Trade Desk Inc ($TTD) Q1 2026 Earnings Call

Thanks, Chris, and good afternoon everyone. Thank you for joining us. As you've seen from our press release, we delivered a solid quarter once again. This fall, we will celebrate our 10-year anniversary as a publicly traded company. Similar to the last 10 years, we remain solidly profitable. The core of our business remains resilient, and I'm proud of our team and their dedication to supporting our clients, especially in what continues to be a dynamic macro environment for large brand advertisers. We remain as confident as ever in the long-term opportunity for our business and for programmatic advertising as a whole. The business model we established when we founded the company is the same in part because it is more proven than ever. Advertising is over a trillion dollar TAM and it's growing. At endstate we continue to believe most if not all of those ad dollars will be data-driven. We're convinced that the lion's share of the market will belong to a scaled, objective, and independent platform. By that standard, we are the company in the best position to win. The expanding TAM continues to grow as we predicted, but there are some new areas of growth that have caused the TAM to grow even faster than predicted, like retail media and the chat bots and AI search engines. Linear television moving to CTV is still at the early stages alongside with the rapid growth of retail media and over time the emergence of new high-intent search-like opportunities as AI reshapes legacy search. We believe these trends are big opportunities for the Trade Desk and reinforce the long-term opportunity for our business. Today I've organized our prepared remarks into three topics. First, the state of the macro environment. Second, the state of the global advertising market and our place in it. And third, the innovation on our platform and in our company to upgrade and scale our business. The macro environment has certainly become more complex in 2026. Geopolitical tensions have increased. All advertisers and agencies are navigating a rapidly evolving landscape. Global economic pressures, wars, and tariffs have created an environment that is harder for some brands and some brand categories to grow. Still, this environment also creates lots of opportunity for change and upgrade. The most sophisticated brands in the world are using these moments to get more deliberate and more data-driven. When marketers get more data driven, the Trade Desk tends to add more value and as a result grow. Many brands and agencies are using this moment to work with us to upgrade long-standing problems in digital advertising. Common examples include bad measurement methodologies and an over reliance on cost cutting. Outside the United States, advertising is growing much faster both in advertising and at the Trade Desk. Our choice to invest in nearly all of the major markets around the world is proving to be wise in moments like this. We are aware of the trends and the opportunity and are positioned well to benefit from this. So, switching gears from the macroeconomic environment to the global advertising market. The macro conditions plus AI innovations are making the global advertising ecosystem as dynamic and changing as ever. Because at TTD, we often set the pace of change, we are in the best position to benefit from this current environment. In 2025, the advertising ecosystem globally added more supply than perhaps any year previously. It is probably the most lopsided market in advertising history with multiples more supply than demand. This supply-demand imbalance creates the biggest buyers' market in the history of advertising. Buyers have the option to be selective, but they need to leverage data and great real-time technology to know what they are buying. Premium advertisers and premium publishers often have been at odds for most of the internet's history. But at this moment, both are heavily invested in making the supply chains and market dynamics of the premium open internet successful. In this buyer market, some publishers are mistakenly copying the Facebook and YouTube walled garden business model. For most of them, it has a couple of years and then it hits a scale ceiling. The walled garden strategy only works when a publisher is massive and a must-have on a media plan. Most marketers now have a clear definition of the open internet that includes media beyond the browser. Finally, the best of movies, TV, sports, and all live events, journalism, and music are all the anchor tenants of the open internet. As a result of this dynamic, the open internet is thriving and evolving very fast. We are convinced that the evolution and changes being made in the open internet today will make it soon become the place where consistently an advertiser's first dollar is spent, not the walled garden leftovers. Once the open internet consistently gets the first dollar, most of the walled gardens will open up their inventory and join the open internet. I view this as inevitable and I'm optimistic at the changes being made in our space. Currently, there are a few dozen companies on both the buy side and the sell side of media and advertising that define the future. Let's talk about a couple of the sell-side companies first. Some of these premium publishers or content owners include Spotify, NBCU, Disney, and Netflix. These companies are shaping the future and are part of the reason why the open internet is thriving today. They influence the pace and design of the open internet. Disney has one of the largest ad businesses of any publisher in CTV. They have learned in recent years the benefits of biddable programmatic, low ad loads, and a close direct relationship with the Trade Desk. The Trade Desk and Disney both have business models that benefit from the supply chains of the open internet getting more efficient. They have made clear that their growth and higher CPMs will come from better data, more relevant ads, and less waste. Biddable marketplaces are the only way to get the best of all premium inventory, but especially sports inventory. This is a great setup for both of us. Switching to audio. By the end of this year, Spotify is likely to have the largest and arguably most successful subscription program in the world. They have provided amazing consumer surplus. However, just over 10% of Spotify's revenue has come from ads. They need a variety of ads, a scale of ads, and a quality of ads that only a very large open market can provide. I still believe that audio, including Pandora and others, represent the most on-sale part of the open internet. When I consider the gap between time spent and ad budgets, I see substantial upside for these companies and the Trade Desk. We've seen these gaps many times before and they always get filled. I'm very bullish on the ad opportunities for Spotify and audio. NBCU, including Freewheel, is leaning in to initiatives that improve supply chains, CTV price discovery, and better signals for advertisers to spend against. NBCU has institutionally embraced that better signals and better auctions will move more dollars to CTV. We exceeded our own spend stretch goal for NBC at the Winter Olympics, providing yet another case study on the power of the open internet and the benefits of decisioning for both buyers and sellers on the most premium content in the world, including on the most premium live events in the world. Last but not least, on the content side, Netflix continues to model how rolling out an ad experience methodically preserves the user experience and attracts advertisers. We continue to make technological enhancements to our partnership that enable better advertising efficacy. Our partnership with Netflix is a source of optimism for us, but also for the open internet. Biddable and Premium are inseparably connected by this standard. We're also optimistic that the LLMs and AI search engines like ChatGPT, Perplexity, and Gemini will eventually unlock more inventory in the future because highly detailed prompts can create a willingness to see even video ads and higher levels of engagement that is way beyond what legacy search and keywords could provide. We're optimistic that over time the TAM that was once locked up by search will be unlocked by a more premium and more competitive environment. The walled garden strategy has only worked at scale when advertisers are chasing cheap reach and willing to buy large amounts of user-generated content like Instagram, TikTok, and YouTube. None of those attributes apply to the chat bots and AI search engines. Also, the walled garden playbook only works when grading one's own homework is tolerated by advertisers, which is a good segue to the next trend in the state of the state of advertising. And I place this topic between buy-side and sell-side commentaries because it impacts both buyers and sellers. In the current state of the market, both buyers and sellers agree that measurement is broken. This is such a great setup for the open internet because most measurement companies and media mix modelers aka MMM have mostly relied on last touch and last view attribution models. This tradition is bad for everyone except for bottom of the funnel walled gardens. I've never seen more discussion in the history of our space about how broken these methods are to measurement. The resolve and commitment for the industry is higher than ever, partially because fixing open internet measurement is required for many AI-backed initiatives to work. The state of measurement is bad for branding. It is bad for premium and all top-of-funnel ad inventory like CTV and audio. Improving measurement is required to unlock the next phase of growth for the open internet and the thousands of companies that are working on it today. Now to discuss the state of the state on the buy side. Most of today's leaders in marketing for the biggest brands are looking at this moment as an opportunity to upgrade their entire marketing operation. Both tech and people, both advertisers and publishers, have a growing understanding and vision for the open internet. They are investing in and leveraging AI tools like KA. They're using and protecting their own data and leaning into the objective media buying platform at Trade Desk to make advertising dollars more effective and better distributed throughout the entire funnel. While a small number of brands have responded to the pressures of this moment by focusing on reducing costs, reducing media budgets, and doubling down on cheap reach, there are trends among the most forward-thinking CMOs and marketing leaders that are very positive for the Trade Desk. These are the leaders helping to shape the future of advertising. The best CMOs in the world are focused on the question, how do I grow? Not how do I cut costs. Of course, they want to avoid waste, but they know that quality and cheap tend to have very little overlap. They also know often by experience that cost cutting doesn't fuel growth. One leader of programmatic at a top 20 brand said it best. He said that his brand has become convinced that the most expensive ads are often the best value and highest performing. He elaborated that chasing cheap reach is one of the biggest landmines a CMO or digital marketer can pursue. We are also seeing a shift toward more effective creative. Advertising is about connecting and making people feel something. Most of digital advertising history has been about touches led by bad measurement. That's changing. Great marketers know that to be remembered in a sea of ads and the battle for attention, you have to create an emotional connection. Our memories as human beings are anchored on our emotions. So, when one marketer shared with me that 95% of their social ads are seen for less than two seconds, I was not surprised to learn that their focus was now on enhancing strong connections with consumers via CTV and audio ads. Another common theme is strong dialogue across the C-suite. Many CEOs and CFOs know little to nothing about the complex and esoteric world of programmatic advertising. Great CMOs and marketing leaders are consistently thinking about how to share the difficult concepts of programmatic without just spewing three-letter acronyms and industry jargon. The strength of great brands can be assessed by how well the dialogue is going with the CMO and the rest of the C-suite. At the same time, most great marketing leaders have a good relationship with their agencies. Very few global brands can do all their own media buying. They depend on agencies. Most great marketers have JBPs or MSAs directly with their buying platform, but they also have clear models of engagement with their agency partners. The best outcomes happen when brands, agencies, and DSPs are all aligned and winning together. Measurement is also top of mind for nearly every marketer I speak to. They realize that measurement and goals have to change. I recently met with one CMO of a top 20 global brand and she opened our meeting by acknowledging that all global marketers including her team have been through a lot in the last few years. But she quickly oriented the meeting on leveraging data, making holistic decisions and thinking about the lifetime value of every customer. I learned a lot from her, but my favorite takeaway from the meeting was when she said, 'Racing to the bottom of the funnel is racing to the bottom of your business.' That mindset is what is driving the shift toward more data-driven decisioning. AI is another area where leading marketers are leaning in. They are not avoiding its use and they aren't simply hyping it in the abstract. They are looking for low-hanging fruit on the AI tree today. That said, they know that there are no quick fixes and that AI is a race, but it is a long race. They know that quality data matters more in an AI world than ever before, and they know that they have to protect it and activate it. An example of this is we announced the first of many partnerships with one of the up-and-coming large agencies, Stagwell. Our partnership is to leverage Agentic AI to create, edit, and modify campaigns. After these basics, we'll move to Agentic optimizations. Great marketing teams are agile and active. Relatedly, we recently had partnership discussions with a smaller AI-first company. While we've been partners for years, we're looking to expand now. And they shared a few things with us that I want to share today. One is that TTD is the only company that gives them enough data from their buying to power their future. We're working together to further ensure they are getting all that they need to train their models while protecting the data of brands and consumers. The other thing that they reminded us of was a quote from one of the greatest F1 drivers of all time who said, 'You cannot overtake 15 cars in sunny weather, but you can when it's raining.' Which is a good segue to the next point. Many marketers are also using this moment, this moment of change to gain share. CPGs and to a lesser degree autos have some headwinds. The macro environment is more difficult for some in these two categories, but the state of measurement is a headwind for all brand builders. However, the track conditions are the same for everyone. Now is a moment to compete and to pull ahead. Whether it is rain or any other unexpected event in the race, there are moments in every race where the standings will change. Between the macro, the state of measurement, and AI, this is one of those moments, and new leaders can emerge. There is also a growing recognition that ads are not fungible. You can't just take any collection of ads from a deal and make it perform. Ads selected at random will lose every time. Programmatic and digital ads tend to cost more. So, choosing them wisely is the only way to win. Buying in bulk or buying cheap fixed price deals that essentially allow sellers and publishers to offload the leftovers don't earn their keep. Brands that are growing are considering millions of ads a second and selecting the best suited for their brand. They are not outsourcing decisioning to sellers, publishers, or the platform offering the cheapest platform rate. We are seeing these behaviors translate directly into business. March was our biggest month on record for JBP signings. We signed 45 JBPs in March alone. For Q1, our total JBP count grew 55% year-over-year. And excluding renewals, new JBP deal spend grew 40% year-over-year during the quarter. To highlight one of these deals, our pharma team recently went head-to-head against Amazon for one of the largest pharmaceutical advertisers in the world. Lured by seemingly low rates, this brand shifted some investment to PG on Amazon last year. Over the past nine months, our team delivered consistent partnership and focused on driving real business outcomes for the client. In Q1, our team won back the business and signed a JBP for 2026 that will increase their spend on our platform by 114% year-over-year. So, stepping back, all of this reinforces a final point. Objectivity matters more than ever. In the best buyers' market in history, it is important that your DSP does not own inventory. At the Trade Desk, our differentiation is that we operate on the open internet and we are objective. We don't own media. We don't have conflicting incentives. The technology we built is all informed by our objectivity. And our objective position allows our AI models to evaluate every opportunity on its merits across the entire ecosystem and optimize purely for each advertiser's goal. So onto our third topic, innovating and upgrading the Trade Desk. We'll spend a lot more time in coming quarters talking about our upgrades to the product and the company, but suffice to say, we are extremely focused on improving the inputs that feed our objective AI-fueled advertising machine for buyers. Those enhancements include improving measurement, improving data-driven decisioning, improving data and price discovery of data itself, and making our supply chain to inventory and data more efficient. Over the last 5 years or so, we have created the world's largest and richest marketplace of retail data. Combined, we believe the retailers in our data marketplace represent more than 80% of sales from top US retailers. Compare that to Amazon, who represents less than 15% of US retail spend. This is a huge advantage for us. For example, a leading travel brand recently ran a test to evaluate campaign performance with and without activating our new product, Audience Unlimited. The results across all KPIs were fantastic. Audience Unlimited delivered 30% lower CPMs on media, 38% lower data costs, and 75% more efficient CPA, and a 2.7x increase in conversion rate compared to the control group. Most importantly, Audience Unlimited increased campaign performance while simultaneously reducing manual effort in the audience selection process. We are also beginning to unlock on-site retail media. Sponsored listings are among the most powerful and effective advertising formats on the internet and are even more powerful when part of an omni-channel strategy. We've begun integrating with partners like Kodi and even more recently Dollar General, and we expect more retailers to enable programmatic access to sponsored listings in 2026. We were also recently chosen by Lyft Ads to power their off-site rider experience or mobility media as Lyft calls it. This is a good example of how media teams are increasingly turning to the Trade Desk not just for access but for the ability to bring together first-party data, measurement, and cross-channel execution. This allows platforms like Lyft to take more relevant ad experiences to their users even when they're not actively taking a Lyft, while helping advertisers better understand and optimize performance campaigns across channels. Of course, our objectivity is critical in all of this. Retail Media and Audience Unlimited are both part of a much bigger effort we're undertaking to reform objective measurement. For years, digital advertising has relied too heavily on last touch or last-click attribution. This often overcredits the lower-funnel or retargeting impressions while undervaluing the awareness and consideration strategies that actually create demand in the first place. You have to plant seeds, water them, and then harvest them. Last touch ignores how consumers really behave today, especially across channels like CTV and audio, where influence happens well before any final action. As a result, marketers end up optimizing for what's easiest to measure and not what actually drives brand recognition, loyalty, and incremental growth. Over the last few months, we've had deeper conversations with our partners and clients around new approaches to measurement and attribution. As we look ahead, our focus is very clear. We are committed to continuing to execute for our clients, helping them navigate an increasingly complex environment and deliver measurable outcomes. We see the premium internet more aligned than ever. Premium advertisers and premium publishers want a more efficient supply chain for the open internet. The Trade Desk is leading this work, but we are far from alone in these efforts. We will continue to invest in the areas that matter most to the future of the open internet, including AI-driven decisioning, retail media, CTV, and identity. And we will continue to strengthen our platform and our organization so that we can scale with discipline and sustain our leadership position for many years to come. We recognize that at this moment where the macro is more uncertain and we are evolving, parts of our business require clarity, accountability, and strong execution. These are areas where we have a proven track record, and we are committed to continuing to earn the trust of our investors, our partners, and our customers. I've said before that trust is one of the most important assets we have. It's not something we take lightly and it is something we work to earn and maintain every single day. Our conviction in the long-term opportunity has not changed. If anything, it has strengthened. Advertisers are demanding more transparency, more performance, and more control. And we believe we are uniquely positioned to lead that effort with our objective platform, our scaled data, and our AI-driven decisioning that helps our clients grow and own their future. The role of data and AI in advertising is increasing and the need for objective, outcome-driven platforms has never been greater. We believe all of those trends are working in our favor and importantly we believe we are still early in this opportunity. As a result, our best days are ahead of us. Thank you and with that I will hand it over to Tamil to cover the financials.

Growth and innovation with strong execution across key initiatives such as CTV, retail media, agentic AI, supply path optimization, and growth outside of the US. We remain confident in our ability to capitalize on the significant opportunities ahead of us. That concludes our prepared remarks. Operator, please open up the call for questions.

Thanks, I appreciate the question. And I appreciate you asking about Publix, although I have less to say about that than I do the second part of your question. But I am really glad to be able to address it head on. There's been a lot said about conflict, and often it's framed in the most conflict-rich language that the press can provide. I think that's been over-dramatized, and I'm hopeful that we're nearing the end of this public discussion. So I'm hopeful that our discussion today puts an end to it. But I will say that since 2018, we've done billions of dollars of business with Publix through the agreement that we have, and we continue to have a great dialogue with Publix about the next chapter of our partnership. Our negotiations are ongoing. It's probably not prudent for me to say more about it in this forum, so I'll just leave it at that on Publix. As it relates to the factors that are driving deceleration, as you put it, in Q2, first I just want to say that we feel really good about the long-term structural drivers of our business and the future of the open internet. I hope you could hear that conviction in our prepared remarks. Secondly, I just want to remind everybody that we are uniquely one of the few large companies that are focused on being a buying platform for large companies. So most of our revenue comes from Fortune 500 companies and their brands, and of course they respond differently to macro factors than smaller companies or local businesses, especially when the headwinds are macro and global in nature. As to the specifics, some of the fast-growing verticals we believe would be growing even faster if they were absent the current macro uncertainty where there's geopolitical instability, tariffs, and broader consumer pressures that are impacting growth. But what gives me confidence is that nearly every major brand we speak with is focused on the right question right now, which is how do we get back to growth as a brand? So it's actually in that context that I am so positive. It's the reason you could hear that positivity in our prepared remarks because I think we're in a position now to build a much bigger business than we've ever been before. And all of the things that we're seeing across the landscape, including the pressures, are actually opportunities. When I look at all the things that are teed up for us nicely, first of all, the discussion around measurement right now is the best thing that could be teed up for a very bright future for the open internet, let alone The Trade Desk. You look at all the progress that we've made in retail data. As we highlighted, we partnered with more retailers than we haven't, in the sense that a greater percentage of retailers are now partners than are not. We talked a lot about our agentic partnership with Stagwell, and of course there are many others to come. We really do see that the future of The Trade Desk is to be a bit of a hub for all the innovation on the open internet, including and especially inside of agentic AI. We're seeing more cooperation from the biggest publishers in the world as they are highly in tune with the fact that they need higher CPMs that come from biddable, and there's not really any way out for them in terms of raising prices or adding to the ad load. The much better path for them that doesn't result in subscribers going away is to actually make their ad environment more effective. That's true for Disney, Spotify, Paramount, NBC, Fox, Netflix, and hundreds of others. Of course, we're also seeing great partnership discussions with our operating system for CTV called Ventura. I expect that you'll hear more about that in the years to come. We've talked about our new product, Audience Unlimited. We've talked about so much about the discussions that the industry itself is having on measurement. But overall, I would just highlight that I view all of these pressures as opportunities. And so while there are clearly near-term headwinds and a cloudier macro environment, we continue to believe that the long-term opportunity for our business remains extremely strong. Thanks for the question, Sean.

Thanks for the question. I agree with you that this was interestingly timed. But I'll just confirm what the article asserted, which is that Samantha is taking a role at OpenAI. At a personal level, I'm excited for her and I'm extremely confident in her abilities to have an impact there, just like she's had here. I'll also say on a personal level that working with Samantha has been one of the highlights of my career, and I'm glad on some level that it isn't over. She's smart and humble, and she's just generally amazing. I'm really sad to see her go in her full-time role, but she is not leaving us fully. As you may know, she's on our board of directors. She'll stay on our board of directors and will continue to give us strategic advice and guidance. She has asked me to share that she's a strong believer in The Trade Desk and our mission, and continues to invest in ensuring that we are successful. Obviously, her passion for the open internet is big and it continues. I'll also highlight something that has not been highlighted enough publicly: we've quietly been assembling a very strong team of meaningfully senior leaders who will bring deep operational experience and are aligned with where the company is going. Despite some of the noise that you read in ad tech headlines, we have a team that really understands where this industry is heading and understands how to take the position that we're in and help this company become a bigger company than we've ever been before. We're extremely optimistic about the future, in large part because of our recent recruiting efforts, and that continues today. Some of the source of my biggest optimism is actually the team that we've assembled and the things that we have in the pipeline. Thanks for the question.

Yeah, thank you for the question. I really like the way you framed it because those are words that are important to underline. It's important to separate what's cyclical from what's structural. The structural drivers of our business are extremely strong, and we think that the opportunity for the open internet is better than it's ever been before. So reacceleration isn't really about reinventing ourselves. It's about executing against a larger and expanding opportunity. Of course, we highlighted before there are a number of macro effects, but it's in these macro effects where the pressures actually help the industry evolve in a healthy way. That is what is happening right now, even though it doesn't show up in results today. So while all of that's true, the macro does matter too. So when conditions stabilize, I think that provides a natural tailwind that isn't there right now. But again, when I look at things like Audience Unlimited, advancements in measurement, CTV adoption, the continued expansion of retail data partnerships, and all the innovations that we've injected into our platform and into our partnerships brought to you via various forms of AI, with agentic being the one I'm most excited about, there's just so much opportunity ahead for us in the open internet. We know we can improve our growth, but I feel very good about where we are as a business in the near term. This is about execution, and we believe that we're really well positioned as all of these factors come together. Thanks for the question.

Yeah, I'll just first say that 2026 is a really important year of disciplined reinvestment. But I'll ask Tanel to go first, then I'll wrap up.

Thanks. I'll just add that maintaining strong profitability has always been a part of our culture here at The Trade Desk. Even when we were a much smaller company, in fact, I was very obsessed when I founded the company with racing to profitability. It was my view that that's how we could own our future, but it's also how we could establish a culture that was extremely disciplined. I believe that focusing on profitability and maintaining that profitability was not only critical to us owning our own future but also developing the company values that we wanted to have. So we've spent a lot of years developing a very durable business model that throws off a lot of cash every single year. We think this is especially important during periods of cyclical pressure like the one we're in, to make certain that we renew our commitment to that. 2026 is a year of disciplined reinvestment because we believe that this will define the company for many years to come. Thank you.

Yeah, well, thanks for the question. As it relates to agencies, and I imagine you're partly asking because of the way that I opened on the questions around Publix, which we've received so many on. I'll just say at a high level, there's not really anything incremental to add on the agency front beyond what I covered earlier as it relates to Q2 guide or anything else related to CPGs and autos. Yeah, I do think that's true. Of course, if you go through a year with continued pressure on specific categories, you then start to create easy comps for them. However, I honestly think the more impressive part of the narrative isn't the easy comps. It's actually the amount of discipline that those companies are starting to implement or have implemented in that year, where they are just thinking about brand building and media buying in more sophisticated ways. In some ways, having the headwind really does force companies to get disciplined and think about what they have to change. I've never seen the biggest brands in the world more focused on growth than they are right now. That's not disconnected from the fact that many of them are under pressure. So this creates a great moment, a great opportunity for us to pass 15 cars, if you will. So thank you.

Yeah, I can't speak publicly to the discussions that we're in with the key players, but I will talk about the opportunity. A lot has been discussed about the amount of capex that has gone into these companies and the amazing products that they've all created. I believe they're in a very similar position to Netflix in the way that we talked about them 5 to 10 years ago when I started asserting that they would eventually have to show ads, even at times when Netflix was saying they weren't going to show ads. I made that assertion in part because I knew how expensive their content was. The LLMs, chatbots, and AI search companies have a very similar dilemma. They have very expensive content. I think some people have wrongly assumed that their monetization will look like legacy search. Legacy search was born when the average search query was less than two words. No good AI prompt is two words or less. They're much more detailed, and when you have many sentences and are asking a very specific question or prompt, obviously the answer often is much more valuable to the user. So it's not unreasonable to think that many of the LLMs are going to try to get as much ad monetization as possible. If you look at it, there's a subscription which is quite expensive, and that either needs to be offset or substituted by an ad experience that is extremely profitable. That extremely profitable ad experience can't just be keyword-based like legacy search. In fact, to make the most amount of money, it might in some cases need to include video. If there's a lot of compute cost that goes into that answer, it probably is somewhat correlated to the value of the response to the user, which might make it easier to put on the other side of a video. In both of those cases, I do believe that it can unlock a greater amount of TAM for the LLMs in the sense that they can participate in top-of-funnel activity and bottom-of-funnel activity, which is different from what search has done. Especially in a world where there's more discussion about measurement, I believe this way of thinking about it is the right way for the LLMs to be thinking about their future. I do think that unlocked TAM for us that we previously a decade ago said was not likely to change inside of search. So I think this represents a tremendous opportunity for us. But to put a finer point on this, I think it also represents a tremendous opportunity for the open internet. In some forums, I've said before that I think the future of the open internet is in some ways a bigger conversation than just the internet, in that we're talking more and more about the tug-of-war between open systems and closed systems. In a tiny corner of advertising, we often talk about that as walled gardens versus the open internet. But if we look at it bigger and think of it more as open systems versus closed systems, I think you're going to see more and more open systems just because that's the only way to get the sort of participation you need for market dynamics to really do their thing. You source demand and competition that you never could in a closed system. So I think this creates a tremendous opportunity for us and for them. I'm quite optimistic about the future here. But we are in the first inning, no question. The debate is what part of the first inning. It's probably a couple pitches in. Thanks for the question.

Awesome. Thank you. I appreciate you referencing OpenPath, too, because that is the hub that I'm speaking of, and I do believe it's the place where more and more innovation can take place. I mentioned in the prepared remarks that there was one AI-first company that commented that they really couldn't run their business if we weren't in the ecosystem. That's largely because about a decade ago, Google made the decision to stop sharing ad-level logs or log-level data. It's actually in those insights, in that grain, where a whole bunch of companies can build. Of course, to be an AI company, you need a lot of data, and you need a lot of quality data. Because The Trade Desk has historically always said to the biggest brands and to their agencies, we want you to keep your data, we want to make certain that we protect it. That's different from most of the big platforms who are asking brands and agencies to surrender their data and to pool their data with their other customers. We say all the time internally that data leakage is exponentially more expensive in a world of AI. Coming to the second part of your question, about whether The Trade Desk should get into the supply side. The reason we have not isn't because we couldn't technologically. It isn't because it wouldn't further shorten the supply chain. It's because we don't want to create the conflict of interest of saying to one group of customers, we want you to get the lowest CPM possible, we're looking for value, and then going straight from advertisers to publishers saying we want to give you the highest CPM possible, and then trying to serve two masters. This is the flaw of every ad network business model, which by the way hundreds of companies are trying to replicate the flaws of the ad network business model that we disproved 20 years ago in a lot of agentic business models today. So this is a lesson that unfortunately not enough have learned. That said, there are hundreds of publishers who want to do their own yield management, and many companies in CTV are doing their own yield management. They built their own tech to do this, and we plug into that tech directly. This is the reason we built OpenPath in the first place, to plug into companies like that who want to do their own yield management. So we will absolutely look for that opportunity. But as it relates to going all the way to the sell side to do the yield management for them, we'll never do that. Now, that said, we will continue to build more tools to facilitate that. We'll make it easier for others to do. If we can tee up a number of other AI companies to do that, we will. I do think that there's tons of opportunity for efficiencies to be gleaned. I do think the inefficiencies of the supply chain of programmatic are one of the biggest bottlenecks to the open internet itself growing. That's something we're incredibly focused on fixing for the betterment of the entire ecosystem. That is one of the reasons why in moments like this, where there are macro headwinds, we're very focused on making those changes because now is the moment where you can. That's also part of the reason why 2026 is a year of disciplined reinvestment for us. Thanks.

Well, thanks. First, I like the way you worded the question because it gives me an opportunity to correct it just a little bit. I do think there's often a mindset that if your company is older than 5 years old, then you think that you'll be impacted by AI instead of leading it. We fundamentally believe that we'll lead the agent revolution. I do believe that word is not overstating it for programmatic advertising. I've said on a number of stages in our industry recently that I don't think there's an industry in the world that is better suited to be upgraded by agentic AI than programmatic advertising. So I do think programmatic will benefit tremendously from agentic. I do think AI in general is changing the world, and we are still in the very early phases of that. What that will look like, though, is a little bit different than the way I think you're hearing most companies in our space talk about agentic AI. Most companies that are focused on agentic in our space are just talking about plugging into these tiny pools of inventory. One advertiser connects to one publisher, and in doing so, you more or less create another ad network, where you have hundreds of thousands of ad networks because of the combination of one advertiser to one publisher and agents talking to each other. It gets rid of the opportunity for you to look at everything at once and then make holistic decisions and compare all of those. That's part of the reason also in the prepared remarks that we talked about why it's so important to look at all of the QPS that we do and to maintain decisioning so that you can look at those currently 20 million ad opportunities every single second and then choose carefully the 300 or 400 that the biggest brands in the world should be buying. So agentic will facilitate that. One of the things that our industry has been hurt by is that when a campaign needs to move from $500,000 to a million dollars, you can immediately be faced with thousands of potential ways to expand your campaign. To even execute the buy, you need to change your frequency caps, how many times per day you show the ad, or your targeting parameters. You need to show it to a new group of users than what you were before at $500,000. There are so many variables in terms of new ways that you could spend that incremental money that you're faced with an overwhelming number of decisions. One simple way to explain agentic AI is that it's a layer on top of the API that can reason, or said simply, an API that can reason while simultaneously creating productivity. So what we've started with Stagwell is the ability to create and edit campaigns in the most basic form, which will of course evolve into optimizations. But the agentic layer can help reason: if you're expanding the campaign, there's a whole bunch of ways to do it. Let's talk about the ways that we can help you do that optimally. Agentic, I think, can help that process that has been overwhelming for users for really the inception of digital advertising. So it represents an opportunity to scale and be more productive and more effective that I'm not sure we would have gotten there nearly as fast without the rise of agentic. So I'm just super excited about what that represents for our space. Jessica, thanks for the question.

So, in your first question, if I understand it correctly, the opportunity for agentic is really to make optimizations and campaigns perform better. I think the optimization questions, which are much more about the variables and how you engage in the transaction, are more the issue being solved than the commercial terms. So I think there will be a lot of frameworks that are decided beforehand, and then we'll repeat that using agents millions, billions, even trillions of times subsequently. As it relates to the JBPs, I can't really comment on whether it's relevant or not to any of the agency discussions that we've had. But we're optimistic about the continued agency discussions that we are having.

Thanks.