The Trade Desk (TTD -21.19%) spent the early summer rebuilding its executive team. A new chief financial officer, Nate Olmstead, started July 9. A new chief marketing officer, Sarah Gavin, joined in mid-June. A new chief commercial officer, Kristi Argyilan, took over on July 27, and a new chief business development officer was announced in between.
Four senior hires in about two months.
On Thursday afternoon, that team gave investors its first forecast. The advertising technology company expects third-quarter revenue of at least $650 million. It produced $739 million in the same quarter of 2025 — a decline of about 12%.
Shares fell 6.8% during Thursday’s session, then dropped another 25% or so in after-hours trading. They were near $14 as of this writing — a 12-month low, and about 85% under the 52-week high of $91.45.
Here’s what that first forecast says about the business.
Image source: Getty Images.
The first forecast from a new team
Second-quarter revenue rose 3% year over year to $715 million. The Trade Desk had guided in May for at least $750 million, so the quarter came in under the company’s own floor.
The adjusted EBITDA forecast is where the step-down gets steep. Management expects non-GAAP (adjusted) earnings before interest, taxes, depreciation, and amortization (EBITDA) of about $160 million in the third quarter. The company earned $317 million on that measure a year ago, at a 43% margin.
That works out to about 25% of the revenue it expects. In all, the forecast calls for revenue down about 12% year over year and adjusted EBITDA down roughly half.
And the trajectory behind it has been building for a year. Revenue grew 18% year over year in the third quarter of 2025. It grew 12% in the first quarter of 2026, then 3% in the second. The third-quarter forecast turns that deceleration into an outright decline.
The same is true of the adjusted EBITDA margin. It was 43% in the third quarter of last year, 30% in the first quarter of this one, and 34% in the second. The new guidance implies about 25%.
Revenue growth has stepped down in every one of those periods. The margin has been choppier, but the guide puts it 18 points below where it was a year ago, which I’d argue is the more telling line.
CEO Jeff Green told analysts on Thursday’s call that revenue growth was “below our expectations and below the standard we hold ourselves to.”
He gave two reasons for it.
The first is the economy. Consumer packaged goods and auto companies together generate about 25% of The Trade Desk’s business, and Green said both categories have been set back by tariffs and oil prices.
And some of those advertisers have responded by shifting to cheaper ways of buying media that involve less automated decision-making (programmatic guaranteed and fixed-price deals).
The second reason is the company itself. Green said The Trade Desk didn’t execute as well as it could have.
Today’s Change
(-21.19%) $-3.75
Current Price
$13.93
Key Data Points
Market Cap
Day’s Range
$12.83 – $14.57
52wk Range
$12.83 – $57.00
Volume
121.2M
Avg Vol
20.4M
Gross Margin
77.83%
What the stock costs now
At about $14 a share, The Trade Desk carries a market capitalization of roughly $6.5 billion. It produced $2.99 billion of revenue and $0.85 in earnings per share over the past 12 months — about two times sales and about 16 times earnings.
The Trade Desk ended June with about $1.5 billion in cash and short-term investments, or close to a quarter of the market value.
Run the same math on the $160 million of adjusted EBITDA guided for this quarter, annualized, and the stock sits near 10 times that figure. For a platform that was growing 18% a year ago, that is not a demanding valuation.
And it is keeping its customers: retention stayed above 95% in the quarter, as it has for more than a decade.
With that said, a quarter of the business sits in two categories management says are under pressure.
So, is the stock cheap enough here?
I don’t think so. The price is low, but it is low against a revenue line the company just guided down 12%, and management hasn’t said the pressure behind it has eased. Growth like this can stabilize quickly once advertisers loosen up, and it may. What I’d want first is a quarter where the forecast stops stepping down.
