The end of an earnings season can be a great time to discover new stocks and assess how companies are handling the current business environment. Let’s take a look at how Zeta (NYSE:ZETA) and the rest of the advertising software stocks fared in Q1.
The digital advertising market is large, growing, and becoming more diverse, both in terms of audiences and media. As a result, there is a growing need for software that enables advertisers to use data to automate and optimize ad placements.
The 6 advertising software stocks we track reported a strong Q1. As a group, revenues beat analysts’ consensus estimates by 5.4% while next quarter’s revenue guidance was 3.4% below.
Luckily, advertising software stocks have performed well with share prices up 13.1% on average since the latest earnings results.
Weakest Q1: Zeta (NYSE:ZETA)
Co-founded by former Apple CEO John Sculley, Zeta Global (NYSE:ZETA) provides software and data analytics tools that help companies market their products to billions of customers.
Zeta reported revenues of $264.4 million, up 35.6% year on year. This print exceeded analysts’ expectations by 4.1%. Overall, it was a strong quarter for the company with a solid beat of analysts’ EBITDA estimates and an impressive beat of analysts’ billings estimates.
Zeta achieved the highest full-year guidance raise of the whole group. Unsurprisingly, the stock is up 9.8% since reporting and currently trades at $14.87.
Is now the time to buy Zeta? Access our full analysis of the earnings results here, it’s free.
Best Q1: AppLovin (NASDAQ:APP)
Co-founded by Adam Foroughi, who was frustrated with not being able to find a good solution to market his own dating app, AppLovin (NASDAQ:APP) is both a mobile game studio and provider of marketing and monetization tools for mobile app developers.
AppLovin reported revenues of $1.48 billion, up 40.3% year on year, outperforming analysts’ expectations by 7.3%. The business had a very strong quarter with EBITDA guidance for next quarter exceeding analysts’ expectations.
AppLovin delivered the fastest revenue growth among its peers. The market seems happy with the results as the stock is up 21.8% since reporting. It currently trades at $370.
Is now the time to buy AppLovin? Access our full analysis of the earnings results here, it’s free.
The Trade Desk (NASDAQ:TTD)
Founded by former Microsoft engineers Jeff Green and Dave Pickles, The Trade Desk (NASDAQ:TTD) offers cloud-based software that uses data to help advertisers better plan, place, and target their online ads.
The Trade Desk reported revenues of $616 million, up 25.4% year on year, exceeding analysts’ expectations by 7%. It was a good quarter as it locked in an impressive beat of analysts’ EBITDA estimates and a solid beat of analysts’ billings estimates.
Interestingly, the stock is up 30.4% since the results and currently trades at $78.20.
Read our full analysis of The Trade Desk’s results here.
Integral Ad Science (NASDAQ:IAS)
Founded in 2009, Integral Ad Science (NASDAQ:IAS) provides digital advertising verification and optimization solutions, ensuring that ads are viewable by real people in brand-safe environments across various platforms and devices.
Integral Ad Science reported revenues of $134.1 million, up 17.1% year on year. This print beat analysts’ expectations by 3.2%. Taking a step back, it was a mixed quarter as it also produced a solid beat of analysts’ EBITDA estimates.
Integral Ad Science had the weakest full-year guidance update among its peers. The stock is up 5.4% since reporting and currently trades at $8.60.
Read our full, actionable report on Integral Ad Science here, it’s free.
PubMatic (NASDAQ:PUBM)
Founded in 2006 as an online ad platform helping ad sellers, Pubmatic (NASDAQ: PUBM) is a fully integrated cloud-based programmatic advertising platform.
PubMatic reported revenues of $63.83 million, down 4.3% year on year. This result topped analysts’ expectations by 2.8%. Zooming out, it was a mixed quarter as it also logged an impressive beat of analysts’ EBITDA estimates.
PubMatic had the weakest performance against analyst estimates and slowest revenue growth among its peers. The stock is up 6.9% since reporting and currently trades at $11.74.
Read our full, actionable report on PubMatic here, it’s free.
Market Update
In response to the Fed’s rate hikes in 2022 and 2023, inflation has been gradually trending down from its post-pandemic peak, trending closer to the Fed’s 2% target. Despite higher borrowing costs, the economy has avoided flashing recessionary signals. This is the much-desired soft landing that many investors hoped for. The recent rate cuts (0.5% in September and 0.25% in November 2024) have bolstered the stock market, making 2024 a strong year for equities. Donald Trump’s presidential win in November sparked additional market gains, sending indices to record highs in the days following his victory. However, debates continue over possible tariffs and corporate tax adjustments, raising questions about economic stability in 2025.
Want to invest in winners with rock-solid fundamentals? Check out our Strong Momentum Stocks and add them to your watchlist. These companies are poised for growth regardless of the political or macroeconomic climate.
Join Paid Stock Investor Research
Help us make StockStory more helpful to investors like yourself. Join our paid user research session and receive a $50 Amazon gift card for your opinions. Sign up here.