The Trade Desk stock slips ~4% after hours despite Q2 beat, solid Q3 revenue guidance
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Shares of The Trade Desk (NASDAQ:TTD) on Wednesday fell more than 4% in extended trading, despite the ad-buying digital platform reporting a Q2 results beat and customer retention of over 95%.
TTD stock retreated 4.2% to $77.50 after hours.
It is worth noting that the stock has seen a massive runup this year, having gained a whopping 80.5% up to its last close. Expectations for advertising-related companies have also been especially high in light of their elevated valuations.
TTD earned $0.28 per share on an adjusted basis in Q2 on revenue of $464M. Analysts were expecting earnings per share of $0.26 on revenue of $455.07M.
The company also issued Q3 revenue guidance of at least $485M, compared to a consensus estimate of $480.51M.
"With advances in areas such as CTV (connected TV), retail and identity, we are helping the worldâs largest brands buy media on the open internet with more precision and transparency than ever,â TTD CEO Jeff Green said in a statement.
However, the postmarket reaction to the results seem to suggest that investors were hoping for more, despite TTD's revenue growing 23.1% Y/Y and customer retention remaining at over 95% in Q2.
Another reason for the heightened expectations could be Facebook-owner Meta (META) and Google-parent Alphabet (GOOG) (GOOGL) both reporting robust increases in advertising revenues in their recent earnings reports. Investors had expected a similar trend for The Trade Desk (TTD).
TTD also provided Q3 adjusted EBITDA guidance of about $185M.
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