PubMatic, Inc. (NASDAQ:PUBM) Q1 2024 Earnings Call Transcript

Mauricio Munoz: Very helpful. Thank you.

Stacie Clements: We have time for one more question from Justin Patterson at KeyBanc. Please go ahead, Justin.

Justin Patterson: Great. Thank you very much and good afternoon. I just wanted to go back to the land and expand strategy. With now 77% of revenue coming from high value formats and channels, that seems like it provides a nice margin tailwind of the business. So curious how you’re thinking about just taking some of that margin and driving more growth, with new customers, existing customers, versus having that margin drop through play out? Thanks.

Rajeev Goel: Hey, Justin, thank you for the question. And it’s something that we think about every day given sort of our strong profitability, but also strong goal imperative to keep driving the top line. And you can see the results from the last quarter. From our perspective, it’s a balance. But absolutely, going into the year, we said that we’re going to incrementally invest in a couple key areas. The areas that we envision to be the fastest growing around video mobile supply path optimization in the commerce media space. So, we feel that now is the time to make those investments and we’re appropriately managing those in terms of timing and the magnitude. You can see from our guidance that we still have a very robust expectation forecast for the year at 31% at the midpoint.

And I would say that for us, it’s really about taking advantage of the opportunities that we have and we see them emerging and we’ve proven an ability to innovate and then capture that opportunity. And so we’re going to keep doing that and still deliver very robust margins and free cash flow.

Justin Patterson: All right, thank you.

Stacie Clements: Great. Thank you all. We’re just about, or we’re actually over the top of the hour, so I’m going to go ahead and turn the call back over to Rajeev for closing remarks.

Rajeev Goel: Thank you, Stacie, and thank you all for joining us today. We had a strong start to the year with continued momentum into April. This, along with the planned investments this year in high return areas, gives us confidence to raise our full year guidance. Content creators, ad buyers, data partners, commerce, media networks, they’re all choosing to build their ad tech stacks on PubMatic. Our platform offers efficiency and control across the digital advertising ecosystem, resulting in higher CPMs and increased advertiser ROI. And our logo list continues to grow, fueling greater access to ad dollars, data and high value inventory. We’ll be out on the road over the next month, and we look forward to seeing many of you then. Thanks and have a great afternoon, everyone.