TLDR:
- The Trade Desk reported Q1 earnings of $0.33 per share, beating estimates of $0.25
- Revenue reached $616.02 million, exceeding expectations by 7.27% with 25.4% year-over-year growth
- The company has topped consensus EPS estimates for four consecutive quarters
- Q2 revenue guidance of $682 million and EBITDA guidance of $259 million both exceeded analyst expectations
- TTD shares jumped 9% after the report despite being down 52% year-to-date
The Trade Desk (TTD), a digital advertising platform operator, has delivered a strong financial performance for the first quarter of 2025, reversing some of the negative sentiment that has plagued the stock this year. The company reported earnings that handily beat Wall Street expectations on Thursday.
The ad tech firm posted quarterly earnings of $0.33 per share, compared to analysts’ expectations of $0.25 per share. This represents a substantial earnings surprise of 32%.
The results also showed improvement from the same period last year when the company reported earnings of $0.26 per share. These figures are adjusted for non-recurring items.
This marks the fourth consecutive quarter that The Trade Desk has surpassed consensus earnings per share estimates.
Revenue for the quarter ended March 2025 came in at $616.02 million. This topped the consensus estimate by an impressive 7.27%.
Compared to the year-ago quarter, revenue increased by 25.4% from $491.25 million. The company has now exceeded revenue expectations in three of the last four quarters.
Growth Momentum Continues
The latest results confirm The Trade Desk’s strong position in the competitive digital advertising market. Founded by former Microsoft engineers Jeff Green and Dave Pickles, the company offers cloud-based software that helps advertisers plan, place, and target their online ads more effectively.
Over the last three years, The Trade Desk has maintained solid growth, with a compound annual growth rate of 25.8%. This outpaces many competitors in the software sector.
The company’s adjusted EBITDA for Q1 was $207.9 million, representing a 33.7% margin. This crushed analyst estimates of $147.5 million by 41%.
Operating margin improved to 8.8%, up from 5.8% in the same quarter last year. The free cash flow margin jumped to 37.3%, a significant increase from 23.9% in the previous quarter.
Jeff Green, Co-founder and CEO of The Trade Desk, commented on the results. “We delivered strong results in the first quarter, growing revenue 25% year-over-year to $616 million,” he said.
One impressive aspect of The Trade Desk’s business model is its efficiency in acquiring new customers. The company’s customer acquisition cost payback period checked in at just 4 months for the quarter.
This rapid recovery of customer acquisition costs suggests The Trade Desk has a highly differentiated product offering and strong brand reputation in the market.
Looking ahead, management provided an optimistic outlook for the second quarter. The company expects revenue of approximately $682 million, which is 0.8% above analysts’ estimates.
EBITDA guidance for Q2 was set at $259 million, also exceeding analyst expectations of $254.1 million.
Despite the positive earnings report, The Trade Desk shares have struggled in 2025. The stock has lost about 52% since the beginning of the year, underperforming compared to the S&P 500’s decline of 4.3%.
However, the market reacted positively to the earnings announcement. The stock traded up 9% to $65.40 immediately after reporting.
Wall Street analysts project continued growth for The Trade Desk, with revenue expected to increase by 14.7% over the next 12 months. While this represents a slowdown from the growth rate of the last three years, it still indicates confidence in the company’s products and services.
For the coming quarter, the current consensus EPS estimate is $0.42 on $676.51 million in revenues. For the full fiscal year, analysts expect earnings of $1.79 per share on $2.84 billion in revenues.
The Trade Desk’s current market capitalization stands at approximately $27.75 billion following the earnings release.
The latest quarterly results seem to have restored some investor confidence in The Trade Desk after a challenging start to the year. The company’s ability to exceed expectations on multiple financial metrics demonstrates its resilience in the competitive digital advertising landscape.
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