PubMatic, Inc. — Call Transcript 2026

We're gonna get started. I'm Laura Martin. I'm the Senior Analyst at Needham & Company. Let me introduce our speaker today. Rajeev Goel is CEO of PubMatic. He's the co-founder and CEO, where he spent nearly two decades scaling the company into a leading independent SSP, which has recently pivoted to become an agnostic OS, AI-powered operating system. A serial entrepreneur and tech visionary, he previously co-founded Chipshot.com. Rajeev also serves as a trustee for Johns Hopkins University and a board member for the Interactive Advertising Bureau. Okay, I want to start with a question on leadership. Even the last two sessions, both men have started with the saying that generative AI is transformational. My question is: How do you think about a leader in this kind of period of uncertainty and tech disruption? Yeah. Well, I think, you know, we've been working in an industry, leading in an industry that's obviously incredibly complex. You know, sometimes people liken it to wartime, and I feel like I've been a wartime CEO for 20 years. You know, we compete with Google. Which is a declared monopolist, right? Fair. Okay, you gotta compete with somebody like that. You know, we view our opportunity as roughly a 4% market share leader versus, you know, Google at 60%. There's a lot of upside for us. I think with AI, I mean, I view this as really the third major transformation in our industry, and we're right at the early stages of it. The first was real-time bidding, the second was the consumer shift to mobile, and that obviously, you know, created a lot of disruption, winners and losers. Now, AI. We're in, I think, the second branch of AI. The first was machine learning, right? Yeah. Which works on structured data. That came into our industry about 15 years ago. This transformation with generative AI, I think is gonna be significantly larger. The reason is that, you know, structured data's only been around since really the 1950s or 1960s, right? Think about, you know, data in a database. Unstructured data is the world around us. Yeah. It's 100x the size of structured data, right? Yeah. More. More, right? It's audio, it's video, it's the spoken word, right? It's the human interface to how the world exists. It's just a much bigger opportunity. We really view it not so much as just a technological revolution, which of course it is, but really an opportunity to revolutionize the value chain in our industry. To really bring the publisher and advertiser much closer together, remove a lot of the complexity in the ecosystem, which for us means an opportunity to drive performance advertising, increase our TAM, and create a lot more value. You're talking about the company. I wanna know about leadership. Sure. What does this say? How do you have to lead differently in a period of, let's say it's only 18 months, of technological disruption, 1your employee base, the fear factor? How does that change? Are you saying it's just the same as when you went through mobile? Is that the point you're making an internet? I think those transformations required a significant level of leadership. Specifically, I think number one is honesty. Honesty with yourself, with your team, with your capabilities, where you have holes, where you have gaps, where you have opportunities. The second is to really question every assumption, right? It's really important to not think about what are the things that we've been good at historically, we're gonna continue to focus on, but really, what is it that we can do for our customers? What's the value that we can generate for them? Really hone in on that and then move the business in that direction. Such a fascinating answer because it's so systemic. It's not about people. You must not see leadership as people. You must think it as strategic from a systems point of view. I don't agree with that because I said honesty at the beginning, right? Honesty, you can't tell me you're dishonest. If there's not a transition between mobile. I assume you're honest all the time. That's not a change. Well, I think leaders aren't always honest with their team, right? Sometimes there are unknowns. You have to say, "Hey, we don't know. We gotta figure it out. Yeah. Sometimes you gotta change the skills of the team. Sometimes you gotta bring in new people. I think all of those things require a high degree of honesty in a period of significant change. Yeah. More so, maybe. I think I would say most CEOs think they're honest all the time. Well, that's a different issue. Whether they are or not, they may think that they are. I think that's totally fair. Okay. Let's start. I missed you at POSSIBLE. Yes. I came by to your booth, but you were so busy. Everybody was so crazy at POSSIBLE. You guys made a lot of product announcements at POSSIBLE. Let's go over some of those and just, your AgenticOS, your AI Insights, your Creative Innovation Suite. Let's talk about the big product announcements you guys are doing and why you think they're important to the future of PubMatic. Well, I think the biggest one by far and the biggest growth driver for us, in the coming years is AgenticOS. Okay. What we're doing with AgenticOS is MCP, Model Context Protocol, you know, generative AI enabling all of the core use cases on our platform. That's everything from inventory discovery and planning to media activation, to reporting and measurement, fee transparency, you know, guardrails for buyers. This extends well beyond purely the SSP capability set, and it moves into many more buyer-connected workflows. Many of the examples that I just gave you are actually things that buyers wanna do. We've been building towards this moment for the last four or five years, and we'll get into our data platform. We launched a couple of years ago a product called Activate, which allows buyers to buy directly in our SSP. By doing that, what we're doing is, back to what I said earlier about revolutionizing the value chain, via AI, we're collapsing the value chain in the industry, removing complexity, and allowing buyers to buy directly in our SSP. AgenticOS brings that all together, where what we see is that software, the legacy software user interfaces, those are very quickly becoming obsolete. I think one of the big advantages that incumbent DSPs have had over the years is, they've trained the agency trader or the advertiser, you know, trader to use their platform. What we see is that, with AI, the expectation of the customer is, "Hey, I don't need a complex interface. I don't wanna take two hours to set up a campaign. I wanna use AI and be able to do it in minutes. I don't wanna have to log in and troubleshoot a campaign. I want the system to tell me, 'Hey, this campaign has an issue. Here's three options to resolve it. You can pick, or maybe an AI agent will do that autonomously. That's exactly the value proposition that we're delivering with AgenticOS. AgenticOS is a product, but then you need action on the side of the ad agency, presumably, to create an agent that can talk to your AgenticOS? Is that right? A buyer will use an agent. They can use an agent that we're providing them. They can use an agent they've built or an agent that they've licensed. Using any of those buyer agents, our agent is part of AgenticOS, or they can connect in with their own agent to our system. They can't use a DSP. The Trade Desk doesn't have an agent that can talk to your AgenticOS on the SSP side? Yeah, as far as I'm aware, they do not. I don't know if they will in the future. If a buyer, if a DSP wants to connect with us via Model Context Protocol, we're open and available to do that. Okay. The idea is to streamline and cut some of the fees. This is another, like, aspect of, trying to pull fees out of the ecosystem? That's the AgenticOS objective? Our objective with AgenticOS is to deliver performance in the open internet. Okay. The key part of delivering performance is to simplify the ecosystem. Okay. When you have a DSP and you have an SSP, it's very difficult to actually deliver performance outcomes because there's a huge data divide between the platforms. Okay. If we think about, you know, what do walled gardens look like, right? There's a single layer of technology that connects the ad campaign with the inventory and the audiences. Yeah. Right? It's Exactly. They're not living in this world of, "Hey, we have these disparate systems that have limitations in how they can connect. Right. Instead, they're one platform that combines everything. We're taking the same approach with the open internet. With Activate, you can buy directly in our SSP. With AgenticOS, you can do it using an AI agent. We expose all of the services agentically. That product is growing incredibly quickly. I have a question. I guess I don't understand something. Activate is your ClearLine equivalent where a DSP can go directly to you through Activate and buy directly on your SSP, thereby disintermediating a bunch of the fees in the open internet. How is that different from AgenticOS? Sure. It seems it's exactly the same except one has to interact with an agent and one has to interact through a DSP. I wouldn't compare Activate to ClearLine. I think there's some huge differences. Okay. It's the same idea. It's search. It's, like, optimizing. Well, our focus is on collapsing the value chain in the ecosystem so that a DSP and an SSP is not needed. Traditionally, that's done via software interface. Okay. A user will, you know, come into a UI or Activate UI. Yeah. They'll set up a campaign and they'll buy. Okay. With AgenticOS, they don't need to use the user interface. They can do this all via AI. They can log into Claude if they want to. Right. Anthropic solution. Right, like Claude does have a buyer agent. Correct. They can log into there. Yes. They can connect to our Model Context Protocol service. They can discover all of the services. Right. They can use that. They can do it via OpenAI. They can do it via Gemini. They can use any system that they want. They can deploy their own agent that they've built. I guess my question is, aren't we just moving money from one pocket to another? The brand is the same, and you're just giving a brand, let's call it Coke. Instead of going through a DSP and paying the DSP fee, you're saying you can go through an agent, skip the DSP, and come straight. It's the same. All we're doing is moving money from Coke from one place to another, right? Well, when you collapse the. We didn't add. I guess, are we adding value to the ecosystem? Yeah. Are we just moving money? Let me give you a couple of case studies around this. When you collapse the ecosystem like what we're doing. Okay You're creating a lot of value for the advertiser and for the publisher. That's true. That's what we're focused on. The two endpoints get more value. Exactly You're pulling out fees. Okay. You're pulling out fees. You're removing operational overhead and complexity. Sure. You are increasing the amount of data that's available for targeting. You are building solutions that are privacy safe. You know, big problem in programmatic is, you know, dispersion of data across the ecosystem. You're reducing the amount of time that's needed to set up and manage campaigns. Yeah. I'll give you a couple of examples of this. We did a demo, live demo on stage at a MarTech event a couple months ago with MiQ as the buying platform. Their trader got on stage and said, "Using PubMatic's AgenticOS. I can cut down the campaign set-up time by 98%. So, it would take me a couple of hours to set up a complex campaign in a traditional DSP. Now there's no user interface. I just type in or I upload. You talk. Planning brief. Yeah. Or you talk, whatever you like to do. We can set up that campaign in 2% of the time. If you compound that across the ecosystem. Right. You're talking about, you know, thousands of millions of hours of labor that's saved. Um, but we also- Millions of jobs lost. Well, I think millions of jobs focused on higher value add activity, right? That's how I would define progress. Second is, by collapsing the value chain, we're able to deliver much higher ROI. Abovo Maxlead, largest independent ad agency in the Netherlands, probably nobody here has ever heard of them. Sure. They play an important role in that market. They're able to generate 40% lower CPMs for the media that they buy, and 30%-40% improvement on return on ad spend. That's because we are removing the DSP from that equation. Yeah. Compressing the supply chain. That saves you 12%. Mm-hmm. Well, I don't know anybody that's paying 12%. It's usually much, much higher than that. Okay. When you look at the all-in fee that DSPs are charging. It also removes a lot of that operational complexity. When a deal doesn't scale, for instance, now a trader on the buy side has to log into the DSP. They're working with somebody, let's say PubMatic at the SSP, or the publisher trying to figure out, "Okay, am I sending you the inventory? Are you seeing it? Why are you not bidding on it?" All of that complexity is eliminated when you're in a single platform. Okay. All right. You say you've launched this cool product, AgenticOS. You say it's growing fast, but I don't get that. Really what you're waiting on is ad agencies, who are not typically very fast. They need to create a buyer agent. Let's call it a set of rails. There's programmatic rails that have DSP and SSP. You're saying, and I think people agree with you, we're moving to agentic rails. Those rails are different. They're a different caliber of railroad size. Correct. You need a buyer, and a traditionally slow-moving buyer. To create a agent that can talk to your AgenticOS. Who is it that is driving the growth in this product? Sure. We launched the industry's first fully autonomous agentic campaign in December. Okay With an independent agency called Butler/Till. Okay. The advertiser is a malt beverage, Geloso Beverage Group. Yeah. Some canned cocktail, I believe. Okay. We shared in our earnings call last week that we now have 30 campaigns live. With that guy or with that ad agency? Across the ecosystem. Dentsu Amnet in France. Okay. We have some holdcos in Asia. We have Abovo Maxlead, independent agency in the Netherlands. Okay. I agree with you that the big agency holdcos, they tend to move slowly. However, that's not our sole focus. We have a big focus on the indie or independent agency market. That makes sense to me. They move very quickly. They move fast. Yes. That's also where a lot of the ad budget growth is. If we look at, you know, who are the clients behind the agency holdcos, specifically Fortune 1,000 advertisers? Or 100. 100. Okay. What's the growth in media budget, advertising budget at a Unilever, at a Coca-Cola, at a BMW? It's flat, right? Maybe even down. When you get into the mid-market, you look at challenger brands, right? Vuori instead of Levi's. Chime Bank instead of Citigroup. That's where the growth is, and that's where the growth in ad budgets are, and that's a huge driver, of our growth. Okay. That's who's adopting this AgenticOS? Correct. Okay. Buyers don't need to wait. Again, they can log into chat ChatGPT. They can log into Anthropic. They can use that chat interface. They can use our chat interface. Some of them are, you know, hiring an Accenture or somebody like that to build a buyer agent for them. Some of them are building it internally, so they can connect their agent to our platform. There's no obstacle right now, other than I would say the human component of change management. Leadership. Leadership, exactly. That is preventing buyers from executing this way. Four years from now, five years from now, which feels like three forevers in a generative AI ecosystem. What percent of the like of a programmatic advertising has moved to agentic, would you estimate? I said two earnings calls ago that I estimate, I expect that by the end of 2028, 25% of media transacted in our ecosystem will be agentic. No way. By the end of 2030, it'll be 50%. No way. In the two quarters since. I would take the under. I think I may have been too conservative. No. Yes. That implies the big ad agency holding companies, who are 75% of ad spend, have adopted this. No. The big agency holdcos are 40-ish% of ad spend today. They were 55% about 10 years ago. Their share of the budgets has shrunk. It does imply that the big holdcos will have adopted this, and I fully expect that they will by the end of 2027. Oh, boy. I'm taking the under on that. Let's see. I went to an upfront yesterday. I'll come back. Wall Street's been trying to kill upfronts for 30 years. I still have upfronts this week. For sure. That is the ad agencies. More and more of the upfront is being transacted programmatically. True. Right? I'm just saying these ad agencies. That'll become agentic. Are still doing upfronts. Sure. It's two decades since they've been relevant. I mean, upfronts are salesmanship. That's all that is, right? You gotta sell your wares. I'm just saying, you know, infrastructure and systems are ponderous, and they're slow-moving. Sure. By decades. Upfronts are going to drive more programmatic selling and more Agentic selling and buying, not less. Oh, maybe. We'll see. I think you're being a little optimistic. It probably doesn't matter to your company. You're small enough. You can grow no matter how much moves. We can absolutely. You know, if 10% moves. Yes. You're gonna grow. Yes. It doesn't matter. I mean, our Activate product is growing 3x year-over-year. This is the direct buying in the SSP. Right. Now greater and greater portion of that is gonna be done agentically. Yeah. I do wonder whether one cannibalizes the other, though. It feels like it's the same guy that would adopt your Activate ClearLine product as the Agentic product. Agentic is a great on-ramp for our Activate solution, so I see them as going hand-in-hand. Why would that be? Seems like they're on different rails, so they're substituted. No, they're not on different rails. Under AgenticOS is a way to agentically access a variety of capabilities on our platform. Right. One of those capabilities is buying directly in our SSP. Another set of capabilities which is Activate. Another set of capabilities is the SSP itself. Another set is Connect our data platform, so 300+ data partners. It's the ability to attach data to any campaign. All of these are now exposed agentically via AgenticOS. Think of AgenticOS as a, as a wrapper, as a front end to agentically access any capabilities on our platform. Okay. Interesting. All right, fair enough. Okay, you don't want to talk about the other announcements you've made, like AI Insights or Creative Innovation. That one sounded interesting to me. You think AgenticOS is the number one driver of financial upside, revenue upside. Correct. For PubMatic? That's right. Cool. All right, one of the questions I think a lot of people, investors are particularly worried about is this take rate question. If both sides of the equation, both DSPs and SSPs are trying to cut out fees of the middlemen, doesn't that hurt everybody's take rate? I mean, what do you see happening to your take rates over the next three years? We see our take rates as stable to growing. Okay. The reason is that we are bringing more value across the ecosystem to our customers. I mentioned earlier that with Activate and AgenticOS. We are reaching deeper into buyer workflows. Okay. Right? As we do that, we're creating more value for publishers and buyers on our platform. That means we're able to charge incremental fees. Okay. For instance, when a buyer uses Activate, we charge a fee for that. When a publisher or a buyer uses our Connect data platform, and they activate data from any of 300 different parties, then we charge a fee for that. Okay. These are all, you know, take rate additive opportunities. We're growing our TAM, we're growing the value we create for the ecosystem. I also don't think it's correct to believe that as we do this or as others, you know, move in a similar direction perhaps, that there's gonna be a revenue collapse in the ecosystem. What I see is that as advertising gets more efficient and more effective, we should be moving, bringing more dollars into the ecosystem, and that's exactly what we're focused on doing. Okay. Well, ideally 'cause you love to pull it out of the walled gardens. For sure. The more efficient you get, the more you look like a walled garden. Not only pulling it from the walled gardens, but if the marginal effectiveness of advertising goes up. Yeah I mean, those dollars are not capped, right? Yeah. So a brand will advertise more in order to sell more product. Yeah. That would be the profit maximizing thing for them to do so that, you know, that describes the growth of Meta, for instance. Fair enough. One of the meetings I had at POSSIBLE that was really fascinating was an SSP private, and he was saying that his curation, his data is growing 80% a year, and it's now like, I'm gonna say, 40% of his business. I'm gonna explain curation in a minute, but Is curation a driver for you guys? Curation is a driver for us. Okay. We need to explain what curation is. Sure. I just wanna make sure it was important to your business before I brought it up. Yeah. Yeah, yeah. Absolutely. Why don't you explain what curation is, and then we'll talk about this 'cause this is a new thing going on in SSPs. Yeah. I'm more excited about than Agentic, I want you to know. Oh, interesting. Anyway. I think you have that backwards, but I'll come back next year. I know, I know. I get it. We disagree. We'll see. It's okay. We'll be honest. That's what makes markets markets. We'll see. Yeah, exactly. Okay. first explain curation. Sure. Because I think it's really important. Historically, advertisers have attached data on the buy side of the ecosystem, meaning in a DSP. Sure. Right? If you go into Google or, you know, any large DSP. Trade Desk. Mm-hmm Amazon, Trade Desk, sure. They have extensive data partnerships, where you can, you know, layer in Nielsen, Comscore, et cetera data. Yeah. Over the last, really over the last five years, there's been a conservative. I would say two or three years really. It's more recent than that. I mean, we've been generating revenue there for five years. Okay. It's accelerating though. It is, yeah. I'll give you that. We've seen a shift in how the ecosystem operates and a shift in where buyers are applying data to the sell side of the ecosystem in the SSP. There's a couple of reasons for this. One is the scale of audiences is larger, much larger in the SSP than it is on the, in the DSP because you have to do audience matching. Yeah. The further you get from the publisher and the consumer, there's a, you know, typically a 20%-40%, you know, falloff rate. Loss. Yeah. Exactly. Second is privacy. With privacy regulations increasing around the world, there's a need for consent from the consumer. Consent exists at the publisher, not typically with the advertiser. There's more data to be applied there. Third is, it can be done, applying data can be done much more efficiently. In many DSPs, you know, data has become 30%, 40%, 50% of their revenue where they're charging, you know, very high take rates against that data. We built, we've been building now for five-plus years a Connect platform, which is our data platform. I think it's probably one of the largest scaled data platforms in the ecosystem. There are over 300 data partners that are plugged in. Everything from, I mentioned, you know, Comscore, Nielsen, Circana. To a very rich set of commerce media partners. Klarna, Kroger, Intuit, Shopify. We've launched, announced at POSSIBLE Walmart and PayPal. Wow. Right. With PayPal there's $25 billion transactions, $400 million Venmo and PayPal accounts. This is, you know, very rich data that's sitting in our platform. What we do with curation, back to your question, is we package the data and the media for a buyer's objective. A buyer might say, "Okay, I'm launching a movie in June, and I need to find these types of audiences." We will take the right data from our platform, 300+ data partners. We will take the trillion-plus ad impressions that we process on a daily basis, and we will figure out, we will curate the right set of media. To sell to them. To sell to them. Exactly. To help them meet their objectives. We generate a data fee when we curate and leverage one of our data partners. Our data partners generate revenue, we generate a data fee in addition to our SSP fee. I thought the big thing about curation was that you guys didn't charge on the data side. It was just free, but you just got a higher CPM because the data makes the CPM that you're selling at a more valuable CPM, so you just charge your take rate on a bigger CPM. I didn't know you were charging. We do both. For data separately. I would say most SSPs are not charging for the data piece. Well, last quarter was our 40th consecutive quarter of profitability at adjusted EBITDA. You know, we like to generate fee revenue where we're adding value to our partners. Okay. Yeah. Okay. Interesting. Okay, that's the first time I've heard it. Anyway, this trend, how much of your growth is being driven by attaching data to, How much of your revenue is now because you're attaching data to the sale? We don't break out that specifically, Connect. A lot of the products that we've been talking about, Connect Data Platform with curation, Activate, AgenticOS. Okay. We put that in a category called, emerging revenue streams. Okay. That category, we just shared, last week, is 14% of our revenue, and it grew 80% year-over-year last quarter. Okay. This, you know, collective set of newer products. Which is where we see the industry evolving to, is growing very quickly. Okay. A year from now you're gonna sit on my stage, and I want you to break out this 14% and see which is bigger, and I bet it is curation and not Agentic. Betcha, a year from now. Let's see. We'll see. Curation today is bigger, because it's been around longer, right? Fair. Agentic. That's fair. You know, two quarters. Two quarters old. It's two. I was gonna say two months old. Exactly. Exactly. Let's see. I think there's a decent chance. I'm gonna be right, and you're gonna come in and go, "Oh, but it's 120% growth in Agentic from $2 million-$3 million. Let's see. I think Agentic will be bigger by next year, but let's see. I disagree with you. Let's see. We'll see. We'll see. It's discernible fact. Yeah. One year from now. We're gonna be here. Either way we win. Next time. Either way, PubMatic will win. Yeah. Our shareholders will win. I really am very high on this curation stuff, but okay. Okay. Where is AI already driving measurable ROI today, either by yield optimization or matching or cost efficiencies or you're not hiring as many people? Tell me where it's actually delivering financial returns today, and what you see the biggest upside from it, specifically generative AI over the next year. Sure. I think a good framework, let's say for our customers, and then we can turn to internal application of AI. Okay. Is really just efficiency and effectiveness, right? I think whenever we're thinking about innovation in advertising, we can think about, like, those two categories. Efficiency we've talked about already quite a bit, right? Significant reduction, 7x time reduction in campaign troubleshooting and management. These are all, you know, efficiency measures. Yeah. Where a significant amount of labor is saved. Effectiveness is where there's still a lot of work being done. As AI scales up, right, from very early stages. A couple of examples of this, right? We've been able to reduce fees taken, you know, in a media buy by 40%, right? That means lower CPMs, 30%-40% more working media for an advertiser. That's a, you know, great example of increased. You're an SSP. All you should care about is higher CPMs for your publisher. The point is how do you generate higher CPMs? It's not a zero-sum game to say, "Hey, we just wanna get the advertiser to pay more." What we focus on at PubMatic is delivering higher CPMs by delivering more performance for the advertiser. When we deliver more performance, the advertiser is happy to pay more. Which is how we connect the dot to higher CPM. That effectiveness and performance is really important. We talked earlier about 300 data partners in curation. One of the biggest challenges in curation is what data and what media should I apply to this advertiser's campaign? This is where I think the big wave of AI and effectiveness is going to come, which is using AI to figure out which dozens of the 300 data partners. Of the 2,000 publishers on our platform, you know, which hundreds of those publishers. For instance, today, when that RFP comes out, hey, a studio's launching a movie, the agency's working on behalf of that studio to launch that movie, they typically will send an RFP out via email. It's very old school, right? Send an RFP out to 20 or 30 publishers. There's no reason that that shouldn't be happening across hundreds of relevant publishers. That's where a seller agent for a publisher and a buyer agent for an advertiser can do that matching job much better. This is yet to come, but this is where I think there's a lot of opportunity around effectiveness. Okay. I think the question though was where is AI already driving measurable ROI? Is there anything on the cost side? I mean, usually CEOs sit up here and they talk about cost 'cause they can see those. Sure. We talked about that already, the efficiency piece. That's where I started the answer, right? Okay. Is that helping your FTEs not grow as fast? Okay. Margin improvement somewhere? Everything that I talk about is for customers. Right. We can talk about, you know. Internal. Internal. Right. We operate a self-serve platform, so we're not sitting there, you know, logging into our own system and, you know, have teams of ad ops people. Our biggest investments are in product and engineering and in sales. About 80% of the code on our platform now is generated via AI. Those are good numbers. So it's a very healthy number. What we've been able to do is ship product, more product much faster over the last several years, even as we've flattened or decreased the size of our engineering team. Significant improvement in efficiency due to AI. Okay. Our current focus, 'cause that 80% obviously is gonna hit a ceiling is in every other function: finance, marketing, you know, sales ops, account management. AI enabling every single one of those functions. If we looked at our headcount number, you know, from our K, it's down somewhere in the 5%-10% range. That's fantastic. Even as we're growing revenue. That's fantastic. Yes. Yeah, we keep track of FTEs religiously for every one of our ad tech companies. Yes. I know you publish those stats. Google Yeah. Meta's down 8% over the last three years. Yeah. They sort of lay off 10%. They hire 20%. Hire 10% and then they, you know, they sort of do this. Exactly. We have not been doing that. Yeah. What we have been doing is certainly investing from a CapEx perspective in new AI-enabled capabilities. We historically have invested CapEx, this year's number's in the $15 million-$19 million range. Historically we've invested in two areas. One is increasing capacity.The second is in new capabilities. An important thing to note is that we own all of our own ad-serving infrastructure, so we do very little in the public cloud. We've had this approach for 10+ years. It's a key driver of the cash that we generate. We own tens of thousands of servers around the world. This year, one of the things that's different is we are putting no CapEx into impression volume growth. We've been eliminating redundancy, across our platform, redundancy of impressions, and instead all of that CapEx is going into new hardware to deliver AI solutions, and we can talk about our NVIDIA partnership. Yeah, let's do that. Let's do that next. Let's go to the NVIDIA partnership. Great. We've been working with NVIDIA for, I think three years now, where we co-innovate around solving specific advertising domain problems with the help of their, you know, hardware and software engineers with our software engineers. I'll give you an example of this. I think probably people have heard of inferencing. Yeah. Which is, okay, we have a model that's been trained and now, you know, we want to query that model to ask a question or figure something out. One of the big challenges in our ecosystem is I've got 1 trillion ad impressions per day. Which impressions should I send to which DSPs? We have 150 DSPs that are bidding on our platform, some in particular geos. They have different campaigns at any given point in time, you know, different ad formats, different audiences. This is a key inferencing problem. We have worked with NVIDIA to develop inferencing solutions that help us figure out exactly which ad impressions to send to which DSPs. The reason we have this integrated stack of software and hardware is we're able to control both the software and the hardware level versus layers, versus if we were in public cloud where we can only control the software. We've deployed specific NVIDIA Triton chips. Within our infrastructure to solve exactly this problem. Hmm. Very interesting. Questions from the audience for Rajeev. Yes, Scott? Yeah, you talked about Google as the more patient monopolist that you always have to deal with. Yes. How do different POSSIBLE remedies that the judge might impose affect your business? Sure. I think everybody's waiting, you know, with bated breath, at least in this track of your conference, for that remedies verdict to be handed down. Edge of our seat. Yeah, exactly. Just to give you some numbers, we estimate every point of market share shift is worth $50 million-$75 million of revenue to us, of which 80%-90% would drop to our bottom line. We have a, you know, high fixed cost, low variable cost business. You know, every point of market share that shifts as a result of remedies. There's, you know, two classes of remedies. There's behavioral and there's structural. We don't know, you know, what the mix of those will be. I think the behavioral remedies, which is where Google has to change some of its practices or policies, those, in my opinion, can be implemented very quickly within weeks to months. We could see benefit, you know, as early as later this year. Structural remedies are things like Google having to spin, you know, certain entities out or, you know, sell them off, operate them at arm's length in some way. I think those are likely to take longer to come into effect. I mean, presumably structural remedies would be better for you without any time constraint, but that would take longer. Behavioral remedies might in fact be better in that present policy sense. I think that is true, I also don't think it's either/or, right? Of course, I don't know what the judge is gonna decide, but it could very well be that there's behavioral remedies in the run-up to a structural remedy. Because based on, you know, my interaction with the judge in the case, she's, you know, very, very aware of the harms that Google has created across the ecosystem and, you know, focused on correcting those harms. Any other questions? Yes, sir. I think you just said you work with 150 DSPs. How top heavy is that? Like how much of your revenue is driven by the top four or five today, and how is that gonna trend over the next couple years? Yeah, sure. There's been a very significant unwind in concentration over the last couple of years. I would say, you know, if we went back like five years, it was a story of DSP consolidation. You know, there's a couple of DSPs that, you know, were driving most of the market share growth. If we look now, you know, I talked earlier about the mid-market advertiser. Many of the two of the largest incumbent DSPs, they're not really focused on that mid-market arena, right? There's, you know, a lot of fast-growing mid-market DSPs, companies like StackAdapt, for instance, Viant, who I think you have here. Yep. Later this week. That number is growing significantly, and what we see is that the concentration is reducing on a year-over-year basis. I think one of the metrics, we haven't broken out the concentration specifically, but we did share that mid-market DSP cohort is growing 20% year-over-year on our platform in terms of the spend or activity. Very, very significant growth. It's amazing there's such low barriers to entry for DSPs. Yes, there are very low barriers to enter, and I think with AI it's a huge opportunity to remove what I think is the last barrier, which was software UI incumbency. Right? Again, if you go into, you know, a big agency holdco, the big challenge for them to move off of a DSP if they wanted to expand their portfolio is, well, hey, I've got thousands of traders around the world, and, you know, they need to know Google's DSP in order to buy YouTube, they need to know Amazon's in order to buy, you know, Amazon Prime Video, and for, you know, shopping use cases. We don't have time to learn, you know, four other DSP UIs. Now with AI, the expectation is, well, if you can type, right, and you know you don't even need to know English. Talk. Yeah, or talk. You can do it in any language, then you can give an agent your instructions and execute those. That's why one of the reasons why we see such great growth with AgenticOS and Activate. Any other questions? Okay. Let's go to your commerce initiatives. Yeah. Can you talk about your commerce media platform and your Connect platform? Yeah. How your commerce products are driving upside at PubMatic? Sure. Again, our focus is on performance advertising in the open internet. That for us is the North Star. Commerce partnerships, commerce data is, you know, critically important to that. You know, where most of the growth is in the ecosystem is where you have known user identity, so think of CTV and mobile app, and where you have the ability to measure the outcomes. Commerce media obviously is a key area of that. We have dozens of commerce media partnerships. I went through some of the names earlier. Last week what we announced was POSSIBLE last week? Two weeks ago. Two weeks ago, okay. What we announced at POSSIBLE was a partnership with PayPal and with Walmart. With Walmart, obviously, Walmart Connect, they have great shopper, you know, knowledge, audiences at scale. Absolutely. They're combining their data with the streaming inventory and the mobile app inventory on our platform. Giving their advertisers, whether they're enterprise advertisers or SMB advertisers, the ability to find those Walmart audiences off of walmart.com. Okay. Right? Now an advertiser can say, Great, Walmart knows that this user is, you know, high propensity to buy my product. I wanna reach them when they're watching 'Landman,' you know, on Paramount, or they're watching, you know, 'Bill Maher' on HBO or whatever the case is. That's what we're doing with Walmart, obviously a huge scale and partner. With PayPal, there's a couple of things that we're doing there. One is very similar, taking that data and making that available to any advertiser, not just, you know, PayPal's clients. PayPal is also a user of Activate, so they're buying directly in our SSP when they go out and they sell campaigns. Then the third thing is they launched PayPal Ads ID, their own ID graph. Identifying who users are, and we're merging their graph, integrating their graph with our graph, so that anybody, any advertiser that's using PayPal's graph can find those users on our platform. All of these are around identifying and delivering high-value, relevant campaigns to the user, which is where we drive return on ad spend. Which is what pushes the CPMs up for our publishers. Okay. Okay, we're almost out of time. Just wanna make sure there's no other questions for Rajeev before I call it. No. Okay, I will call it there. We have 30 seconds left. Great. Perfect timing. Thank you. Thank you so much, Laura. Okay, thank you so much.

Speaker 1: We're gonna get started. I'm Laura Martin. I'm the Senior Analyst at Needham & Company. Let me introduce our speaker today. Rajeev Goel is CEO of PubMatic. He's the co-founder and CEO, where he spent nearly two decades scaling the company into a leading independent SSP, which has recently pivoted to become an agnostic OS, AI-powered operating system. A serial entrepreneur and tech visionary, he previously co-founded Chipshot.com. Rajeev also serves as a trustee for Johns Hopkins University and a board member for the Interactive Advertising Bureau. Okay, I want to start with a question on leadership. Even the last two sessions, both men have started with the saying that generative AI is transformational. My question is: How do you think about a leader in this kind of period of uncertainty and tech disruption? We're gonna get started. we're gonna get started I'm Laura Martin. i'm laura martin I'm the Senior Analyst at Needham & Company. i'm the senior analyst at needham & company Let me introduce our speaker today. let me introduce our speaker today Rajeev Goel is CEO of PubMatic. rajeev goel is ceo of pubmatic He's the co-founder and CEO, where he spent nearly two decades scaling the company into a leading independent SSP, which has recently pivoted to become an agnostic OS, AI-powered operating system. he's the co-founder and ceo where he spent nearly two decades scaling the company into a leading independent ssp which has recently pivoted to become an agnostic os ai-powered operating system A serial entrepreneur and tech visionary, he previously co-founded Chipshot.com. a serial entrepreneur and tech visionary he previously co-founded chipshot.com Rajeev also serves as a trustee for Johns Hopkins University and a board member for the Interactive Advertising Bureau. rajeev also serves as a trustee for johns hopkins university and a board member for the interactive advertising bureau Okay, I want to start with a question on leadership. okay i want to start with a question on leadership Even the last two sessions, both men have started with the saying that generative AI is transformational. even the last two sessions both men have started with the saying that generative ai is transformational My question is: How do you think about a leader in this kind of period of uncertainty and tech disruption? my question is how do you think about a leader in this kind of period of uncertainty and tech disruption

Speaker 2: Yeah. Well, I think, you know, we've been working in an industry, leading in an industry that's obviously incredibly complex. You know, sometimes people liken it to wartime, and I feel like I've been a wartime CEO for 20 years. You know, we compete with Google. Which is a declared monopolist, right? Yeah. yeah Well, I think, you know, we've been working in an industry, leading in an industry that's obviously incredibly complex. well i think you know we've been working in an industry leading in an industry that's obviously incredibly complex You know, sometimes people liken it to wartime, and I feel like I've been a wartime CEO for 20 years. you know sometimes people liken it to wartime and i feel like i've been a wartime ceo for 20 years You know, we compete with Google. you know we compete with google Which is a declared monopolist, right? which is a declared monopolist right

Speaker 1: Fair. Fair. fair

Speaker 2: Okay, you gotta compete with somebody like that. You know, we view our opportunity as roughly a 4% market share leader versus, you know, Google at 60%. There's a lot of upside for us. I think with AI, I mean, I view this as really the third major transformation in our industry, and we're right at the early stages of it. The first was real-time bidding, the second was the consumer shift to mobile, and that obviously, you know, created a lot of disruption, winners and losers. Okay, you gotta compete with somebody like that. okay you gotta compete with somebody like that You know, we view our opportunity as roughly a 4% market share leader versus, you know, Google at 60%. you know we view our opportunity as roughly a 4% market share leader versus you know google at 60% There's a lot of upside for us. there's a lot of upside for us I think with AI, I mean, I view this as really the third major transformation in our industry, and we're right at the early stages of it. i think with ai i mean i view this as really the third major transformation in our industry and we're right at the early stages of it The first was real-time bidding, the second was the consumer shift to mobile, and that obviously, you know, created a lot of disruption, winners and losers. the first was real-time bidding the second was the consumer shift to mobile and that obviously you know created a lot of disruption winners and losers Now, AI. We're in, I think, the second branch of AI. The first was machine learning, right? Now, AI. now ai We're in, I think, the second branch of AI. we're in i think the second branch of ai The first was machine learning, right? the first was machine learning right

Speaker 1: Yeah. Yeah. yeah

Speaker 2: Which works on structured data. That came into our industry about 15 years ago. This transformation with generative AI, I think is gonna be significantly larger. The reason is that, you know, structured data's only been around since really the 1950s or 1960s, right? Think about, you know, data in a database. Unstructured data is the world around us. Which works on structured data. which works on structured data That came into our industry about 15 years ago. that came into our industry about 15 years ago This transformation with generative AI, I think is gonna be significantly larger. this transformation with generative ai i think is gonna be significantly larger The reason is that, you know, structured data's only been around since really the 1950s or 1960s, right? the reason is that you know structured data's only been around since really the 1950s or 1960s right Think about, you know, data in a database. think about you know data in a database Unstructured data is the world around us. unstructured data is the world around us

Speaker 1: Yeah. Yeah. yeah

Speaker 2: It's 100x the size of structured data, right? It's 100x the size of structured data, right? it's 100x the size of structured data right

Speaker 1: Yeah. More. Yeah. yeah More. more

Speaker 2: More, right? It's audio, it's video, it's the spoken word, right? It's the human interface to how the world exists. It's just a much bigger opportunity. We really view it not so much as just a technological revolution, which of course it is, but really an opportunity to revolutionize the value chain in our industry. To really bring the publisher and advertiser much closer together, remove a lot of the complexity in the ecosystem, which for us means an opportunity to drive performance advertising, increase our TAM, and create a lot more value. More, right? more right It's audio, it's video, it's the spoken word, right? it's audio it's video it's the spoken word right It's the human interface to how the world exists. it's the human interface to how the world exists It's just a much bigger opportunity. it's just a much bigger opportunity We really view it not so much as just a technological revolution, which of course it is, but really an opportunity to revolutionize the value chain in our industry. we really view it not so much as just a technological revolution which of course it is but really an opportunity to revolutionize the value chain in our industry To really bring the publisher and advertiser much closer together, remove a lot of the complexity in the ecosystem, which for us means an opportunity to drive performance advertising, increase our TAM, and create a lot more value. to really bring the publisher and advertiser much closer together remove a lot of the complexity in the ecosystem which for us means an opportunity to drive performance advertising increase our tam and create a lot more value

Speaker 1: You're talking about the company. I wanna know about leadership. You're talking about the company. you're talking about the company I wanna know about leadership. i wanna know about leadership

Speaker 2: Sure. Sure. sure

Speaker 1: What does this say? How do you have to lead differently in a period of, let's say it's only 18 months, of technological disruption, 1your employee base, the fear factor? How does that change? Are you saying it's just the same as when you went through mobile? Is that the point you're making an internet? What does this say? what does this say How do you have to lead differently in a period of, let's say it's only 18 months, of technological disruption, 1 your employee base, the fear factor? how do you have to lead differently in a period of let's say it's only 18 months of technological disruption, 1 your employee base the fear factor How does that change? how does that change Are you saying it's just the same as when you went through mobile? are you saying it's just the same as when you went through mobile Is that the point you're making an internet? is that the point you're making an internet

Speaker 2: I think those transformations required a significant level of leadership. Specifically, I think number one is honesty. Honesty with yourself, with your team, with your capabilities, where you have holes, where you have gaps, where you have opportunities. The second is to really question every assumption, right? It's really important to not think about what are the things that we've been good at historically, we're gonna continue to focus on, but really, what is it that we can do for our customers? What's the value that we can generate for them? Really hone in on that and then move the business in that direction. I think those transformations required a significant level of leadership. i think those transformations required a significant level of leadership Specifically, I think number one is honesty. specifically i think number one is honesty Honesty with yourself, with your team, with your capabilities, where you have holes, where you have gaps, where you have opportunities. honesty with yourself with your team with your capabilities where you have holes where you have gaps where you have opportunities The second is to really question every assumption, right? the second is to really question every assumption right It's really important to not think about what are the things that we've been good at historically, we're gonna continue to focus on, but really, what is it that we can do for our customers? it's really important to not think about what are the things that we've been good at historically we're gonna continue to focus on but really what is it that we can do for our customers What's the value that we can generate for them? what's the value that we can generate for them Really hone in on that and then move the business in that direction. really hone in on that and then move the business in that direction

Speaker 1: Such a fascinating answer because it's so systemic. It's not about people. You must not see leadership as people. You must think it as strategic from a systems point of view. Such a fascinating answer because it's so systemic. such a fascinating answer because it's so systemic It's not about people. it's not about people You must not see leadership as people. you must not see leadership as people You must think it as strategic from a systems point of view. you must think it as strategic from a systems point of view

Speaker 2: I don't agree with that because I said honesty at the beginning, right? I don't agree with that because I said honesty at the beginning, right? i don't agree with that because i said honesty at the beginning right

Speaker 1: Honesty, you can't tell me you're dishonest. If there's not a transition between mobile. I assume you're honest all the time. That's not a change. Honesty, you can't tell me you're dishonest. honesty you can't tell me you're dishonest If there's not a transition between mobile. if there's not a transition between mobile I assume you're honest all the time. i assume you're honest all the time That's not a change. that's not a change

Speaker 2: Well, I think leaders aren't always honest with their team, right? Sometimes there are unknowns. You have to say, "Hey, we don't know. We gotta figure it out. Well, I think leaders aren't always honest with their team, right? well i think leaders aren't always honest with their team right Sometimes there are unknowns. sometimes there are unknowns You have to say, "Hey, we don't know. you have to say "hey we don't know We gotta figure it out. we gotta figure it out

Speaker 1: Yeah. Yeah. yeah

Speaker 2: Sometimes you gotta change the skills of the team. Sometimes you gotta bring in new people. I think all of those things require a high degree of honesty in a period of significant change. Sometimes you gotta change the skills of the team. sometimes you gotta change the skills of the team Sometimes you gotta bring in new people. sometimes you gotta bring in new people I think all of those things require a high degree of honesty in a period of significant change. i think all of those things require a high degree of honesty in a period of significant change

Speaker 1: Yeah. More so, maybe. I think I would say most CEOs think they're honest all the time. Yeah. yeah More so, maybe. more so maybe I think I would say most CEOs think they're honest all the time. i think i would say most ceos think they're honest all the time

Speaker 2: Well, that's a different issue. Whether they are or not, they may think that they are. Well, that's a different issue. well that's a different issue Whether they are or not, they may think that they are. whether they are or not they may think that they are

Speaker 1: I think that's totally fair. Okay. Let's start. I missed you at POSSIBLE. I think that's totally fair. i think that's totally fair Okay. okay Let's start. let's start I missed you at POSSIBLE. i missed you at possible

Speaker 2: Yes. Yes. yes

Speaker 1: I came by to your booth, but you were so busy. Everybody was so crazy at POSSIBLE. You guys made a lot of product announcements at POSSIBLE. Let's go over some of those and just, your AgenticOS, your AI Insights, your Creative Innovation Suite. Let's talk about the big product announcements you guys are doing and why you think they're important to the future of PubMatic. I came by to your booth, but you were so busy. i came by to your booth but you were so busy Everybody was so crazy at POSSIBLE. everybody was so crazy at possible You guys made a lot of product announcements at POSSIBLE. you guys made a lot of product announcements at possible Let's go over some of those and just, your AgenticOS, your AI Insights, your Creative Innovation Suite. let's go over some of those and just your agenticos your ai insights your creative innovation suite Let's talk about the big product announcements you guys are doing and why you think they're important to the future of PubMatic. let's talk about the big product announcements you guys are doing and why you think they're important to the future of pubmatic

Speaker 2: Well, I think the biggest one by far and the biggest growth driver for us, in the coming years is AgenticOS. Well, I think the biggest one by far and the biggest growth driver for us, in the coming years is AgenticOS. well i think the biggest one by far and the biggest growth driver for us in the coming years is agenticos

Speaker 1: Okay. Okay. okay

Speaker 2: What we're doing with AgenticOS is MCP, Model Context Protocol, you know, generative AI enabling all of the core use cases on our platform. That's everything from inventory discovery and planning to media activation, to reporting and measurement, fee transparency, you know, guardrails for buyers. This extends well beyond purely the SSP capability set, and it moves into many more buyer-connected workflows. Many of the examples that I just gave you are actually things that buyers wanna do. We've been building towards this moment for the last four or five years, and we'll get into our data platform. We launched a couple of years ago a product called Activate, which allows buyers to buy directly in our SSP. What we're doing with AgenticOS is MCP, Model Context Protocol, you know, generative AI enabling all of the core use cases on our platform. what we're doing with agenticos is mcp model context protocol you know generative ai enabling all of the core use cases on our platform That's everything from inventory discovery and planning to media activation, to reporting and measurement, fee transparency, you know, guardrails for buyers. that's everything from inventory discovery and planning to media activation to reporting and measurement fee transparency you know guardrails for buyers This extends well beyond purely the SSP capability set, and it moves into many more buyer-connected workflows. this extends well beyond purely the ssp capability set and it moves into many more buyer-connected workflows Many of the examples that I just gave you are actually things that buyers wanna do. many of the examples that i just gave you are actually things that buyers wanna do We've been building towards this moment for the last four or five years, and we'll get into our data platform. we've been building towards this moment for the last four or five years and we'll get into our data platform We launched a couple of years ago a product called Activate, which allows buyers to buy directly in our SSP. we launched a couple of years ago a product called activate which allows buyers to buy directly in our ssp By doing that, what we're doing is, back to what I said earlier about revolutionizing the value chain, via AI, we're collapsing the value chain in the industry, removing complexity, and allowing buyers to buy directly in our SSP. By doing that, what we're doing is, back to what I said earlier about revolutionizing the value chain, via AI, we're collapsing the value chain in the industry, removing complexity, and allowing buyers to buy directly in our SSP. by doing that what we're doing is back to what i said earlier about revolutionizing the value chain via ai we're collapsing the value chain in the industry removing complexity and allowing buyers to buy directly in our ssp AgenticOS brings that all together, where what we see is that software, the legacy software user interfaces, those are very quickly becoming obsolete. I think one of the big advantages that incumbent DSPs have had over the years is, they've trained the agency trader or the advertiser, you know, trader to use their platform. What we see is that, with AI, the expectation of the customer is, "Hey, I don't need a complex interface. I don't wanna take two hours to set up a campaign. I wanna use AI and be able to do it in minutes. I don't wanna have to log in and troubleshoot a campaign. I want the system to tell me, 'Hey, this campaign has an issue. Here's three options to resolve it. You can pick, or maybe an AI agent will do that autonomously. That's exactly the value proposition that we're delivering with AgenticOS. AgenticOS brings that all together, where what we see is that software, the legacy software user interfaces, those are very quickly becoming obsolete. agenticos brings that all together where what we see is that software the legacy software user interfaces those are very quickly becoming obsolete I think one of the big advantages that incumbent DSPs have had over the years is, they've trained the agency trader or the advertiser, you know, trader to use their platform. i think one of the big advantages that incumbent dsps have had over the years is they've trained the agency trader or the advertiser you know trader to use their platform What we see is that, with AI, the expectation of the customer is, "Hey, I don't need a complex interface. what we see is that with ai the expectation of the customer is "hey i don't need a complex interface I don't wanna take two hours to set up a campaign. i don't wanna take two hours to set up a campaign I wanna use AI and be able to do it in minutes. i wanna use ai and be able to do it in minutes I don't wanna have to log in and troubleshoot a campaign. i don't wanna have to log in and troubleshoot a campaign I want the system to tell me, 'Hey, this campaign has an issue. i want the system to tell me 'hey this campaign has an issue Here's three options to resolve it. here's three options to resolve it You can pick, or maybe an AI agent will do that autonomously. you can pick or maybe an ai agent will do that autonomously That's exactly the value proposition that we're delivering with AgenticOS. that's exactly the value proposition that we're delivering with agenticos

Speaker 1: AgenticOS is a product, but then you need action on the side of the ad agency, presumably, to create an agent that can talk to your AgenticOS? Is that right? AgenticOS is a product, but then you need action on the side of the ad agency, presumably, to create an agent that can talk to your AgenticOS? agenticos is a product but then you need action on the side of the ad agency presumably to create an agent that can talk to your agenticos Is that right? is that right

Speaker 2: A buyer will use an agent. They can use an agent that we're providing them. They can use an agent they've built or an agent that they've licensed. Using any of those buyer agents, our agent is part of AgenticOS, or they can connect in with their own agent to our system. A buyer will use an agent. a buyer will use an agent They can use an agent that we're providing them. they can use an agent that we're providing them They can use an agent they've built or an agent that they've licensed. they can use an agent they've built or an agent that they've licensed Using any of those buyer agents, our agent is part of AgenticOS, or they can connect in with their own agent to our system. using any of those buyer agents our agent is part of agenticos or they can connect in with their own agent to our system

Speaker 1: They can't use a DSP. The Trade Desk doesn't have an agent that can talk to your AgenticOS on the SSP side? They can't use a DSP. they can't use a dsp The Trade Desk doesn't have an agent that can talk to your AgenticOS on the SSP side? the trade desk doesn't have an agent that can talk to your agenticos on the ssp side

Speaker 2: Yeah, as far as I'm aware, they do not. I don't know if they will in the future. If a buyer, if a DSP wants to connect with us via Model Context Protocol, we're open and available to do that. Yeah, as far as I'm aware, they do not. yeah as far as i'm aware they do not I don't know if they will in the future. i don't know if they will in the future If a buyer, if a DSP wants to connect with us via Model Context Protocol, we're open and available to do that. if a buyer if a dsp wants to connect with us via model context protocol we're open and available to do that

Speaker 1: Okay. The idea is to streamline and cut some of the fees. This is another, like, aspect of, trying to pull fees out of the ecosystem? That's the AgenticOS objective? Okay. okay The idea is to streamline and cut some of the fees. the idea is to streamline and cut some of the fees This is another, like, aspect of, trying to pull fees out of the ecosystem? this is another like aspect of trying to pull fees out of the ecosystem That's the AgenticOS objective? that's the agenticos objective

Speaker 2: Our objective with AgenticOS is to deliver performance in the open internet. Our objective with AgenticOS is to deliver performance in the open internet. our objective with agenticos is to deliver performance in the open internet

Speaker 1: Okay. Okay. okay

Speaker 2: The key part of delivering performance is to simplify the ecosystem. The key part of delivering performance is to simplify the ecosystem. the key part of delivering performance is to simplify the ecosystem

Speaker 1: Okay. Okay. okay

Speaker 2: When you have a DSP and you have an SSP, it's very difficult to actually deliver performance outcomes because there's a huge data divide between the platforms. When you have a DSP and you have an SSP, it's very difficult to actually deliver performance outcomes because there's a huge data divide between the platforms. when you have a dsp and you have an ssp it's very difficult to actually deliver performance outcomes because there's a huge data divide between the platforms

Speaker 1: Okay. Okay. okay

Speaker 2: If we think about, you know, what do walled gardens look like, right? There's a single layer of technology that connects the ad campaign with the inventory and the audiences. If we think about, you know, what do walled gardens look like, right? if we think about you know what do walled gardens look like right There's a single layer of technology that connects t he ad campaign with the inventory and the audiences. there's a single layer of technology that connects t he ad campaign with the inventory and the audiences

Speaker 1: Yeah. Yeah. yeah

Speaker 2: Right? It's Exactly. They're not living in this world of, "Hey, we have these disparate systems that have limitations in how they can connect. Right? right It's Exactly. it's exactly They're not living in this world of, "Hey, we have these disparate systems that have limitations in how they can connect. they're not living in this world of "hey we have these disparate systems that have limitations in how they can connect

Speaker 1: Right. Right. right

Speaker 2: Instead, they're one platform that combines everything. We're taking the same approach with the open internet. With Activate, you can buy directly in our SSP. With AgenticOS, you can do it using an AI agent. We expose all of the services agentically. That product is growing incredibly quickly. Instead, they're one platform that combines everything. instead they're one platform that combines everything We're taking the same approach with the open internet. we're taking the same approach with the open internet With Activate, you can buy directly in our SSP. with activate you can buy directly in our ssp With AgenticOS, y ou can do it using an AI agent. with agenticos, y ou can do it using an ai agent We expose all of the services agentically. we expose all of the services agentically That product is growing incredibly quickly. that product is growing incredibly quickly

Speaker 1: I have a question. I guess I don't understand something. Activate is your ClearLine equivalent where a DSP can go directly to you through Activate and buy directly on your SSP, thereby disintermediating a bunch of the fees in the open internet. How is that different from AgenticOS? I have a question. i have a question I guess I don't understand something. i guess i don't understand something Activate is your ClearLine equivalent where a DSP can go directly to you through Activate and buy directly on your SSP, thereby disintermediating a bunch of the fees in the open internet. activate is your clearline equivalent where a dsp can go directly to you through activate and buy directly on your ssp thereby disintermediating a bunch of the fees in the open internet How is that different from AgenticOS? how is that different from agenticos

Speaker 2: Sure. Sure. sure

Speaker 1: It seems it's exactly the same except one has to interact with an agent and one has to interact through a DSP. It seems it's exactly the same except one has to interact with an agent and one has to interact through a DSP. it seems it's exactly the same except one has to interact with an agent and one has to interact through a dsp

Speaker 2: I wouldn't compare Activate to ClearLine. I think there's some huge differences. I wouldn't compare Activate to ClearLine. i wouldn't compare activate to clearline I think there's some huge differences. i think there's some huge differences

Speaker 1: Okay. It's the same idea. It's search. It's, like, optimizing. Okay. okay It's the same idea. it's the same idea It's search. it's search It's, like, optimizing. it's like optimizing

Speaker 2: Well, our focus is on collapsing the value chain in the ecosystem so that a DSP and an SSP is not needed. Traditionally, that's done via software interface. Well, our focus is on collapsing the value chain in the ecosystem so that a DSP and an SSP is not needed. well our focus is on collapsing the value chain in the ecosystem so that a dsp and an ssp is not needed Traditionally, that's done via software interface. traditionally that's done via software interface

Speaker 1: Okay. Okay. okay

Speaker 2: A user will, you know, come into a UI or Activate UI. A user will, you know, come into a UI or Activate UI. a user will you know come into a ui or activate ui

Speaker 1: Yeah. Yeah. yeah

Speaker 2: They'll set up a campaign and they'll buy. They'll set up a campaign and they'll buy. they'll set up a campaign and they'll buy

Speaker 1: Okay. Okay. okay

Speaker 2: With AgenticOS, they don't need to use the user interface. They can do this all via AI. They can log into Claude if they want to. With AgenticOS, they don't need to use the user interface. with agenticos they don't need to use the user interface They can do this all via AI. they can do this all via ai They can log into Claude if they want to. they can log into claude if they want to

Speaker 1: Right. Right. right

Speaker 2: Anthropic solution. Anthropic solution. anthropic solution

Speaker 1: Right, like Claude does have a buyer agent. Right, like Claude does have a buyer agent. right like claude does have a buyer agent

Speaker 2: Correct. They can log into there. Correct. correct They can log into there. they can log into there

Speaker 1: Yes. Yes. yes

Speaker 2: They can connect to our Model Context Protocol service. They can discover all of the services. They can connect to our Model Context Protocol service. they can connect to our model context protocol service They can discover all of the services. they can discover all of the services

Speaker 1: Right. Right. right

Speaker 2: They can use that. They can do it via OpenAI. They can do it via Gemini. They can use any system that they want. They can deploy their own agent that they've built. They can use that. they can use that They can do it via OpenAI. they can do it via openai They can do it via Gemini. they can do it via gemini They can use any system that they want. they can use any system that they want They can deploy their own agent that they've built. they can deploy their own agent that they've built

Speaker 1: I guess my question is, aren't we just moving money from one pocket to another? The brand is the same, and you're just giving a brand, let's call it Coke. Instead of going through a DSP and paying the DSP fee, you're saying you can go through an agent, skip the DSP, and come straight. It's the same. All we're doing is moving money from Coke from one place to another, right? I guess my question is, aren't we just moving money from one pocket to another? i guess my question is aren't we just moving money from one pocket to another The brand is the same, and you're just giving a brand, let's call it Coke. the brand is the same and you're just giving a brand let's call it coke Instead of going through a DSP and paying the DSP fee, you're saying you can go through an agent, skip the DSP, and come straight. instead of going through a dsp and paying the dsp fee you're saying you can go through an agent skip the dsp and come straight It's the same. it's the same All we're doing is moving money from Coke from one place to another, right? all we're doing is moving money from coke from one place to another right

Speaker 2: Well, when you collapse the. Well, when you collapse the. well when you collapse the

Speaker 1: We didn't add. I guess, are we adding value to the ecosystem? We didn't add. we didn't add I guess, are we adding value to the ecosystem? i guess are we adding value to the ecosystem

Speaker 2: Yeah. Yeah. yeah

Speaker 1: Are we just moving money? Are we just moving money? are we just moving money

Speaker 2: Let me give you a couple of case studies around this. When you collapse the ecosystem like what we're doing. Let me give you a couple of case studies around this. let me give you a couple of case studies around this When you collapse the ecosystem like what we're doing. when you collapse the ecosystem like what we're doing

Speaker 1: Okay Okay okay

Speaker 2: You're creating a lot of value for the advertiser and for the publisher. You're creating a lot of value for the advertiser and for the publisher. you're creating a lot of value for the advertiser and for the publisher

Speaker 1: That's true. That's true. that's true

Speaker 2: That's what we're focused on. That's what we're focused on. that's what we're focused on

Speaker 1: The two endpoints get more value. The two endpoints get more value. the two endpoints get more value

Speaker 2: Exactly Exactly exactly

Speaker 1: You're pulling out fees. Okay. You're pulling out fees. you're pulling out fees Okay. okay

Speaker 2: You're pulling out fees. You're removing operational overhead and complexity. You're pulling out fees. you're pulling out fees You're removing operational overhead and complexity. you're removing operational overhead and complexity

Speaker 1: Sure. Sure. sure

Speaker 2: You are increasing the amount of data that's available for targeting. You are building solutions that are privacy safe. You know, big problem in programmatic is, you know, dispersion of data across the ecosystem. You're reducing the amount of time that's needed to set up and manage campaigns. You are increasing the amount of data that's available for targeting. you are increasing the amount of data that's available for targeting You are building solutions that are privacy safe. you are building solutions that are privacy safe You know, big problem in programmatic is, you know, dispersion of data across the ecosystem. you know big problem in programmatic is you know dispersion of data across the ecosystem You're reducing the amount of time that's needed to set up and manage campaigns. you're reducing the amount of time that's needed to set up and manage campaigns

Speaker 1: Yeah. Yeah. yeah

Speaker 2: I'll give you a couple of examples of this. We did a demo, live demo on stage at a MarTech event a couple months ago with MiQ as the buying platform. Their trader got on stage and said, "Using PubMatic's AgenticOS. I can cut down the campaign set-up time by 98%. So, it would take me a couple of hours to set up a complex campaign in a traditional DSP. Now there's no user interface. I just type in or I upload. I'll give you a couple of examples of this. i'll give you a couple of examples of this We did a demo, live demo on stage at a MarTech event a couple months ago with MiQ as the buying platform. we did a demo live demo on stage at a martech event a couple months ago with miq as the buying platform Their trader got on stage and said, "Using PubMatic's AgenticOS. their trader got on stage and said "using pubmatic's agenticos I can cut down the campaign set-up time by 98%. So, i t would take me a couple of hours to set up a complex campaign in a traditional DSP. i can cut down the campaign set-up time by 98%. so, i t would take me a couple of hours to set up a complex campaign in a traditional dsp Now there's no user interface. now there's no user interface I just type in or I upload. i just type in or i upload

Speaker 1: You talk. You talk. you talk

Speaker 2: Planning brief. Planning brief. planning brief

Speaker 1: Yeah. Yeah. yeah

Speaker 2: Or you talk, whatever you like to do. We can set up that campaign in 2% of the time. Or you talk, whatever you like to do. or you talk whatever you like to do We can set up that campaign in 2% of the time. we can set up that campaign in 2% of the time If you compound that across the ecosystem. If you compound that across the ecosystem. if you compound that across the ecosystem

Speaker 1: Right. Right. right

Speaker 2: You're talking about, you know, thousands of millions of hours of labor that's saved. You're talking about, you know, thousands of millions of hours of labor that's saved. you're talking about you know thousands of millions of hours of labor that's saved Um, but we also- Um, but we also- um but we also-

Speaker 1: Millions of jobs lost. Millions of jobs lost. millions of jobs lost

Speaker 2: Well, I think millions of jobs focused on higher value add activity, right? That's how I would define progress. Second is, by collapsing the value chain, we're able to deliver much higher ROI. Abovo Maxlead, largest independent ad agency in the Netherlands, probably nobody here has ever heard of them. Well, I think millions of jobs focused on higher value add activity, right? well i think millions of jobs focused on higher value add activity right That's how I would define progress. that's how i would define progress Second is, by collapsing the value chain, we're able to deliver much higher ROI. second is by collapsing the value chain we're able to deliver much higher roi Abovo Maxlead, largest independent ad agency in the Netherlands, probably nobody here has ever heard of them. abovo maxlead largest independent ad agency in the netherlands probably nobody here has ever heard of them

Speaker 1: Sure. Sure. sure

Speaker 2: They play an important role in that market. They're able to generate 40% lower CPMs for the media that they buy, and 30%-40% improvement on return on ad spend. That's because we are removing the DSP from that equation. They play an important role in that market. they play an important role in that market They're able to generate 40% lower CPMs for the media that they buy, and 30%-40% improvement on return on ad spend. they're able to generate 40% lower cpms for the media that they buy and 30%-40% improvement on return on ad spend That's because we are removing the DSP from that equation. that's because we are removing the dsp from that equation

Speaker 1: Yeah. Yeah. yeah

Speaker 2: Compressing the supply chain. Compressing the supply chain. compressing the supply chain

Speaker 1: That saves you 12%. Mm-hmm. That saves you 12%. that saves you 12% Mm-hmm. mm-hmm

Speaker 2: Well, I don't know anybody that's paying 12%. It's usually much, much higher than that. Well, I don't know anybody that's paying 12%. well i don't know anybody that's paying 12% It's usually much, much higher than that. it's usually much much higher than that

Speaker 1: Okay. Okay. okay

Speaker 2: When you look at the all-in fee that DSPs are charging. It also removes a lot of that operational complexity. When a deal doesn't scale, for instance, now a trader on the buy side has to log into the DSP. They're working with somebody, let's say PubMatic at the SSP, or the publisher trying to figure out, "Okay, am I sending you the inventory? Are you seeing it? Why are you not bidding on it?" All of that complexity is eliminated when you're in a single platform. When you look at the all-in fee that DSPs are charging. when you look at the all-in fee that dsps are charging It also removes a lot of that operational complexity. it also removes a lot of that operational complexity When a deal doesn't scale, for instance, now a trader on the buy side has to log into the DSP. when a deal doesn't scale for instance now a trader on the buy side has to log into the dsp They're working with somebody, let's say PubMatic at the SSP, or the publisher trying to figure out, "Okay, am I sending you the inventory? they're working with somebody let's say pubmatic at the ssp or the publisher trying to figure out "okay am i sending you the inventory Are you seeing it? are you seeing it Why are you not bidding on it?" All of that complexity is eliminated when you're in a single platform. why are you not bidding on it?" all of that complexity is eliminated when you're in a single platform

Speaker 1: Okay. All right. You say you've launched this cool product, AgenticOS. You say it's growing fast, but I don't get that. Really what you're waiting on is ad agencies, who are not typically very fast. They need to create a buyer agent. Let's call it a set of rails. There's programmatic rails that have DSP and SSP. You're saying, and I think people agree with you, we're moving to agentic rails. Those rails are different. They're a different caliber of railroad size. Okay. okay All right. all right You say you've launched this cool product, AgenticOS. you say you've launched this cool product agenticos You say it's growing fast, but I don't get that. you say it's growing fast but i don't get that Really what you're waiting on is ad agencies, who are not typically very fast. really what you're waiting on is ad agencies who are not typically very fast They need to create a buyer agent. they need to create a buyer agent Let's call it a set of rails. let's call it a set of rails There's programmatic rails that have DSP and SSP. there's programmatic rails that have dsp and ssp You're saying, and I think people agree with you, we're moving to agentic rails. you're saying and i think people agree with you we're moving to agentic rails Those rails are different. those rails are different They're a different caliber of railroad size. they're a different caliber of railroad size

Speaker 2: Correct. Correct. correct

Speaker 1: You need a buyer, and a traditionally slow-moving buyer. To create a agent that can talk to your AgenticOS. Who is it that is driving the growth in this product? You need a buyer, and a traditionally slow-moving buyer. you need a buyer and a traditionally slow-moving buyer To create a agent that can talk to your AgenticOS. to create a agent that can talk to your agenticos Who is it that is driving the growth in this product? who is it that is driving the growth in this product

Speaker 2: Sure. We launched the industry's first fully autonomous agentic campaign in December. Sure. sure We launched the industry's first fully autonomous agentic campaign in December. we launched the industry's first fully autonomous agentic campaign in december

Speaker 1: Okay Okay okay

Speaker 2: With an independent agency called Butler/Till. With an independent agency called Butler/Till. with an independent agency called butler/till

Speaker 1: Okay. Okay. okay

Speaker 2: The advertiser is a malt beverage, Geloso Beverage Group. The advertiser is a malt beverage, Geloso Beverage Group. the advertiser is a malt beverage geloso beverage group

Speaker 1: Yeah. Yeah. yeah

Speaker 2: Some canned cocktail, I believe. Some canned cocktail, I believe. some canned cocktail i believe

Speaker 1: Okay. Okay. okay

Speaker 2: We shared in our earnings call last week that we now have 30 campaigns live. We shared in our earnings call last week that we now have 30 campaigns live. we shared in our earnings call last week that we now have 30 campaigns live

Speaker 1: With that guy or with that ad agency? With that guy or with that ad agency? with that guy or with that ad agency

Speaker 2: Across the ecosystem. Dentsu Amnet in France. Across the ecosystem. across the ecosystem Dentsu Amnet in France. dentsu amnet in france

Speaker 1: Okay. Okay. okay

Speaker 2: We have some holdcos in Asia. We have Abovo Maxlead, independent agency in the Netherlands. We have some holdcos in Asia. we have some holdcos in asia We have Abovo Maxlead, independent agency in the Netherlands. we have abovo maxlead independent agency in the netherlands

Speaker 1: Okay. Okay. okay

Speaker 2: I agree with you that the big agency holdcos, they tend to move slowly. However, that's not our sole focus. We have a big focus on the indie or independent agency market. I agree with you that the big agency holdcos, they tend to move slowly. i agree with you that the big agency holdcos they tend to move slowly However, that's not our sole focus. however that's not our sole focus We have a big focus on the indie or independent agency market. we have a big focus on the indie or independent agency market

Speaker 1: That makes sense to me. That makes sense to me. that makes sense to me

Speaker 2: They move very quickly. They move very quickly. they move very quickly

Speaker 1: They move fast. They move fast. they move fast

Speaker 2: Yes. That's also where a lot of the ad budget growth is. If we look at, you know, who are the clients behind the agency holdcos, specifically Fortune 1,000 advertisers? Yes. yes That's also where a lot of the ad budget growth is. that's also where a lot of the ad budget growth is If we look at, you know, who are the clients behind the agency holdcos, specifically Fortune 1,000 advertisers? if we look at you know who are the clients behind the agency holdcos specifically fortune 1,000 advertisers

Speaker 1: Or 100. Or 100. or 100

Speaker 2: 100. Okay. What's the growth in media budget, advertising budget at a Unilever, at a Coca-Cola, at a BMW? It's flat, right? Maybe even down. When you get into the mid-market, you look at challenger brands, right? Vuori instead of Levi's. Chime Bank instead of Citigroup. That's where the growth is, and that's where the growth in ad budgets are, and that's a huge driver, of our growth. 100. 100 Okay. okay What's the growth in media budget, advertising budget at a Unilever, at a Coca-Cola, at a BMW? what's the growth in media budget advertising budget at a unilever at a coca-cola at a bmw It's flat, right? it's flat right Maybe even down. maybe even down When you get into the mid-market, you look at challenger brands, right? when you get into the mid-market you look at challenger brands right Vuori instead of Levi's. vuori instead of levi's Chime Bank instead of Citigroup. chime bank instead of citigroup That's where the growth is, and that's where the growth in ad budgets are, and that's a huge driver, of our growth. that's where the growth is and that's where the growth in ad budgets are and that's a huge driver of our growth

Speaker 1: Okay. That's who's adopting this AgenticOS? Okay. okay That's who's adopting this AgenticOS? that's who's adopting this agenticos

Speaker 2: Correct. Correct. correct

Speaker 1: Okay. Okay. okay

Speaker 2: Buyers don't need to wait. Again, they can log into chat ChatGPT. They can log into Anthropic. They can use that chat interface. They can use our chat interface. Some of them are, you know, hiring an Accenture or somebody like that to build a buyer agent for them. Some of them are building it internally, so they can connect their agent to our platform. There's no obstacle right now, other than I would say the human component of change management. Buyers don't need to wait. buyers don't need to wait Again, they can log into chat ChatGPT. again they can log into chat chatgpt They can log into Anthropic. they can log into anthropic They can use that chat interface. they can use that chat interface They can use our chat interface. they can use our chat interface Some of them are, you know, hiring an Accenture or somebody like that to build a buyer agent for them. some of them are you know hiring an accenture or somebody like that to build a buyer agent for them Some of them are building it internally, so they can connect their agent to our platform. some of them are building it internally so they can connect their agent to our platform There's no obstacle right now, other than I would say the human component of change management. there's no obstacle right now other than i would say the human component of change management

Speaker 1: Leadership. Leadership. leadership

Speaker 2: Leadership, exactly. That is preventing buyers from executing this way. Leadership, exactly. leadership exactly That is preventing buyers from executing this way. that is preventing buyers from executing this way

Speaker 1: Four years from now, five years from now, which feels like three forevers in a generative AI ecosystem. What percent of the like of a programmatic advertising has moved to agentic, would you estimate? Four years from now, five years from now, which feels like three forevers in a generative AI ecosystem. four years from now five years from now which feels like three forevers in a generative ai ecosystem What percent of the like of a programmatic advertising has moved to agentic, would you estimate? what percent of the like of a programmatic advertising has moved to agentic would you estimate

Speaker 2: I said two earnings calls ago that I estimate, I expect that by the end of 2028, 25% of media transacted in our ecosystem will be agentic. I said two earnings calls ago that I estimate, I expect that by the end of 2028, 25% of media transacted in our ecosystem will be agentic. i said two earnings calls ago that i estimate i expect that by the end of 2028 25% of media transacted in our ecosystem will be agentic

Speaker 1: No way. No way. no way

Speaker 2: By the end of 2030, it'll be 50%. By the end of 2030, it'll be 50%. by the end of 2030 it'll be 50%

Speaker 1: No way. No way. no way

Speaker 2: In the two quarters since. In the two quarters since. in the two quarters since

Speaker 1: I would take the under. I would take the under. i would take the under

Speaker 2: I think I may have been too conservative. I think I may have been too conservative. i think i may have been too conservative

Speaker 1: No. No. no

Speaker 2: Yes. Yes. yes

Speaker 1: That implies the big ad agency holding companies, who are 75% of ad spend, have adopted this. That implies the big ad agency holding companies, who are 75% of ad spend, have adopted this. that implies the big ad agency holding companies who are 75% of ad spend have adopted this

Speaker 2: No. The big agency holdcos are 40-ish% of ad spend today. They were 55% about 10 years ago. Their share of the budgets has shrunk. It does imply that the big holdcos will have adopted this, and I fully expect that they will by the end of 2027. No. no The big agency holdcos are 40-ish% of ad spend today. the big agency holdcos are 40-ish% of ad spend today They were 55% about 10 years ago. they were 55% about 10 years ago Their share of the budgets has shrunk. their share of the budgets has shrunk It does imply that the big holdcos will have adopted this, and I fully expect that they will by the end of 2027. it does imply that the big holdcos will have adopted this and i fully expect that they will by the end of 2027

Speaker 1: Oh, boy. I'm taking the under on that. Oh, boy. oh boy I'm taking the under on that. i'm taking the under on that

Speaker 2: Let's see. Let's see. let's see

Speaker 1: I went to an upfront yesterday. I went to an upfront yesterday. i went to an upfront yesterday

Speaker 2: I'll come back. I'll come back. i'll come back

Speaker 1: Wall Street's been trying to kill upfronts for 30 years. I still have upfronts this week. Wall Street's been trying to kill upfronts for 30 years. wall street's been trying to kill upfronts for 30 years I still have upfronts this week. i still have upfronts this week

Speaker 2: For sure. For sure. for sure

Speaker 1: That is the ad agencies. That is the ad agencies. that is the ad agencies

Speaker 2: More and more of the upfront is being transacted programmatically. More and more of the upfront is being transacted programmatically. more and more of the upfront is being transacted programmatically

Speaker 1: True. True. true

Speaker 2: Right? Right? right

Speaker 1: I'm just saying these ad agencies. I'm just saying these ad agencies. i'm just saying these ad agencies

Speaker 2: That'll become agentic. That'll become agentic. that'll become agentic

Speaker 1: Are still doing upfronts. Are still doing upfronts. are still doing upfronts

Speaker 2: Sure. Sure. sure

Speaker 1: It's two decades since they've been relevant. It's two decades since they've been relevant. it's two decades since they've been relevant

Speaker 2: I mean, upfronts are salesmanship. That's all that is, right? You gotta sell your wares. I mean, upfronts are salesmanship. i mean upfronts are salesmanship That's all that is, right? that's all that is right You gotta sell your wares. you gotta sell your wares

Speaker 1: I'm just saying, you know, infrastructure and systems are ponderous, and they're slow-moving. I'm just saying, you know, infrastructure and systems are ponderous, and they're slow-moving. i'm just saying you know infrastructure and systems are ponderous and they're slow-moving

Speaker 2: Sure. Sure. sure

Speaker 1: By decades. By decades. by decades

Speaker 2: Upfronts are going to drive more programmatic selling and more Agentic selling and buying, not less. Upfronts are going to drive more programmatic selling and more Agentic selling and buying, not less. upfronts are going to drive more programmatic selling and more agentic selling and buying not less

Speaker 1: Oh, maybe. We'll see. I think you're being a little optimistic. It probably doesn't matter to your company. You're small enough. You can grow no matter how much moves. Oh, maybe. oh maybe We'll see. we'll see I think you're being a little optimistic. i think you're being a little optimistic It probably doesn't matter to your company. it probably doesn't matter to your company You're small enough. you're small enough You can grow no matter how much moves. you can grow no matter how much moves

Speaker 2: We can absolutely. We can absolutely. we can absolutely

Speaker 1: You know, if 10% moves. You know, if 10% moves. you know if 10% moves

Speaker 2: Yes. Yes. yes

Speaker 1: You're gonna grow. You're gonna grow. you're gonna grow

Speaker 2: Yes. Yes. yes

Speaker 1: It doesn't matter. It doesn't matter. it doesn't matter

Speaker 2: I mean, our Activate product is growing 3x year-over-year. This is the direct buying in the SSP. I mean, our Activate product is growing 3x year-over-year. i mean our activate product is growing 3x year-over-year This is the direct buying in the SSP. this is the direct buying in the ssp

Speaker 1: Right. Right. right

Speaker 2: Now greater and greater portion of that is gonna be done agentically. Now greater and greater portion of that is gonna be done agentically. now greater and greater portion of that is gonna be done agentically

Speaker 1: Yeah. I do wonder whether one cannibalizes the other, though. It feels like it's the same guy that would adopt your Activate ClearLine product as the Agentic product. Yeah. yeah I do wonder whether one cannibalizes the other, though. i do wonder whether one cannibalizes the other though It feels like it's the same guy that would adopt your Activate ClearLine product as the Agentic product. it feels like it's the same guy that would adopt your activate clearline product as the agentic product

Speaker 2: Agentic is a great on-ramp for our Activate solution, so I see them as going hand-in-hand. Agentic is a great on-ramp for our Activate solution, so I see them as going hand-in-hand. agentic is a great on-ramp for our activate solution so i see them as going hand-in-hand

Speaker 1: Why would that be? Seems like they're on different rails, so they're substituted. Why would that be? why would that be Seems like they're on different rails, so they're substituted. seems like they're on different rails so they're substituted

Speaker 2: No, they're not on different rails. Under AgenticOS is a way to agentically access a variety of capabilities on our platform. No, they're not on different rails. no they're not on different rails Under AgenticOS is a way to agentically access a variety of capabilities on our platform. under agenticos is a way to agentically access a variety of capabilities on our platform

Speaker 1: Right. Right. right

Speaker 2: One of those capabilities is buying directly in our SSP. One of those capabilities is buying directly in our SSP. one of those capabilities is buying directly in our ssp Another set of capabilities which is Activate. Another set of capabilities is the SSP itself. Another set is Connect our data platform, so 300+ data partners. It's the ability to attach data to any campaign. All of these are now exposed agentically via AgenticOS. Think of AgenticOS as a, as a wrapper, as a front end to agentically access any capabilities on our platform. Another set of capabilities which is Activate. another set of capabilities which is activate Another set of capabilities is the SSP itself. another set of capabilities is the ssp itself Another set is Connect our data platform, so 300+ data partners. another set is connect our data platform so 300+ data partners It's the ability to attach data to any campaign. it's the ability to attach data to any campaign All of these are now exposed agentically via AgenticOS. all of these are now exposed agentically via agenticos Think of AgenticOS as a, as a wrapper, as a front end to agentically access any capabilities on our platform. think of agenticos as a as a wrapper as a front end to agentically access any capabilities on our platform

Speaker 1: Okay. Interesting. All right, fair enough. Okay, you don't want to talk about the other announcements you've made, like AI Insights or Creative Innovation. That one sounded interesting to me. You think AgenticOS is the number one driver of financial upside, revenue upside. Okay. Interesting. okay. interesting All right, fair enough. all right fair enough Okay, you don't want to talk about the other announcements you've made, like AI Insights or Creative Innovation. okay you don't want to talk about the other announcements you've made like ai insights or creative innovation That one sounded interesting to me. that one sounded interesting to me You think AgenticOS is the number one driver of financial upside, revenue upside. you think agenticos is the number one driver of financial upside revenue upside

Speaker 2: Correct. Correct. correct

Speaker 1: For PubMatic? For PubMatic? for pubmatic

Speaker 2: That's right. That's right. that's right

Speaker 1: Cool. All right, one of the questions I think a lot of people, investors are particularly worried about is this take rate question. If both sides of the equation, both DSPs and SSPs are trying to cut out fees of the middlemen, doesn't that hurt everybody's take rate? I mean, what do you see happening to your take rates over the next three years? Cool. cool All right, one of the questions I think a lot of people, investors are particularly worried about is this take rate question. all right one of the questions i think a lot of people investors are particularly worried about is this take rate question If both sides of the equation, both DSPs and SSPs are trying to cut out fees of the middlemen, doesn't that hurt everybody's take rate? if both sides of the equation both dsps and ssps are trying to cut out fees of the middlemen doesn't that hurt everybody's take rate I mean, what do you see happening to your take rates over the next three years? i mean what do you see happening to your take rates over the next three years

Speaker 2: We see our take rates as stable to growing. We see our take rates as stable to growing. we see our take rates as stable to growing

Speaker 1: Okay. Okay. okay

Speaker 2: The reason is that we are bringing more value across the ecosystem to our customers. I mentioned earlier that with Activate and AgenticOS. The reason is that we are bringing more value across the ecosystem to our customers. the reason is that we are bringing more value across the ecosystem to our customers I mentioned earlier that with Activate and AgenticOS. i mentioned earlier that with activate and agenticos We are reaching deeper into buyer workflows. We are reaching deeper into buyer workflows. we are reaching deeper into buyer workflows

Speaker 1: Okay. Okay. okay

Speaker 2: Right? As we do that, we're creating more value for publishers and buyers on our platform. That means we're able to charge incremental fees. Right? right As we do that, we're creating more value for publishers and buyers on our platform. as we do that we're creating more value for publishers and buyers on our platform That means we're able to charge incremental fees. that means we're able to charge incremental fees

Speaker 1: Okay. Okay. okay

Speaker 2: For instance, when a buyer uses Activate, we charge a fee for that. When a publisher or a buyer uses our Connect data platform, and they activate data from any of 300 different parties, then we charge a fee for that. For instance, when a buyer uses Activate, we charge a fee for that. for instance when a buyer uses activate we charge a fee for that When a publisher or a buyer uses our Connect data platform, and they activate data from any of 300 different parties, then we charge a fee for that. when a publisher or a buyer uses our connect data platform and they activate data from any of 300 different parties then we charge a fee for that

Speaker 1: Okay. Okay. okay

Speaker 2: These are all, you know, take rate additive opportunities. We're growing our TAM, we're growing the value we create for the ecosystem. I also don't think it's correct to believe that as we do this or as others, you know, move in a similar direction perhaps, that there's gonna be a revenue collapse in the ecosystem. What I see is that as advertising gets more efficient and more effective, we should be moving, bringing more dollars into the ecosystem, and that's exactly what we're focused on doing. These are all, you know, take rate additive opportunities. these are all you know take rate additive opportunities We're growing our TAM, we're growing the value we create for the ecosystem. we're growing our tam we're growing the value we create for the ecosystem I also don't think it's correct to believe that as we do this or as others, you know, move in a similar direction perhaps, that there's gonna be a revenue collapse in the ecosystem. i also don't think it's correct to believe that as we do this or as others you know move in a similar direction perhaps that there's gonna be a revenue collapse in the ecosystem What I see is that as advertising gets more efficient and more effective, we should be moving, bringing more dollars into the ecosystem, and that's exactly what we're focused on doing. what i see is that as advertising gets more efficient and more effective we should be moving bringing more dollars into the ecosystem and that's exactly what we're focused on doing

Speaker 1: Okay. Well, ideally 'cause you love to pull it out of the walled gardens. Okay. okay Well, ideally 'cause you love to pull it out of the walled gardens. well ideally 'cause you love to pull it out of the walled gardens

Speaker 2: For sure. For sure. for sure

Speaker 1: The more efficient you get, the more you look like a walled garden. The more efficient you get, the more you look like a walled garden. the more efficient you get the more you look like a walled garden

Speaker 2: Not only pulling it from the walled gardens, but if the marginal effectiveness of advertising goes up. Not only pulling it from the walled gardens, but if the marginal effectiveness of advertising goes up. not only pulling it from the walled gardens but if the marginal effectiveness of advertising goes up

Speaker 1: Yeah Yeah yeah

Speaker 2: I mean, those dollars are not capped, right? I mean, those dollars are not capped, right? i mean those dollars are not capped right

Speaker 1: Yeah. Yeah. yeah

Speaker 2: So a brand will advertise more in order to sell more product. So a brand will advertise more in order to sell more product. so a brand will advertise more in order to sell more product

Speaker 1: Yeah. Yeah. yeah

Speaker 2: That would be the profit maximizing thing for them to do so that, you know, that describes the growth of Meta, for instance. That would be the profit maximizing thing for them to do so that, you know, that describes the growth of Meta, for instance. that would be the profit maximizing thing for them to do so that you know that describes the growth of meta for instance

Speaker 1: Fair enough. One of the meetings I had at POSSIBLE that was really fascinating was an SSP private, and he was saying that his curation, his data is growing 80% a year, and it's now like, I'm gonna say, 40% of his business. I'm gonna explain curation in a minute, but Is curation a driver for you guys? Fair enough. fair enough One of the meetings I had at POSSIBLE that was really fascinating was an SSP private, and he was saying that his curation, his data is growing 80% a year, and it's now like, I'm gonna say, 40% of his business. one of the meetings i had at possible that was really fascinating was an ssp private and he was saying that his curation his data is growing 80% a year and it's now like i'm gonna say 40% of his business I'm gonna explain curation in a minute, but Is curation a driver for you guys? i'm gonna explain curation in a minute but is curation a driver for you guys

Speaker 2: Curation is a driver for us. Curation is a driver for us. curation is a driver for us

Speaker 1: Okay. We need to explain what curation is. Okay. okay We need to explain what curation is. we need to explain what curation is

Speaker 2: Sure. Sure. sure

Speaker 1: I just wanna make sure it was important to your business before I brought it up. I just wanna make sure it was important to your business before I brought it up. i just wanna make sure it was important to your business before i brought it up

Speaker 2: Yeah. Yeah, yeah. Absolutely. Yeah. yeah Yeah, yeah. yeah yeah Absolutely. absolutely

Speaker 1: Why don't you explain what curation is, and then we'll talk about this 'cause this is a new thing going on in SSPs. Why don't you explain what curation is, and then we'll talk about this 'cause this is a new thing going on in SSPs. why don't you explain what curation is and then we'll talk about this 'cause this is a new thing going on in ssps

Speaker 2: Yeah. Yeah. yeah

Speaker 1: I'm more excited about than Agentic, I want you to know. I'm more excited about than Agentic, I want you to know. i'm more excited about than agentic i want you to know

Speaker 2: Oh, interesting. Oh, interesting. oh interesting

Speaker 1: Anyway. Anyway. anyway

Speaker 2: I think you have that backwards, but I'll come back next year. I think you have that backwards, but I'll come back next year. i think you have that backwards but i'll come back next year

Speaker 1: I know, I know. I get it. We disagree. I know, I know. i know i know i I get it. know i know i get it We disagree. we disagree

Speaker 2: We'll see. We'll see. we'll see

Speaker 1: It's okay. It's okay. it's okay

Speaker 2: We'll be honest. We'll be honest. we'll be honest

Speaker 1: That's what makes markets markets. That's what makes markets markets. that's what makes markets markets

Speaker 2: We'll see. Yeah, exactly. We'll see. we'll see Yeah, exactly. yeah exactly

Speaker 1: Okay. first explain curation. Okay. first explain curation. okay first explain curation

Speaker 2: Sure. Sure. sure

Speaker 1: Because I think it's really important. Because I think it's really important. because i think it's really important

Speaker 2: Historically, advertisers have attached data on the buy side of the ecosystem, meaning in a DSP. Historically, advertisers have attached data on the buy side of the ecosystem, meaning in a DSP. historically advertisers have attached data on the buy side of the ecosystem meaning in a dsp

Speaker 1: Sure. Sure. sure

Speaker 2: Right? If you go into Google or, you know, any large DSP. Right? right If you go into Google or, you know, any large DSP. if you go into google or you know any large dsp

Speaker 1: Trade Desk. Mm-hmm Trade Desk. trade desk mm-hmm Mm-hmm desk mm-hmm

Speaker 2: Amazon, Trade Desk, sure. They have extensive data partnerships, where you can, you know, layer in Nielsen, Comscore, et cetera data. Amazon, Trade Desk, sure. amazon trade desk sure They have extensive data partnerships, where you can, you know, layer in Nielsen, Comscore, et cetera data. they have extensive data partnerships where you can you know layer in nielsen comscore et cetera data

Speaker 1: Yeah. Yeah. yeah

Speaker 2: Over the last, really over the last five years, there's been a conservative. Over the last, really over the last five years, there's been a conservative. over the last really over the last five years there's been a conservative

Speaker 1: I would say two or three years really. It's more recent than that. I would say two or three years really. i would say two or three years really It's more recent than that. it's more recent than that

Speaker 2: I mean, we've been generating revenue there for five years. I mean, we've been generating revenue there for five years. i mean we've been generating revenue there for five years

Speaker 1: Okay. Okay. okay

Speaker 2: It's accelerating though. It's accelerating though. it's accelerating though

Speaker 1: It is, yeah. It is, yeah. it is yeah

Speaker 2: I'll give you that. We've seen a shift in how the ecosystem operates and a shift in where buyers are applying data to the sell side of the ecosystem in the SSP. There's a couple of reasons for this. One is the scale of audiences is larger, much larger in the SSP than it is on the, in the DSP because you have to do audience matching. I'll give you that. i'll give you that We've seen a shift in how the ecosystem operates and a shift in where buyers are applying data to the sell side of the ecosystem in the SSP. we've seen a shift in how the ecosystem operates and a shift in where buyers are applying data to the sell side of the ecosystem in the ssp There's a couple of reasons for this. there's a couple of reasons for this One is the scale of audiences is larger, much larger in the SSP than it is on the, in the DSP because you have to do audience matching. one is the scale of audiences is larger much larger in the ssp than it is on the in the dsp because you have to do audience matching

Speaker 1: Yeah. Yeah. yeah

Speaker 2: The further you get from the publisher and the consumer, there's a, you know, typically a 20%-40%, you know, falloff rate. The further you get from the publisher and the consumer, there's a, you know, typically a 20%-40%, you know, falloff rate. the further you get from the publisher and the consumer there's a you know typically a 20%-40% you know falloff rate

Speaker 1: Loss. Yeah. Loss. loss Yeah. yeah

Speaker 2: Exactly. Second is privacy. With privacy regulations increasing around the world, there's a need for consent from the consumer. Consent exists at the publisher, not typically with the advertiser. There's more data to be applied there. Third is, it can be done, applying data can be done much more efficiently. In many DSPs, you know, data has become 30%, 40%, 50% of their revenue where they're charging, you know, very high take rates against that data. We built, we've been building now for five-plus years a Connect platform, which is our data platform. I think it's probably one of the largest scaled data platforms in the ecosystem. There are over 300 data partners that are plugged in. Everything from, I mentioned, you know, Comscore, Nielsen, Circana. To a very rich set of commerce media partners. Klarna, Kroger, Intuit, Shopify. We've launched, announced at POSSIBLE Walmart and PayPal. Exactly. exactly Second is privacy. second is privacy With privacy regulations increasing around the world, there's a need for consent from the consumer. with privacy regulations increasing around the world there's a need for consent from the consumer Consent exists at the publisher, not typically with the advertiser. consent exists at the publisher not typically with the advertiser There's more data to be applied there. there's more data to be applied there Third is, it can be done, applying data can be done much more efficiently. third is it can be done applying data can be done much more efficiently In many DSPs, you know, data has become 30%, 40%, 50% of their revenue where they're charging, you know, very high take rates against that data. in many dsps you know data has become 30% 40% 50% of their revenue where they're charging you know very high take rates against that data We built, we've been building now for five-plus years a Connect platform, which is our data platform. we built we've been building now for five-plus years a connect platform which is our data platform I think it's probably one of the largest scaled data platforms in the ecosystem. i think it's probably one of the largest scaled data platforms in the ecosystem There are over 300 data partners that are plugged in. there are over 300 data partners that are plugged in Everything from, I mentioned, you know, Comscore, Nielsen, Circana. everything from i mentioned you know comscore nielsen circana To a very rich set of commerce media partners. to a very rich set of commerce media partners Klarna, Kroger, Intuit, Shopify. klarna kroger intuit shopify We've launched, announced at POSSIBLE Walmart and PayPal. we've launched announced at possible walmart and paypal

Speaker 1: Wow. Wow. wow

Speaker 2: Right. With PayPal there's $25 billion transactions, $400 million Venmo and PayPal accounts. This is, you know, very rich data that's sitting in our platform. What we do with curation, back to your question, is we package the data and the media for a buyer's objective. A buyer might say, "Okay, I'm launching a movie in June, and I need to find these types of audiences." We will take the right data from our platform, 300+ data partners. We will take the trillion-plus ad impressions that we process on a daily basis, and we will figure out, we will curate the right set of media. Right. right With PayPal there's $25 billion transactions, $400 million Venmo and PayPal accounts. with paypal there's $25 billion transactions $400 million venmo and paypal accounts This is, you know, very rich data that's sitting in our platform. this is you know very rich data that's sitting in our platform What we do with curation, back to your question, is we package the data and the media for a buyer's objective. what we do with curation back to your question is we package the data and the media for a buyer's objective A buyer might say, "Okay, I'm launching a movie in June, and I need to find these types of audiences." We will take the right data from our platform, 300+ data partners. a buyer might say "okay i'm launching a movie in june and i need to find these types of audiences." we will take the right data from our platform 300+ data partners We will take the trillion-plus ad impressions that we process on a daily basis, and we will figure out, we will curate the right set of media. we will take the trillion-plus ad impressions that we process on a daily basis and we will figure out we will curate the right set of media

Speaker 1: To sell to them. To sell to them. to sell to them

Speaker 2: To sell to them. Exactly. To help them meet their objectives. We generate a data fee when we curate and leverage one of our data partners. Our data partners generate revenue, we generate a data fee in addition to our SSP fee. To sell to them. to sell to them Exactly. exactly To help them meet their objectives. to help them meet their objectives We generate a data fee when we curate and leverage one of our data partners. we generate a data fee when we curate and leverage one of our data partners Our data partners generate revenue, we generate a data fee in addition to our SSP fee. our data partners generate revenue we generate a data fee in addition to our ssp fee

Speaker 1: I thought the big thing about curation was that you guys didn't charge on the data side. It was just free, but you just got a higher CPM because the data makes the CPM that you're selling at a more valuable CPM, so you just charge your take rate on a bigger CPM. I didn't know you were charging. I thought the big thing about curation was that you guys didn't charge on the data side. i thought the big thing about curation was that you guys didn't charge on the data side It was just free, but you just got a higher CPM because the data makes the CPM that you're selling at a more valuable CPM, so you just charge your take rate on a bigger CPM. I didn't know you were charging. it was just free but you just got a higher cpm because the data makes the cpm that you're selling at a more valuable cpm so you just charge your take rate on a bigger cpm. i didn't know you were charging

Speaker 2: We do both. We do both. we do both

Speaker 1: For data separately. I would say most SSPs are not charging for the data piece. For data separately. for data separately I would say most SSPs are not charging for the data piece. i would say most ssps are not charging for the data piece

Speaker 2: Well, last quarter was our 40th consecutive quarter of profitability at adjusted EBITDA. You know, we like to generate fee revenue where we're adding value to our partners. Well, last quarter was our 40th consecutive quarter of profitability at adjusted EBITDA. well last quarter was our 40th consecutive quarter of profitability at adjusted ebitda You know, we like to generate fee revenue where we're adding value to our partners. you know we like to generate fee revenue where we're adding value to our partners

Speaker 1: Okay. Okay. okay

Speaker 2: Yeah. Yeah. yeah

Speaker 1: Okay. Interesting. Okay, that's the first time I've heard it. Anyway, this trend, how much of your growth is being driven by attaching data to, How much of your revenue is now because you're attaching data to the sale? Okay. okay Interesting. interesting Okay, that's the first time I've heard it. okay that's the first time i've heard it Anyway, this trend, how much of your growth is being driven by attaching data to, How much of your revenue is now because you're attaching data to the sale? anyway this trend how much of your growth is being driven by attaching data to how much of your revenue is now because you're attaching data to the sale

Speaker 2: We don't break out that specifically, Connect. A lot of the products that we've been talking about, Connect Data Platform with curation, Activate, AgenticOS. We don't break out that specifically, Connect. we don't break out that specifically connect A lot of the products that we've been talking about, Connect Data Platform with curation, Activate, AgenticOS. a lot of the products that we've been talking about connect data platform with curation activate agenticos

Speaker 1: Okay. Okay. okay

Speaker 2: We put that in a category called, emerging revenue streams. We put that in a category called, emerging revenue streams. we put that in a category called emerging revenue streams

Speaker 1: Okay. Okay. okay

Speaker 2: That category, we just shared, last week, is 14% of our revenue, and it grew 80% year-over-year last quarter. That category, we just shared, last week, is 14% of our revenue, and it grew 80% year-over-year last quarter. that category we just shared last week is 14% of our revenue and it grew 80% year-over-year last quarter

Speaker 1: Okay. Okay. okay

Speaker 2: This, you know, collective set of newer products. This, you know, collective set of newer products. this you know collective set of newer products Which is where we see the industry evolving to, is growing very quickly. Which is where we see the industry evolving to, is growing very quickly. which is where we see the industry evolving to is growing very quickly

Speaker 1: Okay. A year from now you're gonna sit on my stage, and I want you to break out this 14% and see which is bigger, and I bet it is curation and not Agentic. Betcha, a year from now. Okay. okay A year from now you're gonna sit on my stage, and I want you to break out this 14% and see which is bigger, and I bet it is curation and n ot Agentic. a year from now you're gonna sit on my stage and i want you to break out this 14% and see which is bigger and i bet it is curation and n ot agentic Betcha, a year from now. betcha a year from now

Speaker 2: Let's see. Let's see. let's see

Speaker 1: We'll see. We'll see. we'll see

Speaker 2: Curation today is bigger, because it's been around longer, right? Curation today is bigger, because it's been around longer, right? curation today is bigger because it's been around longer right

Speaker 1: Fair. Fair. fair

Speaker 2: Agentic. Agentic. agentic

Speaker 1: That's fair. That's fair. that's fair

Speaker 2: You know, two quarters. Two quarters old. You know, two quarters. Two quarters old. you know two quarters. two quarters old

Speaker 1: It's two. I was gonna say two months old. It's two. it's two I was gonna say two months old. i was gonna say two months old

Speaker 2: Exactly. Exactly. Let's see. I think there's a decent chance. Exactly. exactly Exactly. exactly Let's see. let's see I think there's a decent chance. i think there's a decent chance

Speaker 1: I'm gonna be right, and you're gonna come in and go, "Oh, but it's 120% growth in Agentic from $2 million-$3 million. I'm gonna be right, and you're gonna come in and go, "Oh, but it's 120% growth in Agentic from $2 million-$3 million. i'm gonna be right and you're gonna come in and go "oh but it's 120% growth in agentic from $2 million-$3 million

Speaker 2: Let's see. I think Agentic will be bigger by next year, but let's see. Let's see. let's see I think Agentic will be bigger by next year, but let's see. i think agentic will be bigger by next year but let's see

Speaker 1: I disagree with you. I disagree with you. i disagree with you

Speaker 2: Let's see. Let's see. let's see

Speaker 1: We'll see. We'll see. we'll see

Speaker 2: We'll see. We'll see. we'll see

Speaker 1: It's discernible fact. It's discernible fact. it's discernible fact

Speaker 2: Yeah. Yeah. yeah

Speaker 1: One year from now. We're gonna be here. One year from now. one year from now We're gonna be here. we're gonna be here

Speaker 2: Either way we win. Either way we win. either way we win

Speaker 1: Next time. Next time. next time

Speaker 2: Either way, PubMatic will win. Either way, PubMatic will win. either way pubmatic will win

Speaker 1: Yeah. Yeah. yeah

Speaker 2: Our shareholders will win. Our shareholders will win. our shareholders will win

Speaker 1: I really am very high on this curation stuff, but okay. Okay. Where is AI already driving measurable ROI today, either by yield optimization or matching or cost efficiencies or you're not hiring as many people? Tell me where it's actually delivering financial returns today, and what you see the biggest upside from it, specifically generative AI over the next year. I really am very high on this curation stuff, but okay. i really am very high on this curation stuff but okay Okay. okay Where is AI already driving measurable ROI today, either by yield optimization or matching or cost efficiencies or you're not hiring as many people? where is ai already driving measurable roi today either by yield optimization or matching or cost efficiencies or you're not hiring as many people Tell me where it's actually delivering financial returns today, and what you see the biggest upside from it, specifically generative AI over the next year. tell me where it's actually delivering financial returns today and what you see the biggest upside from it specifically generative ai over the next year

Speaker 2: Sure. I think a good framework, let's say for our customers, and then we can turn to internal application of AI. Sure. sure I think a good framework, let's say for our customers, and then we can turn to internal application of AI. i think a good framework let's say for our customers and then we can turn to internal application of ai

Speaker 1: Okay. Okay. okay

Speaker 2: Is really just efficiency and effectiveness, right? I think whenever we're thinking about innovation in advertising, we can think about, like, those two categories. Efficiency we've talked about already quite a bit, right? Significant reduction, 7x time reduction in campaign troubleshooting and management. These are all, you know, efficiency measures. Is really just efficiency and effectiveness, right? is really just efficiency and effectiveness right I think whenever we're thinking about innovation in advertising, we can think about, like, those two categories. i think whenever we're thinking about innovation in advertising we can think about like those two categories Efficiency we've talked about already quite a bit, right? efficiency we've talked about already quite a bit right Significant reduction, 7x time reduction in campaign troubleshooting and management. significant reduction 7x time reduction in campaign troubleshooting and management These are all, you know, efficiency measures. these are all you know efficiency measures

Speaker 1: Yeah. Yeah. yeah

Speaker 2: Where a significant amount of labor is saved. Effectiveness is where there's still a lot of work being done. As AI scales up, right, from very early stages. A couple of examples of this, right? We've been able to reduce fees taken, you know, in a media buy by 40%, right? That means lower CPMs, 30%-40% more working media for an advertiser. That's a, you know, great example of increased. Where a significant amount of labor is saved. where a significant amount of labor is saved Effectiveness is where there's still a lot of work being done. effectiveness is where there's still a lot of work being done As AI scales up, right, from very early stages. as ai scales up right from very early stages A couple of examples of this, right? a couple of examples of this right We've been able to reduce fees taken, you know, in a media buy by 40%, right? we've been able to reduce fees taken you know in a media buy by 40% right That means lower CPMs, 30%-40% more working media for an advertiser. that means lower cpms 30%-40% more working media for an advertiser That's a, you know, great example of increased. that's a you know great example of increased

Speaker 1: You're an SSP. All you should care about is higher CPMs for your publisher. You're an SSP. you're an ssp All you should care about is higher CPMs for your publisher. all you should care about is higher cpms for your publisher

Speaker 2: The point is how do you generate higher CPMs? It's not a zero-sum game to say, "Hey, we just wanna get the advertiser to pay more." What we focus on at PubMatic is delivering higher CPMs by delivering more performance for the advertiser. When we deliver more performance, the advertiser is happy to pay more. Which is how we connect the dot to higher CPM. That effectiveness and performance is really important. We talked earlier about 300 data partners in curation. One of the biggest challenges in curation is what data and what media should I apply to this advertiser's campaign? This is where I think the big wave of AI and effectiveness is going to come, which is using AI to figure out which dozens of the 300 data partners. The point is how do you generate higher CPMs? the point is how do you generate higher cpms It's not a zero-sum game to say, "Hey, we just wanna get the advertiser to pay more." What we focus on at PubMatic is delivering higher CPMs by delivering more performance for the advertiser. it's not a zero-sum game to say "hey we just wanna get the advertiser to pay more." what we focus on at pubmatic is delivering higher cpms by delivering more performance for the advertiser When we deliver more performance, the advertiser is happy to pay more. when we deliver more performance the advertiser is happy to pay more Which is how we connect the dot to higher CPM. which is how we connect the dot to higher cpm That effectiveness and performance is really important. that effectiveness and performance is really important We talked earlier about 300 data partners in curation. we talked earlier about 300 data partners in curation One of the biggest challenges in curation is what data and what media should I apply to this advertiser's campaign? one of the biggest challenges in curation is what data and what media should i apply to this advertiser's campaign This is where I think the big wave of AI and effectiveness is going to come, which is using AI to figure out which dozens of the 300 data partners. this is where i think the big wave of ai and effectiveness is going to come which is using ai to figure out which dozens of the 300 data partners Of the 2,000 publishers on our platform, you know, which hundreds of those publishers. For instance, today, when that RFP comes out, hey, a studio's launching a movie, the agency's working on behalf of that studio to launch that movie, they typically will send an RFP out via email. It's very old school, right? Send an RFP out to 20 or 30 publishers. There's no reason that that shouldn't be happening across hundreds of relevant publishers. That's where a seller agent for a publisher and a buyer agent for an advertiser can do that matching job much better. This is yet to come, but this is where I think there's a lot of opportunity around effectiveness. Of the 2,000 publishers on our platform, you know, which hundreds of those publishers. of the 2,000 publishers on our platform you know which hundreds of those publishers For instance, today, when that RFP comes out, hey, a studio's launching a movie, the agency's working on behalf of that studio to launch that movie, they typically will send an RFP out via email. for instance today when that rfp comes out hey a studio's launching a movie the agency's working on behalf of that studio to launch that movie they typically will send an rfp out via email It's very old school, right? it's very old school right Send an RFP out to 20 or 30 publishers. send an rfp out to 20 or 30 publishers There's no reason that that shouldn't be happening across hundreds of relevant publishers. there's no reason that that shouldn't be happening across hundreds of relevant publishers That's where a seller agent for a publisher and a buyer agent for an advertiser can do that matching job much better. that's where a seller agent for a publisher and a buyer agent for an advertiser can do that matching job much better This is yet to come, but this is where I think there's a lot of opportunity around effectiveness. this is yet to come but this is where i think there's a lot of opportunity around effectiveness

Speaker 1: Okay. I think the question though was where is AI already driving measurable ROI? Is there anything on the cost side? I mean, usually CEOs sit up here and they talk about cost 'cause they can see those. Okay. okay I think the question though was where is AI already driving measurable ROI? i think the question though was where is ai already driving measurable roi Is there anything on the cost side? is there anything on the cost side I mean, usually CEOs sit up here and they talk about cost 'cause they can see those. i mean usually ceos sit up here and they talk about cost 'cause they can see those

Speaker 2: Sure. We talked about that already, the efficiency piece. That's where I started the answer, right? Sure. sure We talked about that already, the efficiency piece. we talked about that already the efficiency piece That's where I started the answer, right? that's where i started the answer right

Speaker 1: Okay. Is that helping your FTEs not grow as fast? Okay. okay Is that helping your FTEs not grow as fast? is that helping your ftes not grow as fast

Speaker 2: Okay. Okay. okay

Speaker 1: Margin improvement somewhere? Margin improvement somewhere? margin improvement somewhere

Speaker 2: Everything that I talk about is for customers. Everything that I talk about is for customers. everything that i talk about is for customers

Speaker 1: Right. Right. right

Speaker 2: We can talk about, you know. We can talk about, you know. we can talk about you know

Speaker 1: Internal. Internal. internal

Speaker 2: Internal. Right. We operate a self-serve platform, so we're not sitting there, you know, logging into our own system and, you know, have teams of ad ops people. Our biggest investments are in product and engineering and in sales. About 80% of the code on our platform now is generated via AI. Internal. internal Right. right We operate a self-serve platform, so we're not sitting there, you know, logging into our own system and, you know, have teams of ad ops people. we operate a self-serve platform so we're not sitting there you know logging into our own system and you know have teams of ad ops people Our biggest investments are in product and engineering and in sales. our biggest investments are in product and engineering and in sales About 80% of the code on our platform now is generated via AI. about 80% of the code on our platform now is generated via ai

Speaker 1: Those are good numbers. Those are good numbers. those are good numbers

Speaker 2: So it's a very healthy number. What we've been able to do is ship product, more product much faster over the last several years, even as we've flattened or decreased the size of our engineering team. Significant improvement in efficiency due to AI. So it's a very healthy number. so it's a very healthy number What we've been able to do is ship product, more product much faster over the last several years, even as we've flattened or decreased the size of our engineering team. what we've been able to do is ship product more product much faster over the last several years even as we've flattened or decreased the size of our engineering team Significant improvement in efficiency due to AI. significant improvement in efficiency due to ai

Speaker 1: Okay. Okay. okay

Speaker 2: Our current focus, 'cause that 80% obviously is gonna hit a ceiling is in every other function: finance, marketing, you know, sales ops, account management. AI enabling every single one of those functions. If we looked at our headcount number, you know, from our K, it's down somewhere in the 5%-10% range. Our current focus, 'cause that 80% obviously is gonna hit a ceiling is in every other function: finance, marketing, you know, sales ops, account management. our current focus 'cause that 80% obviously is gonna hit a ceiling is in every other function finance marketing you know sales ops account management AI enabling every single one of those functions. ai enabling every single one of those functions If we looked at our headcount number, you know, from our K, it's down somewhere in the 5%-10% range. if we looked at our headcount number you know from our k it's down somewhere in the 5%-10% range

Speaker 1: That's fantastic. That's fantastic. that's fantastic

Speaker 2: Even as we're growing revenue. Even as we're growing revenue. even as we're growing revenue

Speaker 1: That's fantastic. That's fantastic. that's fantastic

Speaker 2: Yes. Yes. yes

Speaker 1: Yeah, we keep track of FTEs religiously for every one of our ad tech companies. Yeah, we keep track of FTEs religiously for every one of our ad tech companies. yeah we keep track of ftes religiously for every one of our ad tech companies

Speaker 2: Yes. I know you publish those stats. Yes. yes I know you publish those stats. i know you publish those stats

Speaker 1: Google Yeah. Meta's down 8% over the last three years. Google Yeah. google yeah Meta's down 8% over the last three years. meta's down 8% over the last three years

Speaker 2: Yeah. Yeah. yeah

Speaker 1: They sort of lay off 10%. They sort of lay off 10%. they sort of lay off 10%

Speaker 2: They hire 20%. They hire 20%. they hire 20%

Speaker 1: Hire 10% and then they, you know, they sort of do this. Hire 10% and then they, you know, they sort of do this. hire 10% and then they you know they sort of do this

Speaker 2: Exactly. We have not been doing that. Yeah. What we have been doing is certainly investing from a CapEx perspective in new AI-enabled capabilities. We historically have invested CapEx, this year's number's in the $15 million-$19 million range. Historically we've invested in two areas. One is increasing capacity.The second is in new capabilities. Exactly. exactly We have not been doing that. we have not been doing that Yeah. What we have been doing is certainly investing from a CapEx perspective in new AI-enabled capabilities. yeah. what we have been doing is certainly investing from a capex perspective in new ai-enabled capabilities We historically have invested CapEx, this year's number's in the $15 million-$19 million range. we historically have invested capex this year's number's in the $15 million-$19 million range Historically we've invested in two areas. historically we've invested in two areas One is increasing capacity. one is increasing capacity The second is in new capabilities. the second is in new capabilities An important thing to note is that we own all of our own ad-serving infrastructure, so we do very little in the public cloud. We've had this approach for 10+ years. It's a key driver of the cash that we generate. We own tens of thousands of servers around the world. This year, one of the things that's different is we are putting no CapEx into impression volume growth. We've been eliminating redundancy, across our platform, redundancy of impressions, and instead all of that CapEx is going into new hardware to deliver AI solutions, and we can talk about our NVIDIA partnership. An important thing to note is that we own all of our own ad-serving infrastructure, so we do very little in the public cloud. an important thing to note is that we own all of our own ad-serving infrastructure so we do very little in the public cloud We've had this approach for 10+ years. we've had this approach for 10+ years It's a key driver of the cash that we generate. it's a key driver of the cash that we generate We own tens of thousands of servers around the world. we own tens of thousands of servers around the world This year, one of the things that's different is we are putting no CapEx into impression volume growth. this year one of the things that's different is we are putting no capex into impression volume growth We've been eliminating redundancy, across our platform, redundancy of impressions, and instead all of that CapEx is going into new hardware to deliver AI solutions, and we can talk about our NVIDIA partnership. we've been eliminating redundancy across our platform redundancy of impressions and instead all of that capex is going into new hardware to deliver ai solutions and we can talk about our nvidia partnership

Speaker 1: Yeah, let's do that. Let's do that next. Let's go to the NVIDIA partnership. Yeah, let's do that. yeah let's do that Let's do that next. let's do that next Let's go to the NVIDIA partnership. let's go to the nvidia partnership

Speaker 2: Great. We've been working with NVIDIA for, I think three years now, where we co-innovate around solving specific advertising domain problems with the help of their, you know, hardware and software engineers with our software engineers. I'll give you an example of this. I think probably people have heard of inferencing. Great. great We've been working with NVIDIA for, I think three years now, where we co-innovate around solving specific advertising domain problems with the help of their, you know, hardware and software engineers with our software engineers. we've been working with nvidia for i think three years now where we co-innovate around solving specific advertising domain problems with the help of their you know hardware and software engineers with our software engineers I'll give you an example of this. i'll give you an example of this I think probably people have heard of inferencing. i think probably people have heard of inferencing

Speaker 1: Yeah. Yeah. yeah

Speaker 2: Which is, okay, we have a model that's been trained and now, you know, we want to query that model to ask a question or figure something out. One of the big challenges in our ecosystem is I've got 1 trillion ad impressions per day. Which impressions should I send to which DSPs? We have 150 DSPs that are bidding on our platform, some in particular geos. They have different campaigns at any given point in time, you know, different ad formats, different audiences. This is a key inferencing problem. We have worked with NVIDIA to develop inferencing solutions that help us figure out exactly which ad impressions to send to which DSPs. Which is, okay, we have a model that's been trained and now, you know, we want to query that model to ask a question or figure something out. which is okay we have a model that's been trained and now you know we want to query that model to ask a question or figure something out One of the big challenges in our ecosystem is I've got 1 trillion ad impressions per day. one of the big challenges in our ecosystem is i've got 1 trillion ad impressions per day Which impressions should I send to which DSPs? which impressions should i send to which dsps We have 150 DSPs that are bidding on our platform, some in particular geos. we have 150 dsps that are bidding on our platform some in particular geos They have different campaigns at any given point in time, you know, different ad formats, different audiences. they have different campaigns at any given point in time you know different ad formats different audiences This is a key inferencing problem. this is a key inferencing problem We have worked with NVIDIA to develop inferencing solutions that help us figure out exactly which ad impressions to send to which DSPs. we have worked with nvidia to develop inferencing solutions that help us figure out exactly which ad impressions to send to which dsps The reason we have this integrated stack of software and hardware is we're able to control both the software and the hardware level versus layers, versus if we were in public cloud where we can only control the software. We've deployed specific NVIDIA Triton chips. Within our infrastructure to solve exactly this problem. The reason we have this integrated stack of software and hardware is we're able to control both the software and the hardware level versus layers, versus if we were in public cloud where we can only control the software. the reason we have this integrated stack of software and hardware is we're able to control both the software and the hardware level versus layers versus if we were in public cloud where we can only control the software We've deployed specific NVIDIA Triton chips. we've deployed specific nvidia triton chips Within our infrastructure to solve exactly this problem. within our infrastructure to solve exactly this problem

Speaker 1: Hmm. Very interesting. Questions from the audience for Rajeev. Yes, Scott? Hmm. hmm Very interesting. very interesting Questions from the audience for Rajeev. questions from the audience for rajeev Yes, Scott? yes scott

Speaker 3: Yeah, you talked about Google as the more patient monopolist that you always have to deal with. Yeah, you talked about Google as the more patient monopolist that you always have to deal with. yeah you talked about google as the more patient monopolist that you always have to deal with

Speaker 2: Yes. Yes. yes

Speaker 3: How do different POSSIBLE remedies that the judge might impose affect your business? How do different POSSIBLE remedies that the judge might impose affect your business? how do different possible remedies that the judge might impose affect your business

Speaker 2: Sure. I think everybody's waiting, you know, with bated breath, at least in this track of your conference, for that remedies verdict to be handed down. Sure. sure I think everybody's waiting, you know, with bated breath, at least in this track of your conference, for that remedies verdict to be handed down. i think everybody's waiting you know with bated breath at least in this track of your conference for that remedies verdict to be handed down

Speaker 1: Edge of our seat. Edge of our seat. edge of our seat

Speaker 2: Yeah, exactly. Just to give you some numbers, we estimate every point of market share shift is worth $50 million-$75 million of revenue to us, of which 80%-90% would drop to our bottom line. We have a, you know, high fixed cost, low variable cost business. You know, every point of market share that shifts as a result of remedies. There's, you know, two classes of remedies. There's behavioral and there's structural. We don't know, you know, what the mix of those will be. I think the behavioral remedies, which is where Google has to change some of its practices or policies, those, in my opinion, can be implemented very quickly within weeks to months. Yeah, exactly. yeah exactly Just to give you some numbers, we estimate every point of market share shift is worth $50 million-$75 million of revenue to us, of which 80%-90% would drop to our bottom line. just to give you some numbers we estimate every point of market share shift is worth $50 million-$75 million of revenue to us of which 80%-90% would drop to our bottom line We have a, you know, high fixed cost, low variable cost business. we have a you know high fixed cost low variable cost business You know, every point of market share that shifts as a result of remedies. you know every point of market share that shifts as a result of remedies There's, you know, two classes of remedies. there's you know two classes of remedies There's behavioral and there's structural. there's behavioral and there's structural We don't know, you know, what the mix of those will be. we don't know you know what the mix of those will be I think the behavioral remedies, which is where Google has to change some of its practices or policies, those, in my opinion, can be implemented very quickly within weeks to months. i think the behavioral remedies which is where google has to change some of its practices or policies those in my opinion can be implemented very quickly within weeks to months We could see benefit, you know, as early as later this year. Structural remedies are things like Google having to spin, you know, certain entities out or, you know, sell them off, operate them at arm's length in some way. I think those are likely to take longer to come into effect. We could see benefit, you know, as early as later this year. we could see benefit you know as early as later this year Structural remedies are things like Google having to spin, you know, certain entities out or, you know, sell them off, operate them at arm's length in some way. structural remedies are things like google having to spin you know certain entities out or you know sell them off operate them at arm's length in some way I think those are likely to take longer to come into effect. i think those are likely to take longer to come into effect

Speaker 3: I mean, presumably structural remedies would be better for you without any time constraint, but that would take longer. Behavioral remedies might in fact be better in that present policy sense. I mean, presumably structural remedies would be better for you without any time constraint, but that would take longer. i mean presumably structural remedies would be better for you without any time constraint but that would take longer Behavioral remedies might in fact be better in that present policy sense. behavioral remedies might in fact be better in that present policy sense

Speaker 2: I think that is true, I also don't think it's either/or, right? Of course, I don't know what the judge is gonna decide, but it could very well be that there's behavioral remedies in the run-up to a structural remedy. Because based on, you know, my interaction with the judge in the case, she's, you know, very, very aware of the harms that Google has created across the ecosystem and, you know, focused on correcting those harms. I think that is true, I also don't think it's either/or, right? i think that is true i also don't think it's either/or right Of course, I don't know what the judge is gonna decide, but it could very well be that there's behavioral remedies in the run-up to a structural remedy. of course i don't know what the judge is gonna decide but it could very well be that there's behavioral remedies in the run-up to a structural remedy Because based on, you know, my interaction with the judge in the case, she's, you know, very, very aware of the harms that Google has created across the ecosystem and, you know, focused on correcting those harms. because based on you know my interaction with the judge in the case she's you know very very aware of the harms that google has created across the ecosystem and you know focused on correcting those harms

Speaker 1: Any other questions? Yes, sir. Any other questions? any other questions Yes, sir. yes sir

Speaker 4: I think you just said you work with 150 DSPs. How top heavy is that? Like how much of your revenue is driven by the top four or five today, and how is that gonna trend over the next couple years? I think you just said you work with 150 DSPs. i think you just said you work with 150 dsps How top heavy is that? how top heavy is that Like how much of your revenue is driven by the top four or five today, and how is that gonna trend over the next couple years? like how much of your revenue is driven by the top four or five today and how is that gonna trend over the next couple years

Speaker 2: Yeah, sure. There's been a very significant unwind in concentration over the last couple of years. I would say, you know, if we went back like five years, it was a story of DSP consolidation. You know, there's a couple of DSPs that, you know, were driving most of the market share growth. If we look now, you know, I talked earlier about the mid-market advertiser. Many of the two of the largest incumbent DSPs, they're not really focused on that mid-market arena, right? There's, you know, a lot of fast-growing mid-market DSPs, companies like StackAdapt, for instance, Viant, who I think you have here. Yeah, sure. yeah sure There's been a very significant unwind in concentration over the last couple of years. there's been a very significant unwind in concentration over the last couple of years I would say, you know, if we went back like five years, it was a story of DSP consolidation. i would say you know if we went back like five years it was a story of dsp consolidation You know, there's a couple of DSPs that, you know, were driving most of the market share growth. you know there's a couple of dsps that you know were driving most of the market share growth If we look now, you know, I talked earlier about the mid-market advertiser. if we look now you know i talked earlier about the mid-market advertiser Many of the two of the largest incumbent DSPs, they're not really focused on that mid-market arena, right? many of the two of the largest incumbent dsps they're not really focused on that mid-market arena right There's, you know, a lot of fast-growing mid-market DSPs, companies like StackAdapt, for instance, Viant, who I think you have here. there's you know a lot of fast-growing mid-market dsps companies like stackadapt for instance viant who i think you have here

Speaker 1: Yep. Yep. yep

Speaker 2: Later this week. That number is growing significantly, and what we see is that the concentration is reducing on a year-over-year basis. I think one of the metrics, we haven't broken out the concentration specifically, but we did share that mid-market DSP cohort is growing 20% year-over-year on our platform in terms of the spend or activity. Later this week. later this week That number is growing significantly, and what we see is that the concentration is reducing on a year-over-year basis. that number is growing significantly and what we see is that the concentration is reducing on a year-over-year basis I think one of the metrics, we haven't broken out the concentration specifically, but we did share that mid-market DSP cohort is growing 20% year-over-year on our platform in terms of the spend or activity. i think one of the metrics we haven't broken out the concentration specifically but we did share that mid-market dsp cohort is growing 20% year-over-year on our platform in terms of the spend or activity Very, very significant growth. Very, very significant growth. very very significant growth

Speaker 1: It's amazing there's such low barriers to entry for DSPs. It's amazing there's such low barriers to entry for DSPs. it's amazing there's such low barriers to entry for dsps

Speaker 2: Yes, there are very low barriers to enter, and I think with AI it's a huge opportunity to remove what I think is the last barrier, which was software UI incumbency. Right? Again, if you go into, you know, a big agency holdco, the big challenge for them to move off of a DSP if they wanted to expand their portfolio is, well, hey, I've got thousands of traders around the world, and, you know, they need to know Google's DSP in order to buy YouTube, they need to know Amazon's in order to buy, you know, Amazon Prime Video, and for, you know, shopping use cases. Yes, there are very low barriers to enter, and I think with AI it's a huge opportunity to remove what I think is the last barrier, which was software UI incumbency. yes there are very low barriers to enter and i think with ai it's a huge opportunity to remove what i think is the last barrier which was software ui incumbency Right? right Again, if you go into, you know, a big agency holdco, the big challenge for them to move off of a DSP if they wanted to expand their portfolio is, well, hey, I've got thousands of traders around the world, and, you know, they need to know Google's DSP in order to buy YouTube, they need to know Amazon's in order to buy, you know, Amazon Prime Video, and for, you know, shopping use cases. again if you go into you know a big agency holdco the big challenge for them to move off of a dsp if they wanted to expand their portfolio is well hey i've got thousands of traders around the world and you know they need to know google's dsp in order to buy youtube they need to know amazon's in order to buy you know amazon prime video and for you know shopping use cases We don't have time to learn, you know, four other DSP UIs. Now with AI, the expectation is, well, if you can type, right, and you know you don't even need to know English. We don't have time to learn, you know, four other DSP UIs. we don't have time to learn you know four other dsp uis Now with AI, the expectation is, well, if you can type, right, and you know you don't even need to know English. now with ai the expectation is well if you can type right and you know you don't even need to know english

Speaker 1: Talk. Talk. talk

Speaker 2: Yeah, or talk. You can do it in any language, then you can give an agent your instructions and execute those. That's why one of the reasons why we see such great growth with AgenticOS and Activate. Yeah, or talk. yeah or talk You can do it in any language, then you can give an agent your instructions and execute those. you can do it in any language then you can give an agent your instructions and execute those That's why one of the reasons why we see such great growth with AgenticOS and Activate. that's why one of the reasons why we see such great growth with agenticos and activate

Speaker 1: Any other questions? Okay. Let's go to your commerce initiatives. Any other questions? any other questions Okay. okay Let's go to your commerce initiatives. let's go to your commerce initiatives

Speaker 2: Yeah. Yeah. yeah

Speaker 1: Can you talk about your commerce media platform and your Connect platform? Can you talk about your commerce media platform and your Connect platform? can you talk about your commerce media platform and your connect platform

Speaker 2: Yeah. Yeah. yeah

Speaker 1: How your commerce products are driving upside at PubMatic? How your commerce products are driving upside at PubMatic? how your commerce products are driving upside at pubmatic

Speaker 2: Sure. Again, our focus is on performance advertising in the open internet. That for us is the North Star. Commerce partnerships, commerce data is, you know, critically important to that. You know, where most of the growth is in the ecosystem is where you have known user identity, so think of CTV and mobile app, and where you have the ability to measure the outcomes. Commerce media obviously is a key area of that. We have dozens of commerce media partnerships. I went through some of the names earlier. Last week what we announced was POSSIBLE last week? Sure. sure Again, our focus is on performance advertising in the open internet. again our focus is on performance advertising in the open internet That for us is the North Star. that for us is the north star Commerce partnerships, commerce data is, you know, critically important to that. commerce partnerships commerce data is you know critically important to that You know, where most of the growth is in the ecosystem is where you have known user identity, so think of CTV and mobile app, and where you have the ability to measure the outcomes. you know where most of the growth is in the ecosystem is where you have known user identity so think of ctv and mobile app and where you have the ability to measure the outcomes Commerce media obviously is a key area of that. commerce media obviously is a key area of that We have dozens of commerce media partnerships. we have dozens of commerce media partnerships I went through some of the names earlier. i went through some of the names earlier Last week what we announced was POSSIBLE last week? last week what we announced was possible last week

Speaker 1: Two weeks ago. Two weeks ago. two weeks ago

Speaker 2: Two weeks ago, okay. What we announced at POSSIBLE was a partnership with PayPal and with Walmart. Two weeks ago, okay. two weeks ago okay What we announced at POSSIBLE was a partnership with PayPal and with Walmart. what we announced at possible was a partnership with paypal and with walmart With Walmart, obviously, Walmart Connect, they have great shopper, you know, knowledge, audiences at scale. Absolutely. They're combining their data with the streaming inventory and the mobile app inventory on our platform. Giving their advertisers, whether they're enterprise advertisers or SMB advertisers, the ability to find those Walmart audiences off of walmart.com. With Walmart, obviously, Walmart Connect, they have great shopper, you know, knowledge, audiences at scale. with walmart obviously walmart connect they have great shopper you know knowledge audiences at scale Absolutely. absolutely They're combining their data with the streaming inventory and the mobile app inventory on our platform. they're combining their data with the streaming inventory and the mobile app inventory on our platform Giving their advertisers, whether they're enterprise advertisers or SMB advertisers, the ability to find those Walmart audiences off of walmart.com. giving their advertisers whether they're enterprise advertisers or smb advertisers the ability to find those walmart audiences off of walmart.com

Speaker 1: Okay. Okay. okay

Speaker 2: Right? Now an advertiser can say, Great, Walmart knows that this user is, you know, high propensity to buy my product. Right? right Now an advertiser can say, Great, Walmart knows that this user is, you know, high propensity to buy my product. now an advertiser can say great walmart knows that this user is you know high propensity to buy my product I wanna reach them when they're watching 'Landman,' you know, on Paramount, or they're watching, you know, 'Bill Maher' on HBO or whatever the case is. That's what we're doing with Walmart, obviously a huge scale and partner. With PayPal, there's a couple of things that we're doing there. One is very similar, taking that data and making that available to any advertiser, not just, you know, PayPal's clients. PayPal is also a user of Activate, so they're buying directly in our SSP when they go out and they sell campaigns. Then the third thing is they launched PayPal Ads ID, their own ID graph. I wanna reach them when they're watching 'Landman,' you know, on Paramount, or they're watching, you know, 'Bill Maher' on HBO or whatever the case is. i wanna reach them when they're watching 'landman,' you know on paramount or they're watching you know 'bill maher' on hbo or whatever the case is That's what we're doing with Walmart, obviously a huge scale and partner. that's what we're doing with walmart obviously a huge scale and partner With PayPal, there's a couple of things that we're doing there. with paypal there's a couple of things that we're doing there One is very similar, taking that data and making that available to any advertiser, not just, you know, PayPal's clients. one is very similar taking that data and making that available to any advertiser not just you know paypal's clients PayPal is also a user of Activate, so they're buying directly in our SSP when they go out and they sell campaigns. paypal is also a user of activate so they're buying directly in our ssp when they go out and they sell campaigns Then the third thing is they launched PayPal Ads ID, their own ID graph. then the third thing is they launched paypal ads id their own id graph Identifying who users are, and we're merging their graph, integrating their graph with our graph, so that anybody, any advertiser that's using PayPal's graph can find those users on our platform. All of these are around identifying and delivering high-value, relevant campaigns to the user, which is where we drive return on ad spend. Which is what pushes the CPMs up for our publishers. Identifying who users are, and we're merging their graph, integrating their graph with our graph, so that anybody, any advertiser that's using PayPal's graph can find those users on our platform. identifying who users are and we're merging their graph integrating their graph with our graph so that anybody any advertiser that's using paypal's graph can find those users on our platform All of these are around identifying and delivering high-value, relevant campaigns to the user, which is where we drive return on ad spend. all of these are around identifying and delivering high-value relevant campaigns to the user which is where we drive return on ad spend Which is what pushes the CPMs up for our publishers. which is what pushes the cpms up for our publishers

Speaker 1: Okay. Okay, we're almost out of time. Just wanna make sure there's no other questions for Rajeev before I call it. No. Okay, I will call it there. We have 30 seconds left. Okay. okay Okay, we're almost out of time. okay we're almost out of time Just wanna make sure there's no other questions for Rajeev before I call it. just wanna make sure there's no other questions for rajeev before i call it No. no Okay, I will call it there. okay i will call it there We have 30 seconds left. we have 30 seconds left

Speaker 2: Great. Great. great

Speaker 1: Perfect timing. Perfect timing. perfect timing

Speaker 2: Thank you. Thank you so much, Laura. Thank you. thank you Thank you so much, Laura. thank you so much laura

Speaker 1: Okay, thank you so much. Okay, thank you so much. okay thank you so much