PubMatic beats Q3 2025 expectations with CTV growth, AI strategy

PubMatic delivered third quarter 2025 monetary outcomes on November 10, 2025, that surpassed expectations throughout income and profitability metrics. The unbiased expertise firm reported $68 million in income, exceeding the $63.97 million consensus forecast, whereas adjusted EBITDA reached $11.2 million with a 16% margin.

The programmatic promoting platform processed roughly 87 trillion impressions in the course of the quarter, in line with ready remarks from the earnings name. Linked tv income grew over 50% year-over-year when excluding political promoting, considerably outpacing market charges. Rising income streams, together with curation, commerce media, and non-SSP revenues, elevated 80% year-over-year and contributed 10% of complete income.

Income in Q3 2025 declined 5% year-over-year in comparison with $71.8 million in the identical interval of 2024. Q3 2024 included $5 million in income from political promoting. Excluding political spend, Q3 2025 income remained flat year-over-year, in line with the corporate’s SEC submitting.

Internet loss for the quarter reached $6.5 million with a margin of adverse 9%, or adverse $0.14 per diluted share. Non-GAAP internet revenue totaled $1.6 million, or $0.03 per diluted share. Internet money from working actions reached $32.4 million, a rise from $19.1 million in the identical interval of 2024.

AI infrastructure collaboration drives technical benefits

PubMatic deployed next-generation AI fashions by way of a multi-year technical collaboration with NVIDIA, in line with CEO Rajeev Goel. The partnership delivers bid response speeds 5 occasions sooner than earlier methods, with public sale timeouts diminished by 85%. Servers now course of 3 occasions extra advert requests, whereas bodily infrastructure consolidated from 5 knowledge middle racks to at least one.

“By way of our technical collaboration with NVIDIA, we’re deploying next-generation AI fashions on the world’s most superior GPU structure,” Goel acknowledged in the course of the earnings name. The collaboration required bodily infrastructure able to deploying GPUs at scale, large transaction quantity for testing throughout the open web, and technical sophistication for early adoption.

The infrastructure enhancements recuperate thousands and thousands in advert spend beforehand misplaced to latency, in line with firm statements. Quicker bid responses unlock optimization methods beforehand not possible at customary programmatic charges. 3 times extra advert requests processed per server develop impression capability with out proportional value will increase.

PubMatic’s AI-powered live sports marketplace launched in July 2025, demonstrating sensible functions of the infrastructure investments. Advert-buying exercise from the Stay Sports activities Market grew sequentially greater than 150% in Q3 2025 over Q2 2025.

Linked tv momentum continues with premium content material enlargement

CTV income development exceeded 50% year-over-year excluding political promoting, in line with monetary outcomes. Together with political promoting, CTV income grew over 10% year-over-year. The corporate now monetizes CTV stock from over 90% of the highest 30 world streamers.

PubMatic added and expanded partnerships with free ad-supported streaming providers in the course of the quarter, together with Tubi, Future At this time, and LocalNow. These additions complement current relationships with premium streamers. Omnichannel video income, which incorporates CTV, grew 21% year-over-year excluding political promoting and represented roughly 38% of complete income.

Fremantle, one of many world’s largest leisure content material creators, generated a 78% improve in incremental programmatic demand throughout their increasing FAST channel portfolio by partnering with PubMatic, in line with the earnings name. The corporate launched Pause Advertisements for CTV in collaboration with dentsu, permitting advertisers to serve dynamic, contextually related adverts when viewers pause content material.

PubMatic and MNTN expanded premium CTV access in October 2025, delivering a ten% income uplift for publishers by way of 14% extra distinctive advertiser demand. The partnership connects performance-focused entrepreneurs with premium streaming stock.

AI-powered platforms scale back marketing campaign setup time, speed up subject decision

PubMatic launched AI-powered purchaser and writer platforms that minimize marketing campaign setup time by 87% and velocity up subject decision by 70%, in line with firm statements. The writer suite contains 17 operational AI brokers guiding yield, diagnostics, and artistic setup.

The newly launched AI yield optimization resolution for publishers makes use of adaptive studying fashions to automate pricing and enhance public sale effectivity, driving a mean of 10% income development for publishers. The answer unlocked tens of thousands and thousands of {dollars} in incremental income for publishers inside a number of months of launch, producing a brand new PubMatic income stream.

Impartial company Butler/Until applied PubMatic for Consumers platform. Scott Ensign, Chief Technique Officer at Butler/Until, acknowledged in the course of the earnings name: “Traditionally, methods do not speak to one another—knowledge units are disparate, walled backyard knowledge is difficult to attach. AI permits us to scale human reasoning and run campaigns that really look throughout all channels and optimize throughout them.”

Overwolf, one in all PubMatic’s largest omnichannel companions, famous that the PubMatic Assistant AI chatbot demonstrates distinctive accuracy and velocity of execution, in line with the earnings name. The corporate deployed a dozen AI brokers internally throughout Q3 2025 to automate operational workflows, speed up growth, and scale back overhead.

Provide path optimization drives purchaser consolidation

Provide Path Optimization represented over 55% of complete exercise on PubMatic’s platform in Q3 2025, up from 50% a 12 months in the past. The rise displays development from Activate, CTV Marketplaces, and sturdy sell-side concentrating on capabilities, in line with ready remarks.

Buyer adoption on Activate elevated 35% over the trailing 9 months, whereas the variety of lively campaigns grew 4 occasions over the trailing 9 months in 2024. The direct-to-supply shopping for platform permits transparency, effectivity, and loyalty as patrons improve spend after seeing measurable ROI.

Advert spend from efficiency entrepreneurs and mid-tier centered DSPs grew 25%+ year-over-year in Q3 2025. PubMatic has been expanding its mid-market DSP relationships all through 2025, onboarding over 25 new DSP companions in the course of the 12 months.

The corporate partnered with Blis, an omnichannel DSP that brings high-value demand from main world manufacturers throughout automotive, retail, and monetary providers. Blis combines T-Cell’s app engagement knowledge with real-world motion patterns and transaction indicators to drive performance-focused campaigns with measurable outcomes.

Operational effectivity enhancements drive margin leverage

PubMatic processed almost 87 trillion impressions in Q3 2025, a rise of 24% over Q3 2024 and 12% over Q2 2025. Almost 60% of complete impressions got here from CTV and cell app stock. Value of income per million impressions processed decreased 19% on a trailing twelve-month interval in comparison with the prior interval.

Infrastructure optimization initiatives mixed with restricted capital expenditures enabled the elevated impression processing. Complete working bills remained roughly flat at $51 million per quarter all through 2025, whereas the corporate realigned investments to areas that ship the strongest ROI. The customer-focused gross sales crew elevated 19% in Q3 2025 in comparison with the prior 12 months, whereas total complete headcount remained flat.

“We exceeded expectations on each income and adjusted EBITDA,” acknowledged CFO Steve Pantelick in the course of the earnings name. “This outperformance was pushed by CTV, on-line video and cell app. We additionally managed bills, leveraged AI and delivered wholesome margins and powerful free money move.”

Adjusted EBITDA of $11.2 million marked the thirty eighth consecutive quarter of adjusted EBITDA profitability. The 16% margin included roughly $1 million in international alternate prices as a result of weakening U.S. greenback in the course of the quarter.

Rising income streams scale quickly

Rising revenues grew 80% year-over-year and included curation, commerce media, and different non-SSP revenues. The brand new AI-based yield optimization resolution for publishers unlocked tens of thousands and thousands of {dollars} in incremental income for publishers whereas producing new PubMatic income, in line with the earnings name.

PubMatic expanded partnerships with main knowledge suppliers all over the world. Nielsen named PubMatic as their unique sell-side accomplice to deliver greater than 10,000 viewers segments to Australian advertisers and businesses. The curation and knowledge enterprise, Join, grew over 40% year-over-year, in line with ready remarks.

PubMatic and DIGITS partnered in November 2024 to remodel native grocery retail media promoting, leveraging the Convert platform for programmatic monetization. The commerce media section continues gaining momentum as retailers and transaction-based enterprises search to activate and monetize first-party viewers intelligence.

Income from Activate grew over 100% year-over-year. The expanded partnership with a prime three DSP launched Programmatic Assured offers that streamline execution for advertisers throughout premium streaming content material, lowering friction in deal setup and accelerating time-to-market for campaigns.

Transaction layer innovation permits agent-to-agent communication

PubMatic served as a co-founder of the Advert Context Protocol (AdCP) alongside companions together with Yahoo, LG Advert Options, and Raptive. The Ad Context Protocol launched on October 15, 2025, as an open-source promoting automation protocol offering a unified interface for AI brokers.

The corporate grew to become the primary to publish a Mannequin Context Protocol specification for agent-to-agent communication within the programmatic business. The protocol establishes protocols, security mechanisms, and interoperability requirements that allow AI brokers throughout your complete ecosystem to transact effectively and securely, in line with the earnings name.

“We’re establishing the protocols, security mechanisms, and the interoperability requirements that may allow AI brokers throughout your complete ecosystem to transact effectively and securely,” Goel acknowledged throughout ready remarks. The AdCP initiative positions PubMatic for the subsequent main step in promoting automation, the place advertisers’ and publishers’ AI brokers can transact immediately by way of infrastructure.

The corporate’s AI technique facilities round three distinct layers of programmatic promoting: infrastructure, software, and transaction. PubMatic owns and operates its full expertise stack, offering efficiencies, management, and independence that many friends lack, evidenced by a number of current public cloud outages.

Monetary place strengthens with money era

The corporate ended Q3 2025 with $136.5 million in money and money equivalents with zero debt. For the reason that starting of 2021 by way of Q3 2025, PubMatic generated over $390 million in internet money from operations and greater than $215 million in free money move.

Free money move for Q3 2025 reached $22.8 million, in line with supplemental money move data. The DSP that made modifications in mid-2024 returned to development in Q3, which favorably improved days gross sales excellent. Lowered money taxes paid resulted from the brand new federal tax invoice that went into impact earlier in 2025.

By way of September 30, 2025, PubMatic used $180.6 million to repurchase 12.4 million shares of Class A standard inventory, representing 24% of absolutely diluted shares as of this system’s inception. The corporate has $94.4 million remaining within the repurchase program approved by way of December 31, 2026.

PubMatic has maintained profitability by way of difficult market circumstances in 2025. The corporate reported its thirty sixth consecutive quarter of adjusted EBITDA profitability in Q1 2025, persevering with the streak by way of Q3.

Fourth quarter steering displays cautious macroeconomic outlook

PubMatic projected This autumn 2025 income within the vary of $73 million to $77 million, inclusive of an influence from one of many firm’s prime DSP patrons. The steering assumes flat income from the big DSP that declined in July relative to Q3 ranges.

Adjusted EBITDA for This autumn 2025 is anticipated within the vary of $19 million to $21 million, representing roughly a 27% margin on the midpoint. The adjusted EBITDA expectation assumes adverse international foreign money alternate influence predominantly from Euro and Pound Sterling.

Full-year 2025 income steering ranged from $276 million to $280 million, with adjusted EBITDA between $53 million and $55 million. The complete-year steering contains greater than $5 million of estimated adverse international foreign money influence. Full-year capital expenditure outlook remained at roughly $15 million.

“When it comes to the newest traits, in October, the everyday vacation seasonal uptick so far has been comparatively muted for some shopper discretionary advert verticals comparable to Meals & Drink and Arts & Leisure,” Pantelick acknowledged in the course of the earnings name. The corporate took a prudent method to steering primarily based on current traits.

Internet dollar-based retention reached 98% for the trailing twelve months ended September 30, 2025, in comparison with 112% within the comparable trailing twelve-month interval a 12 months in the past. The metric contains the impacted DSP and political promoting.

Market positioning for business transformation

The continued Google AdTech antitrust trial presents potential alternatives for market share shifts. “With respect to potential treatments within the Google AdTech antitrust trial, we proceed to consider that any treatments that degree the aggressive taking part in area, whether or not structural, behavioral, or each, will profit the open web and PubMatic,” Pantelick acknowledged throughout ready remarks.

The corporate anticipates margin enlargement at each gross and adjusted EBITDA ranges in 2026 and past as income development reaccelerates. The last decade-plus expertise proudly owning and working world non-public cloud infrastructure gives a number of benefits, together with the flexibility to develop capability whereas progressively lowering the speed of capital expenditures.

Complete headcount is anticipated to stay comparatively flat in 2026, whereas investments supporting the fastest-growing areas of the enterprise will improve by way of inside reallocations. The corporate goals to extend money move in 2026 supported by additional working capital enhancements and incremental AI-driven efficiencies.

“Because the business quickly redefines itself, we’re actively shaping its future and fueling promoting efficiency, transparency and automation,” Goel acknowledged within the press launch saying the outcomes.

Timeline

Abstract

Who: PubMatic Inc., an unbiased expertise firm delivering programmatic promoting infrastructure, introduced third quarter 2025 monetary outcomes. CEO Rajeev Goel and CFO Steve Pantelick introduced the outcomes.

What: The corporate reported $68 million in income, exceeding consensus forecasts, with adjusted EBITDA of $11.2 million at a 16% margin. Linked tv income grew over 50% year-over-year excluding political promoting, whereas rising income streams elevated 80% year-over-year. The corporate processed 87 trillion impressions, processed 24% greater than the prior 12 months, with value per million impressions declining 19% on a trailing twelve-month foundation.

When: Monetary outcomes for the third quarter ending September 30, 2025, had been introduced on November 10, 2025. Fourth quarter 2025 steering projected income between $73 million and $77 million with adjusted EBITDA of $19 million to $21 million.

The place: PubMatic operates globally with owned-and-operated infrastructure processing programmatic promoting transactions. The corporate works with over 90% of the highest 30 world streamers and roughly 1,950 publishers and app builders worldwide. Regional efficiency confirmed APAC revenues rising 12% year-over-year and EMEA revenues rising 7% year-over-year.

Why: The outcomes show momentum in secular development areas together with linked tv, cell app, and rising income streams. Infrastructure investments with NVIDIA delivered 5 occasions sooner bid response speeds and 85% fewer public sale timeouts. AI-powered platforms diminished marketing campaign setup time by 87% and subject decision by 70%. The corporate’s three-layer AI technique throughout infrastructure, software, and transaction layers positions it for market transformation because the promoting ecosystem shifts towards knowledge concentrating on, efficiency measurement, and agent-to-agent automation.