Daniel Salmon is a Partner and Head of US Internet Research at New Street Research, specializing in in-depth analysis of digital advertising, eCommerce, streaming, and major US Internet companies. He covers industry leaders such as Amazon, Meta, Google, and Reddit, and is known for influential work on Amazon's advertising business, frequently delivering actionable, high-impact investment insights. Salmon joined New Street Research in 2022 after an 18-year tenure as Managing Director and Head of US Internet & Media Equity Research at BMO Capital Markets, with earlier experience at Citi focused on lodging and gaming. A Princeton University graduate, he is widely recognized as a leading authority in the sector, though formal FINRA certifications or specific performance rankings are not publicly listed.
Dan Salmon asked if advertising fill rates are improving as expected with the scaling of the Netflix ad suite and new demand partnerships.
Co-CEO Greg Peters stated that Netflix focuses on overall revenue as the most important metric. He confirmed that fill rates have improved and are expected to continue improving with further development of go-to-market capabilities, measurement, and targeting.
Dan Salmon asked if Netflix's ad fill rates are improving as expected with the scaling of the Netflix ad suite and new demand partnerships.
Co-CEO Greg Peters confirmed that while the primary focus is on overall revenue optimization, fill rates have improved and are anticipated to continue improving as go-to-market capabilities, measurement, and targeting evolve.
Dan Salmon requested a deeper analysis of Snap's small and medium customer (SMC) base, asking about advertiser count growth, which ad products are gaining traction, and the future product roadmap for this segment.
CEO Evan Spiegel confirmed that the SMC segment was the largest contributor to Q2 ad revenue growth, driven by better go-to-market operations and simplified ad tools. He highlighted that AI-powered automation features like smart bidding, budget optimization, and auto-targeting are providing a significant lift for smaller advertisers by simplifying campaign management and improving performance.
Dan Salmon requested more details on Snap's small and medium customer (SMC) base, including advertiser count growth and which ad products are gaining the most traction with this segment.
CEO Evan Spiegel identified the SMC segment as the largest contributor to ad revenue growth in Q2. He attributed this success to improved go-to-market operations and simplified ad products. He highlighted that AI-powered automation tools, such as smart bidding, budget optimization, and auto-targeting, are particularly beneficial for smaller advertisers.
Daniel Salmon asked about the next steps for growing the small and medium-sized business (SMB) advertiser base, especially after lapping the launch of Snap Promote, and inquired about the rate at which these SMBs transition to the main ads platform.
CEO Evan Spiegel explained that while Snap Promote remains important for advertiser count, the company's acquisition focus is shifting more towards medium-sized advertisers, which can drive more significant dollar volume. He mentioned plans to streamline the Snap Promote product and ease the transition to the full Ads Manager, but emphasized the current focus is on the mid-sized customer segment.
Daniel Salmon of New Street Research asked for more details on the growth of small and medium-sized business (SMB) advertisers. He specifically sought to understand how Snap helps these advertisers graduate from the simple 'Snap Promote' tool to more sophisticated use of the full Ad Manager, and what other initiatives are in place to accelerate this growth.
CFO Derek Andersen explained that SMB growth is driven by a combination of more performant direct-response (DR) ad products, optimized go-to-market operations, and a simplified, automated ad buying experience. He noted that CAPI integrations and the 'Snap Promote' tool, which helped double active SMB advertisers year-over-year, are key drivers. Andersen added that the future roadmap includes features like 'smart budget optimization' to further support this segment.
Daniel Salmon asked about the strategy for managing the potential risks of the 'Simple Snapchat' transition, particularly how the company is ensuring it avoids monetization headwinds in its most valuable markets.
CEO Evan Spiegel explained that while the company is excited about the long-term engagement opportunities, especially with new users, they are taking a cautious 'test-and-learn' approach. He highlighted the need to better understand shifts in ad inventory, such as moving from tile-based ads to interstitial placements, before a broader rollout to ensure both the community and advertising partners benefit from the changes.
Daniel Salmon asked for commentary on recent Board of Directors changes and their strategic implications, as well as an update on the company's dialogue with activist or publicly active investors.
CEO Spencer Rascoff expressed excitement about new board members Darrell and Kelly, highlighting their deep consumer, product, and technology expertise. Regarding investors, he confirmed he is personally and actively engaging with all key shareholders, including those who have been publicly active. He stated that he values these conversations, learns from them, and looks forward to continued engagement with all shareholders.
Daniel Salmon asked if the Board is considering divestitures, noting that the new business segment disclosures and the exit from live streaming could facilitate such actions.
CFO Gary Swidler stated that while the board is open to any action that drives shareholder value, the new segment disclosures are not tied to divestiture plans. He clarified the goal was to provide investors with deeper insight into the business units ahead of Investor Day. CEO Bernard Kim added that the team's focus remains on core execution.
Daniel Salmon asked for more details on the performance of the 'ads in comments' placement, which now accounts for 6% of impressions, and how it informs the broader monetization strategy.
COO Jen Wong highlighted that the ads in comments placement is unique to Reddit due to the high engagement and commercial nature of conversations on the platform. She noted they are pleased with advertiser adoption and performance, as the format reaches users with very high intent who are actively seeking answers.
Speaking for Dan Salmon of New Street Research, an associate asked for an update on the go-to-market strategy for data licensing, covering both large language model trainers and enterprise-size customers.
COO Jen Wong described a 'barbell' strategy: engaging a small group of AI model trainers in an evolving landscape, and a larger number of marketing intelligence and vertical-specific firms for smaller deals. For the latter, the strategy involves working with clients to demonstrate the value of Reddit's data to their own end customers, thereby growing the business through proven insights.
Daniel Salmon asked for quantification of the 2024 political ad spend impact, whether non-political ad dollars would offset this in 2025, and for an update on the CapEx outlook.
CFO Laura Schenkein stated that political spend is expected to be in the low single digits as a percentage of overall 2024 spend. She advised that when modeling Q1 2025, analysts should account for this contribution in Q4. She also reiterated that CapEx is expected to be around 5% of revenue for both 2024 and 2025. CEO Jeff Green added that advertiser dollars that shifted due to the political environment in Q4 would return in 2025, leading to a more typical and predictable spending cycle.
Daniel Salmon inquired about Pinterest's third-party partnership strategy, asking if it makes sense to add more partners beyond Amazon and Google to target different verticals or markets.
CEO Bill Ready affirmed that the company's ad platform was built to ingest demand from multiple partners and that the long-term intent is to work with more. While no new partnerships are being announced at the moment, he emphasized that this strategy is crucial for addressing the platform's significant undermonetization relative to its high commercial intent, complementing their first-party and reseller efforts.
Performance on expert-authored financial analysis tasks
