PubMatic Q2 revenue swells 88% to $49.7 million

PubMatic, a sell-side platform for digital advertising, has delivered an 88% increase in revenue at $49.7 million in Q2 2021 over $26.4 million in the same period of 2020.

GAAP net income was $9.9 million, an increase over net income of $0.7 million. Adjusted EBITDA was $18.6 million, compared to adjusted EBITDA of $4.9 million. Net dollar-based retention was 150% for the trailing twelve months ended June 30, 2021, an increase from 107% in the comparable trailing twelve-month period a year ago. Total cash, cash equivalents, and marketable securities of $122 million with no debt, an increase of 11% in the quarter.

“We delivered another great quarter, benefiting from a differentiated business model, multiple organic growth drivers, prior period investments, and accelerated digital ad spend,” said Rajeev Goel, co-founder and CEO at PubMatic.

“We’re relentlessly focused on the growing value proposition we bring to publishers and buyers, and we believe our continued investments and innovation position us well to take advantage of the rapidly growing market. As we enter the second half of the year, we are well ahead of where we expected to be in terms of organic market share gains. We are growing at twice the rate of the overall digital ad market, giving us the confidence to raise our 2021 and 2022 expectations on both the top and bottom lines.”

The company said that it processed 20.2 trillion impressions in the second quarter, a 96% increase over a year ago. Revenue from fast-growing advertising formats mobile and omnichannel video, which includes OTT/CTV, grew 108% year-over-year and represented 65% of total revenue in Q2 2021.

Revenue from CTV, which includes OTT, grew by more than 100% over Q1 2021, an increase over the 55% sequential growth we saw from Q4 2020 to Q1 2021. As of the end of Q2 2021, we are monetizing CTV/OTT inventory from 114 publishers, up from more than 80 publishers in Q1 2021.

In the second quarter, 23.6% of ad dollars on our platform were via Supply Path Optimization agreements, with the share more than doubling since the beginning of 2020. Over 250 publishers are using our Identity Hub solution, which is integrated with 13 leading email-based or alternative identifiers to enable buyers to recognize a publisher’s audience in cookieless environments and bid accordingly.

“Our outstanding performance in the quarter reflects the strength of our omnichannel platform, our usage-based business model, and our infrastructure-first approach to digital advertising,” said Steve Pantelick, CFO at PubMatic.

“We benefit from a powerful network effect that is built on long-term, consistent investment in innovation that provides increased revenue visibility and operational scale, which benefits our customers and us. As a result, we are raising our full year 2021 revenue and adjusted EBITDA guidance. Given this strong momentum, we expect 2022 year-over-year revenue growth of 25%, and anticipate achieving approximately 30% adjusted EBITDA margin, inclusive of our continued investments for growth.”

For the third quarter 2021, the company expects revenue to be in the range of $51 million to $53 million, representing growth of 35% to 39% over Q3 2020. We expect adjusted EBITDA to be in the range of $15 million to $16 million, representing a 30% margin.

For the full year 2021, the company has raised its outlook and is now expecting revenue to be in the range of $205 million to $209 million (previously $195 million to $200 million) representing year-over-year growth of 38% to 40% (previously 31% to 34%) over 2020. We now expect adjusted EBITDA to be in the range of $65 million to $68 million (previously $54 million to $58 million) or 30% to 32% margin (previously 27% to 29%). For the full year 2022, the company expects year-over-year revenue growth of 25%, and anticipate achieving an adjusted EBITDA margin of approximately 30%.