In this video, I will talk about The Trade Desk (NASDAQ:TTD) and go over its recent earnings. I'm also going to touch on why connected television (CTV) is the future and why The Trade Desk is leading the way. 

What's the hype?

There's a huge shift from linear TV to connected TV; cord-cutting is accelerating each and every year. The likes of The Trade Desk and Roku are heavily benefiting from this shift. According to The Trade Desk, 27% of U.S. cable subscribers intend to cut the cord in 2021, up from the 15% who cut the cord in 2020. Thanks to CTV it will become easier for advertisers to target buyers instead of paying for an ad that gets played to the broader audience and has a low return on investment. More on this topic is discussed in the video below.

Earnings highlights

The company reported revenue of $219.8 million, a 37% year-over-year increase. Non-GAAP EPS of $1.41 compared to $0.90 the prior year.

Q2 guidance of revenue between $259 million and $262 million would be an increase of 86%-88%. That big YOY increase would be because last year the majority of advertisers stopped spending during the peak of the pandemic. 

A threat

Alphabet announced that it wants to cancel support for third-party cookies, which is supposed to hurt the likes of The Trade Desk, but it's been working on something called UID 2.0 or Unified ID. If this works out for TTD, it might just become the biggest player in the programmatic advertising world. 

For full insight do watch the video below. 

*Stock prices used were the closing prices of May 14, 2021. The video was published on May 16, 2021.

This article represents the opinion of the writer, who may disagree with the “official” recommendation position of a Motley Fool premium advisory service. We’re motley! Questioning an investing thesis -- even one of our own -- helps us all think critically about investing and make decisions that help us become smarter, happier, and richer.