Vasily Karasyov

Vasily Karasyov asked about the potential downstream implications for DSPs, SSPs, and the open internet value chain if Google de-emphasizes its open internet businesses following recent antitrust verdicts.

Answer

CEO Jeff Green stated that recent verdicts against Google and other walled gardens are creating a fairer, more competitive market. He believes Google will be forced to focus on its core businesses like Search and YouTube, reducing its anti-competitive practices on the open internet. Green asserted that since The Trade Desk was already winning in an unfair market, it is positioned to benefit more than any other company from these changes and can compete even more effectively.

Vasily Karasyov followed up on the Q4 shortfall, asking to what extent external factors like weaker brand spend, the political environment, or internal issues like the Kokai platform rollout pace contributed to the results.

Answer

Co-Founder and CEO Jeff Green acknowledged the macro environment wasn't perfect but stated the company has outperformed in similar conditions before and the miss was due to internal execution. He explained that the Kokai rollout was deliberately slower in some areas to inject more AI and build a stronger long-term foundation for features like a digital upfronts market. Green framed this as a strategic choice to build what clients need for the future, which is a more complex task than simply fulfilling short-term wants.

Vasily Karasyov asked about the market impact of regulatory pressure on Google and whether The Trade Desk has a preferred outcome for the DOJ's antitrust trial.

Answer

CEO Jeff Green stated that The Trade Desk is positioned to win regardless of the trial's outcome. He believes Google will inevitably have to "play more fair" due to scrutiny, which benefits TTD as it has succeeded even in an unfair market. Green noted that Google appears to be deprioritizing its network business, where it competes with TTD, to focus on larger opportunities like search, cloud, and AI, creating a significant opportunity for the open internet ecosystem.

Vasily Karasyov asked about the evolution of advertisers' LTV calculations, specifically if the advertising component is higher now compared to a year ago, given the variance in growth rates between the in-app purchases and in-app advertising markets.

Answer

Adam Foroughi, Co-Founder, CEO, and Chairperson, AppLovin, noted that the in-app advertising market (MAX) is growing much faster than the more mature in-app purchasing market, driven by better tools for publishers and increased supply. This expansion of the true market (supply side on MAX) is key for AppLovin's growth.

Vasily Karasyov asked about the evolution of advertisers' LTV calculations, given the variance in growth rates between the in-app purchasing and in-app advertising markets, and what this means for AppLovin.

Answer

Adam Foroughi, Co-Founder, CEO, and Chairperson, AppLovin, noted that the in-app purchasing market is more mature, while the in-app advertising market (MAX) is growing much faster due to better tools for publishers. He emphasized that AppLovin focuses on driving impact where they can, particularly with in-app advertising powering their true market on the MAX supply side.

Vasily Karasyov asked about the competitive response from incumbent platforms to AppLovin's success in e-commerce and how the industry landscape might change as AppLovin scales its offering.

Answer

CEO Adam Foroughi stated that AppLovin is expanding the overall advertising economy rather than taking market share. He explained that advertisers are seeing incremental, performance-based sales they wouldn't otherwise capture, leading them to increase their total ad spend rather than shifting budgets away from other platforms.

Vasily Karasyov of Cannonball Research asked about the e-commerce opportunity, questioning whether it requires a major overhaul of AXON 2.0 or just minor tweaks. He also inquired about the competitive landscape and which existing budgets AppLovin would be competing for in the e-commerce space.

Answer

CEO Adam Foroughi described the move into e-commerce as entering 'greenfield' territory, as no one has previously delivered a comparable solution within the mobile game ecosystem for non-gaming brands. He emphasized that this provides advertisers with access to a new, incremental audience. Regarding the technology, he stressed its complexity, noting that the platform is powerful and that the underlying math is not limited by advertiser category, suggesting a broad expansion opportunity over time.

Vasily Karasyov asked for clarification on ARPU growth trajectory relative to platform revenue growth and user base growth, particularly for the U.S. market.

Answer

CFO Dan Jedda stated that ARPU is growing and expected to continue, believing it can get 'significantly higher' due to monetization initiatives. He clarified that while streaming households are growing (projected 100 million by 2026), ARPU is expected to grow faster than active accounts because platform revenue initiatives are accelerating.

Vasily Karasyov inquired about the contribution of programmatic advertising to platform revenue, asking if it is entirely incremental or if it cannibalizes some direct-sold inventory.

Answer

President of Roku Media, Charlie Collier, clarified that the impact is a mix. While some programmatic revenue is entirely new and incremental, particularly from channel sales partners and self-service SMBs, many enterprise clients who previously bought directly are now transacting programmatically. He framed programmatic as a method of execution that makes it easier for all buyers to access Roku's inventory, ultimately unlocking new revenue and deepening existing relationships.

Vasily Karasyov asked which initiative, the Trade Desk partnership or home screen video advertising, could be a larger benefit in the coming year and how they are expected to ramp. He also requested the size of the quarter's 606 accounting adjustment.

Answer

CFO Dan Jedda and CEO Anthony Wood addressed the growth initiatives. Jedda highlighted that the Trade Desk integration is already showing positive impacts on advertiser acquisition and wallet share, while the home screen video marquee unit is an 'enormous opportunity' set for general availability in Q4. Wood emphasized that both programmatic expansion and home screen monetization are major opportunities in their early stages. Jedda also confirmed the 606 adjustment in Q3 was $12 million.

Vasily Karasyov from Cannonball Research asked for specifics on how Unity Vector is driving install growth and whether the ad take rate has changed with the new technology.

Answer

CEO Matthew Bromberg stated that Vector is delivering broad-based improvements across all drivers that indicate value for ad customers, which is best measured by their increased spend. CFO Jarrod Yahes confirmed that there have been no material shifts in the take rate; the growth is coming from increased install volume and value per customer.

Vasily Karasyov from Cannonball Research asked about opportunities for advertising formats beyond display, such as video, that could command higher CPMs and accelerate digital advertising revenue growth.

Answer

President and CEO Meredith Kopit Levien responded that The Times sees broad opportunity in advertising, noting that even its standard display canvases command strong CPMs due to the high-value audience and improving targeting. She confirmed they are experimenting with video and that audio remains a key part of the ad proposition, with more format innovation to come. She also highlighted that the varied user activities across the product portfolio create diverse and valuable advertising contexts.

Vasily Karasyov asked for elaboration on the 'audience headwinds' from other platforms mentioned in the prepared remarks, questioning if the trend is worsening and how the company plans to address it.

Answer

Meredith Kopit Levien, President and CEO, clarified that the comment refers to a consistent trend over the past two years where platforms are sending less traffic to publishers, with AI playing a role. She stressed that the company's strategy is explicitly designed to build resilience to this by fostering direct relationships with users, and that the comment did not signal a new or worsening trend beyond what has been previously discussed.