Marketecture: Get Smart. Fast.
00:32:36 · Ari Paparo, Eric Franchi
[00:32:36] S0: It was just [00:32:37] S1: free free lead. Free lead. Get get after it. But the new the new company is called, I think, WR Labs. So, you know, we'll, we'll we'll hopefully, you know, see some see some visibility in the engines, from there. But shout out to Omar. I mean, Omar is is is a is a brilliant founder and and, you know, product and technology leader, but he's been particularly good at M and A in his, you know, kind of two point o acquired Spaceback acquired the The US business of Myriad, now merging this thing, obviously going for scale and potential IPO, knock on wood. Don't have any information like, you know, very very interesting to see, like, how Omar's trajectory has matured. [00:33:14] S0: Are you still a shareholder of the combined company? Yeah. [00:33:17] S1: Yeah. [00:33:18] S0: For sure. Okay. Great.
00:33:18 · Ari Paparo, Eric Franchi
[00:33:18] S0: For sure. Okay. Great. [00:33:19] S1: Good to hear. Alright. Cool. So earnings? Sure. Alright. There's been a lot of earnings over the course of the past week, and of course, over the course of the past night or so. So maybe the best way to do this is how we've done it before. I'll just kinda like rattle through and we'll we'll come up with, with some some insights and and some some themes. So Amazon earnings, they didn't do that great in terms of the public market performance, but ads are up 12%, AWS 39%. This is basically Google. You know, just like ads growing, cloud really, really growing. So that was Amazon. AppLovin reported last night. AppLovin absolutely crushed it. Their stock, again, we're not a stock show, but their stock was ripping. Revenue up 55% to a record 2,180,000,000, making a push into CTV finally, and a market cap of $90,000,000,000. Our friend James Burrow, who you were on just on on his pod, he did one of those tweets where it's just like, this market cap is now all of these companies and sports teams and, like, you know, the billionaires combined, like AppLovin is is certainly on an incredible trajectory again. Magnite reported. Magnite revenue up 14% to 204,000,000. CTV up 39%. Criteo revenue down 12% year over year, profits down as well. Mountain, 15% revenue growth, but CEO is out, management talking about an execution crisis, the stock got obliterated. And Teads, Teads just came out, revenue down 37% year over year. [00:35:06] S0: Not good. Not good.
00:35:06 · Ari Paparo, Eric Franchi
[00:35:06] S0: Not good. Not good. [00:35:08] S1: Alright. I'm gonna take a breath. Yeah. Tell us what this all means.
00:35:13 · Ari Paparo
[00:35:13] S0: There... There's some themes. Right? So obvious theme number one is open web. I talked about it five minutes ago. The so called death of the open web, the more exposure you have to web based advertising, the worse your earnings are gonna be. We we actually don't have on this list Taboola, which was also had a challenging but optimistic corner... Quarter. You know, I think they were down, like... Don't I remember exactly the numbers, but it was... Them as a leader in their space also had a down quarter. The t... The Teads 37% is just atomic bomb level, especially because of how much debt they have. The stock is trading at 19¢, and that is just not a great situation. So that's theme number one. Maybe Criteo can be swept into that theme a little bit. The other theme here, CTV, very exciting. Right? So CTV is the growth area. It is relatively open. You can participate in it. The value is there. The advertisers love it. Even with the bad earnings, Mountain was up eight... 15% year over year. So that's a second theme. And then the third theme is just, you know, performance. People want performance then. So that's where AppLovin crushing it. You know, they're just tweaking the algorithm and getting better results. They're they're up a little bit because they had a challenging last quarter, and they blame the last quarter on the algorithm. They said the algorithm didn't improve as much as they expected, so they missed the quarter. Well, they started whipping the engineers and whipping the data centers, and they got the algorithm to work again, and suddenly they're explosive. It tells you kind of the nature of the of the mechanics of that business. It's much more like a... Like the way Meta does business than it is like some of these other names who are still, you know, largely humans in the loop trying to sell stuff.
00:36:57 · Eric Franchi, Ari Paparo
[00:36:57] S1: Yeah. It makes a ton of sense. The one thing I think John from tip sheet dot ai, had this in in his post. They're not yet breaking out, like, core mobile gaming, mobile downloads versus e com versus, you know, CTV, which I I think is, you know, still burgeoning. It might not be... Not not even be live yet. So that would be interesting as well. Like, is there any shifts happening under the under the the the hood, so to speak? [00:37:22] S0: Yeah. I think also, some more color here. So the Mountain earnings are interesting because Mountain is very exposed to political, and, obviously, we just... They had the election. It should have been a huge quarter for them. So the fact they're up 15% probably is really bad compared to where they may have thought they were gonna be because they... The political was such a tsunami of spend, especially on CTV. There was there was a separate story that I don't think we have in our notes that CTV exceeded linear for for political this year. [00:37:52] S1: Did it really? [00:37:53] S0: I'm pretty sure it did. Maybe That makes total sense. Yeah. It's just, you know, the local targeting. Targeting by zip code is just everything. Right? So that that weak mountain earnings just is terrible and, you know, kicking the CEO out is a pretty dramatic step. I could only imagine what happened in that boardroom. So that's really not fantastic.
00:37:53 · Ari Paparo, Eric Franchi
[00:37:53] S0: I'm pretty sure it did. Maybe That makes total sense. Yeah. It's just, you know, the local targeting. Targeting by zip code is just everything. Right? So that that weak mountain earnings just is terrible and, you know, kicking the CEO out is a pretty dramatic step. I could only imagine what happened in that boardroom. So that's really not fantastic. [00:38:14] S1: Yeah. Yeah. For sure. Also on the on the CTV front, maybe just like quickly transition to this, but I thought this was interesting. Walmart is now making first party audiences available in Vibe. So you can see where this CTV thing is going. To your point, it's the way, you know, to scale geo. It's gonna be the way to scale commerce. AppLovin, it's the way to scale, you know, kinda like all their data, like, very clearly this idea of c t of performance TV is is is that now thing. It's no longer a future. [00:38:46] S0: It is. And Walmart data was already available on the trade desk and Yahoo, and, you know, Target data has been available in a lot of places historically. So this is like a vertical integration story with Vibe. Makes ton of sense. And, you know, Amazon's been doing it for, you know, for a while with Fire TV and stuff like that. So it it makes a ton of sense to get those ads on TV from small and midsize advertisers with performance metrics.