The Trade Desk, once the undisputed leader in programmatic advertising, is facing a tough reckoning. After an impressive streak of 33 consecutive quarters meeting or exceeding expectations, the company missed its revenue target in late 2024. The market’s reaction was brutal, causing a 30% drop in stock value and shattering its aura of invincibility.
Long-standing tensions between The Trade Desk and media agencies have come to the forefront. Agencies are increasingly skeptical of The Trade Desk’s transparency and motives, citing discrepancies in the company’s take rate. Publicly reported at 20%, insiders suggest it’s closer to 30%, fueling a sense of betrayal and competition rather than collaboration.
CTV Setbacks and Platform Doubts Cloud The Trade Desk’s Industry Leadership Position
The Trade Desk’s bold push into Connected TV (CTV) took a hit when Sonos abandoned plans for a TV device that would have hosted its new ad tech operating system. Without device integration, its CTV vision is left hanging, and with no partners lined up, the company is struggling to assert control over streaming ad inventory.
The company is grappling with multiple headwinds: lukewarm reception for its UID 2.0 cookie alternative, tensions with publishers, and dissatisfaction with Kokai, its AI-enhanced data platform. What was once seen as a visionary disruptor now appears defensive and reactive, scrambling to maintain relevance amid growing competition and skepticism.
The Trade Desk Loses Momentum as Revenue Miss, CTV Struggles, and Agency Tensions Erode Its EdgeDespite mounting criticism, The Trade Desk remains a fundamentally strong player with deep agency ties and billions in revenue. While recent stumbles have dented its image, it’s still a dominant force outside the ad tech walled gardens. Its tools and infrastructure continue to matter, even if their effectiveness and future relevance are now under scrutiny.
Fighting on New Fronts While Searching for the Next Big Growth Opportunity
New and old rivals are making things harder for The Trade Desk. Agencies have invested in Mediaocean, a competing ad tech provider, incentivizing them to prioritize it over The Trade Desk’s platforms. Mediaocean’s deep integration into agency workflows makes it hard to displace, making Kokai’s adoption even more difficult.
The path forward may lie in expanding its CTV efforts internationally, especially in underdeveloped yet promising markets like Europe and MENA. At the same time, The Trade Desk is shifting focus from agencies to direct advertiser relationships, hoping to unlock new ad dollars. Whether these strategies can compensate for its challenges at home remains uncertain.
Despite having nearly $2 billion in cash, The Trade Desk has ruled out big acquisitions like Roku, choosing to protect its neutrality. Its recent purchase of Sincera signals an interest in improving transparency and measurement, but overall, its next big move remains unclear. For now, the company’s future hinges not on perfection, but on whether one or two bets can reignite momentum.
