Here are some stats on The Trade Desk: The DSP laid off 15% of its staff before Labor Day; the stock is down 90% from its high seven quarters ago; it’s about to get booted out of the S&P 500; and nearly everyone in the C-suite has turned over in the past year.
While ad tech industry insiders may have their own view on what pushed The Trade Desk into revenue decline, Wall Street operates with its own criteria to evaluate companies. To help us see The Trade Desk through the eyes of a Wall Street analyst, we brought on Richard Kramer, the London-based independent analyst who follows The Trade Desk closely and a longtime bear on the DSP.
Kramer offers his take on our recent story, “Why Wall Street Turned Against The Trade Desk,” in which Senior Editor James Hercher chronicled The Trade Desk’s decline, including its recent staff reduction.
Wall Street was willing to conflate The Trade Desk’s recurring campaign revenue with the recurring revenue of SaaS companies, Kramer notes, until revenue declined and the music stopped. He’s also concerned about the loss of institutional knowledge that comes with C-suite turnover and the loss of many knowledgeable workers throughout the organization as a result of the layoffs. We also talk about the new challengers to The Trade Desk, from smaller DSPs like Pontiac and Tuple to the rise of Yahoo’s DSP and, of course, the competitor CEO Jeff Green long refused to acknowledge to investors: Amazon.
