Q3: Neustar’s Marketing Services Rockets Ahead – Just Not Fast Enough

neustar q3If Neustar were only a marketing services provider – that is, if it weren't at risk of losing a contract that brought in 49% of its 2013 revenue – then the company would be on solid ground.

Its Q3 revenue increased 7% YoY to $243.9 million and its marketing services division – an area of growing investment for the company – popped at 21% YoY to $37.5 million.

Q3 highlights for Neustar’s marketing services unit include Facebook’s September relaunch of the Atlas ad server, which uses Neustar’s Measurement Insights platform – “the only one of its kind to be integrated,” said Neustar CEO Lisa Hook during the earnings call.

Neustar also partnered with three mobile ad tech companies in September – Adelphic, NinthDecimal, and Voltari – which Hook said provides Neustar with “a comprehensive look at mobile consumers.”

Finally, Neustar partnered with comScore to give its marketing stack PlatformOne the ability to determine how long audiences engaged with ads and whether those ads were viewable.

Thus far, Neustar’s business as an end-to-end marketing services provider seems to be in good shape, with growth coming “across the board,” according to CFO Paul Lalljie.

He pointed out that Neustar’s customer intelligence service offering grew 12% YoY in Q3 and its customer targeting and activation offering grew 15% YoY. Additionally, strong sales in Q4 2013 and Q1 2014, particularly in retail, paid off in the latest quarter.

But while Lalljie highlighted Neustar’s growth strategy – alluding to its 2011 acquisition of TargusInfo and its 2013 acquisition of Aggregate Knowledge – analysts wondered whether the company was growing quickly enough.

Neustar, after all, might lose a contract providing technology that lets United States consumers move their phone number to different carriers.

Since Neustar’s Q2 call, the Federal Communications Commission (FCC) has recommended that Swedish Internet communications provider Ericsson should be awarded the contract. Neustar isn’t going down without a fight: “What is clear is the vendor selection process has been deeply flawed since its implementation,” Hook said.

What isn't clear is when a final decision will be made.

“The FCC has not announced any timeline for its decision making, and I would hesitate to speculate,” Hook said.

 

Add a comment

XHTML: You can use these tags: <a href="" title=""> <abbr title=""> <acronym title=""> <b> <blockquote cite=""> <cite> <code> <del datetime=""> <em> <i> <q cite=""> <s> <strike> <strong>