The Trade Desk's Stock Soared After Earnings: Was the Rise Justified?
The Trade Desk (NASDAQ: TTD) reported its fiscal year 2022 second-quarter earnings on Aug. 9, which pleased shareholders. The stock is up by 17% since then, with the initial news pushing up share prices by as much as 33%. Investors were concerned revenue would slow considerably due to macroeconomic headwinds affecting businesses worldwide. Despite those challenges, The Trade Desk generated impressive growth.
For those unaware, The Trade Desk is a cloud-based digital demand-side ad buying platform. It helps advertisers optimize ad campaigns and help garner the most return on investment. Traditional marketing verticals, such as print newspapers, billboards, and cable TV, have always proved challenging for advertisers to measure actual results. For example, how do you count the number of people who saw your billboard? Who made a purchase resulting from seeing your advertisement in the newspaper?
In the digital space, this sort of measurement can be quantified. And thanks to the explosion of digital media, ad spending on digital platforms has promising long-term growth. That growing demand for digital advertisements is precisely what the California-based company has been successfully capturing.
Source Fool.com
