The Trade Desk outlines Q4 revenue target of $840M with accelerated AI-driven product innovation and leadership refresh

Earnings Call Insights: The Trade Desk (TTD) Q3 2025

MANAGEMENT VIEW

* CEO Jeffrey Green reported that "revenue grew approximately 18% compared with Q3 of last year. And when excluding political spend compared to last year's Q3, our revenue grew by 22%. CTV remains our largest and fastest-growing channel, continuing to grow at a faster rate than our overall business." He emphasized the acceleration of biddable CTV and the company’s expanding total addressable market, highlighted by growth in CTV, AI chatbots, and premium content.
* Green discussed recent organizational upgrades, stating, "Since March, we've welcomed a new COO, a new CFO and a new CRO, who we just announced last week and began this week." He credited COO Vivek Kundra with "bringing greater structure, discipline and clarity," and new CRO Anders Mortensen with strengthening the go-to-market organization.
* Green highlighted product innovation: "This year has really been the year of innovation for us. We've launched some of the most market-changing products that we ever have." Kokai, the company’s latest AI-powered platform, has seen adoption by nearly 85% of clients as the default experience.
* CFO Alex Kayyal stated, "In Q3, we delivered revenue of $739 million, representing 18% year-over-year growth. Excluding political spend related to last year's U.S. elections, revenue increased approximately 22% year-over-year. Our strong performance in Q3 reflects our continued capture of incremental advertiser wallet share among large global brands during this period."

OUTLOOK

* The company guided Q4 revenue to "at least $840 million." Excluding the benefit of U.S. political ad spend in Q4 of 2024, "our estimated growth in Q4 of this year would be approximately 18.5% on a year-over-year basis." Adjusted EBITDA for Q4 is estimated to be approximately $375 million.
* Kayyal concluded, "As we look towards 2026, we remain well positioned to grow our share of the advertising TAM, generate significant profitability and cash flow and deepen the value we're delivering to advertisers."

FINANCIAL RESULTS

* The company reported revenue of $739 million for Q3 2025, with adjusted EBITDA of $317 million, or about 43% of revenue. Adjusted net income was $221 million or $0.45 per diluted share. Net cash provided by operating activities was $225 million, and free cash flow was $155 million.
* CTV and video represented around 50% of the business in Q3, while mobile was a low 30s percentage, display a low double-digit share, and audio around 5%. North America accounted for 87% of revenue, with international contributing 13%.
* The company repurchased $310 million of Class A common stock in the quarter, and the board authorized a new $500 million repurchase program.

Q&A

* Shyam Patil, Susquehanna: Asked about competition with Amazon and Google. Green responded, "Amazon's primary advertising efforts are to compete with Google, and it is driving nearly all of their revenue and all of the growth in advertising...Our focus is in decisions data-driven buying across the open Internet, especially in high-growth areas like CTV."
* Justin Patterson, KeyBanc: Inquired about organizational changes. Green said, "Since March, we've welcomed a new COO...a new CFO...most recently, a new CRO...We've streamlined our go-to-market organization and improved cross-regional coordination."
* Vasily Karasyov, Cannonball: Sought perspective on 2026 trends. Green said, "At a macro level, I describe the environment as a tale of 2 cities...we're seeing a growing number of forward-thinking brands outperform. Categories like financial services, health care, insurance...are leaning into data-driven marketing."
* Jason Helfstein, Oppenheimer: Questioned impact of agentic search and Q4 guidance. Green replied that supply remains robust, and AI's impact on inventory supply is "fairly de minimis as it relates to the open Internet at large." Kayyal stated, "There's no change to our guidance philosophy. Our outlook is really grounded in the trends we've observed so far in October and November, and we feel good about the guide."
* Youssef Squali, Truist: Asked about Google antitrust trial fallout and product focus. Green commented, "I think there is no scenario where Google doesn't back away from the open Internet to some degree." Regarding products, he highlighted Kokai, Deal Desk, trading modes, and Audience Unlimited as future growth drivers.

SENTIMENT ANALYSIS

* Analysts voiced interest in competitive positioning, product innovation, and management changes, with a neutral to slightly positive tone. Questions focused on strategy and execution rather than skepticism.
* Management maintained a confident and optimistic tone in both prepared remarks and Q&A, with Green stating, "I've never been more excited about the road ahead."
* Compared to the previous quarter, tone remained steady, with management expressing continued excitement and analysts seeking clarity on competitive and operational shifts.

QUARTER-OVER-QUARTER COMPARISON

* Revenue growth rate slightly moderated from 19% to 18% year-over-year. Q4 revenue guidance increased to at least $840 million, up from Q3’s $717 million guidance.
* New leadership additions were highlighted this quarter, whereas last quarter focused on the CFO transition. The pace of AI and product innovation was presented as even more foundational, with Kokai adoption rising from 75% to nearly 85% of clients.
* Analysts in both quarters concentrated on competitive threats (Amazon, Google), macro pressures, and product adoption. Management’s confidence and focus on long-term opportunity remained consistent.
* Strategic focus has shifted toward international expansion and aggressive AI-driven product launches.

RISKS AND CONCERNS

* Management cited macroeconomic uncertainty affecting select verticals, such as CPG and retail, due to tariffs and inflation.
* The imbalance of advertising supply and demand was described as a persistent structural feature, though positioned as an opportunity for buyers.
* Analysts probed about the implications of industry legal developments (Google antitrust trial) and possible shifts in competitive dynamics.
* Management’s mitigation strategies included operational rigor, leadership expansion, and accelerated AI-driven innovation.

FINAL TAKEAWAY

The Trade Desk leadership emphasized strong revenue growth, expanded CTV leadership, and accelerated AI-powered product innovation as key drivers positioning the company for long-term success. Strategic organizational changes and the rapid adoption of new offerings like Kokai, Deal Desk, and Audience Unlimited set the stage for continued market share gains and operational efficiency, with management reiterating its focus on capturing the expanding open Internet advertising opportunity in 2026 and beyond.

Read the full Earnings Call Transcript [https://seekingalpha.com/symbol/ttd/earnings/transcripts]

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