Why The Trade Desk stock rose 25% in February

stock trading desk (TTD -0.43%) The adtech space’s leading independent demand-side platform (DSP) was one of the winners in February, as it posted strong fourth-quarter results and benefited from gains in technology and artificial intelligence (AI) stocks.

The stock rose 24.8% in February, according to data from S&P Global Market Intelligence. As you can see in the chart, The Trade Desk experienced steady growth during the first half of the month before seeing a spike in its earnings report mid-month.

TTD data from YCharts

The Trade Desk Keeps Winning

The Trade Desk’s stock rose during the first half of the month in response to strong earnings reports from large technology companies and other companies, indicating that the digital advertising market continues to recover.

In particular, strong results were obtained. meta platform The stock appeared to be on the rise on February 2nd, with The Trade Desk rising 4.2% on high trading volume.

But the real highlight of the quarter was guidance from the Trade Desk. The company reported strong fourth-quarter results and provided better-than-expected guidance for the first quarter.

During the last quarter, The Trade Desk said revenue rose 23% to $606 million, well above expectations of $582.2 million. Finally, adjusted earnings before interest, taxes, depreciation, and amortization (EBITDA) increased 16% to $284 million, and adjusted earnings per share improved from $0.38 to $0.41, but fell short of expectations of $0.43.

The ad technology leader reported revenue retention of at least 95% for another quarter and continued to advance with its post-cookie tracking technology, Unified ID 2.0 (UID2). It also increased its market share, with total spending on the platform reaching $9.6 billion.

Finally, The Trade Desk expects to start benefiting from the adoption of its new artificial intelligence platform, Kokai.

Image source: Getty Images.

What’s next for The Trade Desk?

Looking ahead, The Trade Desk expects revenue to increase 25% year-over-year to $478 million, with adjusted EBITDA expected to reach approximately $130 million.

The Trade Desk has performed well during the digital advertising downturn and is well-positioned to win the recovery as Kokai looks to strengthen its leadership by accelerating advertising insights and increasing ROI for its clients. UID2 also appears to be the best post-cookie tracking solution.

There’s still a lot of growth potential for the company in areas like connected TV and retail media, and investors should expect the stock to continue to perform well, especially as advertising demand grows.