A：The Trade Desk had a solid fourth quarter with a 1% revenue growth from Q4 2020, not adjusting for the irre nature of political revenue. The revenue grew 14% Q over Q. For the full year, the company grew revenue to record levels and maintained strong profitability margins while investing in innovation for the next decade of digital advertising.

A：The three themes discussed were the state of the macro environment and the global advertising market, the sustained weakness among some large consumer packaged goods companies (CPGs) and global auto companies, and the differences in verticals and their impact on the company's business.

A：The current state of CPGs and global auto companies is one of sustained weakness with over a quarter of The Trade Desk's business affected. These companies face tough choices and high levels of uncertainty not seen in the last 15 years. In contrast, some have done well by focusing on cost reduction, while others have reduced branding spend for cost-cutting.

A：The Trade Desk's platform performed well during the test with the leading appliance manufacturer, reaching 70% more unique households and achieving a 30% lower total cost. The platform outperformed with a 6% better campaign result, which is attributed to objective decisioning across the open internet.

A：Global brands are becoming skeptical of the cheap reach dynamics of walled garden platforms and are recognizing that cheap does not drive growth. There is an increasing understanding that growth is driven by meaningful engagement rather than sheer volume of people reached.

A：The Trade Desk is investing in AI because nearly all clients are using AI, it is the most advanced AI-fueled buying platform, it enhances every function in the advertising campaign, AI is a productivity enhancer, and the company's proprietary AI combined with its objectivity offers a unique power combo. AI makes better decisions for advertisers and matches the best ad opportunities with valuable data like first-party data being more valuable in an AI world.

A：AI is changing nearly every industry directly or indirectly and is considered an unprecedented generational shift that will change the world similarly to how the internet emerged. AI will continue to play a growing role in the complex and fast-evolving global advertising market, which is highly leveraged and has an infinite number of permutations for every campaign.

A：The emerging narrative is that AI will potentially compress software value or disintermediate platforms, which may affect companies that deal with gene process or data and have earned trust and scaled data that can be leveraged with AI to add more value.

A：The complexity of the global advertising market is considered a strength because it serves as a 'moat,' offering advantages such as deep customer trust, scaled and objective data, and a prioritization of outcomes over companies with limited data as their business model.

A：AI is seen as an evolution of outcome-based platforms, creating the most value for companies that already possess deep customer trust and have scaled, objective data. It is not a shortcut but rather a way to optimize platforms and achieve better outcomes.

A：Audience Unlimited is a significant innovation that changes the value of the data marketplace by enabling advertisers to use a wider range of relevant data for campaigns at an all-in cost with clearly understood value and impact, supported by AI and a flat cost structure.

A：Early adopters like Cheerios have seen 88% more conversions and seven times better cost per acquisition using retail data for audience targeting. Nestle plans to activate retail data across most future campaigns, indicating positive results from using retail data.

A：'Deals' centralizes the way buyers create, manage, and analyze their deals, using AI to ensure deals are competitive in the open market. Early results are encouraging, with deals set up and managed through Deals performing meaningfully better than the traditional approach.

A：The Trade Desk is making huge efforts to simplify the complexity for users by simplifying supply chains, measurement, and building processes. They aim to provide transparency and functional reporting while avoiding the inefficiencies of a 'walled garden' approach.

A：Entering 2026, the Trade Desk will continue to drive performance and innovation through AI and its roadmap. They aim to deepen relationships with advertisers and agencies, support the shift in retail media and CTV, and maintain alignment with advertisers' interests while enhancing the power of choice through trusted and objective use of AI.

A：During the transition, the priorities of theTrade Desk are on operational continuity, clear objectives, and support for the ongoing operations and strategic priorities for the overall business. The focus is on supporting the growth of theTrade Desk in the near term and beyond, and there is an emphasis on working with a world-class organization.

A：In Q4, CTV grew at a faster rate than the overall business and represented about 50% of the company's business, with mobile accounting for a low-digit share, and display and audio each representing a smaller percentage. Geographically, the United States contributed to approximately 84% of Q4 revenue, while international revenue made up about 16%. Growth in the international business outpaces that in North America, with a continued strong momentum in EMEA and APAC.

A：As of the end of Q4, the company had a strong cash and liquidity position with about 1.3 billion in cash, cash equivalents, and short-term investments. The balance sheet also showed no debt. Days Sales Outstanding (DSO) and Days Payable Outstanding (DPO) were consistent with prior periods at approximately 100 days and under 85 days, respectively.

A：In Q4, the company used 423 million of cash to repurchase its Class A common stock. An additional authorization for share repurchase was announced, bringing the total to 500 million. Net cash provided by operating activities was 312 million, and free cash flow was 282 million.

A：The company's Q1 2026 guidance reflects a prudent approach with revenue expected to be at least 678 million, representing 10% year over year growth. Adjusted EBITDA for Q1 is estimated to be approximately 195 million. They plan to continue investing in the business while maintaining strong cost discipline, focusing on investments that directly support revenue growth and AI-driven innovation. Full 2026 adjusted EBITDA margin percentage is expected to be approximately in line with 2025.

A：The EPG and Auto categories have been highlighted as some of the best parts of the company's business, and there is optimism about their future. However, these categories have been impacted by forces like cost inflation, consumer pressures, and uncertainty in brand marketing budgets. In the company's business, the impact of these categories has resulted in a growth rate that is 5% higher if not included, or parity with other categories. The company has experienced a supply and demand imbalance where there is more supply than demand, emphasizing the value of decisioning. Some CPGs are focusing on growth and targeting, rethinking measurement, and building their brands, while others are focused on cost-cutting. This dichotomy in approach impacts the company's performance.

A：The financial guidance reflects the prudence from both the EPG and Auto categories, influenced by the state of the state and the challenges they are dealing with. It is not indicative of a diminished long-term opportunity for the company or these categories but rather a prudent approach at this moment in time. The company maintains strong dialogue with these brands and is optimistic about the future.

A：The company is changing leadership because the current leadership team is not the same as the one that will take the company from $3 billion to $10 billion in valuation. The company plans to ensure operational efficiency by clearly defining roles and responsibilities, and holding people accountable with more clarity.

A：The company's mission and business model have remained constant over the years, focusing on specific themes which they communicate to investors consistently.

A：The company ensures clear roles and responsibilities for every brand and agency, making teams more collaborative and ensuring that there is no overlap or gaps in responsibilities.

A：The company's current Justified Deal Pipeline (JDP) is the greatest it has ever been, which signifies a tremendous optimism for the company's future.

A：The company is working on being more deliberate about the products it brings to market, which includes learning from past experiences of moving too quickly or too slowly. The company is also implementing better systems to manage the roll-out of products and investments.

A：The competitive landscape has become more complex and fragmented with increased market fragmentation and less favorable press coverage. However, the company views itself as a strong competitor, especially due to its unique position in the market and ability to leverage AI for objectivity and decisioning.

A：AI is a core part of the company's strategy, improving decisioning by processing millions of ad opportunities every second and making better choices. This enhances the efficacy and performance of ad delivery, which in turn improves the monetization model, client stickiness, and the company's overall go-to-market efforts.

A：The evolution of deal types in CTV is complex and varies with different definitions for each type, such as direct buys, programmatic guaranteed deals, and open exchange transactions. The dynamics are influenced by advertiser and publisher preferences for certainty versus bid transactions.

A：The most sophisticated and growing brands are seeking more bidding and decisioning in their ad purchases while also seeking guarantees and assurances that they are buying in the best way possible.

A：Brands are expected to seek deal structures where they can buy in any way they want, bid anywhere they want, and still receive credit for it, similar to how it works in an upfront.

A：The speaker challenges the notion because they believe that AI, specifically genetic AI, will improve programmatic advertising by simplifying decision-making in a complex environment. They argue that AI does not suggest quality and consistency are irrelevant, as consumers tend to buy from brands they love due to their great products.

A：The speaker suggests that AI, specifically genetic AI, will make decisioning in the complex programmatic advertising environment easier by aiding in the reasoning process advertisers face when deciding whether to buy an ad.

A：The speaker emphasizes that trust and brand data are critical in scaling AI, as brand data is more valuable to buyers than Google's data and it is essential to winning trust, particularly in an AI-driven world.

A：The company's strategy is to focus on the 'head' of the market by initially partnering with the biggest advertisers in the world and then working their way down to the 'torso' and 'tail'. This is because there are many concentrated dollars in the head of the market, and they believe the lines between brand and performance budgets are artificial and temporary.

A：The speaker believes that giving all the credit to the 'last touch' in brand building is a mistake because it fails to reward the entire team and does not account for the importance of top-funnel brand building. They are working with brands like Hershey's to create a better measurement framework that rewards all contributors.

A：Open Path was created to be the most efficient supply chain in the market and a canary in the coal mine for detecting inefficiencies. It is considered by some as inefficient because it provokes criticism from players who do not want a more efficient supply chain, and who may stand to lose business if their less efficient paths are exposed.

A：Open Path's fee structure is simple, charging a fee of 4.5% which is meant to be nearly break-even to slightly profitable. This fee is applied directly to the seller or publisher, making the supply chain more efficient by reducing the exploitation of inefficiencies by sellers.