Posted on Wednesday, Jun 30th 2021
According to a recent report,
the US digital advertising market grew 12.2% in 2020. The early days of the pandemic saw pullback in ad budgets, but by the latter half of 2020, ad spending had returned again. According to the report, a surge in connected television, e-commerce shopping, and at-home deliveries helped drive the growth despite the pandemic conditions. Magnite’s Offerings
Los Angeles-based Magnite (NASDAQ: MGNI) was founded in 2007 by Craig Roah, Duc Chau, Frank Addante, and Julie Mattern. It is a sell-side advertising platform that allows publishers to monetize content. Magnite was initially set up as Rubicon Project in 2007. In 2019, Rubicon announced a merger with Telaria, and rebranded itself as Magnite the following year.
Today, Magnite is the world’s largest independent sell-side ad platform. It was formed by leveraging the programmatic ad capabilities of Rubicon Project with the Connected TV (CTV) experts at Telaria. It allows thousands of publishers to sell advertising across every channel and format—including CTV, desktop, mobile, and audio. It helps agencies and brands reach end consumers efficiently, safely, and while respecting their privacy.
Recently Magnite announced its first quarter results. Revenues for the quarter grew 67% to $60.7 million, ahead of the market’s estimates of $58 million. Net loss was $12.9 million, or $0.11 per share, compared to a net loss of $9.7 million, or $0.18 per share reported a year ago. Non GAAP net income was $0.03 per share compared with $0.06 per share reported a year ago. The market was looking for an EPS of $0.02 for the quarter.
For the current quarter, Magnite forecast revenues of $92-$96 million.
Magnite’s SpotX Acquisition
Magnite recently announced the acquisition of Colorado-based SpotX for an estimated $1.17 billion. Founded in 2007 by Michael Shehan and Steven B. Swoboda, SpotX provides premium digital media owners with a holistic solution, giving its customers the ability to monetize content with the help of video advertising across desktop, mobile, and connected devices. The platform connects premium media owners with brands, agencies, trading desks, and DSPs, facilitating the sale of video advertising. It allows customers to gain insights into buyer behavior and audience consumption, allowing them to better manage video ad inventory and maximize yield. The acquisition will provide comprehensive advertising technology stack for publishers and TV programmers. Prior to the acquisition, SpotX raised $12 million in 2 rounds of funding with the help of H.I.G. Capital.
Earlier this year, Magnite launched the open beta of Unified Decisioning, a
solution that empowers CTV and OTT publishers to maximize yield by removing the need to manage direct sold and programmatic demand channels independently and allowing them to compete side by side. Unified Decisioning provides publishers with access to tools and controls that can help define when and how direct sold and programmatic demand should compete. It works alongside all major ad servers to ensure that the optimal ad set is chosen while taking into consideration both direct and programmatic deal priority and yield. Programmatic buyers and brands will have greater insight into available inventory and also have the opportunity to compete for premium video content. It is an ad server agnostic solution with no conflicting demand agenda.
Its stock is trading at $36.50 with a market capitalization of $4.7 billion. It had touched a 52-week high of $64.39 in February. It had fallen to a 52-week low of $5.57 in July.
Disclosure: All investors should make their own assessments based on their own research, informed interpretations, and risk appetite. This article expresses my own opinions based on my own research of product-market fit, channel execution, and other factors. My primary interest is in product strategy. While this may have bearing on stock movements, my writings tend to focus on long-term implications. The information presented is illustrative and educational, but should not be regarded as a complete analysis nor recommendation to buy or sell the securities mentioned herein. I am not a registered investment adviser and I am not receiving compensation for this article. Photo Credit: Michael Gaida / Pixabay This segment is a part in the series : Cloud Stocks . Smartsheet Acquiring Bootstrapped Startups to Drive Growth . Bootstrapped Unicorn Atlassian is Acquiring Capital Efficient Startups . Netflix Price Hike Ruffles Competition . How Will Carbon Black Differentiate? . 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