DoubleVerify’s third quarter results prompted a significant negative market reaction, reflecting concerns about both top-line and bottom-line performance. Management attributed the underperformance to widespread softness in retail advertiser spending and tougher comparisons from last year’s strong quarter. CEO Mark Zagorski pointed out that while core verticals like consumer packaged goods remained stable, “market dynamics led to some retail budgets being softer,” ultimately weighing on revenue growth. The company also highlighted persistent customer retention among its largest clients and noted early traction for new AI-powered offerings.
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DoubleVerify (DV) Q3 CY2025 Highlights:
- Revenue: $188.6 million vs analyst estimates of $190.2 million (11.2% year-on-year growth, 0.8% miss)
- Adjusted EPS: $0.22 vs analyst expectations of $0.27 (17.4% miss)
- Adjusted Operating Income: $50.66 million vs analyst estimates of $49.37 million (26.9% margin, 2.6% beat)
- Revenue Guidance for Q4 CY2025 is $209 million at the midpoint, below analyst estimates of $210.8 million
- EBITDA guidance for Q4 CY2025 is $79 million at the midpoint, above analyst estimates of $77.86 million
- Operating Margin: 11.2%, down from 15.2% in the same quarter last year
- Market Capitalization: $1.69 billion
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 From DoubleVerify’s Q3 Earnings Call
- Maria Ripps (Canaccord Genuity) asked for clarity on growth drivers for next year; CFO Nicola Allais explained that base-case growth assumes stable macro conditions, with upside driven by new social, CTV, and AI products.
- Mark Murphy (JPMorgan) asked about the broadness of retail weakness; Allais replied that softness was across the retail vertical, not isolated to specific accounts, and reflected broader industry disruption.
- Raimo Lenschow (Barclays) probed assumptions underlying margin and revenue guidance; Allais said no dramatic macro changes are expected, and margin improvement depends on AI adoption and cost discipline.
- Laura Martin (Needham & Co.) inquired about expanding the client base to smaller advertisers and the competitive landscape for bot detection; CEO Mark Zagorski said SMBs represent an opportunity as CTV grows, and new AI tools provide deeper transparency for bot engagement.
- Timothy Nollen (SSR) questioned penetration and differentiation in CTV; Zagorski confirmed DV works with all major streaming platforms and emphasized a focus on quality and transparency rather than traditional reach and frequency measurement.
Catalysts in Upcoming Quarters
In the coming quarters, the StockStory team will be monitoring (1) the adoption trajectory and revenue contribution from new social and CTV product offerings, (2) the pace and efficiency of AI-driven automation initiatives, and (3) whether retail advertiser spending stabilizes or recovers. The scaling of international operations and further product launches targeting measurement and activation are also important indicators for the company’s medium-term growth profile.
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