The Trade Desk shares climb on strong ad-tech demand

Shares of The Trade Desk Inc. advanced on Thursday, extending gains after the digital advertising technology company reported quarterly results that topped analysts' expectations and provided an optimistic forecast for connected TV (CTV) advertising growth.

The Trade Desk, a leader in programmatic advertising through its demand-side platform, posted adjusted earnings per share of 26 cents, exceeding the 22-cent estimate compiled by Refinitiv. Revenue totaled $515.8 million, surpassing the $502.3 million consensus forecast. The company attributed the outperformance to sustained demand for its CTV advertising solutions, which allow brands to target audiences across streaming platforms.

Chief Executive Officer Jeff Green highlighted the accelerating shift from traditional linear TV to streaming services, noting that CTV ad spend is projected to grow by double digits in the coming quarters. The Trade Desk raised its full-year revenue guidance to a range of $2.15 billion to $2.17 billion, up from its prior forecast of $2.05 billion to $2.10 billion. Adjusted EBITDA guidance was also increased to $570 million to $590 million, from $540 million to $560 million previously.

Analysts at Jefferies maintained a buy rating on the stock, citing strong secular tailwinds in digital advertising and The Trade Desk's dominant market position. The stock has gained roughly 15% over the past month, outpacing the broader tech sector's gains, as investors bet on continued growth in programmatic advertising amid rising streaming consumption.

The rally follows a broader rebound in tech shares, which have been buoyed by easing concerns over interest rate hikes and improving economic sentiment. The Trade Desk's stock closed at $78.45 on Wednesday, up 3.2%, and was last indicated higher by 2.1% in premarket trading on Thursday.