PubMatic (PUBM) investor relations material

Business overview and growth drivers

• Positioned as a global digital advertising platform connecting publishers, advertisers, data owners, and commerce media on owned infrastructure.

• Evolved from a publisher-only SSP to an end-to-end platform serving all major ecosystem stakeholders.

• Key growth areas include CTV, commerce media, sell-side targeting, and supply path optimization (SPO).

• CTV now represents about 20% of revenue, with over 50% year-over-year growth and strong partnerships with top streamers.

• SPO has grown to 55% of business, up from 35% in recent years, driving deeper buyer relationships and revenue visibility.

Financial performance and operational strategy

• Achieved 37 consecutive quarters of adjusted EBITDA profitability and generates healthy free cash flow.

• Q2 results exceeded guidance, with sales up 6% actual and 19% core, but Q3 guidance reflects a temporary headwind from a major DSP partner's platform shift.

• Diversification strategy is accelerating, with spending from DSPs outside the top five growing 20%+ year-over-year.

• Owned and operated private cloud infrastructure has driven significant cost leverage, with impressions processed up 130-140% over three years while cost of revenue rose less than 50%.

• Maintains gross margins above 70% and expects private cloud to remain a profitability tailwind.

Industry trends and market positioning

• Secular shift from linear TV to streaming and programmatic advertising is a major tailwind.

• Mid-market advertisers and SMBs are growing faster than large brands, with platforms like Mountain and TV Scientific driving CTV growth.

• AI and privacy regulations are pushing targeting and activation to the sell side, creating new opportunities for SPO and direct buying via the Activate product.

• Not significantly exposed to search-related headwinds from large language models, as mobile app and CTV make up 40% of business and browser-based exposure is limited.