Viant(DSP)2023-11-07 02:40Financial Data and Key Metrics - Revenue for Q3 2023 was 39.1 million, also a 22% increase YoY and 16% higher than Q2 [83] - Non-GAAP net income for Q3 was 4.4 million in the prior year period [61] - Adjusted EBITDA for Q3 was 64 million to 60 billion of linear television advertising moving into connected TV [28] - The company's Household ID technology is available on over 85% of all ad requests, enabling addressable advertising and attribution in a cookieless environment [36] - The company's Direct Access program is focused on CTV, providing a more cost-efficient direct path to premium inventory [70][81] Company Strategy and Industry Competition - The company is leveraging AI to develop the most advanced DSP in the market, focusing on simplifying and automating the platform to expand its addressable market [37][38] - The company's AI Bid Optimizer solution has seen strong adoption, with over half of customers utilizing it and achieving an average savings of 35% on CPMs [50][51] - The company is focusing on mid-market advertisers, offering best-in-class products supported by industry-leading AI to win larger shares of budgets [28][79] - The company is well-positioned to benefit from Google's deletion of cookies in 2024, with its Household ID technology offering a scalable and proven solution [76] Management Commentary on Operating Environment and Future Outlook - The company sees a number of favorable drivers for the business, including the ongoing shift from linear TV to CTV and the application of AI [28][35] - The company expects to continue its momentum in Q4, benefiting from the stabilization in the U.S. advertising environment [46] - The company believes that the deletion of cookies by Google will accelerate the growth of ad spend flowing through its platform [76] - The company is confident in the sustainability of its progress, driven by the substantial role of AI in enhancing productivity [60] Other Important Information - The company ended Q3 with 227 million of positive working capital, and no debt [87] - The company has access to a $75 million undrawn credit facility, providing a solid financial foundation [87] - The company's Rule of 40 metric was 47% in Q3 and is expected to increase to 52% in Q4 based on the midpoint of guidance [63] Q&A Session Summary Question: Impact of customer count decline and traction with mid-market agencies [3] - The company is focusing on mid-market customers, with solutions around CTV, Direct Access, and measurement driving new customer acquisition and growth [92] Question: Impact of cookie deletion and positioning of the sales force [14] - The company's Household ID technology is well-positioned to handle the signal loss due to cookie deletion, with no disruption expected [11] - The company is discussing the topic with brands and agencies, focusing on measurement solutions to drive customer adoption [14] Question: Monthly progression of the quarter and impact of Middle East conflict on CTV trends [17] - The quarter saw steady growth, with the last month being the biggest, and no significant impact from the Middle East conflict [126] Question: CTV growth potential with Direct Access adoption [127] - Direct Access is expected to continue growing, with over 25% of CTV spend already through the program, driven by financial and operational efficiencies [128] Question: Impact of AI tools on the P&L [107] - AI tools like Bid Optimizer are both revenue drivers and differentiators, helping to win incremental business and increase contribution ex TAC [107] Question: Tailoring go-to-market strategy for novice users [96] - The company is focusing on simplifying the platform and making it more accessible, particularly for mid-market and SMB customers [113] Question: Behavior of Household ID technology with potential IP signal loss [99] - The company's Household ID technology is not tied to IP addresses but to physical household data points, making it resilient to IP signal loss [11]