PubMatic’s first quarter results reflected resilience in the face of sector headwinds, as the company’s performance was shaped by both ongoing challenges and emerging opportunities within the programmatic advertising landscape. Management emphasized that, while revenue declined year over year, core business areas such as connected TV (CTV) and supply path optimization (SPO) experienced robust growth. CEO Rajeev Goel highlighted that “excluding the affected DSP and political spend, year-over-year revenue growth accelerated to 21%,” underscoring the strength in newer media channels and data-driven offerings. The company continues to adapt to shifting advertiser preferences and industry changes, helping to offset softness in certain display segments.
Is now the time to buy PUBM? Find out in our full research report (it’s free).
PubMatic (PUBM) Q1 CY2025 Highlights:
- Revenue: $63.83 million vs analyst estimates of $62.09 million (4.3% year-on-year decline, 2.8% beat)
- Adjusted EPS: -$0.04 vs analyst estimates of -$0.07 ($0.03 beat)
- Adjusted Operating Income: -$2.21 million vs analyst estimates of -$14.38 million (-3.5% margin, 84.7% beat)
- Revenue Guidance for Q2 CY2025 is $68 million at the midpoint, roughly in line with what analysts were expecting
- EBITDA guidance for Q2 CY2025 is $10.5 million at the midpoint, below analyst estimates of $11.36 million
- Operating Margin: -18.6%, down from -8.3% in the same quarter last year
- Market Capitalization: $565.9 million
While we enjoy listening to the management's commentary, our favorite part of earnings calls are the analyst questions. Those are unscripted and can often highlight topics that management teams would rather avoid or topics where the answer is complicated. Here is what has caught our attention.
Our Top 5 Analyst Questions PubMatic’s Q1 Earnings Call
- Eric Martinuzzi (Lake Street Capital) inquired about the impact of the Google AdTech antitrust ruling. CEO Rajeev Goel explained that customers are increasingly considering alternatives to Google, and highlighted PubMatic’s potential to gain share as industry dynamics evolve.
- Zach Cummins (B. Riley) asked for updates on key DSP partner volumes and the effect on display revenue. CFO Steve Pantelick described stability with this partner and expects to lap the impact by the end of Q2, citing growth opportunities beyond the current technical shift.
- Simran Biswal (RBC) questioned macro spending trends and resilience of CTV and emerging products. Goel responded that advertiser budgets remain steady, while secular shifts toward streaming and lower-funnel performance channels favor PubMatic’s offerings.
- Jacob Armstrong (KeyBanc) probed how higher-margin CTV revenues will be balanced between margin expansion and reinvestment. Pantelick emphasized a disciplined approach, reinvesting in secular growth areas while maintaining adjusted profitability.
- Andrew Boone (JMP) sought clarity on the roadmap for new products and bridging normalized growth to reported results. Goel outlined a focus on first-party data, supply chain efficiency, and performance optimization, while Pantelick detailed the impact of DSP and political ad headwinds on growth figures.
Catalysts in Upcoming Quarters
In the coming quarters, our team will closely monitor (1) the pace of CTV and omni-channel video adoption, particularly as advertisers shift budgets from linear TV to streaming; (2) the rollout and client uptake of new AI-powered buying and curation tools; and (3) stabilization in display and emerging product segments as the company laps DSP and political advertising headwinds. Execution in international markets and agency direct sales will also be important indicators of sustained momentum.
PubMatic currently trades at $11.68, up from $10.99 just before the earnings. In the wake of this quarter, is it a buy or sell? See for yourself in our full research report (it’s free).
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