Including our most recent Form 10 k and any subsequent filings on Forms 10 q or eight k. Our actual results may differ materially from those contemplated by the forward looking statements. We caution you, therefore, against relying on any of these forward looking statements. All information discussed today is as of May 8, twenty twenty five, and we do not intend or undertake no obligation to update any forward looking statement. As a result of new information, future developments, or otherwise. Except as may be required by law. In addition, today's discussion will include references to certain non GAAP financial measures. Including adjusted EBITDA, non GAAP net income and free cash flow. These non GAAP measures are presented for supplemental informational purposes only, and you should not be considered a substitute for financial information presented in accordance with GAAP. A reconciliation of these measures to the most directly comparable GAAP measures is available in our press release. And now I will turn the call over to Rajiv.

Thanks, Stacy, and welcome, everyone. We are pleased to have exceeded our guidance in q '1 on both the top and bottom line. Driven by the secular growth areas in our business. Excluding the affected DSP and political spend, year over year revenue growth accelerated to 21%, up from 17% in the second half of last year. We saw particular strength in CTV, which grew over 50% year over year. Also driving strength in q one was supply path optimization or SPO, which represented a record at over 55% of total activity agencies and advertisers prioritize the efficiency, data, and high ROI that the PubMatic platform delivers. This success highlights the clear differentiation of our platform. The investments we've made in activate for SPO, convert for commerce media, and Connect for Curation are resonating with key stakeholders across the digital supply chain. Publishers, media buyers, commerce media networks, curation and data partners. Further, these investments are driving significant growth while also diversifying our business. Creating sticky customer engagement and fueling performant advertising on our platform. Our business continues to shift to secular growth areas, an important transformation that will provide resiliency we navigate the current ad spend environment. Moreover, there are two significant and recent developments that provide long term tailwinds to our business.

First, the verdict in the Google AdTech antitrust case will provide us with a more level playing field in the open Internet. This is somewhat dependent on the timing and outcome of appeals and remedies, but the court's decision forces a major shift in the market as publishers and buyers opt for independent and transparent solutions. As a leading SSP provider, PubMatic is already positioned to take advantage of this structural shift. Second, Google recently announced that third party cookies will continue in the Chrome browser. We have built an innovative platform around a variety of data solutions over the past five which will continue to drive growth in newer media environments like CTV and commerce media, while at the same time, browser based content and ad monetization will now continue without dramatic interruption. The fundamentals of our business are strong. Looking beyond the isolated impact of the single DSP buyer, which we will lap in just a few weeks, and the tailwinds from political advertising last year, Our business is performing well, and on track to grow 15% plus with healthy margins and cash flow. Moreover, our durable financial profile positions us well for macroeconomic uncertainty. Which we believe creates more opportunities for us.

Our strength lies in maintaining focus and executional rigor while being adaptable and agile. This is a familiar playbook for us, one we use to manage through the great financial crisis and the COVID induced recessions. Coming out of both periods, significantly accelerated growth and drove durable market share gains. This was largely due to our agile approach to going after secular growth drivers and our ability and will to invest responsibly through each downturn. Although we're not immune to some of the potential negative effects of the economic environment, we firmly believe that digital advertising will come out of this period bigger than before with an accelerated shift to programmatic, and a heavy reliance on AI driven solutions. Periods of economic stress are terrific opportunities us to deepen our relationships with customers. Publishers need our help more than ever to drive monetization of their inventory and audiences, and and buyers will lean into the flexibility and accountability of programmatic advertising. Our plan is to once again leverage the many factors within our control and position ourselves to drive accelerated market share over the medium term. Given our past success in doing this, with a large and growing TAM, we plan to manage the business under the following three guiding principles.

One, anticipate where advertising growth will move to as the market rapidly evolves. Two, closely manage costs in order to preserve agility and protect our balance sheet and our free cash flow. And three, align the mix of investment and resources towards the high growth opportunities. So our growth accelerates on the other side. Based on our prior experience, we know that the market will rapidly evolve. We intend to continue to play offense, which will position us for accelerated growth once we emerge from a cautious macro environment. We are preparing for more pronounced shifts in ad spend in key programmatic driven areas. First, we anticipate an acceleration of the ad spend shift from linear TV to streaming. Based on the current economic environment, there's a growing likelihood that advertisers will step back from making significant upfront commitments in exchange for the flexibility that the spot market offers. The spot market will be heavily transacted programmatically, whereas the upfront market is not. Programmatic also brings a higher degree of measurement and accountability. Our platform is already scaled for this dollar shift. Given the investment we have made in buyer and seller relationships in CTV and premium online video, PMP and PG capabilities, AI solutions for deal management and optimization, and more.

Recall that PubMatic has over 80% penetration of the top 30 streamers. Second, we anticipate a more pronounced shift from upper funnel advertising strategies to lower funnel. In other words, a shift from brand advertising to performance. This will ultimately benefit new performance channels in the open Internet. Like commerce media and advanced data and targeting solutions. In both areas, we have made significant advancements with our convert and connect solutions. Innovation around first party data and identifiers. Third, we anticipate increased spend consolidation as ad budgets come under greater scrutiny, marketers seek greater efficiencies. SPO initiatives are a clear and obvious way for marketers to offset any potential decline in their ad budgets. With Activate, buyers can consolidate ad spend access curated audiences, increase performance, and gain tangible cost and operational efficiencies. Will better position them to maintain and grow their businesses. And finally, AI driven capabilities that can both drive growth and create efficiencies will be increasingly attractive to both new and existing customers. Over the past several years, we fully embrace generative AI. Expanding our multi decade focus on machine learning. The investments we've made are now translating into a steady stream of customer solutions. Yesterday, we announced the industry's first GenAI powered end to end platform that gives buyers direct access to nearly the entire open Internet.

Our technology simplifies and optimizes every stage of the media buying process. From inventory discovery and forecasting to curation, activation, and performance optimization. By unifying supply side intelligence, AI powered buying tools in a single platform, we aim to deliver greater efficiency, ease of use, and better outcomes for advertisers and agencies. With anticipated shifts in ad spend, this unified experience gives buyers exactly what they need to plan and refine campaigns with unprecedented ease. By simply describing their ideal inventory in natural language, our generative AI models instantly create optimized deal packages eliminating manual workflows, reducing time to launch, improving targeting precision. Buyers can then seamlessly activate those deals either through activate gaining full supply chain transparency, control, and efficiency, or push them to their DSP of choice. GroupM, a global partner and early adopter of our Activate platform, is among the beta testers of this unified experience. Andrew Meaden, GroupM's global head of investment explained, quote, our long standing partnership with PubMatic is based on a shared commitment to privacy first, AI powered innovation helps us stay ahead in a rapidly evolving industry. PubMatic's new unified platform will help us deliver smarter, more efficient campaigns for our clients.

End quote. As AI becomes foundational to programmatic success, PubMatic is uniquely positioned to lead with differentiated technology, a scaled platform, and a commitment to delivering tangible business outcomes. Both buyers and publishers. Our second priority is to safeguard our balance sheet and free cash flow. While remaining agile in order to capitalize on opportunities as they arise. We will tightly manage costs and use our well honed playbook to drive continued OpEx and CapEx efficiencies. We're also intently focused on generating efficiencies through the use of GenAI across our business operations, I mentioned last quarter. Application within our engineering organization is allowing us to accelerate innovation in expanding headcount. Generating improved productivity and faster deployments. By tightly managing costs and driving efficiencies, we're able to shift our growth investments to the areas with the highest returns. In particular, we are expanding the scale and specialization of our global sales organization. Including the team that serves agency holding companies to drive growth in SPO and Activate, our independent agency and advertiser sales team, which we believe represents an incremental 15,000,000,000 addressable market, for SPO in the next few years. Sales specialists dedicated to specific products such as Activate, CTV, commerce media, online video, and mobile app.

And finally, our curation sales team as sell side targeting becomes more prominent, and data partners and curators look to activate their first party data on the PubMatic platform. This discipline and forward looking framework aligns with the growth opportunities we see across our key customer segments. On the publisher side of our business, we have deepened our relationships with leading CTV platforms. Our partnership with Spectrum Reach, the advertising division of Charter Communications, brings greater demand efficiency and robust curation across their CTV marketplace. While our work with TCL is helping to drive advertiser access to live sports streaming, segment that is both rapidly growing and notoriously challenging to monetize effectively We're not just seeing strong growth in The US, in key international markets like Europe, Australia, India, and Japan. For example, recently expanded our partnership with the BBC to monetize their free ad supported streaming channels. We're also seeing a broader trend with traditional broadcasters globally turning to PubMatic to drive monetization, of their increasingly streaming based consumption. On the demand side, we are seeing momentum accelerate across agencies, advertisers, and DSPs. We have seen activity from mid market DSPs that specialize in performance marketing almost triple on a year over year basis.

These platforms are rapidly scaling their spend on PubMatic, thanks to our premium supply addressable audiences, and full funnel capabilities. Additionally, as I predicted a few quarters ago, we are seeing a marked increase in SPO activity with direct advertisers. Both at the head of the market and among the next tier as they take a more active role in their buying strategies and consolidate around trusted, performance oriented partners. In recognition of the performance impact PubMatic is driving for advertisers, PubMatic received the supply path optimization award as part of AdXchangers twenty twenty five programmatic impact awards for how we helped Mars PetCare exceed sales goals. In addition, Kroger Precision Marketing, looking to improve its customer acquisition marketing by eliminating unnecessary supply chain efficiencies, partnered with PubMatic to target and curate data on the sell side. Not only did our solutions boost video performance, but Kroger also consolidated ad spend on PubMatic. Reducing its supply partners by more than 70%. According to KPM's manager of media activation and buying, quote, PubMatic has consistently been achieving efficient supply path strategies, backed by data. Especially in online video. Their performance outshines competitors. Their platform helps us helps us exceed our goals and solve our inefficiency challenges.

End quote.

More broadly, commerce media continues to be one of the fastest growing segments in programmatic. And we expect that trend to accelerate due to its measurable performance. With the investments we've made, commerce media network can monetize both their audience data off-site as well as their on-site inventory in a privacy safe efficient way. In fact, our platform gives commerce companies full control over their data and direct access to premium demand and transparent reporting. Giving buyers greater efficiency and performance. For example, a leading casual dining brand reduced customer acquisition costs by 11% by leveraging Instacart's audience segments across our premium inventory. Previous campaigns that relied on DSP based audience targeting struggled with data leakage and low match rates resulted in higher costs and limited reach. We are seeing similar trends with data partners and curation are increasingly pivoting towards sell side targeting. This shift is being driven by structural industry changes. The shift away from third party cookies, growing sensitivity around data privacy, and advertiser demand for more transparent performing paths to inventory. As a result, sell side activation is emerging as a preferred model and PubMatic has built a unified, AI powered platform that is delivering clear performance gains.

Publishers using our curation tools have seen up to 10% revenue gains due to an increased diversity of buyers and higher CPMs. At the same time, data owners are able to build new and scaled revenue streams. By expanding opportunities for our customers, able to generate incremental revenue through both SSP and curation related transaction fees. These quarterly highlights just a handful of examples of how we're creating value across the entire supply chain. As audience targeting strategies continue to shift to the sell side, PubMatic's end to end tools, including our new AI buyer platform, along with our scale and track record of innovation, make us an ideal partner to support customer growth. We have a leading market position and are growing high double digits in key secular areas of the business. Highlighting the confidence in our strategy and our strong financial profile, the board of directors has expanded our repurchase plan by an incremental $100,000,000. While the current environment has a degree of uncertainty, we firmly believe it also serves as a catalyst and will accelerate the shift to programmatic that will benefit our business and create outsized shareholder value over the long term. I'll now turn the call over to Steve for the financials.

You, Rajeev, and welcome, everyone. We delivered a strong quarter with revenue ahead of expectations, driven by significant growth in the long term secular drivers of our business. CTV, SPO, and our emerging revenue streams. These drivers accelerated the growth of our underlying business to 21% year over year, up from 17% in the second half of last year. This excludes the large DSP buyer and political advertising, and now accounts for 70% of all revenue. Our growth clearly demonstrates the benefits we're gaining from increased scale, our winning product suite, and investments in our go to market teams. We also exceeded our adjusted EBIT expectations as a result of our increasing mix towards secular growth drivers, ongoing optimization of our infrastructure, impact from prior investments, and increased engineering efficiency with GenAI. Turning to the revenue breakdown for q one. Once again, our secular growth areas powered our business. Omnichannel video revenues in the quarter grew 20% year over year, represented 40% of total revenues in the first quarter. This was driven by strong CTV revenues, which increased over 50% year over year. Emerging revenue streams more than doubled year over year. Within this category, Connect, our curation and data business, continued its rapid revenue growth trajectory at over a % year over year, as buyers are increasingly using PubMatic to target audiences on the sell side.

Revenue from display, which was disproportionately impacted by the large DSP buyer, declined 10% year over year. Excluding this buyer, all other display revenues grew strongly at over 20% year over year. Q one total revenue, inclusive of the impact from the DSP buyer, declined 4%. Our underlying business, excluding this DSP and political advertising, increased 21%. Notably, March was a strong month and delivered better than expected results, which led to our overachievement for the quarter. Ad spend for our top 10 ad verticals grew in the mid single digit percentages year over year. Within the top 10, health and fitness, food and drink, style and fashion in aggregate increased over 10%. We saw softer trends for technology in computing and automotive, which declined by over 10%. On a regional basis, both Americas and EMEA declined slightly, while APAC grew over 8% year over year. As a reminder, we have limited exposure to China based advertisers. Turning to adjusted EBITDA. We significantly exceeded the upper end of expectations due to higher total revenues and the continued mix shift to high value channels and formats. Q one adjusted EBITDA was 8,500,000.0 or 13% margin and was our thirty sixth straight quarter of adjusted EBITDA profitability.

This result included a foreign exchange impact of approximately 1,000,000 due to the weakening US dollar over the quarter. Our long track record underscores the intrinsic strengths of our durable business model. Over the last decade, we have executed our strategy of owning and operating our programmatic infrastructure combined with a singular focus on operational excellence. This approach has enabled us to consistently drive productivity. Over the last two years, on a trailing twelve month basis, we increased the number of impressions processed by 60% while managing our GAAP cost of revenue to an increase of percent over the same period. We are also leveraging AI in our engineering organization, as well as across business functions. These efforts further allow us to accelerate our programmatic capabilities, and expand our go to market efforts while tightly managing costs. Total operating expenses in the first quarter were 50,000,000, and reflected cost savings as well as the cumulative impact from investments in the high growth secular areas that are driving the double digit percentage growth in our underlying business. Q one GAAP net loss was 9,500,000.0, or minus 20¢ per diluted share. Moving to cash and our capital allocation. We have a healthy balance sheet and generate positive cash flow which provides financial stability, but at the same time allows us consistently invest for revenue growth.

Over the last four years, we have produced nearly 350,000,000 in net cash from operations, and more than a hundred and 80,000,000 in free cash flow. In the quarter, we generated 15,600,000.0 in net cash provided by operating activities and free cash flow of 7,300,000.0. We ended the quarter with a hundred and 44,100,000.0 in cash, marketable securities, and zero debt. Given the strength, we continue to deploy our capital to maximize shareholder value. Since the inception of our repurchase program, in February 2023 through the end of q one, We have bought back 8,700,000.0 class a common shares a hundred and 38,200,000.0. We had 36,800,000.0 remaining authorized through the end of twenty twenty five. On May 7, our board of directors authorized a hundred million expansion of the repurchase program and extended through the end of twenty twenty six. Our guiding principles that Rajeev outlined position us well for the current macro environment and the significant growth opportunities ahead. History shows that uncertain times lead to rapid industry shifts, accelerated adoption of new tools and platforms. Our track record demonstrates we can successfully navigate these periods while continuing to strategically invest, to take advantage of the opportunities that emerge.

We are taking a proactive approach by implementing a number of savings initiatives, unlocking incremental productivity gains, and expanding AI adoption. This allows us to continue innovating and expanding our global sales team while managing our cost structure. Expect operating expenses to increase sequentially in the low single digit percentages over the course of 2025. Turning to the latest trends we are seeing. April revenues were in line with our expectations. We delivered over 15% growth in our underlying business. Total revenues, inclusive of the DSP headwind, were flat year over year, reflecting an improvement from the first quarter's year over year decline. As a reminder, have a well diversified platform with over 20 different ad verticals and more than 50,000 advertisers spending on our platform every month. In April, we saw the benefits from this diversification. Our health and fitness and arts and entertainment verticals increased over 20% year over year in aggregate. Which helped offset softness in verticals such as CPG heavy shopping vertical and automotive, which declined 10% year over year. For q two, we expect revenue to be in the range of 66 to 70,000,000 and assumes 15% plus year over year growth of our underlying business.

The low end of this range reflects conservatism in the event that a slowdown in ad were to develop for the remainder of q two, which, again, we are not currently seeing. We expect our q two adjusted EBITDA to be in the range of 9 to 12,000,000 which factors in an incremental impact of continued weakness of the US dollar. Looking to the second half of the year, based on the strong momentum we are seeing in our underlying business, combined with the go to market and innovation investments we are making, we expect our online revenues to continue growing 15% plus. We remain confident that we will deliver second half year over year revenue growth which includes a five to seven percentage point headwind from political spend in the back half of twenty twenty four. In terms of CapEx, through a combination of optimization efforts, and cost saving measures, we anticipate reducing our full year CapEx by at least 15% to 15,000,000. In closing, I wanna take the opportunity to summarize the key takeaways. Our company delivered a strong first quarter. We stayed focused on driving our long term secular growth areas, and exceeded our expectations with 21% growth for underlying business.

We have implemented a prudent operational plan that allows us to continue investing behind the fastest growing programmatic opportunities also protecting our profitability and balance sheet. This, coupled with our durable business model, gives us confidence that we can successfully navigate the current environment and be well positioned for mute future market share gains. I will now turn the call over to Stacy for questions.

Thank you, Steve. As a reminder, you can ask a question by raising your can located on the dashboard. Our first question comes from Eric Martinuzzi at Lake Street. Please go ahead, Eric.

Congratulations on the strong first quarter results and the good outlook for Q2. I wanted to start off with the one of the issues you highlighted in your prepared remarks, Rajiv, regarding the the Google antitrust ruling. Curious to know if you had direct interaction with the kind of DOJ as they've looked to kind of size up potential remedies to the monopolistic behavior.

Sure. Yeah. Eric, what I can say is that I think the DOJ is making its rounds in terms of talking to witnesses that testified in the in the trial itself. As they figure out, you know, what the the remedy strategy is, and I think you saw that you saw that posted. In terms of their their filing on Monday. I think more broadly, you know, what verdict has crystallized for the whole ecosystem is that Google is not the immovable object that it once was was. And when I talk to customers both on the sell side and the buy side, people are starting to prepare for the uncertainty of what lies ahead. Knowing that there could be a spinout. You know, is there gonna be innovation? Put all of your eggs into the Google basket? And so why not start growing faster with the alternatives that you know are already here in that scale like PubMatic. And we think we have about a 4% share of the market. Google got roughly 60% and so we think there's a lot of potentially share up for grab as early as next year. With every 1% share that we can pick up equating to 50 to 75,000,000 of net revenue to us.

So I think it's a pretty significant opportunity.

Gotcha. And then I wanted to shift gears and talk about the SPO traction that you've had. You know, that 55% number, that's a pretty amazing accomplishment. It's been interesting to see the progress of SPO over time. Over the long term, where do you think SPO kind of what is the ceiling for that? And then just commenting on the most recent quarter, what's the mix of new buyers versus old in that 55%?

Sure. Yeah. So on the on the first part of your question, and thank you for the for the compliment there. So we think long term SPO could be as high as 75%. Share of the business. So we've we've made a lot of progress as you mentioned. I think we were in the the roughly thirties. Percent two years ago. And there's still, I think, lot of runway to go. Obviously, the the share will gains will slow, we get, higher and higher. Where we see opportunity is a couple of different areas. So one is just continuing to grow the spend that's coming under our existing relationships. Are primarily with big agency holding companies. Right? And so we we all know who those are. GroupM, for instance, you know, we mentioned them in our GenAI buyer solution release yesterday. So that's that's an example of potential for, continued growth with an existing customer, agency holdco in that case. But we are also expanding our sales team to go after more advertisers, and independent agencies we think there's a lot of SPO runway ahead. So that I think, would be both growth in terms of new dollars as well as in terms of, SPO dollars.

Got it. Thank you.

Thank you. Our next question comes from Zant. Cummins at B. Riley. Please go ahead, Hi, good afternoon, Rajeev and Steve. Thanks for taking my questions. Steve, my first question is really can you give an update on how volumes trended with your key DS partner here in the first quarter? In terms of I know you mentioned 10% decline in overall display revenue. Was there a more outsized impact, whether that be in desktop display versus mobile display?

You know, what we're actually seeing, and I've, commented on this in the past, is that there's been quite a bit of stability. And one of the drivers of our, our expectations in the first quarter was a little bit better results from that DSP buyer. So from our perspective, it's, unfolding exactly as we had anticipated and, you know, slightly to the upside. And so we think, you know, we're, gonna have a a solid, second half with this buyer. As a reminder to everyone, we're gonna be lapping that impact midyear, so the end of q two. And so, you know, as we've shared in the past, we continue to have a great relationship with the buyer. We're expanding, you know, in multiple, new areas. So we feel really good about where we are right now.

Just a a quick add there, Zach, that, we've seen, for instance, CTV growth with this buyer. Has grown dramatically on a year over year basis. So there's there's plenty of, I think, growth opportunities with this DSP buyer in general. Beyond the the technical auction, shift. Got it. Got it. And and my one follow-up question, Rajiv, is interesting to see that the strong traction you're getting with these mid market DSPs I mean, can you just talk about how those relationships have really evolved and kind of where you can see this going now that you're starting to get traction off at that mid market level?

Yeah. You know, I think four or five years ago, the DSP space was pretty heavily consolidated. Right? And I think that's the perception in the market and, you know, it was probably not not too far from reality. Now we fast forward to today, and what we see is that there's a lot of actually change in the DSP market. Right? So there's a a lot written about the growth of Amazon. We know where the antitrust verdict is with with Google. And then we're seeing, I think, with the rise of CTV, a lot more performance buying for instance, happening in CTV. We're seeing that money has shifted the share of ad budgets controlled by the the big five or six agency hold codes is actually, the share is shrinking over time. From something like 40% to 30%, in the last decade. So what that means is that there's a big mid market of advertisers that, and agencies that are not tied to, you know, the decisions that those big holding companies have made. And they're making their own decisions. So we're seeing a lot of growth and potential there. And that's not only in The US, but but it's around the world.

And so we're really focused on bringing those DSPs onto our platform, making sure that we're, growing our our share of revenue with them.

Great. Well, thanks for taking my questions, and, best of luck with the rest of the quarter. Thanks, Zach. Thanks.

And our next question comes from Simran Biswal at RBC. Please go ahead.

Hey, guys. This is Simran on for Matt Swanson. Thanks for taking our question and congrats on the quarter. Just one for me. Can you talk about the macro environment and spend and what you're seeing at a high level with the uncertainty as we think about the rest of the year. And then to that point, double clicking on the resiliency around some of these growth drivers like CTV and emerging products.

Sure.

Why don't I, start with that? And then, Steve, I'll I'll turn it over to you. So let me just talk a little bit about what what we're seeing from a a macro perspective, Simran. So I do think advertisers are intensively scenario planning for the future. They certainly have practice with that with COVID in 2020 and then the the recession that never came in in 2023. I think one of the things that advertisers have learned is really the trade off of pulling back on ad spend respect to negatively affecting, you know, their own top line growth and market share. And so as Steve highlighted, you know, we're not seeing a pullback so far in the quarter. Seeing anything that gives us pause right now. April came in well, and and we're not hearing from customers that they are, pausing or delaying ad spend at scale. Now looking through to the other side, I think there's a number of trends or shifts that I see and expect. All of which I think will benefit us. So first of all, we anticipate a shift from linear TV into streaming. As the up fronts, are getting underway, I gotta imagine that many advertisers know, are not super keen to commit significant upfront budgets.

And, and they want flexibility. They want agility. Which means they'll be able to buy more in the spot market, which know, scatter market, which really favors programmatic. I think that's significantly to our benefit. You know, we've got 80% penetration of the top 30 streamers. I think we're gonna see a shift from upper funnel to lower lower funnel or, you know, brand to performance, and we've got a lot of solutions there. You to your point on resiliency around, CTV, media, advanced data, and targeting. So we've got our you know, convert, connect other products, and our performance DSP, tripled on a year over year basis. I think we're also gonna see marketers say, hey. One way to offset pressure on ad budgets is, spend consolidation or SPO. Right? And so that, I think, can continue to to grow, as a share of the business and we've got Activate in our in our new launch. We're really excited about that. Then I think more broadly, AI solutions focused on growth efficiency, will be increasingly attractive, and buyers and publishers alike will be willing to try new solutions. And so I think that favors know, our AI, driven development.

Let me let me turn it over to Steve.

Sure. Yeah. Just to tack on to what Rajiv has described described, which lays the the real foundation of how we think about the second half. I mean, number one, you know, really to emphasize the point that over the last couple of years, we've been diversifying our customers. You know? Publisher base, you know, branded publishers, buyers, commerce media networks, data curation partners. So the business we are today is very different what we were a couple years ago. So that gives us a lot of confidence in terms of being able to, be resilient and be agile. And then there's the, overarching points around just this secular, shift in the market towards, you know, CTV and, you know, high engagement formats like mobile app. All areas that we're very well positioned in and growing. And so when we think about the, the second half, you know, we're we're confident that we're gonna be able to grow our underlying business 15% plus. And be able to, you know, continue to grow through it's a function of both the momentum we have as well as the continued investments that we're making And, of course, you know, our ability to execute, which we've proven, time and time again in terms of navigating, you know, uncertain environments as we have today.

Thanks, guys.

Next up, we have Jacob Armstrong from Ki Bin. Please go ahead, Jacob.

Hi. This is Jacob on for Justin. Made a lot of progress with omnichannel video. As you approach and surpass this is about 50% of the mix. How do you think about letting those higher CPMs drop through to margins versus reinvesting for future growth? Thank you.

Sure. Rajeev and I could tag team, but let me just give you a a perspective from where I sit, the CFO's seat. So what we're doing as a business, you know, to, build on the, the themes that we've shared is we're looking for, and identifying the fastest growing area of secular growth areas. And you you hit the nail on the head. Omnichannel video is certainly one of them, you know, and double clicking, you know, CTV. You know, CTV, we had a great, first quarter growing revenues over 50%. And so, you know, significant momentum. But we've also been expanding in a number of other areas. You know, you heard the announcement that we, had yesterday. You know, the first end to end AI enabled buying platform. That, you know, we think is gonna position us well. And so when we think about investing, it's always a function of are we having, you know, adequate resources to make sure we're capitalizing on the best growth opportunities? The answer is yes. We believe we are doing that. Number two, you know, our focus is obviously getting continued productivity out of the organization to help fund that. And, you know, we've been, sharing, you know, data over the years in terms of our strength in managing our infrastructure.

The stat that I shared in the prepared comments you know, increasing our, impression capacity by 60% while keeping, you know, our cost of revenue, you know, 16%. Is a significant delta that allows us to reinvest in the business. And so as long as we keep on seeing sort of the opportunities to drive those growth areas, we're gonna keep doing that. At the same time, we're obviously very cognizant of managing the bottom line, and we've done that consistently over many years. You know, very long track record of adjusted EBITDA profitability. And so we're gonna always balance, you know, in terms of, you know, funding growth and then, you know, appropriately, managing the bottom line. We think we have a right, mix between the two. Anything you wanna add, Rajiv?

Yeah. I think, you know, we we are very focused on growing, video business just because it's it's there's still so much runway ahead of us. So we are 80% penetrated with the top 30 streamers. You know, when we think about CTV, CTV grew over 50% year over year. Still a lot more premium content to add live sports, you know, traditional broadcasters in some parts of the world are just getting going with streaming. They're more and more using PubMatic to drive monetization of their streaming based consumption. So as an example, we added the the fast the free ad supported, TV channels of the BBC, out of The UK. And then we're just seeing tremendous momentum from Activate in our CTV marketplace. So I think there's there's a lot of growth opportunity for us to to go after.

Thanks, Sridhar. Our next question comes from Andrew Boone at JMP. Please go ahead, Andrew. Thanks so much for taking the question.

One on guidance and one strategic. Rajiv, you talked about how curation and data and all of the other kind of newer products you guys have launched for the last three years is improving kind of ROAS across the platform.

What do you think is next? Right? Like, how do you drive that over the next two years? And then how do you think about that maybe in, five years? Right? So give us kind of a near and medium term road map. And then, Steve, I I would love to just better understand the bridge from what is kind of that normalized strong, I think, 21% growth that you guys talked about in the quarter versus kind of the the gap result that got put up You just help us understand the breakdown of kind of what is political versus kind of what is that one time DSP? And then just connect that to kind of 15% growth you guys are targeting for 2025. Thanks so much.

Yeah. Great. So, yeah, let me start on the the first part just in terms of, you know, how do we continue to grow, ROAS on the platform. So think there's three key drivers. So number one is data, as you mentioned. So with the know, on and off again, you know, cookie, deprecation, process. I think we certainly have been investing a lot in bringing first party data and identity data onto our platform. So that, I think, is a key ingredient to driving performance. The reasons the walled gardens do so well is, you know, you're logged in as a consumer into those environments, and so they can you know, use that to target and drive strong performance. Now seeing a lot more first party data whether it's CTV or it's commerce media driven or mobile app environment. We're seeing a lot that data, in the open Internet on our platform. Which creates a great, background for driving performance. Second is just driving efficiency across the supply chain, so bringing side and the buy side closer together. That creates a lot of operational efficient efficiency, creates a lot of fee efficiency. And it also accelerates the feedback loop of sell side to buy side.

Or buy side to sell side so that you can drive performance. That's exactly, you know, what we've been doing with Activate and supply path optimization. Our announcement, from yesterday, we think we'll move that forward materially. There's clearly a trend in the in the ecosystem towards buyers and and sellers looking to to, transact with fewer fewer intermediaries or or fewer ops in between. And then I think the last piece is really to build performance solutions in terms of know, helping buyers, optimize whatever the outcome is that they're looking So it could be close loop attribution in the case of commerce. It could be, cost per action or cost per customer acquisition. And I think the the framework that we've laid, around data and supply chain efficiency activate in our SSP, gives us the ingredients to drive that over the next couple of years.

Thanks, Rajeev. So, Andrew, with respect to just helping understand the bridge between the 15% plus growth and our total reported numbers. So as a reminder for everyone, who's not familiar, mid last year, there was a change in one of the DSPs in terms of how they bid on our platform. We'd anticipated that that would have an impact in the, second half of twenty four and the first half of twenty five. And how it's unfolded is exactly how as we had anticipated. You know, we're gonna be, you know, growing through that. And the key point a couple key points are to note. The, 15% plus growth, that, you know, we anticipate is, you know, the the the large majority of our business, 70% of our revenues. And we're gonna be lapping that, you know, anniversary of the DSP change, midyear. That impact that we are growing through in the first half of this year is about 15 to $20,000,000. So when you think about us putting up, you know, you know, a decent total reported numbers, and then in April, as I shared, you know, we were flat, year over year inclusive of that. Shows the, the strong momentum that we have.

And then, as everyone's familiar, there was a, you know, a big, amount of political spending last year. In the second half of the year, we're gonna be, lapping that. That represents a headwind, about, you know, six ish per six to 7% of, overall revenues. But we expect that even with that headwind, we're gonna be able to grow with the core momentum of 50% plus, you know, absorbing that headwind, you know, on a plus, positive year over year basis in the second half. And it's a function of the points that we've, articulated. One, the diversified business that we built the focus on the, the fastest growing areas, you know, with, you know, video, growing double digits. And then, of course, you know, other parts of our business doing quite well. The emerging revenues, you know, doubling over, year over year. So I expect as we, you know, end the year, you know, the it's gonna be much more apparent terms of what the total business, looks like. And then going into '26, it's gonna be, you know, a clean comparison, you know, and we expect to be growing in the double digits.

Great. Thank you.

Thanks, Steve.

I'm now gonna turn the call back over to Rajiv for closing remarks. Go ahead, Rajiv.

Thank you, Stacy, and thank you all for joining us today. Delivered a strong first quarter, and ad spend trends to date remain consistent. The current environment has a degree of uncertainty, we firmly believe it also serves as a catalyst that will accelerate the shift to programmatic. This, together with opportunities from the recent Google verdict, position us well for long term growth. Our prudent operating plan allows us to continue investing in secular growth opportunities, while also protecting our balance sheet and cash flow while expanding our repurchase program. We look forward to seeing many of you at upcoming conferences, including Evercore's Nothing But Net Conference, Jefferies Public Technology Conference, which also be on the road in several cities over the next few weeks. Everyone for joining us today, and have a great afternoon.

Thank you.