Magnite, Inc. Q4 FY2025 earnings call

Michael noted CTV is now the majority of business, with strong growth from large players in the industry. DBplus saw budget reallocation to CTV. AI was discussed with embedding ADCP and agent-to-agent campaigns. Partnerships in DV+ like commerce media are gaining momentum. CTV combines brand impact of TV with precision of digital, and Magnite is well-positioned in this shift.

In Q4 2025, CTV contribution ex-tax grew 32% ex-political, accounting for 48% of total contribution XTAC. DBplus grew 4% ex-political in Q4, modestly below expectations. For the full year 2025, contribution XTAC totaled $670 million, up 10% year-over-year or 14% excluding political. CTV achieved contribution ex-tac of $304 million, up 17% or 22% excluding political. DBplus reported $365 million for the year, growth of 5% or 8% ex-political.

For Q1 2026, expected contribution XTAC 157 - 161 million, +8 - 10% growth; CTV contribution XTAC 81 - 83 million, +28 - 31% growth; DBplus contribution XTAC 76 - 78 million, -6 - 8% decline. Full year 2026, anticipate total contribution extract growth at least 11%, adjusted EBITDA percentage growth mid-teens, adjusted EBITDA margin >35%, free cash flow growth >30%, CapEx ~$60 million.

Await court's final order in Google ad tech remedies phase, which could create share reallocation opportunities or uncertainties. Also, potential impacts of AI development and macroeconomic factors on business.

Q: Talked about breadth of CTV and sustainability, break down growth by SMVs and verticals.

A: Saw broad growth across board, performance advertisers shifting to CTV.

Q: Risk of elongating client relationship time, lowering risk of investing in Magnite.

A: Highly differentiated in CTV with leading programmatic ad server and SSP platform.

Q: Parse mix shift to CTV versus organic partner growth.

A: Spend shift rolling into organic numbers, both CTV growth and organic growth positive.

Q: Thoughts on CTV and DV+ growth going forward.

A: CTV has high sustainable growth due to secular shift, DV+ has diverse portfolio with some weakness but emerging categories.

Q: Evolution of ADCP and client interest in AI agents.

A: Interest high, execution not high yet, but Magnite positioned to take advantage.

Q: Context protocol, CloudX, ad tax case.

A: ADCP allows agents to talk, CloudX integration in mobile, ad tax case outcome hard to predict but behavioral remedies likely.

Q: CTV strength, key unlocks.

A: Broad-based growth, strength in DSPs and agency marketplaces.

Q: CTV verticals, guide change.

A: Status quo on vertical trends.

Q: Netflix ad business impact.

A: Anticipate bigger year for Netflix, take rate not significantly impacting overall growth.

Q: Strength with agencies, clear line adoption.

A: Encouraged by agency marketplace adoption and volume, ClearLink adoption growing with stickiness.