PubMatic Is Ready for an Advertising Slump
Businesses aren't so keen to pour cash into digital ads in an uncertain and volatile economic environment. The big boys of the digital advertising industry are starting to feel some pain -- Alphabet reported a decline in advertising revenue in the fourth quarter, Meta Platforms followed suit, and even Amazon's much-touted advertising arm suffered a significant slowdown.
Platforms that match ad buyers and sellers aren't faring much better. PubMatic (NASDAQ: PUBM), a sell-side platform that helps publishers better monetize their content, reported a slight decline in fourth-quarter revenue and guided for a bigger decline in the first quarter of 2023. "There is considerable uncertainty about the trajectory for digital ad spend this year due to the pronounced December weakness and persistent overhang of macro headwinds across the globe," said PubMatic's earnings release.
One of PubMatic's key competitive advantages is its owned and operating infrastructure. Instead of relying on cloud computing providers, an expensive proposition given the amount of data the company processes, PubMatic handles hardware and software itself.
Source Fool.com
