Mauricio, on the second part of your question, when we think about what are the most exciting growth opportunities in the industry, it’s really around supply path optimization, so getting closer to buyers and capturing a greater share of their ad budgets and return for greater efficiency and greater control on their part, omnichannel video, so both connected TV as well as online video. Just as a reminder, online video is still multiples of the size of connected TV in terms of TAM or opportunity commerce media and then addressability. And so these are squarely aligned with where our investment portfolio sits over the last 18 months. And that, of course, is not by accident. As Steve described, when we get into a downturn or a soft patch in terms of the macro environment, we really think about where is the industry headed when the inevitable upturn comes and then we align our innovation or investment portfolio accordingly.
So our intent is to be really well positioned with the fastest-growing segments when we come out of this downturn, right which hopefully we’ll start to see in the next couple of quarters, although nobody knows for certain. And hopefully, we’ll also see a firming up of the display market which is still about 2/3 of our business. And all of that combined should push us to market share gains, as Steve mentioned.
Operator: Our next question comes from Dan Day at Riley.
Dan Day: So Steve, I think we talked a few months ago on ACTIVATE, just how advertisers are likely to take sort of a crawl walk-around approach with something like it, starting with really small test budgets getting comfortable with it, ramping over time with more significant budgets. So maybe if you can just talk about where you are right now? Are we still in the test phase with really all of them? And any advertisers starting to move past that? It could be a more significant growth driver maybe in the first half of next year?
Steve Pantelick: So as we’ve called out when we launched the product and on progress over time, this is really a product that’s a great product market fit for us. It leverages our platform, it leverages our publisher relationships — our buyer relationships. And so we are seeing a very robust pipeline in our prepared comments. We mentioned that 50 opportunities that we’re going after across the globe. We recently launched in APAC. And we are in the ramp-up phase. Of course, it depends on the cycles for an agency or an advertiser. We share the specifics, the excitement from a global advertiser like Mars in terms of what they see in the product and their plans for the future. So our goal is to make sure we continue to lay the foundation, establish these relationships, get into the investment cycles of the agencies and the advertisers and often contract does go through a testing process and then expansion of the budgets.
I don’t anticipate material benefits to the top line until the second half of ’24 as we get more into the ramp-up in the investment cycle of these partners. But the way to think about it from an investor’s perspective is this is a multiyear runway. So we are taking the time to make sure that we develop the product in ways that ultimately match the opportunity and we’re very positive about the progress we’ve made.
Dan Day: And if I could just follow up with one on convert, other product you’re looking to scale here. Just how are connotations with retailers and the other commerce partners going so far? There’s a couple of kind of more established specialized retail media ad tech vendors out there targeting that admin to long tail. So just talk us through how you cut through that and differentiate is the easy answer that there’s room for multiple solutions. They don’t — they’re not choosing one or the other is retail media a little different and they might not want to work with 10-plus SSPs like they do in the Open Web.
Rajeev Goel: Sure. Yes. Dan, I can take that one. So I think there is a case of truth to what you’re saying, certainly which is that the industry is still quite early in the Commerce Media evolution and opportunity. So yes, there are obviously some folks that are already playing in this space. But we see the vast majority of the opportunity really has been white space. And so we are going after opportunities where we can bring together a suite of offerings with on-site monetization, sponsor listings as well as display and video, along with off-site monetization. So that’s inventory, our audience extension and use of first-party data to be able to scale retailer’s budgets. So with the launch of Converto, we have a unified platform that can bring all of these use cases together and deliver that to commerce media participants.
And we’re seeing that as commerce media participants look to scale their business from maybe an initial set of dollars to a bigger portion of their ad business than having a comprehensive platform can be quite useful. So that’s really where we’re focused in terms of the opportunity set.
Operator: And our next question comes from Maxwell Michaelis at LakeStreet.
Maxwell Michaelis: Just one for me. I was wondering, I just want to tie back to convert. I just want to know if it’s kind of in line with initial expectations you had. I know this is the first quarter that you’ve launched the product.
Rajeev Goel: Yes. I would say, so far, it is in line with our initial expectations. As you said, it’s still very early. The sales cycles here are not short, right? This is an enterprise software sales cycle. So I think we’re looking at several quarters for a sales cycle but we’ve seen, I think, a lot of enthusiastic reaction. Obviously, we had a number of great launch partners when we did launch and our pipeline is looking pretty healthy here. So I would say in line with expectations, although certainly still very early going.
Operator: We have time for one more question. Matt Condon from JMP.
Matt Condon: Just one for me. Maybe just with Google’s Privacy Sandbox API moving bidding from the exchange into the browser. Can you just talk about how that changes the offering for SSPs and maybe just the competitive dynamic there?
Steve Pantelick: So a key part of Privacy Sandbox from Google is shifting the auction environment and the data used in that auction environment into the browser, right, to make that privacy safe. So that is a pretty, I think, significant shift in terms of the infrastructure required to monetize an ad impression. And so we’ve got a team of engineers that are working on this. As I mentioned, we’re working with Google and testing those APIs. I think it’s still quite early going. I think there’s still a number of unknowns as we are in conversation with the Google team about how things will work and how they’ll scale. So I would say it’s still pretty early going in terms of validating do these APIs work and how transactions will be processing will be scaled up.
But to your question, it is, I think, a pretty meaningful shift in terms of infrastructure. And I think given that we own and operate our own infrastructure and have a great degree of control and flexibility, we feel like we should be in a good position to be able to build in the way that we want to build it.
Operator: At this time, there are no additional questions. I’m going to turn the call back over to Rajeev for closing remarks.
Rajeev Goel: Thank you, Stacy. I want to thank everyone for joining us today. This quarter, we delivered strong execution and market inflection point for revenue growth in Q4. I couldn’t be more excited by the momentum we’re seeing across our business and investments we’ve made that are accelerating our business. Sell-side technology is increasingly relevant to digital advertising publishers and buyers and we are at the forefront of that opportunity. And of course, underpinning our success is our durable model, including healthy cash flow and a strong balance sheet. We look forward to seeing many of you over the next couple of months. Have a great afternoon, everyone.
