Wrapping up Q3 earnings, we look at the numbers and key takeaways for the advertising software stocks, including PubMatic (NASDAQ: PUBM) and its peers.

The digital advertising market is large, growing, and becoming more diverse, both in terms of audiences and media. As a result, there is a growing need for software that enables advertisers to use data to automate and optimize ad placements.

The 7 advertising software stocks we track reported a strong Q3. As a group, revenues beat analysts’ consensus estimates by 2.8% while next quarter’s revenue guidance was 1.1% below.

In light of this news, share prices of the companies have held steady as they are up 3.8% on average since the latest earnings results.

PubMatic (NASDAQ: PUBM)

Powering billions of daily ad impressions across the open internet, PubMatic (NASDAQ: PUBM) operates a technology platform that helps publishers maximize revenue from their digital advertising inventory while giving advertisers more control and transparency.

PubMatic reported revenues of $67.96 million, down 5.3% year on year. This print exceeded analysts’ expectations by 6.1%. Overall, it was a strong quarter for the company with a solid beat of analysts’ EBITDA estimates and an impressive beat of analysts’ revenue estimates.

PubMatic achieved the biggest analyst estimates beat but had the slowest revenue growth of the whole group. Unsurprisingly, the stock is up 17.6% since reporting and currently trades at $9.

Is now the time to buy PubMatic? Access our full analysis of the earnings results here, it’s free for active Edge members.

Best Q3: AppLovin (NASDAQ: APP)

Sitting at the crossroads of the mobile advertising ecosystem with over 200 free-to-play games in its portfolio, AppLovin (NASDAQ: APP) provides software solutions that help mobile app developers market, monetize, and grow their apps through AI-powered advertising and analytics tools.

AppLovin reported revenues of $1.41 billion, up 17.3% year on year, outperforming analysts’ expectations by 4.5%. The business had an exceptional quarter with an impressive beat of analysts’ EBITDA estimates and a solid beat of analysts’ revenue estimates.

The market seems happy with the results as the stock is up 9.2% since reporting. It currently trades at $667.12.

Is now the time to buy AppLovin? Access our full analysis of the earnings results here, it’s free for active Edge members.

Weakest Q3: DoubleVerify (NYSE: DV)

Using advanced analytics to evaluate over 17 billion digital ad transactions daily, DoubleVerify (NYSE: DV) provides AI-powered technology that verifies digital ads are viewable, fraud-free, brand-suitable, and displayed in the intended geographic location.

DoubleVerify reported revenues of $188.6 million, up 11.2% year on year, falling short of analysts’ expectations by 0.8%. It was a slower quarter as it posted revenue guidance for next quarter slightly missing analysts’ expectations.

DoubleVerify delivered the weakest performance against analyst estimates in the group. The stock is flat since the results and currently trades at $10.88.

Read our full analysis of DoubleVerify’s results here.

Integral Ad Science (NASDAQ: IAS)

Processing over 280 billion digital ad interactions daily through its AI-powered technology, Integral Ad Science (NASDAQ: IAS) provides a cloud-based platform that measures and verifies digital advertising across devices, channels, and formats to ensure ads are viewable, fraud-free, and brand-safe.

Integral Ad Science reported revenues of $154.4 million, up 15.6% year on year. This print topped analysts’ expectations by 3.4%. Overall, it was a very strong quarter as it also produced a solid beat of analysts’ EBITDA estimates and a decent beat of analysts’ revenue estimates.

The stock is flat since reporting and currently trades at $10.24.

Read our full, actionable report on Integral Ad Science here, it’s free for active Edge members.

LiveRamp (NYSE: RAMP)

Serving as the digital middleman in an increasingly privacy-conscious world, LiveRamp (NYSE: RAMP) provides technology that helps companies securely share and connect their customer data with trusted partners while maintaining privacy compliance.

LiveRamp reported revenues of $199.8 million, up 7.7% year on year. This number beat analysts’ expectations by 1%. It was a strong quarter as it also put up an impressive beat of analysts’ EBITDA estimates and a narrow beat of analysts’ annual recurring revenue estimates.

LiveRamp achieved the highest full-year guidance raise among its peers. The company added 5 enterprise customers paying more than $1 million annually to reach a total of 132. The stock is up 10.2% since reporting and currently trades at $30.21.

Read our full, actionable report on LiveRamp here, it’s free for active Edge members.

Market Update

The Fed’s interest rate hikes throughout 2022 and 2023 have successfully cooled post-pandemic inflation, bringing it closer to the 2% target. Inflationary pressures have eased without tipping the economy into a recession, suggesting a soft landing. This stability, paired with recent rate cuts (0.5% in September 2024 and 0.25% in November 2024), fueled a strong year for the stock market in 2024. The markets surged further after Donald Trump’s presidential victory in November, with major indices reaching record highs in the days following the election. Still, questions remain about the direction of economic policy, as potential tariffs and corporate tax changes add uncertainty for 2025.

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