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Why The Trade Desk Stock Skyrocketed Friday

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Daniel Sparks, The Motley Fool
In this article:
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  • TTD

What happened

Shares of programmatic ad-buying platform The Trade Desk (NASDAQ: TTD) soared on Friday, hitting new highs. Shares were up 27% as of 9:52 a.m. EST.

The surge in the stock's price followed The Trade Desk's fourth-quarter earnings report, which featured revenue and earnings per share that crushed analysts' estimates. The company's full-year 2019 revenue guidance also came in meaningfully ahead of analyst expectations.

Arrows pointing up and to the right
Arrows pointing up and to the right

Image source: Getty Images.

So what

The Trade Desk reported record fourth-quarter revenue of $160.5 million, up 56% year over year. This obliterated a consensus analyst forecast for revenue of $147.7 million (which would have represented about 44% year-over-year growth) and, notably, surpassed the company's 50% growth rate in Q3.

The company's non-GAAP earnings per share were $1.09, more than doubling from $0.54 in the year-ago quarter. Analysts, on average, expected $0.80.

"Connected TV spend on our platform helped to drive our revenue acceleration," said The Trade Desk CEO Jeff Green in a statement to the media. "We had record CTV spend in Q4. Over 160 advertisers each spent at least $100K in CTV with many spending in the millions."

Now what

Looking ahead, The Trade Desk expects full-year revenue of $637 million, ahead of a consensus analyst estimate for revenue of $616.8 million.

In addition, the company forecast full-year adjusted earnings before interest, taxes, depreciation, and amortization (EBITDA) of $182 million, up from $159.4 million in 2018. But management noted in its fourth-quarter earnings call that any outperformance on its top line during the year will likely fall straight to EBITDA.

More From The Motley Fool

Daniel Sparks owns shares of The Trade Desk. The Motley Fool owns shares of and recommends The Trade Desk. The Motley Fool has a disclosure policy.

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