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Trade Desk Shares Plunge as Company Warns of a Pullback in Ad Sales in Some Industries


Key Takeaways

  • The Trade Desk shares plunged as the ad technology firm’s current quarter outlook missed estimates on a pullback by some advertisers.
  • The company indicated the UAW strike against the Big Three automakers and the walkouts by Hollywood writers and actors negatively affected ad sales.
  • The Trade Desk reported better than expected third quarter profit and revenue.

Shares of The Trade Desk (TTD) cratered as the ad technology provider gave lower-than-expected guidance on a pullback in advertising spending in certain businesses.

The Trade Desk indicated it expects current quarter revenue to be $580 million, $30 million below analysts’ estimates.

The company explained that strikes by auto workers and Hollywood writers and actors affected ad demand for those industries.

CEO Jeff Green noted that starting in the middle of October, The Trade Desk saw “some transitory cautiousness around certain advertisers.” He pointed specifically to “some reduction in brand spend in verticals such as automotive and consumer electronics, for instance, specifically around cell phones and media and entertainment.”

Green added that spending “stabilized” in the first week in November, and the company is confident its results will “outpace our industry.” However, he warned that if there is caution by businesses because of “macro uncertainty,” The Trade Desk “won’t be immune from that in the short term.”

For the third quarter, the company reported earnings per share of $0.33, with revenue jumping 24.8% to $493 million. Both exceeded forecasts. 

The Trade Desk shares were down 18% in late-morning trading Friday, hitting their lowest level since May.



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