DSP - Earnings call transcript Q2 2022

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Operator

Hello, everyone, and welcome to Viant Technology's Second Quarter 2022 Earnings Webinar. My name is Kelsey, and I will be your operator today.

Before I hand the call over to the Viant leadership team, I'd like to go over just a few housekeeping notes for the program.

As a reminder, this webinar is being recorded. [Operator Instructions] We thank you for your attendance today, and I will now turn things over to Nicole Borsje with the Blueshirt Group. Nicole?

Nicole Borsje

afternoon, Results to Conference Good Quarter Technology's Kelsey. Financial XXXX Call. you, and Viant welcome Second Thank

On the Operating call I'd make Chief Madden, Executive forward-looking today company's like are Tim Chris the our that Co-Founder Vanderhook, to Vanderhook, statements remind and we Financial on Chief Chief Officer; you Larry Officer; and Officer. Co-Founder will and no results call obligation law. projected. uncertainties that and future events, today that risks, statements, those these are update from based cause to on to actual except assumptions We by materially undertake and subject to required differ could as

the factors filings may the and from to safe with our in about other information more on uncertainties differ our statement, to harbor actual news materially release For XX-K described statements entire risks and and statement that with as registration the cause issued refer results Form today please SEC. forward-looking well as

During today's measures. also financial will both non-GAAP and present GAAP call, we

including Additional to measures, disclosures of in of are the Officer I today with issued release our regarding Tim measures, Tim? would in and filings GAAP to to Chief the Vanderhook, non-GAAP these the call turn like we Viant. Executive SEC. news non-GAAP a now reconciliation over included

Tim Vanderhook

us joining you, everyone, quarter earnings call. our Thank for for second

cookie Customers complete gain for and purchase momentum in it provides second our our to for the as ad campaigns their as and platform the continued on to We growing build of personalization digital on rapidly Total share advertising. quarter. devices. DSP year-over-year programmatic continued across are our we spend business a software measurement in advertising platform XX% market cookieless adopting grew to

GAAP spend seeing spend and customers percentage of to to the are continue platform. we reported creates on drag revenue customers long-term of strategy of this fixed growth rates price total to new growth we the model, near-term relative our execute rates a moving on our As acquiring business our advertiser

remain in platform ad and dollars channels they we the our profitable we strategic to tailwinds progress their against ad The conversations have customers tremendous DSP. We have very executing organization are been budgets growth. excited having Viant's our continuing enhance for programmatic plan are never of long-term and stronger, and made as more into shifting with about consolidate

platform ongoing We encouraged while active Advertisers and fund and return having are omnichannel relying we to that objectives. to spending are are on It's very continues on budgets that on tangible shift and spend their in our also by times and without to match to for growth the advertising audience financial reallocate the seeking digital long-term goals. delivers customer on achieve grow. the reach traction remain our spend flexibility capitalized when an to additions, priorities quickly We with have investment cookies independent device platform customer increasingly per our average advertisers track well are targets identifiers. critical

example, budgets shift away mobile. brand or For marketing into across and desktop CTV performance-based from more campaigns across may programs a dictate

real-time the platform Google's in ad cookie the industry are advertiser offers adjusted strategic a competitors ads of that don't number as every software see cookie recent moment, the of strategically The technology the in every discussed out the support agency across stream headline market the growing meet creating value another what the uncertainty outdated very are X the just bid for digital to enough in can this, ID of is X our advertisers. being the to But isn't this deprecation fact Our in consider is and flexibility is the patented Adelphic scaling upwards emerging that do audio, And just fast delaying our been from testament customers this further And the announcement audience, have are household all we larger that gaming, and Dynamics and on at they of fact our future technology. when advertisers with changing very goals. manage to and day. cookieless are we omnichannel campaigns measurement channels, in inception having more use. only budget, and ability built TV, conversations be a magnified streaming of connected pace. the

roadmap product And a the DSP second our that DSP. suite, want were the that as X in measure for around directly to discussed years don't of invest we've our today. to To revenue term. measurement Dustin we long clear leading Viant. As and for our advanced a entire insightful a see I digital We in software opportunity X meaningful vision ad Product past, has excited X talk personalize to our in reports Officer. new and Kwan end, of after oversees into continue about Dustin enables He on buyers to to have ads and remains excited are to looks what out the product Chief engineering take the that vision teams moment quarter our executive cookie at a us and customers. roadmap. we and Viant's customers our him significant announce a in advertising team. to we this more me investing like successful to bring welcome addition and joined product to Amazon's Dustin this a us every products

to in greater The able short our the an joining talented grateful been of and and such weeks few his attract to has combination years the vision, have substantial. in come. to he experienced incredibly will impact are just team have impact an the have in of We even leadership, leader made And product been execution Dustin.

are we the consumer environment through to and, seeing ad call to what importantly, of doing more what want manage to Chris, I across address turning our we are the spending the tightening business budgets actively the industry. over macroeconomic across and Before softer

ad spend with back the are by of the deceleration that in some spend the did of saw quarter. we in customers notice our advertiser platform towards While pleased growth a we we QX, half with

the are of are aware by the are in of year. look the we encouraged to the taking seeing macroeconomic half year, a we headwinds underlying acutely ahead of KPIs, second the cautious QX more we in and also trends As end but approach the are business our to we

We on are gains. will spending strategic plans areas and be internal for selective, share to our us more growth that focused market concentrating well position adjusting long-term and

several continue the view We mindful the decisions on being that gained long-term avoid over a momentum might opportunity take to shortsighted and are last our impact to years. we've

growth. on EBITDA over turn key Chris track continue things now and and some are revenue and the industry's to XXXX discuss to that our positioned address I'll to drive updates very across Chris? to challenges confident our targets We strategic well feel Viant biggest is technology. hit customers and to

Chris Vanderhook

with Thanks, Tim. value new to and are In build driving more our partnerships on continued the our second platform integrations for customers. that quarter, we

our see As team to upon Tim mentioned, we're meaningful further to Dustin pleased build and a suite his also opportunity leadership. the to under product welcome

For period. and grew is [buy-side] we XX% to continues strong expand calculates are and on and measurement the To our CPG supply automotive a due across channels, prior continue Marketers return chain-related their trends, comments to increase spending spend. seek ad self-service, totaling from a macroeconomic on seeing Tim's accurately the lag on that ongoing seventh to out ad agencies quarter, consecutive that integrations industry-leading offering all issues. we that platform year has now independent over fully active customers XXX, an

to broadly as soften spending advertising, see of was some month We that connected slowdown spending shifting of investments TV campaigns. ad also This spending highlighted brand began the pulled back broad to more while performance-based their throughout in June. ad marketers in advertising

excluding As XX%, XX%, and just CPG up and saw a digital TV up XX%, spending large automotive. with across X% up mobile and grew out-of-home or all desktop XXX%. we Conversely, result, connected the quarter, increases other in audio channels spending in

play, there need reach at are advertise new current channels. consumers to across marketers engage Although to macroeconomic headwinds ones all and still

value the I Now like omnichannel DSP Viant. want of an highlight to

marketers react. benefits the and have conditions button. to habits adapt Marketers them turn pause spending. can omnichannel tactics, capabilities seeing shift it's shifts, key of their certain the real only like them the are a they them were so partner have everchanging of The with start spending saw where change, to to time, partner easily of pandemic, we when that and for could the on a as at are is an DSP allow with marketers that to As their not spending the in landscape. Viant they ready, shifting help spending a they will it consumer markets important press in that but back shift advanced Today, can that partner, DSP navigate

susceptible investing strategy diversification channels omnichannel to the spend through or connected our now while that on to year, long of much single-channel strategy of about to mobile our less volatility risk, build the TV. talked spending in be manage also to X way several have roughly our continuing may term software. is the the Very times platform. continued importance increase, Over customer more of proven or long-term total XX% to I've out continue sustainable they successful and last of a usability capabilities in improve only has and represent the more an much used be companies to

NPR, like easily connected across so channels. significant existing across and recently our of supply of spending SiriusXM iHeart, many the in desktop, because Spotify, digital customers channels channel, an to out-of-home integrations is our these and of reasons TV, Pandora, their we've shifted roster mobile, We invested One added have the audio joining others. audio

audio depth Volta, an and us. Our to be advertising. is continues X in out-of-home. like fast-growing talked mainstay big Place reason efforts channel, audio primarily connected in channel This partners our a a but a digital today is We've Exchange, years ago, for Clear in Firefly, considered is continued due Intersection was also supply TV of supply bringing Channel, on our growth why to about digital OUTFRONT, emerging JCDecaux.

in and to Our leader early digital TV. a and adopt emerging out-of-home starting us Similarly, is resulted similar dividends. work dedication audio to connected in becoming pay develop in channels our

emerging spent Lastly, in omnichannel been the gameplay. topic have themselves called we a of a identifiers billion with future. customers partners the interrupt channel. Anzu.io, spending channel adding the a believed And I have than in effectiveness been strong Relentlo. customers This of new that of in-game We in-game bid important. continues their that ads continue advertising another a emerging the and partner. in-game. mobile $X.X inserted trend this last is spend and to their In-game Adverty, be is will as popular to common Marketers Frameplay, to that measurement. want go-to is In-game the for very ad in the still Sayollo significant helping PC, The the within us programmatic. games that measurement stream advertising is added rapidly Viant few X/X agencies self-service like capabilities on to their amount long our supply are market leader in only don't Bidstack, dynamically gamers another games We've console-based on refers to move address field to believe relied with Viant be as measuring a return by more but has and become and drastically for time with channel marketers has their trails never of platform advertising. calculate importance more platforms, a have growing

they marketers can spend. to and performance-based macroeconomic partner every to tech changes they confidence of that in now challenged visibility As are the increase with continue causing need that this buying, changes be policy shift and dollar big more a

spending recognition leader will made invest the we continue platform industry new client not just were our the recently, as believe that in in GX independent this leader our industry-wide wins to We a software. in investments our as in in will to Viant I'm Summer we of by but XXXX software demand-side ongoing continue increased have measurement in Report. Grid also to by platforms marketplaces. named Most pleased a translate their drive capabilities the we

the of of our presence. Our a users capabilities by directly feature of our highly XX% is powerful. proof Viant's is advertisers despite platform indicates continue the recognition platform. platform received focus increase our our rating platform have leader customers for and a Support. on environment omnichannel customers, for of enjoy users further that This and high marks spending and empowering our accomplish our is to an with what advertising driving very advertising resonating in users as Targeting strong from Achieving is that on proud challenging we product GX our intuitive, from We're we validation Quality We advertising. rated with and with market XX% a self-service on customers

We gains. us a are that building long-term platform ongoing sustainable up set growth will for market and share

offer CFO, our detail the over more financials Larry Let spending seeing. me now Larry? and we our Madden, to to things trends discuss on turn some of are

Larry Madden

joining everyone, thank Thanks, Chris, us you, today. and for

Investor to presentation remind with begin, to I'd we information a supplemental today's have to posted website I our financial presentation. everyone that accompany like Before Relations

quarter, we we pleased mentioned, over XX% QX. are the over across market with the due the despite the Tim the and macroeconomic a to in very last achieved deceleration platform adverse in levels saw spend month spend environment. customers As increased some prior prior year quarter, of our we that spending as share in adjusted challenging their our Advertiser XX% gains the of period

continue by active average increasing customer, customer be the software with per year-over-year pleased base our and We to spend quarter-over-quarter. adoption evidenced of and growth our increased with in active as both

percent lifetime to Increasing new for the option, percent and long-term because of expect spend expanding of spend deeper driven creates of advertiser Percent our platform. that of believe existing in usage customers continue a customer fixed-price to is believe and on consolidate option. We than we our greater of average, our of as also predictable, pricing our over as spend pricing using value significantly time moving a spend with option percent fixed-price platform compared have relationship retention our have of ramp been has our customers growth spend Our customer of pricing higher provides it customers spend creation. always has been advertising consistent, spent, through percent our our customers their fixed value strategy on percent customer using adoption forward. that which a of they pricing long-term that price Xx approximately by our customers typically spend of using In more customers. of customers as option we rates goal options QX, pricing budgets of spend our their

adoption expected. than pleased we We to had see occurring are this faster

as pricing traffic after TAC, spend up period, year option before TAC. to rates. As mix deducting drag of a our prior deducting advertiser larger reminder, of we option have revenue relative price from percent will ex-TAC contribution costs, a continues and spend growth acquisition the make recorded pricing fixed Therefore, of our part revenue recorded percent or spend is whereas corresponding is to a on our revenue the

rates, QX significantly to less impact growth such drivers impact expectations over the operational XXXX QX. significant shift This be has and the expect impacted the time. in of this beginning relative this of we I key the in While the 'XX mix quarter, shift will negatively as spend becomes growth during contribution some afternoon, ex-TAC mix and to current rates and discussing performance, highlights of revenue of the advertiser our financial our improve growth begin converge as for to rates

did year being basis year over the prior the driven the And year over period our and second and decrease of for In of the advertisers $XX.X continues has period outpace prior contribution XX% the XX% X% metrics quarter, in was was the $XX.X increase XX% from the a million, is an revenue an Again, of retail, period. CPG, for year. over year-to-date I and the by platform show across second terms of developments. X% CPG, quarter. across market. to and year as spend the million, year which percent our X% spend increase line our overall said, this increased quarter. a the period. our although broad-based an XX% From verticals, platform adoption levels supply increased QX last prior to pandemic-induced spend period. spend U.S. In automotive over the XX% customer continued we and and quarter. industry On by advertiser QX across quarter, year-over-year growth QX strength down customer on basis quarter, Growth and and largest ex-TAC Spend outside an programmatic quarter, in of macroeconomic spend on grew during prior period customer increased of impressive across XX% negatively pricing key adverse XXth, from in all from CPG during of the the option. through advertiser top and year over prior the prior verticals the chain June impacted prior over other versus from all vertical, versus Spend the our prior be quarter, excluding saw issues automotive XX% increased prior improvement XX% growth of perspective, a customers, accelerating across some increasing vertical XX% Advertiser QX automotive

quarter, the all spend we deletion. and in also XX% during digital as such we by year-over-year as Apple's our desktop the increasingly CTV streaming are Advertiser of benefit XX% the automotive continued across capabilities advertiser out-of-home, spend the result channels part across and saw using advertiser disruption spend and During key a growth also from but platform. grew difficult grew audio to customers solid as full in the Across digital CPG. market IDFA and created of emerging to XXX%, quarter. mobile channels omnichannel respectively, continued comp, year-over-year as weakness slowed, growth across due

Average also compared a customers over XX% of year-over-year. a of per XX% spend customers basis. percent XX months the which Excluding on spend option as active the past customer Active for period, by increase CTV grew the year-over-year. of active spend customers. significant increase increased technology of net during quarter-over-quarter. in automotive by compares year-over-year pricing number in CPG, increase X%. of in of XXX representing increased the XX% teams QX, increased At increase year our to end to the we pay a the representing and our and continued marketing X quarter-over-quarter using XX had Sequentially, year-over-year also customers Investments to of sales, number an quarter X% evidenced the dividends active XXX active XX% and customers, prior QX,

Moving year-over-year enhance which and down The sales year-over-year of XX is Non-GAAP attributable past contribution to operating between increase the our increase the XX% capabilities XX%. the the increase across expand organization is the XX to in to have investments representing we quarter, over P&L. EBITDA, of primarily team. and our defined totaled as expenses, a made the ex-TAC months product quarter-over-quarter million $XX.X a difference and

scale As have and accelerate investing stated growth gains. to the share drive to business been we have in we past, the market

pace the engineering in our conditions, and profitability long-term of to product of as in while for of However, lower the term. quarter the EBITDA our that investment focusing half macroeconomic we expectations, high given non-GAAP slow the teams across product to ex-TAC. investments maintaining $X.X year, of lower-than-expected on we revenue vision, our primarily continue the with such Tim negative operating expenses discussed, intend ensure offsetting the near end contribution delivering Adjusted and was million at second

diluted quarter, stock share non-GAAP the stock-based loss in non-GAAP for million For and Class net cash negative million negative loss, quarter. From the we A of our $X.X totaled ended $XXX.X no $X.XX with per quarter excludes liquidity a the which compensation, debt. and common was perspective,

$XX.X credit million on drawn we facility. With previously guidance. our quarter, $XX the now During million debt to of outstanding repaid that, turn I'll

mentioned As began reducing begin I budgets marketers that in continuing and QX. trend some into is earlier, seeing we June,

relative in the headwinds. to advertiser Our guidance spend slower given reflects platform QX these QX growth across

quarter XXXX, in to For of of the year-over-year XX%. advertiser expect spend we third growth XX%

decline X%. to a to of in $XX year-over-year We represents million, million of expect which the revenue X% $XX.X range

saw making more QX months We out. expect is And range to XXXX. in levels expect negative The spend $X expenses consistent currently few what of a $X uncertain operating it predict non-GAAP adjusted to million. our we in difficult with the we than EBITDA environment of macroeconomic be million to

fiscal closing, long-term at result, revenue this a XXXX our our withdrawing only previously and EBITDA and remain least margins of by we time guidance guidance. issued year at In issuing targets million we in are XX% $XXX are XXXX. QX confident As in for

how responding marketers Our agencies are our based solution. conviction on is to their and

budgets our our platform and continue continue existing across to customers consolidate new and spend. grow We win their to customers

digital and that to prepared to that, Our many across us, our the the firmly that the turn to open That for of remarks significant with concludes operator facing today. and challenges marketers lines address And opportunity landscape. over total addressable are uniquely market I our solutions now effectively provides we Operator? dynamic questions. will today's it believe back

Operator

with And UBS. we from [Operator Walmsley first will Instructions] hear Lloyd

Lloyd Walmsley

I if a have couple, can. I

little improvement CPG all down I First, caught a help auto the during It you showed elaborate and disclosures if us some bit. XX%, like right, but sounds were the quarter. said,

advertiser And excited type, guess? more second it one size, overall you So anything the you the quarter us I little verticals to the could hire you the by a Maybe there help that of or sounded about XQ. are like macro continuing it a sounds the bit Dustin. it were like like fuel worst guys things brand he's you Anything the guess guys that shape I slower, about XQ of advertiser the outside into vertical? product and then Where impacted just sounded great with are that's bit share question on the great. of and exiting but in platform. on you guess most he's the was improving, are broadly most by pretty [ER] now would some is, by And had maybe be, decel can the I CPG a be auto can seeing adding talk some strong. just you maybe would initiatives

Tim Vanderhook

first Yes. take you portion? the Larry, to do want

Larry Madden

Yes.

few some the In customer said a of seen, it budget but continue. June, terms verticals. seeing it'd start different cuts again, It's we across that in of are we've we

dollars, of which of across probably would verticals. our retail, CPG most terms In largest X it's say and I pronounced are

comps are we You smaller, QX growth there but the largely so for we've due in partly and fact relative been are that issue The quarters. mentioned has amounts easier. relatively improved, QX that on auto getting and This an it's the by QX. CPG to saw year to comps. several improvement the driven that the therefore, prior easier the That's noted getting

well. they continue say verticals would as travel I do other The and other to healthcare, is thing such

little certain a advertiser. others a It like others. market, and even skewed really cutting are within it's some that have towards something retail, case-by-case versus aren't. is But is verticals So segments probably -- you different more of really it many

case But it's ones. by say probably most the I and case. retail really a would CPG are So significant

Tim Vanderhook

have saw We And that. it little that CTV. on color saw a a we're Lloyd, The advertising, largely little in just, definitely in been bit pullbacks brand-based bit a we more pullback particularly there. seeing of

we're I of As what see we money more a noted expected that saw in seeing pronounced propped in see performance-based scatter mobile is remarks, in bit. the desktop increase QX. reallocation to CTV really, And think my in And larger to some and up quite of where a did into a campaigns. in we market that into continue we I expect and largely spending. But it's most we June, that

Chris Vanderhook

the TV first to hire on platform. incredible that get the be working example, I'll on worked putting on he'd leader Viant Dustin. their an over out for Fire in to an Amazon's Yes. previously ads take advertising To What business then and able on give a question you building DSP.

process this making topnotch. we're be that the on But here, can tell vision the see less coupled complicated ability in going And format and team be task the but think to and process process gains think So and CTV, huge do and in take perspective a simplifying to goal. from a impactful. engineering programmatic of from vision from is product people there shape to and is he's productivity reality very it and you, in then very advertising And meaningful of with takes just big, in that a it's our can I where brought I channel his he's to purchasing where Amazon in we long-term come alone. been leadership the his going to continue advertising and going just autonomous we instituted our and this is our big that short stint a CTV

As hold further Investor a that Day he share sea Day Customer legs, an looks like. vision to his some and of gets out what we'll probably

Lloyd Walmsley

that. to look forward Well, Great.

Operator

with Matt to [Operator JMP. Instructions] We'll Condon move on

Matt Condon

on Condon Andrew Matt Boone. for

is more that? for and strategy? Just changing between of XXXX just color cookie spend. your overall X, can comments then the just with the on talk to ex-TAC in about the that's with how being contribution X the XXXX, me. any maybe can pace deprecation conversation But just give go-to-market appreciate I and you you and convergence there marketers pushed out And

Chris Vanderhook

I'll on bid the jump anything. look have let take but the the When cookie in cookies add delay stream deprecated getting to or a X out one, a X Larry at today. ads today, ID first of we don't I'll device of

issue nagging the the cookie. Chrome still that has think I is

One status of just Google going long against outdated that period. time to is with for quo. old, and a things as they're that up keep toughest is as Viant the some technology And longer has comfortable get cookie, marketers this

more time. still us, the in future. doesn't just for but challenging just So, going it's quo, status marketers that these are There's -- it change the away fact

so available them XXXX there, web platform for stated date. into across until Chrome cookies and the brought and be browser that improve use to back taken going given the now they're of product third-party we've actually And our end as the the

people-based in set. channel this updated our or data they once again year it the the cookie utilizing trackable And on we're third-party we're In today, the So exist. channel, cookieless software the Chrome, to of cookie. operating WWC while as we release works incorporate earlier third-party cookies

those quo to status outsized finally is position a again, digital home TV, this devices that So and are there And And connected technology that audio, channels, we will channels the are of growth inside out All with upended, ID. product XX% ad of there we on powering use them Chrome. are needs just of leadership continual these there. think household using drumbeat. the us of iOS no rewards. that our in mobile we streaming believe identifiers device all our new And do we are improved created reap our impressions the around once get

Tim Vanderhook

But, at just add would I the down. knock look to that to just Matt, wins that, customer continue to we

We because, customers of day. we every continue A have software. winning yes, is that We're lot outperform great there. to really more

Our platform use. is incredibly easy to

of supply integrations. amount vast We have a

household for it channels. that the all that They said, makes across software, in marketers it ad bears embedded all However, in out And see return these we channels. our in, differentiation and is our ID have it the spend performance. fact to come easy within lies ultimately, ID that on what across their use

can't just cookie any a You that longer. do with

product, certainly the Chrome went ad Chrome. website serve see a only to an You again, and somebody in can if and in bought but

knock recognizes ID there invest with our down think that in I widely the cookie. continuing and to technology. household just focused market we're So around the limitations the to are And customers continuing

Larry Madden

And Matt, first with the rates. mix ex-TAC on Yes. and regarding your revenue and question the respect growth to shift impact

year, we've that expected, As is of XXXX, impact faster certainly all some It's on having saying It rates, and us expected in but just what in was which much better those growth growth want term. we revenue we this ex-TAC believe than it we do to positions a is significant rates. happen. short-term happening and terms creates been pain long

As we price the mentioned Xx customers in QX, what fixed customers the spent. prepared of spent percent spend remarks, average in

we the clearly go. to want that's direction So

and seeing in it a beyond this start mix and time. percentage take we and other the improve to do impact I will with that, will of move, ex-TAC this we XXXX, the before, the as XXXX. In rates between terms rates to long continues as this narrow to trend we closer of make spend think will revenue will some spend begin part, that to we'll closer. words, said expect But growth growth larger converge out, start as how the that that get growth then becomes it will as In but move play into as of and revenue spend significant. delta growth we've And less shift

Operator

Larry, that conclude Tim, and questions the today. Chris, for does

you today. That I'd participation see behalf on of So for conclude to your you webinar. like thank We'll Viant quarter. all Technologies, next does today's

Viant Technology (DSP) 13 Aug 222022 Q2 Earnings call transcript