Financial Data and Key Metrics Changes - Total revenue for 2024 grew by 15% year-over-year to $657 million, driven by double-digit growth across all three revenue lines [6][49] - Adjusted EBITDA margin was 33% for the full year, with $160 million in net cash from operating activities, up 33% from the previous year [10][57] - Q4 2024 total revenue was $191 million, an 11% increase, with activation revenue growing by 10%, measurement by 7%, and supply side by 34% [46][49] - Net income for 2024 was $56 million, representing a 9% margin, down from a 12% margin in 2023 due to slower revenue growth and higher stock-based compensation [58] Business Line Data and Key Metrics Changes - Activation revenue grew by 13% for the full year, while measurement revenue also increased by 15% [49] - Social measurement revenue grew by 27% for the full year, although growth slowed to 9% in Q4 due to reduced spending from large brand advertisers [49][48] - Supply side revenue grew by 25% year-over-year, driven by increased demand from retail media platforms [9][49] Market Data and Key Metrics Changes - The company measured 8.3 trillion billable media transactions, a 19% increase year-over-year [7][51] - Social media measurement revenue accounted for 48% of total measurement revenue in 2024, up from 43% in 2023 [51] - CTV measurement impression volumes grew by 66% for the full year and 95% in Q4 alone, increasing its share of total measurement impression volume to 11% [37][38] Company Strategy and Development Direction - The company aims to unify media quality, optimization, and performance measurement into a single platform to maximize ad effectiveness [17] - Strategic acquisitions, including Rockerbox, are intended to enhance performance measurement capabilities and expand into mid-market customers [19][62] - The company is focusing on diversifying revenue streams and expanding its customer base, with a goal to increase the number of customers generating over $200,000 in revenue [15][42] Management Comments on Operating Environment and Future Outlook - Management acknowledged challenges in Q4 due to reduced ad spending from large customers and a shift in ad dollars to proprietary platforms [11][12] - Despite these challenges, management remains confident in the long-term growth prospects, citing strategic investments and a strong customer pipeline [16][104] - The company expects 2025 to be a transition year, with revenue growth projected at approximately 10% and adjusted EBITDA margins of 32% [63][66] Other Important Information - The company ended 2024 with $311 million in cash and short-term investments and zero long-term debt [61] - Stock-based compensation expenses are expected to stabilize in the high teens, with $200 million remaining available for share repurchases in 2025 [59][67] - The acquisition of Rockerbox is expected to contribute approximately $8 million to total revenue in 2025 [62] Q&A Session Summary Question: Can you elaborate on the strategic rationale for the Rockerbox acquisition? - The acquisition is aimed at enhancing the customer value proposition by integrating performance measurement with existing solutions, creating a competitive differentiator [71][73] Question: How do you see the ramp-up of new products like Scibids and social solutions throughout 2025? - Management believes that while there are headwinds in 2025, the long-term opportunities from new product launches will be significant, with expectations for growth in 2026 [80][82] Question: What is the company's view on the impact of AI on the advertising ecosystem? - The company is heavily investing in AI to enhance its core value proposition, leveraging AI for measurement and optimization solutions [88][90] Question: Can you provide insights on the advertiser that impacted Q4 results? - The reduction in spend was specific to a CPG customer facing rising commodity costs, and management does not expect similar impacts from other clients in the same vertical [113][115] Question: How do you expect margins to evolve throughout 2025? - Margins are expected to grow as the year progresses, with historical patterns indicating higher margins in the latter half of the year [95][96]

DoubleVerify Holdings, Inc. (NYSE:DV) Q4 2024 Results Conference Call February 27, 2025 4:30 PM ET Company Participants Tejal Engman - Senior Vice President, Investor Relations Mark Zagorski - CEO Nicola Allais - CFO Conference Call Participants Matt Swanson - RBC Eric Sheridan - Goldman Sachs Youssef Squali - Truist Securities Maria Ripps - Canaccord Genuity Andrew Boone - Citizens Brian Pitz - BMO Capital Markets Laura Martin - Needham & Company Arjun Bhatia - William Blair & Company Andrew Marok - Raymon ...

Core Insights - DoubleVerify Holdings (DV) reported revenue of $190.6 million for the quarter ended December 2024, reflecting a year-over-year increase of 10.7% but falling short of the Zacks Consensus Estimate by 3.02% [1] - The company's earnings per share (EPS) was $0.13, down from $0.19 in the same quarter last year, resulting in an EPS surprise of -27.78% compared to the consensus estimate of $0.18 [1] Revenue Breakdown - Revenue from Measurement customers was $64.38 million, which is below the six-analyst average estimate of $67.78 million, showing a year-over-year increase of 6.6% [4] - Revenue from Supply-side customers reached $16.73 million, exceeding the six-analyst average estimate of $15.21 million, with a significant year-over-year growth of 34.4% [4] - Revenue from Activation services was $109.52 million, slightly below the estimated $113.25 million, but still representing a year-over-year increase of 10.2% [4] Stock Performance - Over the past month, DoubleVerify shares have returned +5.3%, contrasting with a -2.2% change in the Zacks S&P 500 composite [3] - The stock currently holds a Zacks Rank 2 (Buy), suggesting potential for outperformance in the near term [3]

Group 1: Earnings Performance - DoubleVerify Holdings (DV) reported quarterly earnings of $0.13 per share, missing the Zacks Consensus Estimate of $0.18 per share, and down from $0.19 per share a year ago [1] - The earnings surprise for this quarter was -27.78%, while the previous quarter saw a positive surprise of 42.86% with actual earnings of $0.10 per share against an expectation of $0.07 [2] - The company posted revenues of $190.6 million for the quarter, missing the Zacks Consensus Estimate by 3.02%, compared to $172.23 million in the same quarter last year [3] Group 2: Stock Performance and Outlook - DoubleVerify shares have increased approximately 12.4% since the beginning of the year, outperforming the S&P 500's gain of 1.3% [4] - The company's earnings outlook is crucial for investors, with current consensus EPS estimates at $0.06 for the next quarter and $0.49 for the current fiscal year, with revenues expected at $158.15 million and $742.56 million respectively [5][8] - The Zacks Rank for DoubleVerify is currently 2 (Buy), indicating expectations for the stock to outperform the market in the near future [7] Group 3: Industry Context - The Internet - Software industry, to which DoubleVerify belongs, is currently ranked in the top 33% of over 250 Zacks industries, suggesting a favorable outlook compared to lower-ranked industries [9] - Another company in the same industry, StoneCo Ltd. (STNE), is expected to report quarterly earnings of $0.32 per share, reflecting a year-over-year decline of 11.1% [10]

Financial Performance - In 2024, the company measured approximately 8.3 trillion Media Transactions, an increase from 7.0 trillion in 2023 and 5.5 trillion in 2022[27]. - The company achieved a compounded annual growth rate of 25% in revenue from 2021 to 2024[30]. - The company has a compounded annual growth rate of 24% in average revenue for its top 100 customers from 2021 to 2024[30]. - The company achieved a net revenue retention rate of 112% in 2024, 124% in 2023, and 127% in 2022, driven by increased advertising volume and successful new solution launches[44]. - The company has maintained over 95% gross revenue retention rates across its customer base from 2022 to 2024, retaining 100% of its top 75 customers[44]. - The company’s sales cycle is long and complex, making it difficult to predict revenue generation from new customers[128]. - Future revenue and operating results may fluctuate significantly, impacting stock price and investor expectations[158]. Customer Base and Relationships - The company serves over 2,000 customers, with 110 customers each representing at least $1 million of annual revenue in 2024, up from 93 in 2023[28]. - The average relationship duration with the top 25, 50, and 75 customers is approximately eight years[30]. - The competitive landscape is evolving rapidly, with no single customer accounting for more than 10% of revenue in 2024, indicating a diversified customer base[104]. - Two programmatic partner platforms collected approximately 22% and 14% of the company's total revenue in 2024, indicating a reliance on specific partners for revenue generation[124]. Advertising and Market Trends - Global digital ad spend, excluding search, reached $329 billion in 2024 and is expected to grow to $448 billion by 2028[31]. - Seasonal fluctuations in revenue are expected, with the fourth quarter typically reflecting the highest measurement activity due to increased holiday advertising[83]. - Seasonal fluctuations in advertising activity could negatively impact revenue and cash flow[102]. - The company has experienced significant growth in social media-related revenues, but public criticism and regulatory scrutiny of social media platforms could negatively impact demand for its solutions[138]. Technology and Innovation - The company leverages AI to enhance content classification and deliver cost-effective video classification solutions[37]. - The company employs advanced AI-driven classification technology for content categorization, utilizing machine learning across various content types[72]. - The company acquired Scibids Technology SAS in August 2023, enhancing its AI-powered digital campaign optimization capabilities[52]. - The company’s DV Authentic Attention solution provides comprehensive data for campaign performance, measuring exposure and engagement metrics in real-time[50]. - The company’s technology is integrated with leading digital advertising platforms, facilitating the distribution of its programmatic solutions and enabling comprehensive data analysis[57]. Operational Structure - The company operates in 31 locations across 25 countries, including major markets like the United States, the United Kingdom, and Australia[28]. - The company employs 225 software and data engineers across seven research and development centers focused on product development as of December 31, 2024[43]. - The engineering team consists of 339 employees as of December 31, 2024, focusing on software development and infrastructure operations[66]. - The product team, with 197 employees, collaborates with sales and marketing to define the product roadmap and ensure high-quality technology[67]. - Approximately 42% of the company's 1,197 employees are located outside of the Americas, indicating a global workforce[88]. Risks and Challenges - The company faces significant risks including technological obsolescence, competitive market pressures, and potential system failures that could disrupt operations[99]. - Economic downturns and unstable market conditions could adversely affect the company's financial condition and results of operations[99]. - The company is exposed to risks associated with cybersecurity, including potential breaches that could harm its reputation and financial condition[108]. - The company must continuously upgrade its platform to remain competitive and meet evolving customer needs[103]. - The reliance on third-party service providers for IT systems introduces risks of performance failures that could disrupt operations[111]. - The company is subject to evolving data privacy regulations, which may require significant resources to comply and could lead to legal or regulatory actions if not adhered to[134]. Financial Position and Capital Structure - As of December 31, 2024, the company reported cash, cash equivalents, and short-term investments totaling $310.6 million, an increase from $310.1 million in 2023 and $267.8 million in 2022[333]. - The company has no outstanding variable rate debt as of December 31, 2024, and has $200.0 million available under the New Revolving Credit Facility, which matures in August 2029[333]. - The company may need additional capital in the future to support growth strategies, including acquisitions and technological enhancements[168]. - The company is subject to taxation in multiple jurisdictions, which could increase effective tax rates and cash tax payments in future periods[156]. Corporate Governance and Compliance - Providence VII U.S. Holdings L.P. owns approximately 16% of the outstanding shares, influencing corporate transactions and potentially affecting stock price[182]. - The company does not intend to pay dividends on its common stock for the foreseeable future, relying on future earnings for growth and acquisitions[198]. - Compliance with public company regulations incurs significant costs, impacting operational expenses and management resources[187]. - The company may face challenges in maintaining effective internal controls, which could affect financial reporting and investor confidence[191]. - The existence of anti-takeover provisions may discourage favorable changes in management or control, potentially affecting stockholder interests[192].

Exhibit 99.1 DoubleVerify Reports Fourth Quarter and Full Year 2024 Financial Results Increased Fourth Quarter Revenue by 11% Year-over-Year to $190.6 Million Achieved 2024 Net Income of $56.2 Million and Adjusted EBITDA of $218.9 Million, representing a 33% Adjusted EBITDA margin Agreed to Acquire Rockerbox, a leader in performance attribution, optimization and marketing measurement, to drive greater ROI for advertisers NEW YORK – February 27, 2025 – DoubleVerify ("DV") (NYSE: DV), the leading software pla ...

Core Viewpoint - Growth investors are focused on stocks with above-average financial growth, but identifying stocks that can fulfill their potential is challenging [1] Group 1: Company Overview - DoubleVerify Holdings (DV) is currently recommended as a growth stock due to its favorable Growth Score and top Zacks Rank [2] - The company operates in the digital media measurement and analytics sector [3] Group 2: Earnings Growth - DoubleVerify has a historical EPS growth rate of 13.2%, but projected EPS growth for this year is expected to be 34.1%, significantly higher than the industry average of 23.1% [4] Group 3: Cash Flow Growth - The year-over-year cash flow growth for DoubleVerify is 44.6%, outperforming the industry average of -14.6% [5] - The company's annualized cash flow growth rate over the past 3-5 years is 38.5%, compared to the industry average of 13.2% [6] Group 4: Earnings Estimate Revisions - Current-year earnings estimates for DoubleVerify have been revised upward, with the Zacks Consensus Estimate increasing by 2.5% over the past month [8] Group 5: Investment Positioning - DoubleVerify has earned a Growth Score of A and carries a Zacks Rank 2 due to positive earnings estimate revisions, positioning it well for potential outperformance [10]

Core Viewpoint - Investors are seeking growth stocks that can deliver above-average growth and exceptional returns, but identifying such stocks can be challenging due to inherent risks and volatility [1] Company Summary: DoubleVerify Holdings (DV) - DoubleVerify is identified as a promising growth stock with a favorable Growth Score and a top Zacks Rank [2] - The company has a historical EPS growth rate of 13.2%, with projected EPS growth of 31.3% this year, surpassing the industry average of 24.2% [4] - Year-over-year cash flow growth for DoubleVerify stands at 44.6%, significantly higher than the industry average of -13.9% [5] - The annualized cash flow growth rate over the past 3-5 years is 38.5%, compared to the industry average of 13.8% [6] - There have been upward revisions in current-year earnings estimates for DoubleVerify, with the Zacks Consensus Estimate increasing by 0.1% over the past month [8] - The combination of a Zacks Rank 2 and a Growth Score of A positions DoubleVerify well for potential outperformance, making it an attractive option for growth investors [10]

Core Viewpoint - DoubleVerify Holdings (DV) has been upgraded to a Zacks Rank 2 (Buy) due to an upward trend in earnings estimates, which is a significant factor influencing stock prices [1][3]. Earnings Estimates and Stock Price Movement - The Zacks rating system is based on changes in earnings estimates, which are strongly correlated with near-term stock price movements [4][6]. - Institutional investors often rely on earnings estimates to determine the fair value of stocks, leading to buying or selling actions that affect stock prices [4]. Company Performance and Outlook - The recent upgrade for DoubleVerify indicates a positive outlook for its earnings, suggesting potential buying pressure and an increase in stock price [3][5]. - Analysts have raised their earnings estimates for DoubleVerify, with the Zacks Consensus Estimate increasing by 13.1% over the past three months [8]. Earnings Estimate Details - For the fiscal year ending December 2024, DoubleVerify is expected to earn $0.36 per share, reflecting a year-over-year decline of 12.2% [8]. Zacks Rating System - The Zacks Rank system classifies stocks into five groups based on earnings estimates, with only the top 20% receiving a 'Strong Buy' or 'Buy' rating [9][10]. - The upgrade of DoubleVerify to a Zacks Rank 2 places it in the top 20% of Zacks-covered stocks, indicating a strong potential for market-beating returns in the near term [10].

Core Viewpoint - DoubleVerify Holdings (DV) shows potential as a strong investment opportunity due to significant revisions in earnings estimates, indicating an improving earnings outlook and a positive stock trend [1][2]. Current-Quarter Estimate Revisions - For the current quarter, DoubleVerify is projected to earn $0.18 per share, reflecting a decrease of 5.26% compared to the same period last year [4]. - The Zacks Consensus Estimate for the current quarter has increased by 20.69% over the last 30 days, with four estimates raised and no negative revisions [4]. Current-Year Estimate Revisions - For the full year, the expected earnings per share for DoubleVerify is $0.36, which represents a year-over-year decline of 12.2% [5]. - The consensus estimate for the current year has seen a notable increase of 22.88%, with four estimates moving higher and no negative revisions [5]. Favorable Zacks Rank - The positive revisions in earnings estimates have led to DoubleVerify achieving a Zacks Rank 2 (Buy), indicating strong potential for outperformance [6]. - Research indicates that stocks with Zacks Rank 1 (Strong Buy) and 2 (Buy) tend to significantly outperform the S&P 500 [6]. Bottom Line - The stock has gained 14.6% over the past four weeks, driven by solid estimate revisions, suggesting that it may be a good time to consider adding DoubleVerify to investment portfolios [7].