The Trade Desk posted solid Q3 results on Thursday, with $739 million in revenue, up 18% year over year. Net profit increased 16% YOY to $116 million.
It’s the second straight quarter TTD met its earnings estimate since its calamitous miss in Q4 2024, which was reported in February.
But the main narrative for TTD this year is less about the numbers and more about optics and competitive dynamics.
The DSP bellwether now faces a skeptical investor community, and it’s also no longer the programmatic ecosystem champion everybody roots for. TTD is now a huge incumbent in its own right and must navigate more contentious relationships with sell-side ad tech companies.
Good to be big
The Trade Desk CEO Jeff Green flexed the company’s importance within the ad tech category and to the open web in general.
There are standards across the open internet, including TTD’s own Unified ID2.0 initiative, as well as OpenRTB fields, such as transaction IDs and global placement IDs, which “have become standards because of our innovations and insistence,” he said.
According to Green, there are “entire categories of companies” in programmatic – especially data vendors that rely on log files and open internet data collected from the OpenRTB bidstream – that “wouldn’t be viable” if it were not for TTD keeping those data pipes open and ubiquitous, in contrast to the walled gardens.
Green also said that many large CTV content owners and other premium online publishers increasingly depend on independent partners like TTD. “In fact,” he said, “for most of them, we are the single largest source of third-party demand worldwide.”
Meanwhile, although investors tend to view AI developments as existential, TTD doesn’t have a horse in the race when it comes to agentic and AI-generated search advertising, Green said, and neither is even a minor concern.
TTD sees roughly 20 million ad impressions per second, he said, and even if that number fell to 15 million, it wouldn’t affect TTD’s business model.
By comparison, Amazon’s ads business is far larger than The Trade Desk’s. But more than 90% of Amazon’s ad revenue – “more like 95%-plus,” Green said – goes to Amazon sponsored listing ads, while another couple of billion falls to Prime Video, per his back-of-the-napkin math. Amazon’s DSP business that buys open web ads is a single-digit percent of the pie, and probably a low single digit at that.
“I don’t think Amazon has a DSP as we define it,” Green added. “I think they will have tools to buy owned-and-operated [media] and they play in advertising the way that Facebook does today and the way that I think Google likely will in the future.”
Trading on a vision
Green is laying out a bold vision that Amazon will follow Meta by becoming a fully fledged content fortress and eventually largely ditch its third-party ad tech.
But his pitch to Wall Street would require a sweeping shift from the day-to-day and year-to-year inertia of the ad world, where change is usually slow and incremental.
“The average consumer now spends two-thirds of their digital time on the open internet,” Green said. TTD defines “open internet” broadly to include any internet-delivered streaming, audio, in-app and any formats other than web banners.
The vast majority of budgets right now go to walled gardens like Google, Meta and TikTok, which, according to Green’s theory, actually have relatively less human attention and worthwhile ad inventory. “This imbalance will correct over time,” he said.
Green’s most dubious claim, though, might have been his observation that, having recently completed a road show of town hall sessions with major CMO clients and publisher partners, “what is clear across all of these communities is the confidence that everyone has in the potential of the open internet.”
That sounds rather rose-tinted, considering that advertising revenue is dwindling for many open web publishers right now.
But Green is pushing a vision of the future that is very different from the current reality.
“We maintain that the independent and objective DSPs will have the majority of open internet spend at end state,” he said.
And all of TTD’s biggest competitors are conflicted in their offerings, Green added, “so it is ours for the taking.”
