Redwood City, CA
PubMatic today reported that its GAAP net revenue increased by more than 90 percent year-over-year in 2014 over 2013 and that it ended the year with an annualized net revenue run-rate of more than $130 million. In addition, 2014 marks the second consecutive year of positive adjusted net income for PubMatic, which more than doubled its rate of profitability. The high pace of revenue and profit growth was fueled by PubMatic’s continued commitment to helping publishers protect, monetize and manage their most valuable asset – the relationship between consumers, content and services.
“Our customers recognize that we are the largest, independent software provider with a singular focus on the needs of publishers, as they build their sales strategy in today’s advertising marketplace,” said Rajeev Goel, Co-Founder and CEO of PubMatic. “Unlike technology companies-turned-publishers or exchanges, we never compete with the publishers we serve. Rather, we are focused on playing a critical role in maintaining a free and fair Internet by ensuring that premium, high quality content is never commoditized.”
Global Expansion and Scale
In 2014, PubMatic expanded operations into new markets, including Japan, Singapore, Italy and MENA (Middle East and North Africa), and increased investments in other previously established markets, specifically the United Kingdom, DACH (Germany, Austria and Switzerland), Australia, Brazil and India. PubMatic has more than doubled its team over the last two years to nearly 600 employees, and is projected to hire more than 300 new employees in 2015.
PubMatic works with nearly half of the U.S. comScore 100 publishers, managing more than 20 billion ad impressions per day and processing approximately five trillion advertiser bids per month, reaching 95 percent of the U.S. Internet population.
In 2014, PubMatic was recognized as the fourth fastest growing company in the Internet sector and ranked as the 31st fastest growing company across all industries on Deloitte’s Technology Fast 500™ survey, the third consecutive year that PubMatic has been named to the list. PubMatic attributes this level of performance to its outstanding global team, its industry-leading products, and its continued investments into driving the success of its customers.
Publisher Growth and Customer Success
During the course of 2014, PubMatic established relationships with numerous leading global publishers. By the end of 2014, more than 40 percent of PubMatic’s publishers used more than one of PubMatic’s products and the average tenure of the company’s publishers is 29 months. PubMatic’s unique position as the only publisher-focused, independent solution in the marketplace continues to resonate strongly as publishers become increasingly wary of large exchanges focused on advertiser optimization.
Illustrating its ability to help its customers succeed, for a second consecutive year, PubMatic’s revenue retention reached approximately 150 percent, reflecting average dollar churn of less than two percent per quarter and substantial organic and new product growth. The company forecasts more than $100 million in Annual Recurring Revenue (ARR) from existing customers with tenure of nine months or more in 2015.
In 2014, PubMatic’s revenues from mobile solutions increased more than 500 percent over 2013, not including the revenues from Mocean Mobile, the leading mobile ad server that PubMatic acquired in May 2014. The acquisition has allowed PubMatic to create the industry’s first end-to-end mobile solution for direct and indirect sales and yield in a single server stack. Mobile revenue accounted for approximately 25 percent of PubMatic’s total revenue in the fourth quarter of 2014.
In the first quarter of 2014, PubMatic launched the industry’s first multi-screen solution to deliver video advertising across display, mobile, and tablet for publishers. During the second quarter, Forrester Research, Inc. cited PubMatic as “ahead of the curve on both mobile and video integrations,” and as a leader among evaluated SSPs and exchanges for publishers in “The Forrester WaveTM: Sell-Side Platforms And Exchanges For Publishers, Q2 2014.”
During the second half of 2014, the company unveiled PubMatic Analytics, the industry’s first real-time reporting and analytics solution to include natural language processing capabilities. PubMatic Analytics provides publishers and media buyers with the actionable intelligence needed for real-time decision-making and a distinct competitive advantage.
Throughout 2014, PubMatic established a host of resources dedicated to extending its existing Private Marketplace solution and building industry-leading Automated Guaranteed capabilities. In January 2015, the company announced the industry’s first unified Programmatic Direct offering that extends workflow automation benefits not just to programmatic buyers and sellers, but also buyers and sellers of guaranteed, premium inventory. In addition, publishers will be able to access the very best in real-time insights and tools for streamlining the discovery and packaging of high quality ad impressions at scale across all media formats and sales channels
PubMatic is the technology platform that powers the programmatic advertising strategy of leading publishers and premium brands. Its innovative solutions help content providers drive the highest value for their digital media assets and provide consumers with a more personalized advertising experience across display, mobile and video. PubMatic’s One Platform, proprietary technology, and advanced mobile capabilities are utilized by a global roster of comScore publishers. Pioneering online auctions for the buying and selling of media through Real-Time Bidding (RTB) and Private Marketplaces (PMP), the company also works with hundreds of advertising partners. Ranked by Deloitte as one of the fastest growing companies in the US Internet sector in 2012, 2013 and 2014, PubMatic has offices worldwide with headquarters in Redwood City, California.
Adjusted Net Income: GAAP net income excluding stock-based compensation expense and certain non-recurring expenses.
Revenue Retention: Current year GAAP revenue from customers that were active in the prior year divided by prior year revenues for these customers.
Annual Recurring Revenue: Calendar year GAAP revenue from customers active for nine months or more during the current year.