Pubmatic, Inc. · NASDAQ:PUBM
Pubmatic — Q1 2021 Earnings Presentation
20 slides from Pubmatic's earnings presentation, May 13, 2021
Slide 1: Q1 2021 Earnings Presentation
Q1 2021 Earnings Presentation May 13, 2021
Slide 2: Safe Harbor
SAFE HARBOR This presentation contains forward-looking statements. These statements may relate to, but are not limited to, expectations of future operating results or financial performance, market size and growth opportunities, the calculation of certain of our key financial and operating metrics, c
Slide 3: Mission and Q1 2021 Financial Highlights
MISSION PubMatic Fuels the Endless Potential of Internet Content Creators Q1 2021 FINANCIAL HIGHLIGHTS REVENUE NET INCOME ADJUSTED EBITDA1 $43.6M $4.9M $14.5M +54% YOY +444% YOY +183% YOY 1 Adjusted EBITDA is a non-GAAP measure. A reconciliation of Adjusted EBITDA to net income is provided on slide
Slide 4: Competitive Advantage from Our Cloud Infrastructure for Digital Advertising
COMPETITIVE ADVANTAGE FROM OUR CLOUD INFRASTRUCTURE FOR DIGITAL ADVERTISING Drive superior Leading Speed of outcomes for marketplace Innovation customers efficiency 4
Slide 5: PubMatic's Growth Drivers
PUBMATIC’S GROWTH DRIVERS Economic Re-Opening Driving Omnichannel Digital Ad Spend Growth Programmatic Evolution of CTV / OTT Continued Buy-Side Spend Consolidation 5
Slide 6: Global Re-Opening Creates Significant Tailwinds for Digital Ad Spend
GLOBAL RE-OPENING CREATES SIGNIFICANT TAILWINDS FOR DIGITAL AD SPEND G L O B A L G D P, E X P E C T E D Y O Y G L O B A L D I G I TA L ($ in Trillions) EXCLUDING CHINA1 ADVERTISING SPEND GROWTH 2 $71 $75 20% EXPECTED YOY GLOBAL M OBILE ADVERTISING SPEND GROWTH 2 23% M OBILE SHARE OF P U B M AT I C ’
Slide 7: Significant Opportunity to Deliver Premium CTV / OTT Inventory at Scale
SIGNIFICANT OPPORTUNITY TO DELIVER PREMIUM CTV / OTT INVENTORY AT SCALE E S T I M AT E D G L O B A L C T V / O T T ($ in Billions) P R O G R A M M AT I C A D S P E N D SEQUENTIAL FORECAST 1 CTV/OTT REVENUE GROWTH IN Q1'21 VS Q4'20 $35 55% $20 GLOBAL CTV/ OTT PUBLISHERS2 2020 2025 80+ 1 Source: Magna
Slide 8: Buyers Continue to Consolidate Spend on PubMatic
BUYERS CONTINUE TO CONSOLIDATE SPEND ON PUBMATIC TRANSPARENT OM NICHANNEL I N V E N TO RY EFFICIENCY BUSINESS MODEL REAL TIME BIDDING QUALITY R EC EN T SU PPLY PAT H O PT IM IZ AT ION D EA LS 8
Slide 9: Driving Change in Audience Addressability
DRIVING CHANGE IN AUDIENCE ADDRESSABILITY 1 st Party Known Contextual FLoC & Data Identity Targeting Sandbox Solutions 9
Slide 10: Multiple Growth Drivers Increase Utilization of Our Cloud Infrastructure
MULTIPLE GROWTH DRIVERS INCREASE UTILIZATION OF OUR CLOUD INFRASTRUCTURE ADVERTISERS CUSTOMERS AGENCIES PUBLISHERS DESKTOP DISPLAY MOBILE WEB MOBILE APP DIGITAL VIDEO OTT / CTV A D F O R M AT S A N D D E V I C E S Note: Chart does not depict underlying data, but is intended to illustrate the Company
Slide 11: Financial Results
Financial Results 11
Slide 12: Q1 2021 Financial Highlights
Q1 2021 FINANCIAL HIGHLIGHTS YOY REVENUE GROWTH REVENUE $50 $45 $43.6 54% $40 $35 $28.3 YOY NET INCOME GROWTH $30 $23.6 $25 $20 444% $15 ($ in Millions) $10 $5 YOY ADJUSTED EBITDA GROWTH 1 183% $0 Q1'19 Q1'20 Q1'21 1 Adjusted EBITDA is a non-GAAP measure. A reconciliation of Adjusted EBITDA to net i
Slide 13: Financial Growth Drivers
FINANCIAL GROWTH DRIVERS 1 Scaled Global Business 2 Usage-Based Business Model 3 High Gross Margins 4 Highly Efficient Business Model 5 Consistently Generate Cash Flow 13
Slide 14: Strong Revenue Growth Across Channels in Q1 2021
STRONG REVENUE GROWTH ACROSS CHANNELS IN Q1 2021 YOY MOBILE & SEQUENTIAL CTV YOY DESKTOP OMNICHANNEL VIDEO REVENUE GROWTH1 REVENUE GROWTH REVENUE GROWTH 83% 55% 26% 1 Q1 2021 vs. Q4 2020 14
Slide 15: Robust Gross Profits
ROBUST GROSS PROFITS $50 DRIVERS High marginal profitability $40 $31.3 from structural leverage: ▪ Reduced cost of $30 72% processing impressions $20 $18.3 ▪ Increased infrastructure $14.8 utilization ($ in Millions) $10 65% 63% $0 Q1'19 Q1'20 Q1'21 Gross Profit Gross Margin % 15
Slide 16: Operating Expenses: Investing for Growth
OPERATING EXPENSES: INVESTING FOR GROWTH DRIVERS $24.7 ▪ Increased headcount for $8.1 growth $17.9 $17.3 ▪ Incremental public $5.9 $4.3 company expenses and stock-based compensation in Q1'21 $12.8 $10.0 ($ in Millions) $8.9 $3.1 $2.9 $3.7 Q1'19 Q1'20 Q1'21 Technology & Development Sales & Marketing
Slide 17: Increasing Profitability
INCREASING PROFITABILITY $25 $20 NET INCOME Ad j . E B I T D A 1 $6 $4.9 $15 $14.5 $5 $4 ($ in Millions) $3 $10 $2 $0.9 33% $1 $5.1 ($ in Millions) $0 $5 ($1) 18% $0.4 ($2) ($3) ($2.3) $0 2% Q1'19 Q1'20 Q1'21 Q1'19 Q1'20 Q1'21 Adj. EBITDA Adj. EBITDA Margin 1 Adjusted EBITDA and Adjusted EBITDA Marg
Slide 18: Delivering Cash Flow
DELIVERING CASH FLOW NET CASH PROVIDED S T E P S TA K E N T O B Y O P E R AT I N G A C T I V I T I E S DELIVER CASH FLOW ▪ Investment in automation ▪ Continuous optimization of $14.7 infrastructure (software and $12.7 hardware) ▪ Offshore R&D leverage ▪ Focus on profitable publishers ($ in Millions)
Slide 19: Appendix
Appendix 19
Slide 20: Non-GAAP Reconciliation – Adjusted EBITDA
NON-GAAP RECONCILIATION – ADJUSTED EBITDA ($ in Millions) Three Months Ended March 31, 2020 2021 Net Income $0.9 $4.9 Add back (deduct): Stock-Based Compensation $0.5 $3.2 Depreciation and Amortization $3.6 $4.6 Interest Income ($0.3) ($0.1) Provision for Income Taxes $0.4 $1.9 Adjusted EBITDA $5.1