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What changed in PubMatic, Inc.'s 10-K — 2024 vs 2025

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Paragraph-level year-over-year comparison of PubMatic, Inc.'s 2024 and 2025 10-K annual filings, covering the Business, Risk Factors, Legal Proceedings, Cybersecurity, MD&A and Market Risk sections. Every new, removed and edited paragraph is highlighted side-by-side so you can see exactly what management changed in the 2025 report.

+425 added−387 removedSource: 10-K (2026-02-26) vs 10-K (2025-02-27)

Top changes in PubMatic, Inc.'s 2025 10-K

425 paragraphs added · 387 removed · 291 edited across 8 sections

Item 1. Business

Business — how the company describes what it does

58 edited+27 added−34 removed40 unchanged
Biggest changeAs consumers increasingly engage with digital media, and as advertisers bid on a growing array of ad formats and impressions, an immense amount of data is generated. This data includes anonymized consumer information about interests and intent, log files of winning and losing advertiser bids, and transaction records for billing and payment reconciliation.
Biggest changeThese channels emphasize outcome measurement, closed-loop attribution, high quality supply, and curated transaction paths, reflecting the industry’s migration away from the traditional browser-based model. Automation and Data Processing: As consumers increasingly engage with digital media, and as advertisers bid on a growing array of ad formats and impressions, an immense amount of data is generated.
The hundreds of billions of ad impressions and trillion advertiser bids that we process every day generate enormous volumes of data that we harness to drive higher revenue for our publishers and increased ROI for our buyers. • Transparency: We provide log-level data to buyers and provide transparency on every ad impression, which gives buyers full control over which publishers, ad formats, and specific ad impressions on which they would like to bid. • Built in Quality Controls: We have developed a multi-pronged strategy to create a high-quality marketplace beginning with high quality publisher selection, supported by proprietary and third-party fraud detection software, manual review, timely fraud investigations, and a fraud-free program in which buyers are credited for any fraudulent inventory they may have purchased on our platform. • Data Driven Decisions: We leverage our artificial intelligence and machine learning capabilities to record, aggregate, analyze, and act on vast amounts of data in a matter of milliseconds to help our customers optimize their digital advertising businesses in real-time.
The hundreds of billions of ad impressions and trillion advertiser bids that we process every day generate enormous volumes of data that we harness to drive higher revenue for our publishers and increased ROI for our buyers. • Transparency: We provide log-level data to buyers and provide transparency on every ad impression, which gives buyers full control over which publishers, ad formats, and specific ad impressions on which they would like to bid. • Built in Quality Controls: We have developed a multi-pronged strategy to create a high-quality marketplace beginning with high quality publisher selection, supported by proprietary and third-party fraud detection software, manual review, timely fraud investigations, and a fraud-free program in which buyers are credited for any fraudulent inventory they may have purchased on our platform. • Data Driven Decisions: We leverage our AI and machine learning capabilities to record, aggregate, analyze, and act on vast amounts of data in a matter of milliseconds to help our customers optimize their digital advertising businesses in real-time.
Because both our company and our publishers rely upon large volumes of such data collected primarily through cookies and other tracking technologies, it is essential that we monitor legal requirements and other developments in this area, domestically and globally, maintain a robust privacy and security compliance program, and engage in responsible privacy practices, including providing consumers with notice of the types of data we collect, how we collect it, with whom we share it, how we use that data to provide our solutions, and the applicable choices we offer consumers.
Because both our company and our buyers rely upon large volumes of such data collected primarily through cookies and other tracking technologies, it is essential that we monitor legal requirements and other developments in this area, domestically and globally, maintain a robust privacy and security compliance program, and engage in responsible privacy practices, including providing consumers with notice of the types of data we collect, how we collect it, with whom we share it, how we use that data to provide our solutions, and the applicable choices we offer consumers.
These capabilities improve long term marketplace liquidity resulting in increased publisher revenue and higher advertiser ROI. 8 Table of Contents • Self-Serve: Our cloud infrastructure solutions are available via self-serve to publishers and buyers, including an easy-to-use customer user interface and a set of application programming interfaces that allow our publisher customers to configure new inventory, extend into new geographies or ad formats, review reporting insights, and manage and track payments and billing cycles. • Reporting: Our technology platform provides extensive reporting capabilities to both buyers and publishers via application programming interfaces for direct integration into a customer’s reporting systems.
These capabilities improve long term marketplace liquidity resulting in increased publisher revenue and higher advertiser ROI. • Self-Serve: Our cloud infrastructure solutions are available via self-serve to publishers and buyers, including an easy-to-use customer user interface and a set of application programming interfaces that allow our publisher customers to configure new inventory, extend into new geographies or ad formats, review reporting insights, and manage and track payments and billing cycles. • Reporting: Our technology platform provides extensive reporting capabilities to both buyers and publishers via application programming interfaces for direct integration into a customer’s reporting systems.
Customer Concentration We depend upon a limited number of large DSPs for a large percentage of impressions purchased and our business results, including revenues, may be impacted by changes in their pricing strategies, bidding algorithms or go-to market efforts. Two of our largest DSP relationships are with Google and The Trade Desk.
We depend upon a limited number of large DSPs for a large percentage of impressions purchased and our business results, including revenues, may be impacted by changes in their pricing strategies, bidding algorithms or go-to market efforts. Two of our largest DSP relationships are with Google and The Trade Desk.
Interest-based advertising, or the use of data to draw inferences about a consumer’s interests and deliver relevant advertising to that consumer, has come under increasing scrutiny by state and federal legislatures, regulatory agencies, and self-regulatory bodies, privacy advocates, academics, and commercial interests in the United States and abroad that focus on data protection and consumer privacy.
Interest-based advertising, including the use of AI, or the use of data to draw inferences about a consumer’s interests and deliver relevant advertising to that consumer, has come under increasing scrutiny by state and federal legislatures, regulatory agencies, and self-regulatory bodies, privacy advocates, academics, and commercial interests in the United States and abroad that focus on data protection and consumer privacy.
Website addresses referred to in this Annual Report on Form 10-K are not intended to function as hyperlinks, and the information contained on or available through our website is not incorporated into, and does not form a part of this Annual Report on Form 10-K or any other report or documents we file with or furnish to the SEC. 12 Table of Contents
Website addresses referred to in this Annual Report on Form 10-K are not intended to function as hyperlinks, and the information contained on or available through our website is not incorporated into, and does not form a part of this Annual Report on Form 10-K or any other report or documents we file with or furnish to the SEC. 13 Table of Contents
Additionally, we believe our Activate platform provides buyers with the transparency and reporting they demand and a more efficient, programmatic way to access publisher inventory. Expansion of Video and Mobile: We see significant growth opportunities in both video and mobile as consumers shift more of their time online to mobile devices and online streaming services.
Additionally, we believe our Activate platform provides buyers with the transparency and reporting they demand and a more efficient, performance-based way to access publisher inventory. Expansion of Video and Mobile: We see significant growth opportunities in both video and mobile as consumers shift more of their time online to mobile devices and online streaming services.
The initial term of the agreement ended in November 2013, and it automatically renews for successive one-year terms. Either party may terminate for convenience upon providing at least 30 days’ prior written notice. 9 Table of Contents Intellectual Property The protection of our technology and intellectual property is an important component of our success.
The initial term of the agreement ended in November 2013, and it automatically renews for successive one-year terms. Either party may terminate for convenience upon providing at least 30 days’ prior written notice. Intellectual Property The protection of our technology and intellectual property is an important component of our success.
Our ability to accurately predict and monetize high value impressions also allows us to operate more efficiently, due to the fact that the cost of processing low-value impressions and high-value impressions are approximately the same. Our algorithms, such as for impression throttling, deploy a variety of means to optimize traffic sent to DSPs, agencies, and advertisers.
Our ability to accurately predict and monetize high value impressions also allows us to operate more efficiently, due to the fact that the cost of processing low-value impressions and high-value impressions are approximately the same. Our algorithms, such as for traffic shaping, deploy a variety of means to optimize traffic sent to DSPs, agencies, and advertisers.
Due to the global, omnichannel reach of our infrastructure, we believe we are well positioned to help publishers and ad buyers make their advertising businesses more efficient and effective. Customer Control and Partnership: Due to our status as an independent infrastructure provider prioritizing transparency, we can be more closely aligned with both publishers and buyers.
Due to the global, omnichannel reach of our infrastructure, we believe we are well positioned to help publishers and ad buyers make their advertising businesses more efficient and effective. Customer Control and Partnership: Due to our status as an independent infrastructure provider prioritizing transparency, we can more closely align with both publishers and buyers.
In addition, the laws of various foreign countries where our products are distributed may not protect our intellectual property rights to the same extent as laws in the United States. Privacy and Data We are subject to laws and regulations governing privacy and the transmission, collection, and use of personal data.
In addition, the laws of various foreign countries where our products are distributed may not protect our intellectual property rights to the same extent as laws in the United States. 10 Table of Contents Privacy and Data We are subject to laws and regulations governing privacy and the transmission, collection, and use of personal data.
The GDPR, as originally implement by the respective EU members states and later adopted by the U.K. following Brexit (the “UK GDPR”), sets out higher potential liabilities for certain data protection violations, which may result in fines up to the greater of €20 million or 4% of an enterprise’s global annual revenue.
The GDPR, as originally implemented by the respective EU member states and later adopted by the U.K. following Brexit (the “UK GDPR”), sets out higher potential liabilities for certain data protection violations, which may result in fines up to the greater of €20 million or 4% of an enterprise’s global annual revenue.
We have entered into supply path optimization (“SPO”) agreements directly with both advertisers and agencies through various arrangements including custom data and workflow integrations, product features, and volume-based business terms. The effect of these SPO agreements is to increase the volume of ad spend on our platform without corresponding increases in technology costs.
We have entered into SPO agreements directly with both advertisers and agencies through various arrangements including custom data and workflow integrations, product features, and volume-based business terms. The effect of these SPO agreements is to increase the volume of ad spend on our platform without corresponding increases in technology costs.
Our Customer Success team is organized and specialized by type of ad format and device and is trained to both maximize the number of integrations with each publisher and deploy the value-added solutions that we provide. Similarly, we have teams focused on new business acquisition and existing partner retention and expansion for advertisers, agencies, and DSPs.
Our Customer Success team is organized and specialized by type of ad format and device and is trained to both maximize the number of integrations with each publisher and deploy the value-added solutions that we provide. Similarly, we have teams focused on new business acquisition and existing partner retention and expansion for our buyers.
Many of our publishers have diversified businesses with media properties and audiences across the globe and with a wide variety of ad products, including display and video ads across desktop, tablet, mobile, and connected TV devices.
Many of our publishers have diversified businesses with media properties and audiences across the globe and with a wide variety of ad products, including display and video ads across desktop, tablet, mobile, and CTV devices.
Growth Strategy We believe we are positioned to benefit from tailwinds in the advertising industry, including the rapid proliferation of digital media, the need for purpose-built infrastructure to address the increasing complexity in the digital advertising landscape, and increasing consumer time spent online.
Growth Strategy We believe we are positioned to benefit from tailwinds in the advertising industry, including the rapid proliferation of digital media, the need for purpose-built infrastructure to address the increasing complexity in the digital advertising landscape, the focus of buyers on performance driven media and increasing consumer time spent online.
Our offering is omnichannel and targets a diverse set of publishers touching many ad formats, and digital device types, including mobile app, mobile web, desktop, display, video, over-the-top video/connected TV (“OTT/CTV”), and rich media.
Our offering is omnichannel and targets a diverse set of publishers touching many ad formats, and digital device types, including mobile app, mobile web, desktop, display, video, over-the-top video (“OTT”), CTV, and rich media.
Sales and Marketing We primarily deploy a self-service model and focus our sales and marketing efforts on supporting, advising, and training our publishers to optimize their usage of our platform. We employ a nimble in-market sales team with expertise in programmatic advertising to attract premium publishers to our platform.
Sales and Marketing We employ a nimble in-market sales team with expertise in programmatic advertising to attract premium publishers to our platform. For our publisher relationships, we focus our sales and marketing efforts on supporting, advising, and training our publishers to optimize their usage of our platform.
Beyond laws and regulations, we are also members of self-regulatory bodies that impose additional requirements related to the collection, use, and disclosure of consumer data, including the IAB, the Digital Advertising Alliance, and the NAI.
Such laws are gaining momentum and are being enforced by local authorities. Beyond laws and regulations, we are also members of self-regulatory bodies that impose additional requirements related to the collection, use, and disclosure of consumer data, including the IAB, the Digital Advertising Alliance, and the NAI.
As of December 31, 2024, we had 1,049 employees, of whom 319 were located in the United States, 604 in India, and 126 in our other offices around the world. Corporate Information We were incorporated in the State of Delaware in 2006. Our internet address is www.pubmatic.com.
As of December 31, 2025, we had 1,030 employees, of whom 322 were located in the United States, 573 in India, and 135 in our other offices around the world. Corporate Information We were incorporated in the State of Delaware in 2006. Our internet address is www.pubmatic.com.
In addition, we believe that new market entrants would find it difficult to gain direct access to publishers and ad buyers given their limited scale and face significant costs to integrate with publishers and ad buyers and comply with evolving regulatory requirements around the world.
In addition, we believe that new market entrants would find it difficult to gain direct access to publishers and ad buyers given their limited scale and would also face significant costs to integrate with publishers and ad buyers and comply with evolving regulatory requirements around the world. Seasonality and Customer Concentration Digital advertising spend has historically been subject to seasonality.
For example, when our machine learning models predict that an impression will attract high bids, our algorithms adjust pricing guidance to bidders in real time, which can lead to significant inventory yield improvements for publishers and higher win rates for ad buyers.
By leveraging these capabilities, we are able to more cost effectively improve outcomes for our customers. For example, when our machine learning models predict that an impression will attract high bids, our algorithms provide pricing guidance to bidders in real time, which can lead to significant inventory yield improvements for publishers and higher win rates for ad buyers.
We believe that our specialized cloud platform, supported by rapid innovation, and transparent business model provide incentives to buyers to consolidate an increasing share of their total digital spend on our platform.
Publishers are actively seeking to maximize the value of their ad inventory, and buyers are seeking to increase advertising ROI. We believe that our specialized cloud platform, supported by rapid innovation, and transparent business model provide incentives to buyers to consolidate an increasing share of their total digital spend on our platform.
Additionally, our compliance with our privacy policy and our general consumer data privacy and security practices are subject to review by the Federal Trade Commission, which may bring enforcement actions to challenge allegedly unfair and deceptive trade practices, including the violation of privacy policies and representations or material omissions therein. 10 Table of Contents Certain State Attorneys General in the United States may also bring enforcement actions based on comparable state laws or federal laws that permit state-level enforcement.
Additionally, our compliance with our privacy policy and our general consumer data privacy and security practices are subject to review by the Federal Trade Commission, which may bring enforcement actions to challenge allegedly unfair and deceptive trade practices, including the violation of privacy policies and representations or material omissions therein.
Our marketing team is focused on achieving thought leadership, educating customers on how to harness programmatic advertising to improve their business, guiding buyers on how to maximize ROI via the PubMatic cloud infrastructure, supporting our sales team, generating new leads, and increasing awareness for our brand.
These teams focus on onboarding new partners and increasing spend across a variety of ad formats, devices, and geographies. 9 Table of Contents Our marketing team is focused on achieving thought leadership, educating customers on how to harness programmatic advertising to improve their business, guiding buyers on how to maximize ROI via the PubMatic cloud infrastructure, supporting our sales team, generating new leads, and increasing awareness for our brand.
We designed our platform using a flexible, service-oriented architecture in order to facilitate rapid development of new solutions, to meet evolving industry demands, and to support new use cases and new ad formats.
We own and operate our software and hardware infrastructure globally, which saves significant infrastructure expenditures as compared to public cloud alternatives. We designed our platform using a flexible, service-oriented architecture in order to facilitate rapid development of new solutions, to meet evolving industry demands, and to support new use cases and new ad formats.
We generate revenue through fees charged to our publishers, which are generally a percentage of the value of the advertising impressions that publishers monetize on our platform.
Our channel partners aggregate and provide further access to thousands of sites and apps from smaller publishers. We generate revenue through fees charged to our publishers, which are generally a percentage of the value of the advertising impressions that publishers monetize on our platform.
Some key industry trends include: Continued Growth of Digital Media Across Multiple Platforms: Consumers have dramatically increased the amount of time they spend online, on mobile devices, or watching content through connected television, or CTV. Numerous activities that historically occurred offline continue to shift online.
Our Industry The digital advertising ecosystem continues to evolve and adapt at a rapid pace. Some key industry trends include: Continued Growth of Digital Media Across Multiple Platforms: Consumers have dramatically increased the amount of time they spend online, on mobile devices, or watching content through connected television, or CTV.
These three guiding elements form a social contract between employees as well as set expectations for the common behaviors we can expect from each other and inform how we treat our customers. They are infused in every aspect of our business, from employee experience and workplace culture to marketing strategies and customer success.
These three guiding elements form a social contract between employees as well as set expectations for the common behaviors we can expect from each other and inform how we treat our customers.
Our ability to meet the demands of both buyers and inventory sellers enables us to produce superior outcomes for all industry participants. 6 Table of Contents Sustained Innovation of our Cloud Platform: Our specialized cloud platform enables real-time programmatic advertising transactions in a market characterized by significant data and impression volumes, regulatory complexity, and increased focus on transparency and privacy.
Sustained Innovation of our Cloud Platform: Our specialized cloud platform enables real-time programmatic advertising transactions in a market characterized by significant data and impression volumes, regulatory complexity, and increased focus on transparency and privacy.
Most notably, these include the General Data Protection Regulation (the “GDPR”) which took effect in the European Union in May 2018, and the California Consumer Privacy Act (as amended, the “CCPA”) which took effect in January 2020.
These regulations include, most notably, the European Union’s General Data Protection Regulation (“GDPR”), which became effective in May 2018, and continues to be the subject of active regulatory guidance and enforcement, and the California Consumer Privacy Act, as amended by the California Privacy Rights Act (“CCPA”), which became effective in January 2020.
Our mission is to fuel the endless potential of Internet content creators and to enable a thriving, advertisement-funded open internet where global audiences can gain free or affordable access to information and entertainment.
ITEM 1. BUSINESS Overview PubMatic, Inc. (“we”, or “us) is an independent, artificial intelligence-powered advertising technology company that delivers digital advertising performance. Our mission is to fuel the endless potential of Internet content creators and to enable a thriving, advertisement-funded digital ecosystem where global audiences can gain free or affordable access to information and entertainment.
Consolidation and Convergence of the Digital Advertising Supply Chain: As advertisers increase the percentage of their overall advertising budgets spent on digital formats, they are increasingly demanding greater efficiency and control of their entire digital advertising supply chain. Buyers are looking to reduce operational costs, simplify their buying operations, and increase the return on ad spend or investment.
To better reach consumers, media spend continues to shift to digital formats across every media channel and device. Consolidation and Convergence of the Digital Advertising Supply Chain: As advertisers increase the percentage of their overall advertising budgets spent on digital formats, they are increasingly demanding greater efficiency and control of their entire digital advertising supply chain.
We believe the following strengths provide us with long-term competitive advantages: Global, Omnichannel Reach: We are a global business with distributed critical infrastructure and a go-to-market presence in every major advertising market in the world outside of China.
At the same time, we believe our direct publisher relationships, omnichannel header bidding capabilities, global scale, emerging solutions, and access to incremental advertiser demand through direct relationships with buyers drive superior yield for publishers. 6 Table of Contents We believe the following strengths provide us with long-term competitive advantages: Global, Omnichannel Reach: We are a global business with distributed critical infrastructure and a go-to-market presence in every major advertising market in the world outside of China.
Our workplaces have been recognized as a Great Place to Work in the United States, India, Asia, and Europe. 11 Table of Contents We have achieved these results by creating employee experiences that foster deep employee engagement built upon personal development and achievement that is supported by continuous feedback, learning, and team building.
We have achieved these results by creating employee experiences that foster deep employee engagement built upon personal development and achievement that is supported by continuous feedback, learning, and team building.
We primarily work with publishers and app developers who allow us direct access to their ad inventory, as well as select channel partners that meet our quality and scale thresholds. Our channel partners aggregate and provide further access to thousands of sites and apps from smaller publishers.
Through these customers, we generate revenue from the use of our platform for the purchase and sale of digital advertising inventory and value-added features and functionality. We primarily work with large publishers and app developers who allow us direct access to their ad inventory, as well as select channel partners that meet our quality and scale thresholds.
Outside of the United States, our privacy and data practices are subject to regulation by data protection authorities and other regulators in the countries in which we do business.
Failure to effectively adapt to these changes could expose us to regulatory investigations, enforcement actions, litigation, contractual liabilities, or reputational harm. 11 Table of Contents Outside of the United States, our privacy and data practices are subject to regulation by data protection authorities and other regulators in the countries in which we do business.
We have also demonstrated an ability to extend our header bidding infrastructure into a variety of higher-growth ad formats such as mobile web, mobile app, digital video, and most recently OTT/CTV. We believe that our specialized platform and cloud infrastructure enable us to compete favorably on the factors described above.
In addition, our infrastructure is interoperable with the major header bidding software frameworks including open source Prebid, Google’s Open Bidding, Amazon’s Transparent Ad Marketplace, and others. We have also demonstrated an ability to extend our header bidding infrastructure into a variety of higher-growth ad formats such as mobile web, mobile app, digital video, and most recently OTT/CTV.
In addition to governmental actors, including legislatures and regulatory agencies at the national and state level, there have also been a growing number of consumer-focused non-profit organizations and commercial entities advocating for privacy rights. These laws and institutions enable Internet consumers to assert their rights over the use of their online data in advertising transactions, a trend which we support.
This expansion includes provisions for private right of action, resulting in an increase in class-action litigation involving digital advertising specifically. In addition to governmental actors, including legislatures and regulatory agencies at the national and state level, there have also been a growing number of consumer-focused non-profit organizations and commercial entities advocating for privacy rights.
In California, for example, the state’s Attorney General and the California Privacy Protection Agency (“CPPA”, which is charged with CCPA rule-making and enforcement) may bring regulatory actions for violations of the CCPA. We have registered as a data broker in California with the California Attorney General.
Certain State Attorneys General in the United States may also bring enforcement actions based on comparable state laws or federal laws that permit state-level enforcement. In California, for example, the state’s Attorney General and the California Privacy Protection Agency (“CalPrivacy”, which is charged with CCPA rule-making and enforcement) may bring regulatory actions for violations of the CCPA.
We do not own media and therefore do not have a vested interest in driving ad revenue to specific media properties. We do not take a position in media or arbitrage media. Transparency is a fundamental principle of our business and we provide detailed insights of fees to our customers.
Unlike some of our competitors, we do not own media and therefore do not have a vested interest in driving ad revenue to specific media properties. We do not take a position in media or arbitrage media. Our customers can therefore be more confident that our algorithmic software decisions and our guidance are independent and unbiased.
We have maintained a demonstrated track record of stability and agility to address these regulatory and market conditions, and provide superior outcomes for both publishers and buyers. Additionally, we own and operate our proprietary software and hardware infrastructure around the world.
We have maintained a demonstrated track record of stability and agility to address these regulatory and market conditions, and provide superior outcomes for both publishers and buyers. Additionally, our early adoption of AI in our platform and products is a defining advantage for us which we expect will grow over time.
Our integrated technology platform empowers the world’s leading digital content creators (which we collectively refer to as “publishers”) across the open internet to maximize monetization of their advertising inventory.
Our platform empowers the world’s leading digital content creators (which we collectively refer to as “publishers”) to maximize monetization of their advertising inventory and audiences and provides control and transparency to buyers, which includes advertisers, agencies, agency trading desks, and demand side platforms (“DSPs”), which we collectively refer to as “buyers”.
We leverage our increasing artificial intelligence and machine learning capabilities, alongside our growing publisher and buyer relationships, to improve liquidity in our marketplace. Increasing numbers of ad impressions, increasing advertiser bids, and data proliferation provide us with many opportunities to better match sellers and buyers of ad inventory.
Increasing numbers of ad impressions, increasing number of advertiser bids, and data proliferation provide us with many opportunities to better match sellers and buyers of ad inventory. We believe that improved matching will lead to the growth of our platform and greater publisher and buyer retention.
Some jurisdictions have in recent years enacted data localization laws, which require any personal data of citizens of those jurisdictions to be stored and processed on servers located in those jurisdictions. Such laws are gaining momentum and are being enforced by local authorities.
Additional jurisdictions continue to adopt or expand comprehensive privacy regimes and the regulatory regime surrounding AI is complex and evolving. Some jurisdictions have in recent years enacted data localization laws, which require any personal data of citizens of those jurisdictions to be stored and processed on servers located in those jurisdictions.
We also generate revenues from our other products such as OpenWrap, our header bidding solution, and Connect, our solution that provides additional data and insights to buyers, which are sold separate from or in conjunction with use of our platform.
We also generate revenues from new and add-on features and functionality, such as Connect, our solution that provides additional data and insights to buyers, Activate, which allows buyers to execute direct deals on our platform across our publisher inventory, and OpenWrap, our header bidding solution.
Values: • We put the customer first. • We are biased towards action. • We are leaders and innovators. • We are committed to integrity. • We celebrate teamwork.
They are infused in every aspect of our business, from employee experience and workplace culture to marketing strategies and customer success. 12 Table of Contents Values: • We put the customer first. • We are biased towards action. • We are leaders and innovators. • We are committed to integrity. • We celebrate teamwork.
We believe that improved matching will lead to the growth of our platform and greater publisher and buyer retention. Accelerate Emerging Revenue Streams: As we grow our customer base and process increasing volumes of ad impressions and data, we gain insights into new challenges we can solve on behalf of our customers.
For example, as streaming video continues to expand and ad-supported models become more prevalent, advertising budgets have shifted from linear television to CTV. Accelerate Emerging Revenue Streams: As we grow our customer base and process increasing volumes of ad impressions and data, we gain insights into new challenges we can solve on behalf of our customers.
Pricing of digital ad impressions in the fourth quarter is likely to be higher due to increased demand, while those same impressions may be priced lower in other quarters. Our Competitive Advantage Publishers are actively seeking to maximize the value of their ad inventory, and buyers are seeking to increase advertising ROI.
Pricing of digital ad impressions in the fourth quarter is likely to be higher due to increased demand, while those same impressions may be priced lower in other quarters. As a result, our fourth quarter has historically been our strongest quarter for revenue. Accordingly, our first quarter is typically our largest for collections and publisher payments.
We continue to invest in new features for our existing solutions and emerging solutions such as our product Activate, which allows buyers to execute direct deals on our platform across publisher inventory, and Convert, our commerce media solution.
We continue to invest in new features for our existing solutions and emerging solutions such as our product Convert, our commerce media solution and AI-powered solutions for buyers and publishers. To facilitate the sale of publisher inventory, we enter into written service agreements with our buyers, including DSPs, that allow them to use our platform to buy ad inventory.
Data Privacy Framework as a mechanism to legally facilitate personal data transfers from the EU, the U.K., and Switzerland to the U.S. This new Data Privacy Framework could be subject to legal challenge in front of the Court of Justice of the European Union (“CJEU”), specifically by Max Schrems, who successfully litigated to invalidate the prior EU-U.S.
Data Privacy Framework as a mechanism to legally facilitate personal data transfers from the EU, the U.K., and Switzerland to the U.S.
We believe that strong and diverse customer teams deepen customer relationships, promote innovation, and increase productivity.
We believe that strong and diverse customer teams deepen customer relationships, promote innovation, and increase productivity. Our workplaces have been recognized as a Great Place to Work in the United States, India, Asia, and Europe.
Regulatory Compliance: A growing set of privacy regulations have introduced complexity regarding the collection, use, processing, and transmission of consumer data to the digital advertising ecosystem.
Regulatory Compliance: A rapidly expanding, evolving, and increasingly enforced set of global, federal, and state-level privacy, data protection, and consumer transparency and data governance laws and regulations has significantly increased the complexity, cost, and operational burden associated with the collection, use, processing, and transmission of data within the digital advertising ecosystem.
For example, as streaming video continues to expand and ad-supported models become more prevalent, we expect advertising budgets will shift from linear television to CTV. Monetization Excellence: We strive to continuously improve publisher revenue and advertiser ROI by investing in our technology and improving our machine learning capabilities.
Monetization Excellence: We strive to continuously improve publisher revenue and advertiser ROI by investing in our technology and improving our machine learning capabilities. We leverage our increasing artificial intelligence and machine learning capabilities, alongside our growing publisher and buyer relationships, to improve liquidity in our marketplace.
Our customers can therefore be more confident that our algorithmic software decisions and our guidance are independent and unbiased. Our trusted status has enabled us to build direct relationships with publishers, advertisers, agencies, and DSPs. Leveraging these relationships, we create bespoke products that meet our customers’ needs.
Our trusted status has enabled us to build direct relationships with publisher and buyers. Leveraging these relationships, we create bespoke products that meet our customers’ needs. Our ability to meet the demands of both buyers and inventory sellers enables us to produce superior outcomes for all industry participants.
To address these issues at scale for both publishers and buyers, we provide specialized software and hardware infrastructure to optimally power technology-driven transactions. We compete with other large SSPs, smaller private SSPs in markets around the world, and divisions of larger technology companies.
Our Competition The digital advertising ecosystem is competitive and we compete with other large SSPs, smaller private SSPs in markets around the world, and divisions of larger technology companies. While there is direct competition, we believe our AI-driven cloud infrastructure is differentiated and is a competitive advantage.
We will continue to invest in our go to market efforts to sell these new offerings such as Connect, Activate and Convert, which drives new revenues streams, and have begun to shift customers from a free to fee model for existing solutions such as OpenWrap.
We focus on creating new products that we believe address our customers’ needs, at times before the customer is aware of such need. 7 Table of Contents We will continue to invest in our go to market efforts to sell our emerging offerings such as Connect, Activate, and Convert, which drives new revenues streams, as well as our offerings such as Intelligent Yield and Access Membership.
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ITEM 1. BUSINESS Overview PubMatic, Inc. (“we”, or “us) is an independent technology company seeking to maximize customer value by delivering digital advertising’s supply chain of the future.
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Our integrated technology platform connects buyers, publishers, data providers, and commerce media networks on a single, unified platform, to deliver advertising performance, control, transparency and efficiency.
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Our platform also provides control and transparency to buyers, which includes advertisers, agencies, agency trading desks, and demand side platforms (“DSPs”) (which we collectively refer to as “buyers”) and enables both publishers and buyers to drive better business outcomes. Our Industry The digital advertising ecosystem continues to evolve and adapt at a rapid pace.
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This has resulted in a larger portion of media spend consolidating onto fewer, more capable technology platforms. Increased Focus on Performance Driven Media: As spend shifts to digital formats, media budgets are further consolidating around measurable, outcome-based media.
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To better reach consumers, every major media format has transitioned or is in the process of transitioning content from traditional or analog means of delivery to digital across every media channel and device. In addition, digital advertising continues to evolve into new areas such as commerce media, which creates new opportunities for growth.
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As a result, spend is shifting towards media channels where authenticated audiences, rich first-party data, commerce transactions, and deeper engagement enable more durable and measurable monetization.
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Automation and Data Processing: The challenges of scale and the complexity of the digital advertising ecosystem require an automated, fast, and efficient approach to purchasing ads online, known as programmatic advertising. Programmatic advertising, on an automated basis, enables buyers to purchase ad impressions on publisher supplied inventory within milliseconds in a sophisticated, technology-driven marketplace.
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These media channels include: • CTV and premium video, • Retail and commerce media, which leverages authenticated users and closed-loop attribution tied to transaction data, and • Applications designed specifically for mobile devices (e.g., mobile apps) and emerging AI-native environments that offer richer signals and higher-quality engagement than traditional browser-based surfaces.
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With header bidding, which enables a single parallel auction by a publisher with multiple interested parties simultaneously, the industry has seen a significant increase in the number of ad impressions that need to be processed and analyzed in real-time by each participant in the digital advertising ecosystem.
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Additionally, we see a shift toward increased automation and AI-driven data processing as media consumption fragments across platforms, devices, and formats. The growth of programmatic advertising, real-time bidding, header bidding, retail media, and CTV has materially increased the volume, velocity, and complexity of data generated across the advertising supply chain.
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Technology infrastructure platforms must rapidly process this data while offering a seamless digital ad experience. Companies must continue to innovate and find efficiencies in their data processing, including through the use of machine learning and artificial intelligence, to maintain pace with growing volumes of transactions to maintain profitability.
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As a result, the ability to rapidly process and act on large, diverse data sets has become foundational to effective participation in the digital advertising ecosystem while also prioritizing efficiency and user experience. Machine learning and AI have become critical to enabling this automation and increasingly power pricing, yield optimization, demand allocation, fraud detection, and performance measurement.
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Additionally, buyers want control in determining which media, content, or consumer their ad spend is being invested with to avoid appearing next to content that reflects poorly on the advertiser’s brand or purchasing fraudulent or fake inventory.
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Platforms that embed intelligent automation and AI into their core infrastructure are better positioned to scale efficiently, manage rising transaction volumes, and control unit economics, while supporting increasingly complex advertising workflows. 5 Table of Contents Data Privacy and Regulatory Challenges: There continues to be an increasing awareness of how digital user data is being leveraged to target ads, resulting in the continued expansion of privacy laws and regulations.
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This has resulted in a larger portion of media spend consolidating onto fewer, more capable technology platforms. Data Privacy and Regulatory Challenges: There is an increasing awareness of how Internet user data is being leveraged to target ads, resulting in a growing number of privacy laws and regulations.
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These laws and institutions enable consumers to assert their rights over the use of their digital data in advertising transactions, a trend which we support. Digital advertising as an industry must continue to adapt to these trends they are signals of what consumers tolerate in the wake of their digital footprint.
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The digital advertising landscape must continue to adapt to these trends and incorporate awareness of consumer privacy and compliance with applicable laws and regulations. 5 Table of Contents In addition, several companies have greatly limited the use of third-party cookies and other non-privacy safe identifiers.
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Our Digital Advertising Solutions Our platform and suite of solutions serve four primary customer types: • Publishers, primarily large omnichannel partners, across display, video, mobile web, app, and CTV, • Buyers, including DSPs, agency holding companies, independent agencies, and advertisers, mostly for brand-oriented spend, • Data partners and curators that leverage our platform for activation, measurement, and privacy-safe audience solutions, and • Retail and commerce media participants using our platform for onsite monetization today and offsite monetization in the future.
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We believe the “Open Internet” outside the “walled gardens” (a colloquial term that refers to closed advertising platforms such as Google and Meta) will shift from targeting by anonymized and invisible third-party cookies or identifiers to known identities based on consumer choice and opt-in.
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These solutions, among many others, are sold separately from or in conjunction with use of our platform. We are also investing in AI products that are creating incremental revenue streams such as Intelligent Yield for publishers, which uses adaptive learning models to automate pricing and improve auction efficiency.
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We expect this shift towards significantly more reliable and accurate consumer identity will create short term disruption but could have the potential to significantly increase advertiser return on investment (“ROI”) and therefore publisher revenue in the long run. Our Digital Advertising Solutions We generate revenue from the use of our platform for the purchase and sale of digital advertising inventory.
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We also enter into supply path optimization (“SPO”) agreements directly with both advertisers and agencies through various arrangements to increase the volume of ad spend on our platform.

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Item 1A. Risk Factors

Risk Factors — what could go wrong, per management

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Biggest changeThe most commonly used Internet browsers allow consumers to modify their browser settings to block first-party cookies (placed directly by the publisher or website owner that the consumer intends to interact with) or third-party cookies (placed by parties, like us, that have no direct relationship with the consumer), and some browsers block third-party cookies by default, through browser-based global privacy controls (also known as universal opt out mechanisms), which are newly available as a result of changes to US state privacy laws . 16 Table of Contents Some consumers also download “ad blocking” software on their computers or mobile devices, not only for privacy reasons, but also to counteract the adverse effect advertisements can have on the consumer experience, including increased load times, data consumption, and screen overcrowding.
Biggest changeThe most commonly used Internet browsers allow consumers to modify their browser settings to block first-party cookies (placed directly by the publisher or website owner that the consumer intends to interact with) or third-party cookies (placed by parties, like us, that have no direct relationship with the consumer), and some browsers block third-party cookies by default, or implement browser-level or operating system level privacy controls (including global privacy control or similar mechanisms) that may restrict data collection or use, as a result of changes to a growing list of US state privacy laws.
Some of these self-regulatory bodies have the ability to discipline members or participants, which could result in fines, penalties, and/or public censure (which could in turn cause reputational harm) being imposed on us. Additionally, some of these self-regulatory bodies might refer violations of their requirements to the U.S. Federal Trade Commission or other regulatory bodies.
Some of these self-regulatory bodies have the ability to discipline members or participants, which could result in fines, penalties, and/or public censure (which could in turn cause reputational harm) being imposed on us. Additionally, some of these self-regulatory bodies might refer violations of their requirements to the U.S. Federal Trade Commission or other regulatory bodies.
We contractually require our publishers, buyers, data providers, and partners to abide by relevant laws, rules and regulations, and restrictions by their counterparties, when transacting on our platform, and we generally attempt to obtain representations from buyers that the advertising they place through our platform complies with applicable laws and regulations and does not violate third-party intellectual property rights, and from publishers about the quality and characteristics of the impressions they provide.
We contractually require our customers, publishers, buyers, data providers, and partners to abide by relevant laws, rules and regulations, and restrictions by their counterparties, when transacting on our platform, and we generally attempt to obtain representations from buyers that the advertising they place through our platform complies with applicable laws and regulations and does not violate third-party intellectual property rights, and from publishers about the quality and characteristics of the impressions they provide.
These provisions include: • a provision that our board of directors will be classified into three classes of directors with staggered three-year terms at such time as the outstanding shares of our Class B common stock represent less than a majority of the combined voting power of our common stock, which could delay the ability of stockholders to change the membership of our board; • the ability of our board to issue shares of preferred stock without stockholder approval, which could be used to significantly dilute the ownership of a hostile acquirer; • a prohibition on stockholder action by written consent effective upon such time as the outstanding shares of our Class B common stock represent less than a majority of the combined voting power of our common stock; • the requirement that a special meeting of stockholders may be called only by the chairman of the board, our chief executive officer, our lead director, or a majority of our board; • the requirement for the affirmative vote of holders of at least 66-2/3% of the voting power of all of the then outstanding shares of the voting stock, voting together as a single class, to amend provisions of our restated certificate of incorporation or our restated bylaws; • the ability of our board to amend the bylaws, which may allow it to take additional actions to prevent an unsolicited takeover and inhibit the ability of an acquirer; • the requirement that stockholders submitting notice of a nomination or proposal to be considered at an annual meeting of our stockholders must have continuously beneficially owned at least 1% of our outstanding common stock for a period of one year before giving such notice; • advance notice procedures with which stockholders must comply to nominate candidates to our board or to propose matters to be acted upon at a stockholders’ meeting; and • the dual class common stock structure in which holders of our Class B common stock have the ability to control the outcome of matters requiring stockholder approval, even if they own significantly less than a majority of the outstanding shares of our common stock, including the election of directors and significant corporate transactions, such as a merger or other sale of our company or its assets.
These provisions include: • a provision that our board of directors will be classified into three classes of directors with staggered three-year terms at such time as the outstanding shares of our Class B common stock represent less than a majority of the combined voting power of our common stock, which could delay the ability of stockholders to change the membership of our board; • the ability of our board to issue shares of preferred stock without stockholder approval, which could be used to significantly dilute the ownership of a hostile acquirer; • a prohibition on stockholder action by written consent effective upon such time as the outstanding shares of our Class B common stock represent less than a majority of the combined voting power of our common stock; • the requirement that a special meeting of stockholders may be called only by the chairman of the board, our chief executive officer, our lead director, or a majority of our board; • the requirement for the affirmative vote of holders of at least 66-2/3% of the voting power of all of the then outstanding shares of the voting stock, voting together as a single class, to amend provisions of our restated certificate of incorporation or our restated bylaws; • the ability of our board to amend the bylaws, which may allow it to take additional actions to prevent an unsolicited takeover and inhibit the ability of an acquirer; • the requirement that stockholders submitting notice of a nomination or proposal to be considered at an annual meeting of our stockholders must have continuously beneficially owned at least 1% of our outstanding common stock for a period of one year before giving such notice; 43 Table of Contents • advance notice procedures with which stockholders must comply to nominate candidates to our board or to propose matters to be acted upon at a stockholders’ meeting; and • the dual class common stock structure in which holders of our Class B common stock have the ability to control the outcome of matters requiring stockholder approval, even if they own significantly less than a majority of the outstanding shares of our common stock, including the election of directors and significant corporate transactions, such as a merger or other sale of our company or its assets.
Our results of operations may fluctuate significantly and may not meet our expectations or those of securities analysts and investors. We operate in an evolving industry with ever-changing customer needs, and, as a result, our business has evolved over time such that our operating history makes it difficult to evaluate our business and future prospects.
Our results of operations may fluctuate significantly and may not meet our expectations or those of securities analysts and investors. We operate in an evolving industry with ever-changing customer needs and behavior, and, as a result, our business has evolved over time such that our operating history makes it difficult to evaluate our business and future prospects.
The costs and risks inherent in conducting business internationally include, but are not limited to: • difficulties and costs associated with maintaining effective controls at foreign locations; • adapting our platform and solutions to non-U.S. publishers’ preferences and customs; • regulatory and other delays and difficulties in setting up foreign operations, including difficulties in hiring personnel with skill sets and experience that match our international expansion efforts; • compliance with anti-bribery laws and regulations, export and import control and economic sanctions, laws and regulations; • compliance with foreign data privacy laws; • compliance with domestic and foreign bulk data transfer laws; • economic and political instability in some countries, including as a result of the conflict in Ukraine or a resumption of the conflict between Israel and Palestine; • trade disputes among countries, and changes in international trade volumes or pricing; and • compliance with the laws of numerous taxing jurisdictions.
The costs and risks inherent in conducting business internationally include, but are not limited to: • difficulties and costs associated with maintaining effective controls at foreign locations; • foreign currency fluctuations and controls; • adapting our platform and solutions to non-U.S. publishers’ preferences and customs; • regulatory and other delays and difficulties in setting up foreign operations, including difficulties in hiring personnel with skill sets and experience that match our international expansion efforts; • compliance with anti-bribery laws and regulations, export and import control and economic sanctions, laws and regulations; • compliance with foreign data privacy laws; • compliance with domestic and foreign bulk data transfer laws; • economic and political instability in some countries, including as a result of the conflict in Ukraine or a resumption of the conflict between Israel and Palestine; • trade disputes among countries, and changes in international trade volumes or pricing; and • compliance with the laws of numerous taxing jurisdictions.
Expanding our platform infrastructure and the number of ad impressions we can process requires resource commitment over a period of months or years, and we may not be able to scale quickly enough if demand increases rapidly as short-term solutions may be too costly or unavailable.
Expanding our platform infrastructure and the number of ad impressions we can process requires resource commitment over a period of months or years, and we may not be able to scale quickly or efficiently enough if demand increases rapidly as short-term solutions may be too costly or unavailable.
Some prominent technology companies, including Google, have previously announced intentions to discontinue the use of third-party cookies, and to develop alternative methods and mechanisms for targeting advertisements, though the expected timeline for such changes is difficult to predict and has changed over time.
Some prominent technology companies, including Google, previously announced intentions to discontinue the use of third-party cookies, and to develop alternative methods and mechanisms for targeting advertisements, though the expected timeline for such changes is difficult to predict and has changed over time.
In addition, we may have responsibility for some acts or omissions of publishers, buyers, or partners transacting business through our platform under applicable laws or regulations or as a result of common law duties, even if we have not assumed responsibility contractually.
In addition, we may have responsibility for some acts or omissions of customers, publishers, buyers, or partners transacting business through our platform under applicable laws or regulations or as a result of common law duties, even if we have not assumed responsibility contractually.
Additionally, AI applications generally state they do not use personal data or other classes of protected data, but we may not know the source of data used by an AI application and may inadvertently incorporate personal information, or data derived from personal data, in the course of using an AI application.
AI applications generally state they do not use personal data or other classes of protected data, but we may not know the source of data used by an AI application and may inadvertently incorporate personal information, or data derived from personal data, in the course of using an AI application.
Additionally, if our data, privacy, or consent practices are found to be inadequate, or we make errors in the deployment of existing and future policies or safeguards, we may be subject to regulatory enforcement action or named in class-action lawsuits.
Additionally, if our data, privacy, or consent practices are found to be inadequate, or we make errors in the deployment of existing and future policies or technical safeguards, we may be subject to regulatory enforcement action or named in class-action lawsuits.
If we cannot retain or add individual publishers with valuable ad impressions, or if such publishers decide not to make their valuable ad impressions available to us, then our buyers may be less inclined to use our platform, which could adversely affect our business, results of operations, and financial condition. 13 Table of Contents A limited number of large demand side platforms (“DSPs”) – The Trade Desk and Google DV360 in particular – account for a significant portion of the ad impressions purchased on our platform.
If we cannot retain or add individual publishers with valuable ad impressions, or if such publishers decide not to make their valuable ad impressions available to us, then our buyers may be less inclined to use our platform, which could adversely affect our business, results of operations, and financial condition. 14 Table of Contents A limited number of large demand side platforms (“DSPs”) – The Trade Desk and Google DV360 in particular – account for a significant portion of the ad impressions purchased on our platform.
As we rely heavily on our data center facilities, computer and communications systems, and the Internet to conduct our business and provide high-quality customer service, these disruptions could negatively impact our ability to operate our business and either directly or indirectly disrupt publishers’ and partners’ businesses, which could adversely affect our business, results of operations, and financial condition. 25 Table of Contents We use artificial intelligence in our business, and challenges with properly managing its use could result in reputational harm, competitive harm, and legal liability, and adversely affect our results of operations.
As we rely heavily on our data center facilities, computer and communications systems, and the Internet to conduct our business and provide high-quality customer service, these disruptions could negatively impact our ability to operate our business and either directly or indirectly disrupt publishers’ and partners’ businesses, which could adversely affect our business, results of operations, and financial condition. 29 Table of Contents We use artificial intelligence in our business, and challenges with properly managing its use could result in reputational harm, competitive harm, and legal liability, and adversely affect our results of operations.
The publishers, buyers, and partners engaging in transactions through our platform impose various requirements upon each other, and they and the underlying advertisers are subject to regulatory requirements by governments and standards bodies applicable to their activities.
The customers, publishers, buyers, and partners engaging in transactions through our platform impose various requirements upon each other, and they and the underlying advertisers are subject to regulatory requirements by governments and standards bodies applicable to their activities.
Moreover, any decrease in the use of the advertising channels that we primarily depend on, or failure to expand into emerging channels, could adversely affect our business, results of operations, and financial condition.
Moreover, any decrease in the use of the advertising channels or formats that we primarily depend on, or failure to expand into emerging channels or formats, could adversely affect our business, results of operations, and financial condition.
Moreover, we are unable to prevent DSPs from aggregating bid requests from publishers and directing it to their own buying platforms or even reselling such bid data to advertisers or third parties. 24 Table of Contents If publishers, buyers, data providers, or partners fail to abide by relevant laws, rules and regulations, or contractual requirements when transacting over our platform, or after such a transaction is completed, we could potentially face liability to consumers for such misuse.
Moreover, we are unable to prevent DSPs from aggregating bid requests from publishers and directing it to their own buying platforms or even reselling such bid data to advertisers or third parties. 28 Table of Contents If publishers, buyers, data providers, or partners fail to abide by relevant laws, rules and regulations, or contractual requirements when transacting over our platform, or after such a transaction is completed, we could potentially face liability to consumers for such misuse.
Additionally, the process of obtaining patent protection is expensive and time-consuming, and we may not be able to prosecute all necessary or desirable patent applications at a reasonable cost or in a timely manner. 33 Table of Contents We cannot guarantee that others will not independently develop technology with the same or similar functions to our proprietary technology that we rely on to conduct our business and differentiate ourselves from our competitors.
Additionally, the process of obtaining patent protection is expensive and time-consuming, and we may not be able to prosecute all necessary or desirable patent applications at a reasonable cost or in a timely manner. 38 Table of Contents We cannot guarantee that others will not independently develop technology with the same or similar functions to our proprietary technology that we rely on to conduct our business and differentiate ourselves from our competitors.
If we are unable to obtain or maintain rights to any of this technology because of intellectual property infringement claims brought by third parties against our suppliers and licensors or against us, or if we are unable to continue to obtain the technology or enter into new agreements on commercially reasonable terms, our ability to operate and expand our business could be adversely affected. 34 Table of Contents Our platform relies on third-party open source software components.
If we are unable to obtain or maintain rights to any of this technology because of intellectual property infringement claims brought by third parties against our suppliers and licensors or against us, or if we are unable to continue to obtain the technology or enter into new agreements on commercially reasonable terms, our ability to operate and expand our business could be adversely affected. 39 Table of Contents Our platform relies on third-party open source software components.
Online political advertising laws are rapidly evolving, and our publishers may impose restrictions on receiving political advertising, especially in light of recent elections both in the United States and in foreign jurisdictions.
Online political advertising laws are rapidly evolving, and our publishers may impose restrictions on receiving political advertising, especially in light of recent elections both in the United States, EU. and in foreign jurisdictions.
We may assume responsibility for satisfying or facilitating the satisfaction of some of these requirements through the contracts we enter into with publishers, buyers, and partners.
We may assume responsibility for satisfying or facilitating the satisfaction of some of these requirements through the contracts we enter into with customers, publishers, buyers, and partners.
As of December 31, 2024, we had no outstanding borrowings under our Senior Secured Credit Facilities Credit Agreement (the “Credit Agreement”) with Silicon Valley Bank (“SVB”). Borrowings under the Credit Agreement are secured by substantially all of our assets. The Credit Agreement contains customary representations and warranties as well as customary affirmative and negative covenants.
As of December 31, 2025, we had no outstanding borrowings under our Senior Secured Credit Facilities Credit Agreement (the “Credit Agreement”) with Silicon Valley Bank (“SVB”). Borrowings under the Credit Agreement are secured by substantially all of our assets. The Credit Agreement contains customary representations and warranties as well as customary affirmative and negative covenants.
This concentrated control will limit or preclude your ability to influence corporate matters for the foreseeable future, including the election of directors, amendments of our organizational documents, and any merger, consolidation, sale of all or substantially all of our assets, or other major corporate transaction requiring stockholder approval.
This concentrated control will limit or preclude investors’ ability to influence corporate matters for the foreseeable future, including the election of directors, amendments of our organizational documents, and any merger, consolidation, sale of all or substantially all of our assets, or other major corporate transaction requiring stockholder approval.
If our ability to use cookies, mobile advertising identifiers or other tracking technologies is limited as a result of consumers rejecting targeted advertising, we may be required to develop or obtain additional applications and technologies to compensate for the lack of cookies, mobile advertising identifiers and other tracking technology data, which may not be available to us or could be time consuming or costly to develop, less effective, and subject to additional regulation.
If our ability to use cookies, mobile advertising identifiers or other tracking technologies is limited as a result of consumers rejecting targeted advertising, we may be required to develop or obtain additional applications and technologies to compensate for the lack of cookies, mobile advertising identifiers and other tracking technology data, which may not be available to us or could be time consuming or costly to develop, less effective than current services, and subject to additional regulation.
As we expand and change, in particular across multiple geographies or following acquisitions, it may be difficult to preserve our corporate culture, which could increase employee turnover or reduce our ability to innovate, create, and operate effectively.
As we expand and evolve, in particular across multiple geographies or following acquisitions, it may be difficult to preserve our corporate culture, which could increase employee turnover or reduce our ability to innovate, create, and operate effectively.
Any failure to accurately report and present our non-GAAP financial measures and key metrics could cause investors to lose confidence in our reported financial and other information, which could have a negative effect on the trading price of our Class A common stock. Our credit agreement contains operating and financial covenants that may restrict our business and financing activities.
Any failure to accurately report and present our non-GAAP financial measures and key metrics could cause investors to lose confidence in our reported financial and other information, which could have a negative effect on the trading price of our Class A common stock. 40 Table of Contents Our credit agreement contains operating and financial covenants that may restrict our business and financing activities.
Although we believe we have made and will continue to make reasonable estimates and judgments, the ultimate outcome of any particular issue may differ from the amounts previously recorded in our financial statements and any such occurrence could adversely affect our business, results of operations, and financial condition. Tax changes could affect our effective tax rate and future profitability.
Although we believe we have made and will continue to make reasonable estimates and judgments, the ultimate outcome of any particular issue may differ from the amounts previously recorded in our financial statements and any such occurrence could adversely affect our business, results of operations, and financial condition. 41 Table of Contents Tax changes could affect our effective tax rate and future profitability.
If we were to be found responsible for such a violation, it could adversely affect our reputation, as well as our business, results of operations, and financial condition. 29 Table of Contents Legal uncertainty and industry unpreparedness for new regulations may mean substantial disruption and inefficiency, demand constraints, and reduced inventory supply and value.
If we were to be found responsible for such a violation, it could adversely affect our reputation, as well as our business, results of operations, and financial condition. Legal uncertainty and industry unpreparedness for new regulations may mean substantial disruption and inefficiency, demand constraints, and reduced inventory supply and value.
Reductions in overall advertising spending due to these factors could make it difficult to predict our revenue and could adversely affect our business, results of operations, and financial condition. If our existing customers do not expand their usage of our platform, or if we fail to attract new publishers and buyers, our growth will suffer.
Reductions in overall advertising spending due to these factors or other factors could make it difficult to predict our revenue and could adversely affect our business, results of operations, and financial condition. If our existing customers do not expand their usage of our platform, or if we fail to attract new customers, our growth will suffer.
A significant natural disaster could have a material adverse effect on our business, results of operations, and financial condition, and our insurance coverage may be insufficient to compensate us for losses that may occur. We have one office and one data center facility located in California, a state known for seismic activity.
A significant natural disaster could have a material adverse effect on our business, results of operations, and financial condition, and our insurance coverage may be insufficient to compensate us for losses that may occur. We have office and data center facilities located in California, a state known for seismic activity.
Moreover, events such as the closure of SVB, in addition to other global macroeconomic conditions, may cause further disruptions and uncertainty in the capital markets. 36 Table of Contents Our tax liabilities may be greater than anticipated. The U.S. and non-U.S. tax laws applicable to our business activities are subject to interpretation and change.
Moreover, events such as the closure of SVB, in addition to other global macroeconomic conditions, may cause further disruptions and uncertainty in the capital markets. Our tax liabilities may be greater than anticipated. The U.S. and non-U.S. tax laws applicable to our business activities are subject to interpretation and change.
On February 22, 2024, our board of directors authorized an increase and extension to the 2023 Repurchase Program from $75.0 million to $175.0 million through December 31, 2025 (the “2024 Repurchase Program”).
On February 22, 2024, our board of directors authorized an increase and extension to the 2023 Repurchase Program from $75.0 million to $175.0 million through December 31, 2025.
In such an event, consumers may look to PubMatic to recover any alleged damages as a result of publishers’ use of limitations or disclaimers of liability through their terms of use with consumers.
In such an event, consumers may look to us to recover any alleged damages as a result of publishers’ use of limitations or disclaimers of liability through their terms of use with consumers.
The 2024 Repurchase Program may be modified, suspended, or terminated at any time, and we cannot guarantee that the 2024 Repurchase Program will be fully consummated or that it will enhance long-term stockholder value.
The 2023 Repurchase Program may be modified, suspended, or terminated at any time, and we cannot guarantee that the 2023 Repurchase Program will be fully consummated or that it will enhance long-term stockholder value.
Such macroeconomic factors, as well as broader economic downturns, recessions, inflation, further changes in interest rates or foreign exchange rates or any supply chain disruptions, changes in the tax treatment of advertising expenses, or general uncertainty, in North America, Europe, and Asia, where we do most of our business; could adversely affect our business, results of operations, and financial condition.
Such macroeconomic factors, as well as broader economic downturns, recessions, transnational trade wars or disruptions, inflation, further volatility in interest rates or foreign exchange rates or any supply chain disruptions, changes in the tax treatment of advertising expenses, or general financial uncertainty in North America, Europe, and Asia, where we do most of our business; could adversely affect our business, results of operations, and financial condition.
Market pressure may reduce our revenue per impression. Our revenue can be affected by market changes, new demands by publishers and buyers, new solutions, and competitive pressure. Our solutions may be priced too high or too low, or our pricing approaches may not be accepted, any of which may carry adverse consequences to our business and results of operations.
Our revenue can be affected by market changes, new demands by publishers and buyers, new solutions, and competitive pressure. Our solutions may be priced too high or too low, or our pricing approaches may not be accepted, any of which may carry adverse consequences to our business and results of operations.
Export Administration Regulations and the various sanctions programs administered by the U.S. Department of the 32 Table of Contents Treasury’s Office of Foreign Assets Control (collectively, “Trade Controls”). U.S. Trade Controls may prohibit the shipment of specified products and services to certain countries, governments, and persons.
Export Administration Regulations and the various sanctions programs administered by the U.S. Department of the Treasury’s Office of Foreign Assets Control (collectively, “Trade Controls”). U.S. Trade Controls may prohibit the shipment of specified products and services to certain countries, governments, and persons.
In the future, we or our third-party service providers may experience social engineering, ransomware, phishing, malware and similar attacks and threats of denial-of-service 31 Table of Contents attacks and such attacks could have a material adverse effect on our operations and financial condition.
In the future, we or our third-party service providers may experience social engineering, ransomware, phishing, malware and similar attacks and threats of denial-of-service attacks and such attacks could have a material adverse effect on our operations and financial condition.
We have no minimum commitments from buyers to spend on our platform, so the amount of demand available to us can change at any time with little or no prior notice, and we cannot assure you that we will have access to a consistent volume or quality of ad campaigns or demand for our ad impressions at a reasonable price, or at all.
We have no minimum commitments from buyers to spend on our platform, so the amount of demand available to us can change at any time with little or no prior notice, and we cannot provide assurance that we will have access to a consistent volume or quality of ad campaigns or demand for our ad impressions at a reasonable price, or at all.
We need to continuously update our platform and the technology we invest in and develop, including our machine learning and other proprietary algorithms, in order to attract publishers and buyers and keep ahead of changes in technology, evolving industry standards and a rapidly changing regulatory environment.
We need to continuously update our platform and the technology we invest in and develop, including our machine learning and other proprietary algorithms, in order to attract customers and keep ahead of changes in technology, evolving industry standards and a rapidly changing regulatory environment.
As regulators start to enforce a stricter approach (which has already begun to occur in Germany, where data protection authorities have initiated a probe on third-party cookies), this could lead to substantial costs, require significant systems changes, limit the effectiveness of our marketing activities, divert the attention of our technology personnel, adversely affect our margins, increase costs, and subject us to additional liabilities.
As regulators start to enforce a stricter approach (which has already begun to occur in multiple EU member states, where data protection authorities have initiated a probe on third-party cookies), this could lead to substantial costs, require significant systems changes, limit the effectiveness of our marketing activities, divert the attention of our technology personnel, adversely affect our margins, increase costs, and subject us to additional liabilities.
Sales of a substantial number of shares of our Class A common stock into the public market, particularly sales by our directors and executive officers, or the perception that these sales might occur, could cause the market price of our Class A common stock to decline and may make it more difficult for you to sell your common stock at a time and price that you deem appropriate.
Sales of a substantial number of shares of our Class A common stock into the public market, particularly sales by our directors and executive officers, or the perception that these sales might occur, could cause the market price of our Class A common stock to decline and may make it more difficult for shareholders to sell shares of our Class A common stock at a time and price they deem appropriate.
In addition, the conflict in Ukraine and the resumption of the conflict in Israel could cause unpredictable economic effects in Europe and EMEA, including potentially softening general consumer demand. Such conflicts have increased costs of labor and other items impacting our cost of revenue, and these conflicts and potential others may do so in the future.
In addition, the conflict in Ukraine and the resumption of the conflict in Israel could cause unpredictable economic effects in Europe and EMEA, including potentially softening general consumer demand. Such conflicts may increase costs of labor and other items impacting our cost of revenue, and these factors and potential others may do so in the future.
Although our board of directors authorized the 2024 Repurchase Program, the program does not obligate us to repurchase any specific dollar amount or to acquire any specific number of shares of our Class A common stock.
Although our board of directors authorized the 2025 Repurchase Program Extension, the program does not obligate us to repurchase any specific dollar amount or to acquire any specific number of shares of our Class A common stock.
Our results of operations have fluctuated in the past, and future results of operations are likely to fluctuate as well. Although we have experienced prolonged revenue growth, we may not be able to sustain our historical growth rate, current revenue levels, or profitability.
Our results of operations have fluctuated in the past, and future results of operations are likely to fluctuate as well. Although we have experienced periods of prolonged revenue growth, we may not be able to sustain a consistent growth rate, current revenue levels, or profitability.
In addition, new demands from publishers and buyers, superior offerings by competitors, changes in technology, or new industry standards or regulatory requirements could render our platform or our existing solutions less effective and require us to make unanticipated changes to our platform or business model.
In addition, new demands from customers, superior offerings by competitors, changes in technology or format, or new industry standards or regulatory requirements could render our platform or our existing solutions less effective and require us to make unanticipated changes to our platform or business model.
We expect to face challenges, risks, and difficulties frequently experienced by growing companies in rapidly developing industries, including those relating to: • changes in demand and pricing for ad impressions sold on our platform; • changes in our access to valuable ad impressions from publishers; • responding to evolving industry standards and government regulations that impact our business, particularly in the areas of data protection and consumer privacy; • developing, maintaining, and expanding relationships with publishers, DSPs, agencies, advertisers, and buyers; • seasonality in our business; • innovating and developing new solutions that are adopted by and meet the needs of publishers, DSPs, agencies, advertisers, and buyers; • competing against companies with a larger customer base or greater financial or technical resources; • changes in the structure of the buying and selling of ad impressions; • changes in the pricing policies of publishers and competitors; • changes in demand due to changes in macroeconomic environment, including as a result of an economic downturn, recession, inflation, changes in interest rates or foreign exchange rates, disruptions to supply chains, or otherwise; • further expanding our business internationally; and • recruiting, integrating, and retaining qualified and motivated employees, particularly engineers.
We expect to face challenges, risks, and difficulties frequently experienced by growing companies in rapidly developing industries, including those relating to: • changes in demand and pricing for ad impressions sold on our platform; • changes in our access to valuable ad impressions from publishers; • responding to evolving industry standards and government regulations that impact our business, particularly in the areas of data protection and consumer privacy; • developing, maintaining, and expanding relationships with publishers, DSPs, agencies, advertisers, and buyers; • seasonality in our business; • changes in demand due to real or perceived economic stagnation or recession in certain markets; • innovating and developing new solutions that are adopted by and meet the needs of publishers, DSPs, agencies, advertisers, and buyers; • competing against companies with a larger customer base or greater financial or technical resources; • changes in the structure of the buying and selling of ad impressions; • changes in demand for certain formats of ad impressions; • changes in the pricing policies of publishers and competitors; • changes in the bidding behavior of buyers of ad impressions; • changes in demand due to changes in macroeconomic environment, including as a result of an economic downturn, recession, inflation, volatility in interest rates or foreign exchange rates, disruptions to supply chains, disruptions to global trade, or otherwise; 15 Table of Contents • further expanding our business internationally; and • recruiting, integrating, and retaining qualified and motivated employees, particularly engineers.
The demands on our platform infrastructure have increased over time due to, among other factors, the addition of new solutions, such as our Activate or Convert offerings, the need to support evolving advertising formats, the handling and increased use of large amounts of data, and overall growth in impressions.
The demands on our platform infrastructure have increased over time due to, among other factors, the addition of new solutions, such as our Activate or Commerce Media offerings, the need to support evolving advertising formats, the handling and increased use of large amounts of data, support of AI-enabled offerings, and overall growth in impressions.
In addition, if we are unable to continue to meet these requirements, we may not be able to remain listed on the Nasdaq Global Market. In addition to our results determined in accordance with GAAP, we believe certain non-GAAP measures and key metrics may be useful in evaluating our operating performance.
If we are unable to continue to meet the reporting requirements per the SEC and SOX, we may not be able to remain listed on the Nasdaq Global Market. In addition to our results determined in accordance with GAAP, we believe certain non-GAAP measures and key metrics may be useful in evaluating our operating performance.
Maintaining and upgrading our capabilities associated with ad quality and inventory quality is complex and costly. Maintaining high-quality inventory may become increasingly difficult with the advent and proliferation of “deep fake” video and other media produced using artificial intelligence (“AI”).
Maintaining and upgrading our capabilities associated with ad quality and inventory quality is complex and costly. Maintaining high-quality inventory may become increasingly difficult with the advent and proliferation of “deep fake” video and other media produced using AI.
We cannot assure you that we will not experience bad debt in the future, and write-offs for bad debt could adversely affect our business, results of operations, and financial condition in the periods in which the write-offs occur.
We cannot provide assurance that we will not experience bad debt in the future, and write-offs for bad debt could adversely affect our business, results of operations, and financial condition in the periods in which the write-offs occur.
There is also increased regulatory focus on the use of geolocation data that aims to limit what can be collected, what kind of consent may be required with respect to the same, and how such data may be used, exchanged, or disclosed to others.
There is also increased regulatory focus on the use of geolocation data that aims to limit what can be collected, what kind of consent may be required with respect to the same, and how such data may be used, exchanged, or disclosed to others. In the United States, the U.S.
Even if the market for these offerings develops as we anticipate, publishers and buyers might not embrace our offerings to the degree we expect due to various factors such as inertia from usage of existing implementations of competitive products.
Even if the market for these offerings develops as we anticipate, publishers and buyers might not embrace our offerings to the degree we expect due to various factors such as inertia from usage of existing implementations of competitive products or technological advances by our competitors.
That demand may not materialize and, even if it does so, we may not be able to take advantage of that increased demand if we cannot scale our offerings in a timely manner or if the demand for one of our offerings cannibalizes the demand for other products we offer.
That demand may not materialize and, even if it does, we may not be able to take advantage of that increased demand if we cannot scale our offerings in a timely manner or if the demand for one of our offerings cannibalizes the demand for another product we offer.
There is a finite number of large publishers and buyers in our target markets, and any consolidation of publishers or buyers may give the resulting enterprises greater bargaining power or result in the loss of publishers and buyers that use our platform, reducing our potential base of publishers and buyers, each of which would lead to erosion of our revenue and financial condition.
There is a finite number of large publishers and buyers in our target markets, and any consolidation of publishers or buyers may give the resulting enterprises greater bargaining power or result in the loss of publishers and buyers that use our platform, reducing our potential base of publishers and buyers, each of which would lead to erosion of our revenue and financial condition. 22 Table of Contents Market pressure may reduce our revenues.
In addition, cyberattack techniques are constantly evolving and becoming increasingly diverse and sophisticated, and could involve denial-of-service attacks or other maneuvers that have the effect of disrupting the availability of services on our platform. 22 Table of Contents Other types of cyberattacks could harm us even if our platform operations are left undisturbed.
In addition, cyberattack techniques are constantly evolving and becoming increasingly diverse and sophisticated as attackers deploy AI, and could involve denial-of-service attacks or other maneuvers that have the effect of disrupting the availability of services on our platform. Other types of cyberattacks could harm us even if our platform operations are left undisturbed.
We use “cookies,” or small text files placed on consumer devices when an Internet browser is used, as well as mobile advertising identifiers, to gather data that enables our platform to better serve our customers.
We use “cookies,” or small text files placed on consumer devices when an Internet browser is used, as well as mobile advertising identifiers, and other permitted tracking or contextual signals to gather data that enables our platform to better serve our customers.
To address these issues at scale for both buyers and sellers, we provide specialized software and hardware infrastructure to optimally power technology-driven transactions. To successfully grow our business, we compete with SSPs like Magnite, Inc., smaller private SSPs in markets around the world, as well as divisions of larger companies like Google.
To address these issues at scale for both buyers and sellers, we provide specialized software and hardware infrastructure to optimally power technology-driven transactions. To successfully grow our business, we compete with a range of SSPs, including large, publicly-traded SSPs and smaller private SSPs in markets around the world, as well as divisions of larger companies like Google.
Further, compliance program design and implementation will be an ongoing process as understanding of the CCPA, CPRA, GDPR, UK GDPR, increasing numbers of U.S. state privacy laws, or other emerging regulations and industry compliance standards, evolves and companies address sometimes conflicting compliance guidance.
Further, compliance program design and implementation will be an ongoing process as understanding of the CCPA, CPRA, GDPR, UK GDPR, increasing numbers of U.S. state privacy laws, or other emerging regulations and industry compliance standards (such as those related to the use of Artificial Intelligence), evolves and companies address sometimes conflicting compliance guidance.
The Delete Act requires the CPPA to establish an accessible data deletion mechanism by January 1, 2026, to allow California consumers to submit a single verifiable consumer request to delete their data across all data brokers.
The Delete Act has required CalPrivacy to establish an accessible data deletion mechanism by January 1, 2026, to allow California consumers to submit a single verifiable consumer request to delete their data across all data brokers.
If we fail to do so, or doing so becomes too costly, we may limit our ability to process ad impressions, and we may lose revenue. Our business depends on processing advertising impressions in milliseconds, and we must handle an increasingly large volume of such transactions.
We must scale our platform infrastructure to support anticipated growth and transaction volume. If we fail to do so, or doing so becomes too costly, we may limit our ability to process ad impressions, and we may lose revenue. Our business depends on processing advertising impressions in milliseconds, and we must handle an increasingly large volume of such transactions.
In addition, we charge fees to publishers for use of our platform, and we may decide to offer discounts or other pricing concessions in order to attract more inventory or demand, or to compete effectively with other providers that have different or lower pricing structures and may be able to undercut our pricing due to greater scale or other factors.
In addition, we may decide to offer discounts or other pricing concessions in order to attract more inventory or demand, or to compete effectively with other providers that have different or lower pricing structures and may be able to undercut our pricing due to greater scale or other factors.
In addition to California, over a third of U.S. states have enacted regulations that may apply to our business, and we expect more state legislatures or regulatory agencies to do the same.
In addition to California, approximately 20 U.S. states have enacted regulations that may apply to our business, and we expect more state legislatures or regulatory agencies to do the same.
These and other factors may make it difficult for us to increase our business with our publishers and buyers, cause some buyers to reduce their spending with us, or increase our costs of doing business, which could adversely affect our business, results of operations, and financial condition.
These and other factors may make it difficult for us to increase our business with our publishers and buyers, cause some buyers to reduce their spending with us, or increase our costs of doing business, which could adversely affect our business, results of operations, and financial condition. We generally do not have minimum commitments from publishers.
Any one or more of the factors above may result in significant fluctuations in our results of operations. You should not rely on our past results as an indicator of our future performance.
Any one or more of the factors above may result in significant fluctuations in our results of operations. Past results should not be relied upon as an indicator of our future performance.
A decline in the market for programmatic advertising or the failure of that market to grow as expected could also adversely affect our business, results of operations, and financial condition. If ad formats and digital device types develop in ways that prevent advertisements from being delivered to consumers, our business, results of operations, and financial condition may be adversely affected.
A decline in the market for programmatic advertising or the failure of that market to grow as expected could also adversely affect our business, results of operations, and financial condition. If changes in ad formats, delivery mechanisms, or platform policies prevent advertisements from being delivered to consumers, our business, results of operations, and financial condition may be adversely affected.
We collect this data through various means, including from our own systems, pixels that publishers allow us to place on their websites to track consumer visits, software development kits installed in mobile applications, cookies, and other tracking technologies.
We collect this data through various means, including from our own systems, pixels that publishers allow us to place on their websites to track consumer visits, software development kits installed in mobile applications, cookies, and other tracking technologies. Our publishers, buyers, and data providers may also choose to provide us with their proprietary data about consumers.
We believe there is significant and growing demand for our offerings and those we are developing, and we are making significant investments to meet that demand and grow our market share.
We believe there is significant and growing demand for our offerings and those we are developing, and we are making significant investments to meet that demand and grow our market share, including through the use of AI.
As of January 31, 2025, our directors and officers, and their respective affiliates, beneficially owned in the aggregate approximately 68.3% of the voting power of our capital stock.
As of January 31, 2026, our directors and officers, and their respective affiliates, beneficially owned in the aggregate approximately 67.5% of the voting power of our capital stock.
In recent years, macroeconomic factors such as inflation, rising interest rates and softening demand in certain verticals caused some advertisers to reduce their advertising budgets.
In recent years, macroeconomic factors such as general economic volatility, recessionary fears, inflation, volatile interest rates and softening demand in certain verticals caused some advertisers to reduce their advertising budgets.
The design of digital devices and operating systems or browsers is controlled by third parties that may also introduce new devices and operating systems or modify existing ones, and our access to content on certain devices may be limited.
The design of digital devices and operating systems or browsers is controlled by third parties that may also introduce new devices and operating systems or modify existing ones, including by implementing technical, contractual, or policy-based restrictions on advertising, data access, or interoperability, and our access to content on certain devices may be limited.
This could make advertising through our platform less valuable and decrease our revenue as advertising budgets may be decreased or directed to alternatives that are not exclusively reliant on cookies, mobile advertising identifiers, and other tracking technology data.
This could make advertising through our platform less valuable and decrease our revenue as advertising budgets may be decreased or directed to alternatives that are not exclusively reliant on cookies, mobile advertising identifiers, and other tracking technology data, or favor platforms that rely more heavily on first-party data, authenticated users, or closed ecosystems.
If our cash collections are significantly diminished as a result of these dynamics, our revenue and/or cash flow could be adversely affected, and we may need to use working capital to fund our accounts payable pending collection from the buyers. This may result in additional costs and cause us to forgo or defer more strategic uses of that working capital.
If our cash collections are significantly diminished as a result of these dynamics, our revenue and/or cash flow could be adversely affected, and we may need to use working capital to fund our accounts payable pending collection from the buyers.
Internet users can, with increasing ease, implement practices or technologies that may limit our ability to collect and use data to deliver targeted advertisements, or otherwise inhibit the effectiveness of our platform.
Our ability to collect, use and share data about advertising transactions and consumer behavior is critical to the value of our services. Internet users can, with increasing ease, implement practices or technologies that may limit our ability to collect and use data to deliver targeted advertisements, or otherwise inhibit the effectiveness of our platform.
As of December 31, 2024, we have repurchased approximately $134.6 million of our Class A common stock in aggregate under both the 2023 Repurchase Program and 2024 Repurchase Program.
As of December 31, 2025, we have repurchased approximately $181.1 million of our Class A common stock in aggregate under the 2023 Repurchase Program.
We use data from cookies, mobile device identifiers, and other tracking technologies to help advertisers decide whether to bid on, and how to price, an ad impression in a certain location, at a given time, for a particular consumer.
We then use this data to help advertisers decide whether to bid on, and how to price, an ad impression in a certain location, at a given time, for a particular consumer.
If we fail to comply with any such laws or regulations, we may be subject to enforcement actions that may not only expose us to litigation, fines, and civil and/or criminal penalties, but also require us to change our business practices, each of which could adversely affect our business, results of operations, and financial condition. 26 Table of Contents The regulatory framework for data privacy worldwide is evolving and is likely to remain uncertain for the foreseeable future.
If we fail to comply with any such laws or regulations, we may be subject to enforcement actions that may not only expose us to litigation, fines, and civil and/or criminal penalties, but also require us to change our business practices, each of which could adversely affect our business, results of operations, and financial condition.
Further, such litigation may require significant expenditures of cash and management efforts and could harm our business, financial condition, and results of operations. 21 Table of Contents We expect to continue to rely on significant cost savings obtained by concentrating our technology and development and engineering work in India, rather than in the United States, but difficulties resulting from the factors noted above and other risks related to our operations in India could increase our expenses and harm our competitive position.
We expect to continue to rely on significant cost savings obtained by concentrating our technology and development and engineering work in India, rather than in the United States, but difficulties resulting from the factors noted above and other risks related to our operations in India could increase our expenses and harm our competitive position.
We rely on publishers, buyers, and partners to abide by contractual requirements and relevant laws, rules, and regulations when using our platform, and legal claims or enforcement actions resulting from their actions could expose us to liabilities, damage our reputation, and be costly to defend.
Accordingly, any acquisition or investment would be subject to a risk of partial or total loss of invested capital We rely on customers, publishers, buyers, and partners to abide by contractual requirements and relevant laws, rules, and regulations when using our platform, and legal claims or enforcement actions resulting from their actions could expose us to liabilities, damage our reputation, and be costly to defend.
Technology stocks historically have experienced high levels of volatility. The trading price of our Class A common stock has fluctuated substantially and may continue to do so. These fluctuations could cause you to incur substantial losses, including all of your investment in our Class A common stock.
The trading price of our Class A common stock has fluctuated substantially and may continue to do so. These fluctuations could cause holders of our Class A common stock to incur substantial losses, including all of such investment in our Class A common stock.
Following California’s lead, over a third of other U.S. states have enacted comprehensive consumer privacy laws as well as privacy laws targeted at specific industries or types of data, and at data brokers specifically. Numerous other states have or are in the process of passing their own privacy or privacy-adjacent laws.
The CCPA has encouraged “copycat” laws in other states across the country. Following California’s lead, over a third of other U.S. states have enacted comprehensive consumer privacy laws as well as privacy laws targeted at specific industries or types of data, and at data brokers specifically.

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Item 1C. Cybersecurity

Cybersecurity — threats and controls disclosure

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Biggest changeOur information technology standards and infrastructure safeguards include information security standards prescribed for use by NIST, security measures aligned with the ISO/IEC 27000 series of standards, the Sarbanes-Oxley Act and SSAE 18/ISAE 3402, privacy regulations compliance, and other generally recognized industry standards, in each case, designed to safeguard the confidentiality, integrity and availability of our infrastructure and data and the resiliency of our operations.
Biggest changeOur information technology standards and infrastructure safeguards include information security standards prescribed for use by NIST, security measures aligned with the ISO/IEC 27000 series of standards, the Sarbanes-Oxley Act and SSAE 18/ISAE 3402, privacy regulations compliance, and other generally recognized industry standards, in each case, designed to safeguard the confidentiality, integrity and availability of our infrastructure and data and the resiliency of our operations. 44 Table of Contents In connection with these policies, we deploy technical safeguards that are designed to protect our information systems from cybersecurity threats, including firewalls, endpoint detection and response, endpoint security, email security, identity and access controls, which are evaluated and improved through vulnerability assessments and cybersecurity threat intelligence.
We also provide regular, mandatory training for employees and contractors regarding cybersecurity threats as a means to equip our personnel with effective tools to address cybersecurity threats, including the detection and prevention of “phishing” and other attacks using social engineering, and to communicate our evolving information security policies, standards, processes, and practices.
We also provide regular, mandatory training for employees and contractors regarding cybersecurity threats as a means to equip our personnel with effective knowledge and tools to address cybersecurity threats, including the detection and prevention of “phishing” and other attacks using social engineering, and to communicate our evolving information security policies, standards, processes, and practices.
These efforts include a range of activities, including internal audits, assessments, threat modeling, vulnerability testing, and other exercises focused on evaluating the effectiveness of our cybersecurity measures and planning. We engage third parties to perform assessments on our cybersecurity measures as a component of our SOX compliance program.
These efforts include a range of activities, including internal audits, assessments, threat modeling, vulnerability and penetration testing, and other exercises focused on evaluating the effectiveness of our cybersecurity measures and planning. We engage third parties to perform assessments on our cybersecurity measures as a component of our SOX compliance program.
Our SVP Security has a strong background in engineering with over 30 years’ of industry experience in technology and security, and previously operated one of the world’s largest retail websites instituting and undergoing PCI and HIPPA certifications.
Our SVP Security has a strong background in engineering with over 30 years’ of industry experience in technology and security, and previously operated one of the world’s largest retail websites instituting and undergoing PCI and HIPAA certifications.
Governance The Board, in coordination with the Audit Committee, oversees our overall enterprise risk management (“ERM”) process, including the management of risks arising from cybersecurity threats and information security.
Governance The Board, in coordination with the Audit Committee, oversees our overall enterprise risk management (“ERM”) program, including the management of risks arising from cybersecurity threats and information security.
Beginning in 2024, the Audit Committee was provided updates on our process, procedures, policies and any cybersecurity incidents at least quarterly. In the event of a material incident, or incident that may be determined to be material, the Audit Committee is informed as soon as reasonably practical and provided regular updates by the SIMT.
Since 2024, the Audit Committee has been provided with updates on our process, procedures, policies and any cybersecurity incidents at least quarterly. In the event of a material incident, or incident that may be determined to be material, the Audit Committee is informed as soon as reasonably practical and provided regular updates by the SIMT.
In general, we seek to address cybersecurity risks through a comprehensive, cross-functional approach that is focused on preserving the confidentiality, security and availability of the information that we collect and store by identifying, preventing and mitigating cybersecurity threats and effectively responding to cybersecurity incidents when they occur.
We address cybersecurity risks, including internal and external cybersecurity risks as a result of the use of AI, through a comprehensive, cross-functional approach that is focused on preserving the confidentiality, integrity, and availability of the information that we collect and store by identifying, preventing and mitigating cybersecurity threats and effectively responding to cybersecurity incidents when they occur.
Our incident response and recovery planning are overseen by the SIMT and Company personnel who become aware of an incident or potential incident are required to notify the SIMT.
Our incident response and recovery planning are overseen by the SIMT and Company personnel who become aware of an incident or potential incident are required to notify the SIMT. The SIMT is comprised of senior members of management and subject matter experts and is responsible for overseeing our cybersecurity program and our response to any cybersecurity incidents.
The SIMT, together with other internal and external advisors, has developed a Security Incident Management Policy (“Security Policy”) and Cybersecurity Incident Management Process (“CIM Process”) to help guide our response to any potential cybersecurity incidents or threats.
Through ongoing communications with these teams, the SVP, Security and the SIMT monitor the prevention, detection, mitigation, and remediation of cybersecurity threats and incidents, and report such threats and incidents to our Board and Audit Committee when appropriate. 45 Table of Contents The SIMT, together with other internal and external advisors, has developed a Security Incident Management Policy (“Security Policy”) and Cybersecurity Incident Management Process (“CIM Process”) to help guide our response to any potential cybersecurity incidents or threats.
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In connection with these policies, we deploy technical safeguards that are designed to protect our information systems from cybersecurity threats, including firewalls, anti-malware functionality and access controls, which are evaluated and improved through vulnerability assessments and cybersecurity threat intelligence.
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In 2025, we additionally retained a third-party to conduct a cybersecurity tabletop exercise where members of the SIMT and other senior leadership were presented with a cybersecurity breach scenario, and had to respond in real time. As part of our ERM program, we intend to hold annual tabletop exercises across a range of scenarios.
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The SIMT is comprised of senior members of 40 Table of Contents management and subject matter experts and is responsible for overseeing our cybersecurity program and our response to any cybersecurity incidents.
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Through ongoing communications with these teams, the SVP, Security and the SIMT monitor the prevention, detection, mitigation, and remediation of cybersecurity threats and incidents, and report such threats and incidents to our Board and Audit Committee when appropriate.

Item 2. Properties

Properties — owned and leased real estate

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Biggest changeITEM 2. PROPERTIES We lease office and data center space in various cities across North America, Europe and Asia Pacific. We believe that our facilities are adequate to meet our needs for the immediate future and that, should it be needed, we will be able to secure additional space to accommodate expansion of our operations. 41 Table of Contents
Biggest changeITEM 2. PROPERTIES We lease office and data center space in various cities across North America, Europe and Asia Pacific. We believe that our facilities are adequate to meet our needs for the immediate future and that, should it be needed, we will be able to secure additional space to accommodate expansion of our operations.

Item 3. Legal Proceedings

Legal Proceedings — active lawsuits and investigations

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Biggest changeITEM 3. LEGAL PROCEEDINGS From time to time, we may become involved in legal or regulatory proceedings, lawsuits and other claims arising in the ordinary course of our business. In view of the inherent difficulty of predicting the outcome of such matters, we cannot state what the eventual outcome of such matters will be.
Biggest changeGiven the nature of the case, including that the proceedings are in their early stages, we are unable to predict the ultimate outcome of the case. From time to time, we may become involved in legal or regulatory proceedings, lawsuits and other claims arising in the ordinary course of our business.
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ITEM 3. LEGAL PROCEEDINGS On September 8, 2025, we filed a civil action against Google LLC (“Google”) in the U.S. District Court for the Eastern District of Virginia seeking injunctive relief and damages for monopolistic and anticompetitive behavior in the publisher ad server and ad exchange markets for open-web display advertising.
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In view of the inherent difficulty of predicting the outcome of such matters, we cannot state what the eventual outcome of such matters will be.

Item 5. Market for Registrant's Common Equity

Market for Common Equity — stock, dividends, buybacks

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Biggest changeOn February 26, 2024, we announced an increase to the aggregate amount available for repurchases to $175 million through December 31, 2025. As of December 31, 2024, we had purchased approximately $134.6 million of our Class A common stock. (2) Average price paid per share includes costs associated with the repurchases.
Biggest changeOn February 26, 2024, we announced the authorization of an additional $100 million under our share repurchase program for the repurchase of shares of our Class A common stock through December 31, 2025.
Unregistered Sales of Equity Securities None. 43 Table of Contents Stock Performance Graph This performance graph shall not be deemed “soliciting material” or to be “filed” with the SEC for purposes of Section 18 of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), or otherwise subject to the liabilities under that Section, and shall not be deemed to be incorporated by reference into any filing of ours under the Securities Act of 1933, as amended, except as shall be expressly set forth by specific reference in such filing.
Stock Performance Graph This performance graph shall not be deemed “soliciting material” or to be “filed” with the SEC for purposes of Section 18 of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), or otherwise subject to the liabilities under that Section, and shall not be deemed to be incorporated by reference into any filing of ours under the Securities Act of 1933, as amended, except as shall be expressly set forth by specific reference in such filing.
Securities Authorized for Issuance Under Equity Compensation Plans The information required by this item will be included in our proxy statement relating to our 2024 annual meeting of stockholders to be filed by us with the SEC no later than 120 days after the close of our fiscal year ended December 31, 2024 (the “Proxy Statement”) and is incorporated herein by reference.
Securities Authorized for Issuance Under Equity Compensation Plans The information required by this item will be included in our proxy statement relating to our 2025 annual meeting of stockholders to be filed by us with the SEC no later than 120 days after the close of our fiscal year ended December 31, 2025 (the “Proxy Statement”) and is incorporated herein by reference. 47 Table of Contents Unregistered Sales of Equity Securities None.
The following graph compares the cumulative total stockholder return on an initial investment of $100 in our Class A common stock between December 9, 2020 (the date our Class A common stock commenced trading on the Nasdaq Global Market) through December 31, 2024, with the comparative cumulative total returns of the Nasdaq Composite Index, the Nasdaq US Benchmark Software and Computer Services TR Index and the Nasdaq CTA Internet Total Return Index over the same period.
The following graph compares the cumulative total stockholder return on an initial investment of $100 in our Class A common stock between December 31, 2020 through December 31, 2025, with the comparative cumulative total returns of the Nasdaq Composite Index, the Nasdaq US Benchmark Software and Computer Services TR Index and the Nasdaq CTA Internet Total Return Index over the same period.
Issuer Purchases of Equity Securities The following table provides information about our repurchases of our Class A common stock during the three months ended December 31, 2024: Period Total Number of Shares Purchased Average Price Paid Per Share (2) Total Number of Shares Purchased as Part of Publicly Announced Plans or Programs (1) Approximate Dollar Value of Shares that May Yet Be Purchased Under the Plans or Programs (1) October 1, 2024 - October 31, 2024 705,402 $ 14.88 705,402 $ 40,400,785 November 1, 2024 - November 30, 2024 — $ — — $ 40,400,785 December 1, 2024 - December 31, 2024 — $ — — $ 40,400,785 Total 705,402 705,402 The amounts above do not include the 1% excise tax on stock repurchases enacted by the Inflation Reduction Act of 2022. _______________ (1) On February 28, 2023, we announced the authorization of a share repurchase program for the repurchase of shares of our Class A common stock in an aggregate amount of up to $75 million through December 31, 2024.
Issuer Purchases of Equity Securities The following table provides information about our repurchases of our Class A common stock during the three months ended December 31, 2025: Period Total Number of Shares Purchased Average Price Paid Per Share (2) Total Number of Shares Purchased as Part of Publicly Announced Plans or Programs (1) Approximate Dollar Value of Shares that May Yet Be Purchased Under the Plans or Programs (1) October 1, 2025 - October 31, 2025 — $ — — $ 94,394,302 November 1, 2025 - November 30, 2025 51,391 $ 9.55 51,391 $ 93,903,451 December 1, 2025 - December 31, 2025 — $ — — $ 93,903,451 Total 51,391 51,391 The amounts above do not include the 1% excise tax on stock repurchases enacted by the Inflation Reduction Act of 2022. _______________ (1) On February 28, 2023, we announced the authorization of a share repurchase program for the repurchase of shares of our Class A common stock in an aggregate amount of up to $75 million through December 31, 2024.
There is no public trading market for our Class B common stock. Holders of Record As of January 31, 2025, there were 65 holders of record of our Class A common stock and 89 holders of record of our Class B common stock.
There is no public trading market for our Class B common stock. Holders of Record As of January 31, 2026, there were 62 holders of record of our Class A common stock and 71 holders of record of our Class B common stock.
The returns shown are based on historical results and are not indicative of, nor intended to forecast, future stock price performance. Use of Proceeds Our initial public offering of our Class A common stock was effected pursuant to a registration statement on Form S-1 (File No. 333-250077), which was declared effective by the SEC on December 8, 2020.
The returns shown are based on historical results and are not indicative of, nor intended to forecast, future stock price performance.
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The graph uses the closing market price on December 9, 2020 of $29.45 per share as the initial value of our Class A common stock.
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On May 30, 2025, we announced the authorization of an additional $100 million under our 2023 Repurchase Program for the repurchase of shares of our Class A common stock through December 31, 2026. As of December 31, 2025, we had purchased approximately $181.1 million of our Class A common stock.
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There has been no material change in the planned use of proceeds from the initial public offering as described in our final prospectus dated December 8, 2020 (the “Prospectus”) filed with the SEC pursuant to Rule 424(b) under the Securities Act.
Added
(2) Average price paid per share includes costs associated with the repurchases.

Item 7. Management's Discussion & Analysis

Management's Discussion & Analysis (MD&A) — revenue / margin commentary

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Biggest changeYear Ended December 31, 2024 2023 2022 Consolidated Statements of Operations: Revenue $ 291,256 $ 267,014 $ 256,380 Cost of revenue (1) 101,027 99,229 81,512 Gross profit 190,229 167,785 174,868 Operating expenses (1) : Technology and development 33,263 26,727 20,846 Sales and marketing 95,369 82,803 68,562 General and administrative 57,670 56,219 44,940 Total operating expenses 186,302 165,749 134,348 Operating income 3,927 2,036 40,520 Total other income (expense), net 13,847 8,469 (3,053) Income before income taxes 17,774 10,505 37,467 Provision for income taxes 5,270 1,624 8,762 Net income $ 12,504 $ 8,881 $ 28,705 _______________ (1) Amounts include stock-based compensation expense before tax benefit as follows: Year Ended December 31, 2024 2023 2022 (in thousands) Cost of revenue $ 1,855 $ 1,472 $ 1,135 Technology and development 6,313 4,346 3,225 Sales and marketing 13,407 10,462 7,645 General and administrative 16,101 12,582 8,641 Total stock-based compensation expense $ 37,676 $ 28,862 $ 20,646 Year Ended December 31, 2024 2023 2022 (as percentage of revenue) Revenue 100 % 100 % 100 % Cost of revenue 35 37 32 Gross profit 65 63 68 Operating expenses: Technology and development 11 10 8 Sales and marketing 33 31 27 General and administrative 20 21 17 Total operating expenses 64 62 52 Operating income 1 1 16 Total other income (expense), net 5 3 (2) Income before income taxes 6 4 14 Provision for income taxes 2 1 3 Net income 4 % 3 % 11 % 49 Table of Contents Comparison of the Years Ended December 31, 2024 and 2023 Revenue, Cost of Revenue and Gross Profit Year Ended December 31, 2024 2023 $ Change % Change (dollars in thousands) Revenue $ 291,256 $ 267,014 $ 24,242 9 % Cost of revenue 101,027 99,229 1,798 2 % Gross profit $ 190,229 $ 167,785 $ 22,444 13 % Gross profit margin 65 % 63 % Revenue increased $24.2 million, or 9%, in 2024 primarily due to an increase in the number of ad impressions processed from our publishers, growth in our emerging revenue streams, and increased demand from the growth of our buyer relationships primarily through SPO agreements.
Biggest changeYear Ended December 31, 2025 2024 2023 Consolidated Statements of Operations: Revenue $ 282,926 $ 291,256 $ 267,014 Cost of revenue (1) 103,085 101,027 99,229 Gross profit 179,841 190,229 167,785 Operating expenses (1) : Technology and development 33,820 33,263 26,727 Sales and marketing 102,940 95,369 82,803 General and administrative 60,340 57,670 56,219 Total operating expenses 197,100 186,302 165,749 Operating income (loss) (17,259) 3,927 2,036 Total other income, net 1,305 13,847 8,469 Income (loss) before income taxes (15,954) 17,774 10,505 Provision for (benefit from) income taxes (1,492) 5,270 1,624 Net income (loss) $ (14,462) $ 12,504 $ 8,881 _______________ (1) Amounts include stock-based compensation expense before tax benefit as follows: Year Ended December 31, 2025 2024 2023 (in thousands) Cost of revenue $ 1,854 $ 1,855 $ 1,472 Technology and development 6,088 6,313 4,346 Sales and marketing 13,703 13,407 10,462 General and administrative 16,733 16,101 12,582 Total stock-based compensation expense $ 38,378 $ 37,676 $ 28,862 Year Ended December 31, 2025 2024 2023 (as percentage of revenue) Revenue 100 % 100 % 100 % Cost of revenue 36 35 37 Gross profit 64 65 63 Operating expenses: Technology and development 12 11 10 Sales and marketing 36 33 31 General and administrative 21 20 21 Total operating expenses 69 64 62 Operating income (loss) (5) 1 1 Total other income (expense), net — 5 3 Income (loss) before income taxes (5) 6 4 Provision for (benefit from) income taxes — 2 1 Net income (loss) (5) % 4 % 3 % 53 Table of Contents Comparison of the Years Ended December 31, 2025 and 2024 Revenue, Cost of Revenue and Gross Profit Year Ended December 31, 2025 2024 $ Change % Change (dollars in thousands) Revenue $ 282,926 $ 291,256 $ (8,330) (3) % Cost of revenue 103,085 101,027 2,058 2 % Gross profit $ 179,841 $ 190,229 $ (10,388) (5) % Gross profit margin 64 % 65 % Revenue decreased $8.3 million, or (3)%, in 2025 as compared to 2024.
For the year ended December 31, 2024, net cash provided by investing activities was $22.3 million of cash, consisting of a net inflows from investments of marketable securities of $60.8 million, offset by $17.6 million in purchases of property and equipment (primarily data center infrastructure), and $20.9 million of investments in capitalized internal use software.
For the year ended December 31, 2024, net cash provided by investing activities was $22.3 million, consisting of a net inflows from investments of marketable securities of $60.8 million, offset by $17.6 million in purchases of property and equipment (primarily data center infrastructure), and $20.9 million of investments in capitalized internal use software.
Financing Activities For the year ended December 31, 2024, net cash used in financing activities of $73.5 million was primarily due to $75.3 million in stock repurchases and $2.1 million in payment of a business combination indemnification holdback, offset by $1.8 million proceeds from stock option exercises and $2.4 million proceeds from the employee stock purchase plan.
For the year ended December 31, 2024, net cash used in financing activities of $73.5 million was primarily due to $75.3 million in stock repurchases and $2.1 million in payment of a business combination indemnification holdback, offset by $1.8 million in proceeds from stock option exercises and $2.4 million in proceeds from the employee stock purchase plan.
Non-GAAP Financial Measures In addition to our results determined in accordance with U.S. generally accepted accounting principles (“GAAP”), including in particular operating income, net cash provided by operating activities, and net income, we believe that Adjusted EBITDA, a non-GAAP measure, is useful in evaluating our operating performance.
Non-GAAP Financial Measures In addition to our results determined in accordance with U.S. generally accepted accounting principles (“GAAP”), including, in particular, operating income (loss), net cash provided by operating activities, and net income (loss), we believe that Adjusted EBITDA, a non-GAAP measure, is useful in evaluating our operating performance.
We believe that this non-GAAP financial measure is useful to investors for period to period comparisons of our business and in understanding and evaluating our operating results for the following reasons: • Adjusted EBITDA is widely used by investors and securities analysts to measure a company’s operating performance without regard to items such as stock-based compensation expense, depreciation and amortization, interest expense, provision for income taxes, and certain one-time items such as impairments of long-lived assets, that can vary substantially from company to company depending upon their financing, capital structures and the method by which assets were acquired; 52 Table of Contents • Our management uses Adjusted EBITDA in conjunction with GAAP financial measures for planning purposes, including the preparation of our annual operating budget, as a measure of operating performance and the effectiveness of our business strategies and in communications with our board of directors concerning our financial performance; and • Adjusted EBITDA provides consistency and comparability with our past financial performance, facilitates period-to-period comparisons of operations, and also facilitates comparisons with other peer companies, many of which use similar non-GAAP financial measures to supplement their GAAP results.
We believe that this non-GAAP financial measure is useful to investors for period to period comparisons of our business and in understanding and evaluating our operating results for the following reasons: • Adjusted EBITDA is widely used by investors and securities analysts to measure a company’s operating performance without regard to items such as stock-based compensation expense, depreciation and amortization, interest expense, provision for income taxes, and certain one-time items such as impairments of long-lived assets, that can vary substantially from company to company depending upon their financing, capital structures and the method by which assets were acquired; • Our management uses Adjusted EBITDA in conjunction with GAAP financial measures for planning purposes, including the preparation of our annual operating budget, as a measure of operating performance and the effectiveness of our business strategies and in communications with our board of directors concerning our financial performance; and • Adjusted EBITDA provides consistency and comparability with our past financial performance, facilitates period-to-period comparisons of operations, and also facilitates comparisons with other peer companies, many of which use similar non-GAAP financial measures to supplement their GAAP results.
For discussion on operating, investing, and financing activities of the fiscal year ended December 31, 2022, see the Liquidity and Capital Resources section disclosed in “Management’s Discussion and Analysis of Financial Condition and Results of Operations” of our Annual Report on Form 10-K, which was filed with the SEC on February 28, 2023 and hereby incorporated by reference herein and considered part of this Annual Report on Form 10-K only to the extent referenced.
For discussion on operating, investing, and financing activities of the fiscal year ended December 31, 2023, see the Liquidity and Capital Resources section disclosed in “Management’s Discussion and Analysis of Financial Condition and Results of Operations” of our Annual Report on Form 10-K, which was filed with the SEC on February 28, 2024 and hereby incorporated by reference herein and considered part of this Annual Report on Form 10-K only to the extent referenced.
Some of these limitations are as follows: • Adjusted EBITDA does not reflect: (a) changes in, or cash requirements for, our working capital needs; (b) the potentially dilutive impact of stock-based compensation; or (c) tax payments that may represent a reduction in cash available to us; • Although depreciation and amortization expense are non-cash charges, the assets being depreciated and amortized may have to be replaced in the future, and Adjusted EBITDA does not reflect cash capital expenditure requirements for such replacements or for new capital expenditure requirements; and • Other companies in our industry may calculate Adjusted EBITDA differently than we do, limiting its usefulness as a comparative measure.
Some of these limitations are as follows: • Adjusted EBITDA does not reflect: (a) changes in, or cash requirements for, our working capital needs; (b) the potentially dilutive impact of stock-based compensation; or (c) tax payments that may represent a reduction in cash available to us; 56 Table of Contents • Although depreciation and amortization expense are non-cash charges, the assets being depreciated and amortized may have to be replaced in the future, and Adjusted EBITDA does not reflect cash capital expenditure requirements for such replacements or for new capital expenditure requirements; and • Other companies in our industry may calculate Adjusted EBITDA differently than we do, limiting its usefulness as a comparative measure.
Valuable ad impressions are transparent and data rich, viewable by humans, and verifiable. Each ad impression we auction consists of 644 independent data parameters, which can yield valuable insights if recorded and analyzed properly. This processing of voluminous data for each ad impression must occur in less than half a second as consumers expect a seamless digital ad experience.
Valuable ad impressions are transparent and data rich, viewable by humans, and verifiable. Each ad impression we auction consists of 722 independent data parameters, which can yield valuable insights if recorded and analyzed properly. This processing of voluminous data for each ad impression must occur in less than half a second as consumers expect a seamless digital ad experience.
Objectively verifiable evidence includes our realization of tax attributes, assessment of tax credits, and utilization of net operating loss carryforwards during the year. 48 Table of Contents Results of Operations The following tables set forth our consolidated results of operations data (in thousands) and such data as a percentage of revenue for the periods presented.
Objectively verifiable evidence includes our realization of tax attributes, assessment of tax credits, and utilization of net operating loss carryforwards during the year. 52 Table of Contents Results of Operations The following tables set forth our consolidated results of operations data (in thousands) and such data as a percentage of revenue for the periods presented.
We believe our existing cash, cash equivalents, marketable securities and anticipated net cash provided by operating activities, together with available borrowings under our credit facility, will be sufficient to meet our working capital requirements for at least the next 12 months.
We believe our existing cash, cash equivalents, and anticipated net cash provided by operating activities, together with available borrowings under our credit facility, will be sufficient to meet our working capital requirements for at least the next 12 months.
We expense technology and development costs as incurred, except to the extent that such costs are associated with internal use software development that qualifies for capitalization. We expect technology and development expenses to generally increase in absolute dollars in future periods. Sales and Marketing.
We expend technology and development costs as incurred, except to the extent that such costs are associated with internal-use software development that qualifies for capitalization. We expect technology and development expenses to generally increase in absolute dollars in future periods. Sales and Marketing.
Recent Accounting Pronouncements See Note 2 to our consolidated financial statements included in Part II, Item 8 of this Form 10-K, for recently issued accounting pronouncements not yet adopted. 57 Table of Contents
Recent Accounting Pronouncements See Note 2 to our consolidated financial statements included in Part II, Item 8 of this Form 10-K, for recently issued accounting pronouncements not yet adopted. 60 Table of Contents
We have been investing in SPO technology and partnerships for six years and SPO represented approximately 50% of total activity for the year ended December 31, 2024. 46 Table of Contents Monetization Excellence We focus on monetizing digital impressions by coordinating over a hundred billion real-time auctions and nearly a trillion bids globally on a daily basis, using our specialized cloud software, machine learning algorithms, and scaled transaction infrastructure.
We have been investing in SPO technology and partnerships for six years and SPO represented approximately 55% of total activity for the year ended December 31, 2025. 50 Table of Contents Monetization Excellence We focus on monetizing digital impressions by coordinating over a hundred billion real-time auctions and nearly a trillion bids globally on a daily basis, using our specialized cloud software, machine learning algorithms, and scaled transaction infrastructure.
We expect sales and marketing expenses to increase in 2025 compared to 2024 in absolute dollars primarily due to additional headcount investment and marketing programs.
We expect sales and marketing expenses to increase in 2026 compared to 2025 in absolute dollars primarily due to additional headcount investment and marketing programs.
Personnel costs include salaries, bonuses, stock-based compensation, and employee benefit costs, and are primarily attributable to our network operations group, which maintains our servers, and our client operations group, which is responsible for the integration of new publishers and buyers and providing customer support for existing customers. Operating Expenses Technology and Development.
Personnel costs include salaries, bonuses, stock-based compensation, and employee benefit costs, and are primarily attributable to our cloud operations group, which maintains our servers, and our client operations group, which is responsible for the integration of new publishers and buyers and providing customer support for existing customers. 51 Table of Contents Operating Expenses Technology and Development.
Borrowings under the Revolving Credit Facility accrue interest at rates equal, at our election, to (i) the adjusted term secured overnight financing rate (“SOFR”), which is defined as (a) the applicable term SOFR plus (b) a term SOFR adjustment equal to 0.20% per annum, plus the applicable margin for such loans, or (ii) the alternate base rate (“ABR”), which is defined as the highest of (a) the prime rate in effect from time to time, (b) the federal funds effective rate in effect from time to time plus 0.50%, and (c) the adjusted term SOFR for a one (1) month tenor in effect from time to time plus 1.0%, plus the applicable margin for such loans.
The Credit Agreement matures on October 17, 2027. 58 Table of Contents Borrowings under the Revolving Credit Facility accrue interest at rates equal, at our election, to (i) the adjusted term secured overnight financing rate (“SOFR”), which is defined as (a) the applicable term SOFR plus (b) a term SOFR adjustment equal to 0.20% per annum, plus the applicable margin for such loans, or (ii) the alternate base rate (“ABR”), which is defined as the highest of (a) the prime rate in effect from time to time, (b) the federal funds effective rate in effect from time to time plus 0.50%, and (c) the adjusted term SOFR for a one (1) month tenor in effect from time to time plus 1.0%, plus the applicable margin for such loans.
Our revenue recognition policies are discussed in more detail under “Critical Accounting Policies and Estimates.” 47 Table of Contents Cost of Revenue Cost of revenue consists of data center co-location costs, depreciation expense related to hardware supporting our platform, amortization expense related to capitalized internal use software development costs and acquired developed technology, personnel costs, and allocated facilities costs.
Our revenue recognition policies are discussed in more detail under “Critical Accounting Policies and Estimates.” Cost of Revenue Cost of revenue consists of data center co-location costs, depreciation expense related to hardware supporting our platform, amortization expense related to capitalized internal-use software development costs, personnel costs, and allocated facilities costs.
Cash flows from operating activities have been affected by changes in our working capital, particularly changes in accounts receivable and accounts payable. The timing of cash receipts from buyers and payments to publishers can significantly impact our cash flows from operating activities.
Cash flows from operating activities have been affected by changes in our working capital, particularly changes in accounts receivable and accounts payable. The timing of cash receipts from buyers and payments to publishers can significantly impact our cash flows from operating activities. In addition, we expect seasonality to impact quarterly cash flows from operating activities.
Our future capital requirements and the adequacy of available funds will depend on many factors, including those set forth under “Risk Factors.” Cash Flows The following table summarizes our cash flows for the periods presented: Year Ended December 31, 2024 2023 2022 (in thousands) Net cash provided by operating activities $ 73,425 $ 81,121 $ 87,212 Net cash provided by (used in) investing activities 22,314 (39,018) (81,371) Net cash provided by (used in) financing activities (73,478) (55,976) 4,036 Effect of foreign currency on cash (318) — — Net increase (decrease) in cash and cash equivalents $ 21,943 $ (13,873) $ 9,877 Operating Activities Our cash flows from operating activities are primarily influenced by growth in our operations, increases or decreases in collections from our buyers and related payments to our publishers, as well as our investment in personnel to support the anticipated growth of our business.
Our future capital requirements and the adequacy of available funds will depend on many factors, including those set forth under “Risk Factors.” Cash Flows The following table summarizes our cash flows for the periods presented: Year Ended December 31, 2025 2024 2023 (in thousands) Net cash provided by operating activities $ 81,059 $ 73,425 $ 81,121 Net cash provided by (used in) investing activities 6,072 22,314 (39,018) Net cash used in financing activities (42,731) (73,478) (55,976) Effect of foreign currency on cash 666 (318) — Net increase (decrease) in cash and cash equivalents $ 45,066 $ 21,943 $ (13,873) Operating Activities Our cash flows from operating activities are primarily influenced by growth in our operations, increases or decreases in collections from our buyers and related payments to our publishers, as well as our investment in personnel to support the anticipated growth of our business.
In addition, we expect seasonality to impact quarterly cash flows from operating activities. 53 Table of Contents For the year ended December 31, 2024, net cash provided by operating activities of $73.4 million resulted primarily from net income of $12.5 million, adjustments for non-cash expenses of $74.7 million, including $45.4 million for depreciation and amortization, $37.7 million for stock-based compensation, and $11.0 million for deferred income taxes, and an increase in accounts receivable of $49.3 million, partially offset by an increase in accounts payable of $38.1 million.
For the year ended December 31, 2024, net cash provided by operating activities of $73.4 million resulted primarily from net income of $12.5 million, adjustments for non-cash expenses of $74.7 million, including $45.4 million for depreciation and amortization, $37.7 million for stock-based compensation, and $11.0 million for deferred income taxes, and an increase in accounts receivable of $49.3 million, partially offset by an increase in accounts payable of $38.1 million.
As of December 31, 2024, the applicable interest rate under the Revolving Credit Facility was 8.50%. We had no amounts outstanding under the Revolving Credit Facility as of December 31, 2024. The Credit Agreement contains customary representations and warranties as well as customary affirmative and negative covenants.
As of December 31, 2025, the applicable interest rate under the Revolving Credit Facility was 7.75%. We had no amounts outstanding under the Revolving Credit Facility as of December 31, 2025. The Credit Agreement contains customary representations and warranties as well as customary affirmative and negative covenants.
Accounts receivable are recorded at the amount of gross billings for the amounts we are responsible to collect, and accounts payable are recorded at the net amount payable to publishers. Accordingly, both accounts receivable and accounts payable appear large in relation to revenue reported on a net basis.
We record our accounts receivable at the amount of gross billings to buyers, net of allowances, for the amounts we are responsible to collect, and we record our accounts payable at the net amount payable to publishers. Accordingly, both accounts receivable and accounts payable appear large in relation to revenue, which is reported on a net basis.
See “Risk Factors” for further discussion of the risks related to inflation, volatile interest rates, foreign currency fluctuations and public health crises on our business. 45 Table of Contents Financial Results Overview The table below summarizes the financial highlights of our business: Year Ended December 31, 2024 2023 2022 (in thousands) Revenue $ 291,256 $ 267,014 $ 256,380 Operating income $ 3,927 $ 2,036 $ 40,520 Net income $ 12,504 $ 8,881 $ 28,705 Adjusted EBITDA (1) $ 92,325 $ 75,309 $ 97,014 Net cash provided by operating activities $ 73,425 $ 81,121 $ 87,212 _______________ (1) For a definition of Adjusted EBITDA, an explanation of our management’s use of this measure, and a reconciliation of Adjusted EBITDA to net income, see “Non-GAAP Financial Measures” below.
See “Risk Factors” for further discussion of the risks related to inflation, volatile interest rates, foreign currency fluctuations and public health crises on our business. 49 Table of Contents Financial Results Overview The table below summarizes the financial highlights of our business: Year Ended December 31, 2025 2024 2023 (in thousands) Revenue $ 282,926 $ 291,256 $ 267,014 Operating income (loss) $ (17,259) $ 3,927 $ 2,036 Net income (loss) $ (14,462) $ 12,504 $ 8,881 Adjusted EBITDA (1) $ 61,640 $ 92,325 $ 75,309 Net cash provided by operating activities $ 81,059 $ 73,425 $ 81,121 _______________ (1) For a definition of Adjusted EBITDA, an explanation of our management’s use of this measure, and a reconciliation of Adjusted EBITDA to net income (loss), see “Non-GAAP Financial Measures” below.
Additionally, recent foreign currency fluctuation and persistent inflation in the U.S. and other markets globally continue to create economic volatility and dislocation in the capital and credit markets in the U.S. and globally.
Dollar, and persistent inflation in the U.S. and other markets globally, continue to create economic volatility and dislocation in the capital and credit markets in the U.S. and globally.
Credit Facilities On October 17, 2022, we entered into a Senior Secured Credit Facilities Credit Agreement (the “Credit Agreement”) with the several lenders parties thereto, and Silicon Valley Bank, as administrative agent, lead arranger, issuing lender, and swingline lender.
As a result, this amount is not included in the contractual obligations table above. Credit Facilities On October 17, 2022, we entered into a Senior Secured Credit Facilities Credit Agreement (the “Credit Agreement”) with the several lenders parties thereto, and Silicon Valley Bank, as administrative agent, lead arranger, issuing lender, and swingline lender.
We ended fiscal 2024 with approximately 100 net new publishers, which represented over 60,000 domains and 27,000 apps in total, compared to approximately 150 new publishers in 2023, which represented approximately 66,000 domains and 29,000 apps in total.
We ended fiscal 2025 with approximately 50 net new publishers, which represented over 64,000 domains and 44,000 apps in total, compared to approximately 100 new publishers in 2024, which represented approximately 60,000 domains and 27,000 apps in total.
We expect the cost of revenue to be higher in 2025 compared to 2024 in absolute dollars primarily due to increases in depreciation and amortization expense from data center capacity expansion in 2024, as well as increases in in software, hardware and equipment maintenance to support the data centers.
We expect the cost of revenue to be higher in 2026 compared to 2025 in absolute dollars primarily due to increases in our data center costs as well as increases in software, hardware, and equipment maintenance to support the data centers.
The number of ad impressions processed on our platform was approximately 57.9 trillion, 60.7 trillion, 69.8 trillion, and 74.7 trillion for each of the three months ended March 31, 2024, June 30, 2024, September 30, 2024, and December 31, 2024, respectively, as compared to 46.5 trillion, 48.8 trillion, 56.0 trillion, and 59.4 trillion for each of the three months ended March 31, 2023, June 30, 2023, September 30, 2023, and December 31, 2023, respectively.
The number of ad impressions processed on our platform was approximately 74.7 trillion, 77.7 trillion, 86.8 trillion, and 97.6 trillion for each of the three months ended March 31, 2025, June 30, 2025, September 30, 2025, and December 31, 2025, respectively, as compared to 57.9 trillion, 60.7 trillion, 69.8 trillion, and 74.7 trillion for each of the three months ended March 31, 2024, June 30, 2024, September 30, 2024, and December 31, 2024, respectively.
Negative covenants include, among others, limitations on incurrence of indebtedness, liens, disposition of property and investments by us and our subsidiaries. In addition, the Credit Agreement requires us to maintain certain interest coverage, leverage and senior leverage ratios.
Negative covenants include, among others, limitations on incurrence of indebtedness, liens, disposition of property and investments by us and our subsidiaries. In addition, the Credit Agreement requires us to maintain certain interest coverage, leverage and senior leverage ratios. Critical Accounting Policies and Estimates We prepare our consolidated financial statements in accordance with GAAP.
These strengths include our global, omnichannel reach which targets a diverse set of publishers touching many ad formats and digital device types, including mobile app, mobile web, desktop, display, video, over-the-top video/connected TV (“OTT/CTV”), and rich media.
We continue to focus on the strengths that we believe provide us with long-term competitive advantages. These strengths include our global, omnichannel reach which targets a diverse set of publishers touching many ad formats and digital device types, including mobile app, mobile web, desktop, display, video, over-the-top video/connected TV (“OTT/CTV”), and rich media.
For the year ended December 31, 2023, net cash used in financing activities of $56.0 million was primarily due to $59.3 million in stock repurchases, offset by $1.5 million in proceeds from stock option exercises and $1.9 million in proceeds from the employee stock purchase plan.
Financing Activities For the year ended December 31, 2025, net cash used in financing activities of $42.7 million was primarily due to $46.5 million in stock repurchases, offset by $1.8 million proceeds from stock option exercises and $2.1 million proceeds from the employee stock purchase plan.
The obligations under the Credit Agreement are secured by substantially all of our assets. The Credit Agreement matures on October 17, 2027.
The obligations under the Credit Agreement are secured by substantially all of our assets.
We estimate and record reductions to revenue for volume discounts based on expected volumes during the incentive term. 55 Table of Contents The determination as to whether revenue should be reported gross of amounts billed to buyers (gross basis) or net of payments to publishers (net basis) requires significant judgment, and is based on our assessment of whether we are acting as the principal or an agent in the transaction.
The determination as to whether revenue should be reported gross of amounts billed to buyers (gross basis) or net of payments to publishers (net basis) requires significant judgment, and is based on our assessment of whether we are acting as the principal or an agent in the transaction.
In considering the need for a valuation allowance, we consider our historical, as well as future projected, taxable income along with other objectively verifiable evidence.
Realization of our deferred tax assets is dependent primarily on the generation of future taxable income. In considering the need for a valuation allowance, we consider our historical, as well as future projected, taxable income along with other objectively verifiable evidence.
This represents gross billings to buyers, net of amounts we pay publishers. We record our accounts receivable at the amount of gross billings to buyers, net of allowances, for the amounts we are responsible to collect, and we record our accounts payable at the net amount payable to publishers.
Accounts receivable are recorded at the amount of gross billings for the amounts we are responsible to collect, and accounts payable are recorded at the net amount payable to publishers.
We expect general and administrative expenses to increase in 2025 compared to 2024 in absolute dollars primarily due to increases in expenses relating to our personnel.
We expect general and administrative expenses to increase in 2026 compared to 2025 in absolute dollars primarily due to increases in litigation related expenses.
Purchases of property and equipment may vary from period-to-period due to the timing of the expansion of our data centers, the addition of headcount, and the development cycles of our software development. As our business grows, we expect our capital expenditures and our investment activity to continue to increase.
Purchases of property and equipment may vary from period-to-period due to the timing of the expansion of our data centers, the addition of headcount, and the development cycles of our software development.
We define Adjusted EBITDA as net income adjusted for stock-based compensation expense, depreciation and amortization, unrealized (gain) loss and impairment of equity investment, interest income, acquisition-related and other expenses, and provision for income taxes.
We define Adjusted EBITDA as net income (loss) adjusted for stock-based compensation expense, depreciation and amortization, litigation related expenses, interest income, and provision for (benefit from) income taxes.
We maintain agreements with each publisher and buyer in the form of written service agreements, which set out the terms of the relationship, including payment terms (typically ninety days or less) and access to our platform. We invoice buyers for publisher digital advertising inventory purchased through its platform.
We charge publishers a fee, which is typically a percentage of the value of the impressions monetized through our platform. We maintain agreements with each publisher and buyer in the form of written service agreements, which set out the terms of the relationship, including payment terms (typically ninety days or less) and access to our platform.
For the year ended December 31, 2023, net cash provided by operating activities of $81.1 million resulted primarily from net income of $8.9 million, adjustments for non-cash expenses of $68.0 million, including $44.8 million for depreciation and amortization, $28.9 million for stock-based compensation, and $13.4 million for deferred income taxes, and an increase in accounts receivable of $75.7 million, partially offset by an increase in accounts payable of $79.7 million.
For the year ended December 31, 2025, net cash provided by operating activities of $81.1 million resulted primarily from adjustments for non-cash expenses of $73.1 million, including $43.8 million for depreciation and amortization, $38.4 million for stock-based compensation, and $14.5 million for deferred income taxes, and a decrease in accounts receivable of $66.6 million, partially offset by a decrease in accounts payable of $42.4 million.
Other income (expense) also benefited from foreign currency fluctuations for the year ended December 31, 2024 compared to the prior year period. 51 Table of Contents Provision for Income Taxes Year Ended December 31, 2024 2023 $ Change % Change (dollars in thousands) Provision for income taxes $ 5,270 $ 1,624 $ 3,646 225 % The difference between the effective tax rate in 2024 of 30% and the federal statutory income tax rate of 21% was primarily due to state taxes, Section 162(m) limitation, and acquisition-related costs partially offset by foreign derived intangible income (FDII) deduction and federal research and development credit.
Provision For (Benefit From) Income Taxes Year Ended December 31, 2025 2024 $ Change % Change (dollars in thousands) Provision for (benefit from) income taxes $ (1,492) $ 5,270 $ (6,762) (128) % The difference between the effective tax rate in 2025 of 9% and the federal statutory income tax rate of 21% was primarily due to foreign derived intangible income (FDII) deduction and federal research and development credit, partially offset by stock-based compensation, Section 162(m) limitation, and acquisition-related costs.
Our net dollar-based retention rate was 107% for the year ended December 31, 2024, and 101% for the year ended December 31, 2023. Further, we work with DSPs to help them reduce their costs and improve advertiser ROI, which in turn makes us the specialized cloud infrastructure platform of choice for many of our buying partners.
Expansion of SPO Agreements and Activate We work with DSPs to help them reduce their costs and improve advertiser ROI, which in turn makes us the specialized cloud infrastructure platform of choice for many of our buying partners.
Cost of revenue increased $1.8 million, primarily due to a $5.1 million increase in amortization of internal use software and a $1.3 million increase in personnel costs as headcount increased by 4% in order to support our growing business, offset by a $3.8 million decrease in depreciation of data center equipment.
Cost of revenue increased $2.1 million, primarily due to a $4.2 million increase in amortization of internal use software and a $3.5 million increase in data center costs, offset by a $5.5 million decrease in depreciation of data center equipment. Overall, our cost of revenue per impression processed in 2025 decreased by 20% compared to 2024.
Our channel partners aggregate and provide further access to thousands of sites and apps from smaller publishers. We generate revenue through fees charged to our publishers, which are generally a percentage of the value of the advertising impressions that publishers monetize on our platform.
Through these customers, we generate revenue primarily through fees charged to our publishers, which are generally a percentage of the value of the advertising impressions that publishers monetize on the platform.
As of December 31, 2024, we had cash, cash equivalents, and marketable securities of $140.6 million and net working capital, consisting of current assets less current liabilities, of $156.7 million.
As of December 31, 2025, we had cash and cash equivalents of $145.5 million and net working capital, consisting of current assets less current liabilities, of $146.8 million.
Technology and Development Year Ended December 31, 2024 2023 $ Change % Change (dollars in thousands) Technology and development $ 33,263 $ 26,727 $ 6,536 24 % Percent of revenue 11 % 10 % The increase in technology and development costs was primarily due to an increase of $7.5 million in personnel costs associated with a headcount increase by 13% and higher stock-based compensation costs, an increase of $0.7 million in facilities costs associated with new offices, an increase in depreciation of $0.3 million, and an increase in travel and entertainment of $0.3 million, offset by a $2.3 million increase in the capitalization of internal use software.
Technology and Development Year Ended December 31, 2025 2024 $ Change % Change (dollars in thousands) Technology and development $ 33,820 $ 33,263 $ 557 2 % Percent of revenue 12 % 11 % The increase in technology and development costs was primarily due to an increase of $1.2 million in personnel costs, offset by a $0.6 million increase in the capitalization of internal use software.
We expect technology and development expenses to increase in 2025 compared to 2024 in absolute dollars, primarily due to the additional headcount investment in our key growth opportunities. 50 Table of Contents Sales and Marketing Year Ended December 31, 2024 2023 $ Change % Change (dollars in thousands) Sales and marketing $ 95,369 $ 82,803 $ 12,566 15 % Percent of revenue 33 % 31 % Sales and marketing costs increased primarily due to a $11.7 million increase in personnel costs associated with a headcount increase by 7% and higher stock-based compensation costs and a $1.1 million increase in facilities costs, increase in travel and entertainment expenses of $0.4 million, and increase in marketing expenses of $0.2 million, offset by a decrease in amortization for acquisition-related intangible assets of $0.9 million.
We expect technology and development expenses in 2026 to be flat compared to 2025 in absolute dollars. 54 Table of Contents Sales and Marketing Year Ended December 31, 2025 2024 $ Change % Change (dollars in thousands) Sales and marketing $ 102,940 $ 95,369 $ 7,571 8 % Percent of revenue 36 % 33 % Sales and marketing costs increased primarily due to a $6.0 million increase in personnel costs associated with a headcount increase by 9%, a $1.1 million increase in facilities costs, and an increase in travel and entertainment expenses of $0.9 million, offset by a decrease in marketing expenses of $0.5 million.
Additionally, as an independent infrastructure provider prioritizing transparency, we can be more closely aligned with both publishers and buyers which has enabled us to build direct relationships with publishers, advertisers, agencies, and DSPs and create bespoke products that meet our customers’ needs.
Additionally, as an independent infrastructure provider prioritizing transparency, we can be more closely aligned with both publishers and buyers which has enabled us to create bespoke products that meet our customers’ needs. We have also maintained a demonstrated track record of stability and agility to address changes in market conditions and provide superior outcomes for both publishers and buyers.
We continue to invest in new features for our existing solutions and new solutions such as our new product Activate, which allows buyers to execute direct deals on our platform with publisher inventory, and Convert, our commerce media solution, both of which were launched in 2023. We report revenue on a net basis.
In 2023, we launched Activate, which allows buyers to execute direct deals on our platform with publisher inventory, and Convert, our commerce media solution. We report revenue on a net basis. This represents gross billings to buyers, net of amounts we pay publishers and rebates associated with SPO agreements with buyers.
Our effective tax rate differs from the U.S. federal statutory income tax rate due to state taxes, foreign tax rate differences, technology and development tax credits, Section 162(m) limitation, and stock-based compensation. Realization of our deferred tax assets is dependent primarily on the generation of future taxable income.
We reevaluate the judgments surrounding our estimates and make adjustments, as appropriate, each reporting period. Our effective tax rate differs from the U.S. federal statutory income tax rate due to state taxes, foreign tax rate differences, technology and development tax credits, Section 162(m) limitation, and stock-based compensation.
Our platform allows publishers to sell, in real time, ad impressions to buyers and provides automated inventory management and monetization tools to publishers across various device types and digital ad formats. We charge publishers a fee, which is typically a percentage of the value of the impressions monetized through our platform.
Therefore, we consider these to be our critical accounting policies and estimates. Revenue Recognition We generate revenue through the monetization of publisher ad impressions processed on our platform. Our platform allows publishers to sell, in real time, ad impressions to buyers and provides automated inventory management and monetization tools to publishers across various device types and digital ad formats.
We expect revenue to continue to increase in 2025, primarily driven by growth in mobile and omnichannel video, which is the combination of short form video and OTT/CTV. Additionally, we expect our revenues to be affected by macroeconomic conditions, and will continue to be impacted by the bidding methodology changes implemented by one of our buyers in the near term.
Additionally, we expect our revenues to be affected by macroeconomic conditions, and will continue to be impacted by the bidding methodology changes implemented by one of our buyers in the near term. The magnitude of these impacts on our future revenues is difficult to predict.
Provision for Income Taxes The provision for income taxes consists primarily of federal, state, and foreign income taxes. Our income tax may be significantly affected by changes to our estimates for tax in jurisdictions in which we operate and other estimates utilized in determining the global effective tax rate.
Our income tax may be significantly affected by changes to our estimates for tax in jurisdictions in which we operate and other estimates utilized in determining the global effective tax rate. Actual results may also differ from our estimates based on changes in economic conditions. Such changes could have a substantial impact on the income tax provision.
For the year ended December 31, 2023, net cash used in investing activities was $39.0 million, consisting of a net purchase of investments of marketable securities of $29.6 million, $10.6 million in purchases of property and equipment (primarily data center infrastructure), $17.7 million of investments in capitalized internal use software, offset by net inflows from sales of marketable securities prior to maturity of $18.9 million.
As our business grows, we expect our capital expenditures and our investment activity to continue to increase. 57 Table of Contents For the year ended December 31, 2025, net cash provided by investing activities was $6.1 million of cash, consisting of a net inflows from investments of marketable securities of $13.8 million, sales of marketable securities prior to maturity of $27.1 million, offset by $14.3 million in purchases of property and equipment (primarily data center infrastructure), and $20.5 million of investments in capitalized internal use software.
The following table presents a reconciliation of Adjusted EBITDA to net income for each of the periods indicated: Year Ended December 31, 2024 2023 2022 (in thousands) Net income $ 12,504 $ 8,881 $ 28,705 Add back (deduct): Stock-based compensation 37,676 28,862 20,646 Depreciation and amortization 45,352 44,770 34,249 Unrealized loss and impairment of equity investment — — 5,948 Interest income (8,477) (8,828) (2,214) Acquisition-related and other expenses (1) — — 918 Provision for income taxes 5,270 1,624 8,762 Adjusted EBITDA $ 92,325 $ 75,309 $ 97,014 _______________ (1) We exclude acquisition-related and other expenses incurred in connection with our acquisition of Martin from Adjusted EBITDA because we do not believe such expenses are reflective of our ongoing core operations.
The following table presents a reconciliation of Adjusted EBITDA to net income (loss) for each of the periods indicated: Year Ended December 31, 2025 2024 2023 (in thousands) Net income (loss) $ (14,462) $ 12,504 $ 8,881 Add back (deduct): Stock-based compensation 38,378 37,676 28,862 Depreciation and amortization 43,769 45,352 44,770 Litigation related expenses (1) 902 — — Interest income (5,455) (8,477) (8,828) Provision for (benefit from) income taxes (1,492) 5,270 1,624 Adjusted EBITDA $ 61,640 $ 92,325 $ 75,309 _______________ (1) Litigation related expenses represents external legal fees and other expenses, net of insurance recoveries, associated with pending litigation that arose outside of the ordinary course of business.
Total Other Income (Expense), net Year Ended December 31, 2024 2023 $ Change % Change (dollars in thousands) Total other income (expense), net $ 5,370 $ (359) $ 5,729 (1,596) % Total other income (expense), net increased for the year ended December 31, 2024, compared to the prior year period, primarily driven by other income of $4.0 million from the Google Privacy Sandbox initiative in connection with their previous initiative to phase out the use of third-party cookies.
Interest income decreased due to the decrease in interest rates and a decrease in holdings in marketable securities. Other income (expense), net for the year ended December 31, 2024 included approximately $4.0 million recognized as other income from the Google Privacy Sandbox initiative, in connection with their previous initiative to phase out the use of third-party cookies.
Internal Use Software Development Costs We capitalize certain internal use software development costs associated with creating and enhancing internal use software related to our platform and technology infrastructure.
Accordingly, both accounts receivable and accounts payable appear large in relation to revenue reported on a net basis. 59 Table of Contents Internal Use Software Development Costs We capitalize certain internal use software development costs associated with creating and enhancing internal use software related to our platform and technology infrastructure.
For purposes of our publisher count, we aggregate multiple business accounts from separate divisions, segments or subsidiaries into a single “master” publisher based on our assessment of the related nature of the group. In addition, in 2024 we completed a number of SPO initiatives which increased buyer spend on our platform.
For purposes of our publisher count, we aggregate multiple business accounts from separate divisions, segments or subsidiaries into a single “master” publisher based on our assessment of the related nature of the group. We expect revenue to increase in 2026, primarily driven by growth in mobile and connected video (OTT/CTV), and new revenue streams including AI products.
For discussion on comparison of the fiscal years ended December 31, 2023 and December 31, 2022, please refer to Part II, Item 7, “Management's Discussion and Analysis of Financial Condition and Results of Operations” in our Annual Report on Form 10-K for the fiscal year ended December 31, 2023.
The difference between the effective tax rate in 2024 of 30% and the federal statutory income tax rate of 21% was primarily due to state taxes, Section 162(m) limitation, and acquisition-related costs partially offset by foreign derived intangible income (FDII) deduction and federal research and development credit. 55 Table of Contents For discussion on comparison of the fiscal years ended December 31, 2024 and December 31, 2023, please refer to Part II, Item 7, “Management's Discussion and Analysis of Financial Condition and Results of Operations” in our Annual Report on Form 10-K for the fiscal year ended December 31, 2024.
Because of the high degree of uncertainty regarding the settlement of these liabilities, we are unable to estimate the years in which future cash outflows may occur. As a result, this amount is not included in the contractual obligations table above.
As of December 31, 2025, we had $6.2 million of long-term income tax liabilities, including interest, related to uncertain tax positions. Because of the high degree of uncertainty regarding the settlement of these liabilities, we are unable to estimate the years in which future cash outflows may occur.
Some noted trends include the continued growth of digital media across multiple platforms, a continued increase in the number of ad impressions processed and analyzed in real-time by each participant in the digital advertising ecosystem, a desire for transparency and control throughout the supply chain from both the buyers and publishers, and rapidly evolving data and privacy regulations and standards.
Industry Trends and Macroeconomic Factors The digital advertising ecosystem continues to evolve and adapt at a rapid pace. Some noted trends include the continued growth of digital media across multiple platforms, an increased focus on performance driven media, and a desire for transparency and control throughout the supply chain from both the buyers and publishers.
Our platform also provides control and transparency to buyers, which includes advertisers, agencies, agency trading desks, and demand side platforms (“DSPs”), (which we collectively refer to as “buyers”) and enables both publishers and buyers to drive better business outcomes. Our infrastructure-driven approach allows for the efficient processing and utilization of data in real time.
Our platform empowers the world’s leading digital content creators (which we collectively refer to as “publishers”) to maximize monetization of their advertising inventory and audiences and provides control and transparency to buyers, which includes advertisers, agencies, agency trading desks, and demand side platforms (“DSPs”), which we collectively refer to as “buyers”.
General and administrative expenses also include outside consulting, legal and accounting services, allocated facilities costs, and travel and entertainment primarily related to inter-office travel and conferences. We expect general and administrative expenses to increase in absolute dollars in future periods.
General and administrative expenses also include outside consulting, legal and accounting services, allocated facilities costs, and travel and entertainment primarily related to inter-office travel and conferences. Total Other Income (expense), Net Total other income (expense), net consists of interest income and other income (expense), net. Interest income is generated by investing excess cash into money market accounts and marketable securities.
General and Administrative Year Ended December 31, 2024 2023 $ Change % Change (dollars in thousands) General and administrative $ 57,670 $ 56,219 $ 1,451 3 % Percent of revenue 20 % 21 % General and administrative expense increased primarily due to a $6.3 million increase in personnel costs associated with higher stock-based compensation costs, and a $1.1 million increase in professional services, offset by a $5.7 million decrease in provision for bad debt relating to a DSP buyer of our platform that filed for Chapter 11 bankruptcy on June 30, 2023.
General and Administrative Year Ended December 31, 2025 2024 $ Change % Change (dollars in thousands) General and administrative $ 60,340 $ 57,670 $ 2,670 5 % Percent of revenue 21 % 20 % General and administrative expense increased primarily due to a $1.0 million increase in facilities costs, a $0.9 million increase in personnel costs, and a $0.6 million increase in property taxes.
We have also maintained a demonstrated track record of stability and agility to address these market conditions and provide superior outcomes for both publishers and buyers. Finally, we have designed our technology to efficiently process real-time advertising transactions while leveraging data to optimize outcomes for publishers and buyers.
Finally, we have designed our technology to efficiently process real-time advertising transactions while leveraging data to optimize outcomes for publishers and buyers. We own and operate our software and hardware infrastructure globally, which saves significant infrastructure expenditures as compared to public cloud alternatives.
We recognize revenue when a bid is won and a buyer purchases inventory on our platform.
We invoice buyers for publisher digital advertising inventory purchased through its platform. We recognize revenue when a bid is won and a buyer purchases inventory on our platform. We estimate and record reductions to revenue for volume discounts based on expected volumes during the incentive term.
For the year ended 2024, we served approximately 1,900 publishers worldwide on our platform, compared to approximately 1,800 publishers worldwide for the year ended 2023.
These decreases were offset by an increase in growth of CTV (excluding the impact from political spend), mobile, and new revenue streams. For the year ended 2025, we served approximately 1,980 publishers worldwide on our platform, compared to approximately 1,900 publishers worldwide for the year ended 2024.
The following table summarizes our contractual obligations, at December 31, 2024 (in thousands): Payments due by period Total Less than 1 year 1 - 3 years 3 - 5 years More than 5 years Other contractual obligations (1) $ 25,487 $ 21,872 $ 3,615 $ — $ — Operating lease liabilities 57,902 6,513 18,178 9,125 24,086 Finance lease liabilities 501 149 311 41 — Total $ 83,890 $ 28,534 $ 22,104 $ 9,166 $ 24,086 ______________ (1) Other contractual obligations consist primarily of contractual obligations to third-party data center providers. 54 Table of Contents As of December 31, 2024, we had $5.0 million of long-term income tax liabilities, including interest, related to uncertain tax positions.
The following table summarizes our contractual obligations, at December 31, 2025 (in thousands): Payments due by period Total Less than 1 year 1 - 3 years 3 - 5 years More than 5 years Other contractual obligations (1) $ 75,520 $ 40,241 $ 35,154 $ 125 $ — Operating lease liabilities 54,883 9,019 16,466 8,990 20,408 Finance lease liabilities 352 153 199 — — Total $ 130,755 $ 49,413 $ 51,819 $ 9,115 $ 20,408 ______________ (1) Other contractual obligations consist primarily of contractual obligations to third-party data center providers.
Our revenues in 2024 benefited by approximately $14.2 million from incremental political spend in the United States due to the 2024 presidential election. Conversely, our business was negatively impacted by bidding methodology changes implemented by one of our buyers in the second half of the second fiscal quarter of 2024.
Our revenues in 2025 were primarily driven by impressions processed on our platform, new revenue streams, and growth in customer relationships. The revenue decline in 2025 as compared to 2024 was primarily due to approximately $14.2 million from incremental political spend in the United States in 2024 due to the United States presidential election.
Unrealized gain (loss) on equity investment consists of gains and losses on our investment in equity securities, including unrealized gains and losses from market price changes or impairment of securities we continue to hold. Other income (expense), net consists primarily of gains and losses from foreign currency exchange transactions.
Other income (expense), net consists primarily of gains and losses from foreign currency exchange transactions. Provision for Income Taxes The provision for income taxes consists primarily of federal, state, and foreign income taxes.
Overall, our cost of revenue per impression processed in 2024 decreased by 18% compared to 2023. Our gross margin of 65% in 2024 increased compared to 2023 of 63% due to revenue growth accelerating faster than cost of revenues.
Our gross margin of 64% in 2025 decreased compared to 2024 of 65% due to a higher decline in revenue as opposed to the increase in cost of revenue.
Interest income Year Ended December 31, 2024 2023 $ Change % Change (dollars in thousands) Interest income $ 8,477 $ 8,828 $ (351) (4) % Interest income decreased due to the decrease in interest rates and a decrease in holdings in marketable securities.
Total Other Income (Expense), net Year Ended December 31, 2025 2024 $ Change % Change (dollars in thousands) Interest income $ 5,455 $ 8,477 Other income (expense, net) (4,150) 5,370 Total other income (expense), net $ 1,305 $ 13,847 $ (12,542) (91) % Total other income (expense), net decreased for the year ended December 31, 2025, compared to the prior year period.
Acquisition-related expenses incurred in connection with our acquisition of Martin include third-party transaction costs. For additional information, see Note 7, “Business Combination” to our consolidated financial statements included elsewhere in this Annual Report on Form 10-K. In addition to operating income and net income, we use Adjusted EBITDA as a measure of operational efficiency.
These costs related to a discrete matter, and are not representative of our underlying operating performance. We do not adjust for legal expenses incurred in our ordinary course of business. In addition to operating income (loss) and net income (loss), we use Adjusted EBITDA as a measure of operational efficiency.
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Overview We are an independent technology company seeking to maximize customer value by delivering digital advertising’s supply chain of the future. Our technology platform empowers the world’s leading digital content creators (which we refer to as “publishers”) across the open internet to maximize monetization of their advertising inventory.
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Overview We are an independent, artificial intelligence-powered advertising technology company that delivers digital advertising performance. Our mission is to fuel the endless potential of Internet content creators and to enable a thriving, advertisement-funded digital ecosystem where global audiences can gain free or affordable access to information and entertainment.
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By delivering scalable and flexible programmatic innovation, we believe we improve outcomes for our customers while championing a vibrant and transparent digital advertising supply chain. We continue to focus on the strengths that we believe provide us with long-term competitive advantages.
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Our integrated technology platform connects buyers, publishers, data providers, and commerce media networks on a single, unified platform, to deliver advertising performance, control, transparency and efficiency.
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We own and operate our software and hardware infrastructure globally, which saves significant infrastructure expenditures as compared to public cloud alternatives. Industry Trends and Macroeconomic Factors The digital advertising ecosystem continues to evolve and adapt at a rapid pace.
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In addition, rapidly evolving data and privacy regulations and industry standards continue to impact our business.
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We believe we are positioned to benefit from tailwinds in the advertising industry, including the rapid proliferation of digital media, the need for purpose-built infrastructure to address the increasing complexity in the digital advertising landscape, and increasing consumer time spent online.

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Item 7A. Quantitative and Qualitative Disclosures About Market Risk

Market Risk — interest-rate, FX, commodity exposure

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Biggest changeTo date, we have not entered into any hedging arrangements with respect to foreign currency risk or other derivative instruments. In the event our foreign sales and expenses increase, our operating results may be more greatly affected by foreign currency exchange rate fluctuations, which can affect our operating income. A hypothetical 10% change in the U.S.
Biggest changeAdditionally, our expenses are generally denominated in the currencies in which our operations are located, primarily the U.S. Dollar, Indian Rupee, British Pound, and Euro. In the event our foreign sales and expenses increase, our operating results may be more greatly affected by foreign currency exchange rate fluctuations, which can affect our operating income (loss).
We had no amounts outstanding under our credit facility as of December 31, 2024. We do not believe that an increase or decrease in interest rates of 100 basis points would have a material effect on our operating results or financial condition. In future periods, we will continue to evaluate our investment policy relative to our overall objectives.
We had no amounts outstanding under our credit facility as of December 31, 2025. We do not believe that an increase or decrease in interest rates of 100 basis points would have a material effect on our operating results or financial condition. In future periods, we will continue to evaluate our investment policy relative to our overall objectives.
If our costs were to become subject to significant inflationary pressures, for example in India or increases in data center base costs, we might not be able to fully offset such higher costs through price increases. Our inability or failure to do so could adversely affect our business, results of operations, and financial condition. 58 Table of Contents
If our costs were to become subject to significant inflationary pressures, for example in India or increases in data center base costs, we might not be able to fully offset such higher costs through price increases. Our inability or failure to do so could adversely affect our business, results of operations, and financial condition. 61 Table of Contents
The primary objective of our investment activities is to preserve principal while maximizing income without significantly increasing risk. Because our cash, cash equivalents, and marketable securities have a relatively short maturity, our portfolio’s fair value is relatively insensitive to interest rate changes. Our line of credit is at variable interest rates.
The primary objective of our investment activities is to preserve principal while maximizing income without significantly increasing risk. Because our cash and cash equivalents have a relatively short maturity, our portfolio’s fair value is relatively insensitive to interest rate changes. Our line of credit is at variable interest rates.
Dollar to British Pound exchange rate could result in a change of $2.1 million and $1.7 million in our operating income for the year ended December 31, 2024 and December 31, 2023, respectively. Inflation Risk We do not believe that inflation has had a material effect on our business, results of operations, or financial condition.
Dollar to British Pound exchange rate could result in a change of $2.3 million and $2.1 million in our operating income (loss) for the year ended December 31, 2025 and December 31, 2024, respectively. Inflation Risk We do not believe that inflation has had a material effect on our business, results of operations, or financial condition.
Dollar to India Rupee exchange rate could result in a change of $2.2 million and $2.0 million in our operating income for the year ended December 31, 2024 and December 31, 2023, respectively. A hypothetical 10% change in the U.S.
A hypothetical 10% change in the U.S. Dollar to India Rupee exchange rate could result in a change of $2.2 million in our operating income (loss) for each of the years ended December 31, 2025 and December 31, 2024, respectively. A hypothetical 10% change in the U.S.
Currency Exchange Risk Our consolidated results of operations and cash flows are subject to fluctuations due to changes in foreign currency exchange rates. Historically, the majority of our revenue contracts have been denominated in U.S. Dollars. Our expenses are generally denominated in the currencies in which our operations are located, primarily the U.S. Dollar, Indian Rupee and British Pound.
Currency Exchange Risk Our consolidated results of operations and cash flows are subject to fluctuations due to changes in foreign currency exchange rates. Historically, the majority of our buyer contracts have been denominated in U.S. Dollars while our publisher contracts have been primarily denominated in U.S. Dollars as well as the Euro, British Pound, and Australian Dollar.
ITEM 7A. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK We are exposed to certain market risks in the ordinary course of our business.
ITEM 7A. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK We are exposed to certain market risks in the ordinary course of our business. These risks primarily include: Interest Rate Risk We had cash and cash equivalents of $145.5 million as of December 31, 2025, which consisted of bank deposits, money market accounts and commercial paper.
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These risks primarily include: Interest Rate Risk We had cash and cash equivalents of $100.5 million and marketable securities of $40.1 million as of December 31, 2024, which consisted of bank deposits, money market accounts, commercial paper, agency debt securities, and U.S. Treasury and government debt securities.

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