Trade Desk Inc (NASDAQ:TTD) stock plunges 18.12% (As on November 10, 11:38:29 AM UTC-4, Source: Google Finance) after the company issued fourth-quarter revenue guidance that fell well short of analysts’ estimates. Net income increased to $39 million, from $16 million, a year earlier. Customer retention remained over 95% during the third quarter, as it has for the past nine consecutive years. The Trade Desk is building support for Unified ID 2.0 (UID2), an industry-wide approach to identity that preserves the value of relevant advertising, while putting user control and privacy at the forefront. UID2 is an upgrade and alternative to third-party cookies. In CTV, the company have innovated by constructing a more efficient supply chain by creating a new product, OpenPath. The company has also advanced TV measurement with the launch of TVQI (the TV Quality Index) to showcase the value of premium TV content over UGC platforms like YouTube that advertise on more questionable content for brands.

TTD in the third quarter of FY 23 has reported the adjusted earnings per share of 33 cents, beating the analysts’ estimates for the adjusted earnings per share of 29 cents, expected by LSEG, formerly known as Refinitiv. The company had reported 25 percent increase in the adjusted revenue to $493 million in the third quarter of FY 23, beating the analysts’ estimates for revenue of $487.04 million. Excluding US political election spend, which represented a low single digit percent of spend in Q3 2022, the revenue growth rate in Q3 of this year was about 27% on a year-over-year basis. During the third quarter, CTV led the growth from a scaled channel perspective once again. The company has generated approximately $200 million in adjusted EBITDA, or about 40 percent of revenue. This led to free cash flow of $184 million in Q3, marking over $600 million of free cash flow on a trailing twelve-month basis. Cash, cash equivalents and short-term investments ended the quarter at $1.5 billion.

Additionally, the company repurchased $90 million of the Class A common stock in the third quarter of 2023. As of September 30, 2023, we had $273 million available and authorized for repurchases.

For the December period, Trade Desk projected revenue of at least $580 million, trailing the $610 million that was expected by analysts, according to LSEG. For the fourth quarter 2023 Adjusted EBITDA is expected to be of approximately $270 million.