On the heels of the launch of its latest supply-path optimization product, PubMatic posted $55.4 million in Q1 revenue, growing 2% YOY. More than 65 publishers joined the platform in the first quarter, bringing its total portfolio to about 1,700 publishers and app developers. PubMatic’s stock rose approximately 13% after the earnings.
The new tool, Activate, follows the recent trend of SSPs and DSPs going end-to-end (think Magnite’s ClearLine or The Trade Desk’s OpenPath). Activate lets agencies and brands buy online video and CTV inventory directly via programmatic channels (but not via real-time bidding). CTV publishers LG and Fubo were among Activate’s launch partners, as were a bunch of buy-side players, including Dentsu, Omnicom, Havas, WPP-owned GroupM and CPG brand Mars.
Online video and CTV represent a channel of focus for PubMatic. Thirty percent of its revenue stemmed from omnichannel video, comprising connected TV (CTV), desktop and mobile devices, which increased 13% YOY.
In the first quarter, the company saw an 80% increase in buyers interested in pursuing SPO with PubMatic, which made up more than 35% of the activity on the platform in Q1, compared to around 27% in Q1 2022. Within the online video segment, CTV revenues grew by more than 50%. PubMatic declines to break out its overall CTV revenue.
Through SPO, PubMatic aims to make the ecosystem more efficient and transparent, with fewer hops and lower latency, said CFO Steve Pantelick.
In other CTV news, OpenWrap, PubMatic’s Prebid-based software tool for unified auctions, saw “increased stickiness for publishers,” said CEO and co-founder Rajeev Goel, with signed payments growing 27% YoY for Q1. OpenWrap works across CTV, mobile, web, video and display, with a native launch to come soon.
Of course, it’s not all sunshine and rainbows. One topic that didn’t come up on the investor call was PubMatic’s recent consent-related woes, whereby the default setting within Identity Hub, its Prebid-based identity management tool, was set so low as to effectively ignore user consent strings.
Consolidation station
Acquiring media measurement and reporting platform Martin hastened the development of Activate, enabling PubMatic to get to the finish line faster. “We’re constantly on the lookout for acquisition opportunities that might help us accelerate [our SPO] road map,” Goel said.
Another area of interest for PubMatic is commerce media, which has a market size of more than $120 billion. PubMatic plans to use “a similar playbook” as it did with SPO, Goel said, to tap the commerce media market through audience extension, on-site multiformat monetization and operations tech.
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Aside from nurturing its CTV video and display inventory partnership with Kroger Precision Marketing, PubMatic won several new customers in the first quarter, including Lyft and TripAdvisor, which are using the SSP for sponsored products, display and video ad units.
“We’re helping those publishers monetize the inventory they have on their properties,” Goel said. “That’s obviously bread and butter to what we do as an SSP.”
