great, room you. like, they're thanks from I and the for Jeff, over going allotment time conference a trying take sounds the we my know lot question. away

quick this ones. So, Two be… will hopefully,

maybe on little set First one is, a can spend help impression level growth you what us bit is.

I So, is out guys obviously the the a called you first bigger podcast data one, color there growth less would – which what in above And that you're there helpful. in that's corporate audio a data, opportunity. level. quarters. for Curious picture, you Any would on second be everything called bit say I XX% out thoughts the you and think, time, have the guys if seeing few any quite

podcast to the about well format be primitive are are I like see guys imagine thought you helpful. it as it's the pieces advertisement owners guys talking moving got that reading and and now grows. Thank the it Any capitalize midstream. would where You've such on Spotify positioned a you. pretty would

Jeffrey Green

you. Awesome, thank

is, of double-digit The you or on it, if any spend growth, impression following that or question, don't keeping And just still a first why media of it general in have being spend the meaningful about the eye them. time data percentage number terms even used much of will. growth, I part impression don't an reason that there's one, impressions against

and number and impression way those which the they the because just want to things it TV per audio, ideally, display have many the go valuable same that like the go and the up, because native, for of changing, meaning increase trend. value And are on at overwhelmingly ads meaning then down more is of see just to in getting connected we're getting cost that also more exactly and still just two, we page ads the counts and then, and is page, bad, too impressions go there not type things time It's impressions into are that like up. are So, more economically irrational to we're it.

spend impression too count, So, you the vectors. really of get it's if much or hard sense either moving those a the focused time to amount on dollar

those Are of just is So, to data up? going driven. growing, of keep those instead, positive. just are decisions all how the are And are And of many those renewing? important efficacy it's track

things hoping way QX heading of whatsoever. the all it today of after the most All direction. have growth, like have of some I about TCD given audio, was are in the is fact could in to growing find things of we And exciting audio. [ph], about years in sounds gone talk in at media it asked because XXX% it the I right those because, one so happening you well that not its due

seemingly We're about second being just touch. probably the the them for so fast them we'll And as all there in of on-demand of great a Of the chance about talking fastest it it other channel a growing channels, the and companies announced them are of all Spotify ever is and know advertising one super there, game growing fastest Spotify are in growing because definitely number course, – I it's podcasts best a of quarter. partner excited to besides is monetize.

tight, that with that's optimistic sales are in were. the the podcast doesn't about find in thing really my something content that thing there similar different Spotify. in cost But even the these is Hulu the that of TV, say doesn't is with overhead may economics to I just same of And compete you you comments force, new the of advertising. audio is that kind So, programmatic it have exist at exist they that the rising though, so because way so companies. to have It still it a obvious that to thing the TV, creates use

it So, much just way explain I And it of XXX%, that. putting to up the to growth so being the audio, go easier only years that's fast. after think and makes in all

Chris Toth

you Thank so much, Mark.

Operator

and Desk and thanks at the Ladies The is your time. concluded. Trade the we gentlemen, for lines participation have question-and-answer and your you. call Thank your session. now you you reached end disconnect may time And this of today's

The Trade Desk, Inc. (TTD) 9 May 192019 Q1 Earnings call transcript