Over the past several weeks, a number of well-known digital advertisers have reported less than spectacular results, as the macroeconomic headwinds caused many businesses to cut back on their advertising budgets. Facebook parent Meta Platforms suffered its first-ever year-over-year revenue decline, followed in swift succession by Snap and Twitter, which both reported weaker-than-expected revenue growth.

The Trade Desk (TTD 5.72%) was up to bat after the market close on Tuesday and investors had similar expectations for weak results -- but the ad tech company proved once again why it's the industry leader.

A beat by any other name

The Trade Desk reported revenue of $377 million, up 35% year over year, on top of 101% growth in the prior-year quarter. The bottom line was also higher, with adjusted earnings per share (EPS) of $0.20, up 11%. This was enough to meet or beat analysts' consensus estimates, which called for revenue of $364.9 million and adjusted EPS of $0.20. 

The company also reported strength in its client relationships, with a customer retention rate of 95% during the quarter, a metric that it has consistently delivered each and every quarter going back eight consecutive years.

"This trend also gives us confidence that we will continue to gain market share in any market environment," said co-founder and CEO Jeff Green. "At the same time, we continue to invest to drive future growth in key areas such as identity, connected TV, retail media, and supply chain optimization."

Green went on to say that the company had signed "major new partnerships with some of the world's leading publishers, broadcasters, retailers, and technology partners in the second quarter." Partnerships such as these bode well for the company's future growth.

The Trade Desk highlighted one such deal last month when it announced a major advertising deal with media powerhouse Disney (DIS -0.07%). The partnership will integrate data from Disney's proprietary Audience Graph with The Trade Desk's open-source identity framework, Unified ID 2.0 (UID 2.0). 

Perhaps more importantly to investors -- particularly in this uncertain macroeconomic environment -- The Trade Desk put its money where its mouth is, issuing a solid outlook for the third quarter. The company is guiding for revenue of at least $385 million and adjusted EBITDA of roughly $140 million. To give those numbers context, analysts' consensus estimates were calling for $382.2 million and EPS of $0.22. This suggests that The Trade Desk is expecting its growth streak to continue.

Is the stock a buy?

The company's blockbuster quarter aside, there are plenty of reasons to add The Trade Desk to your buy list.

The Trade Desk's UID 2.0 is gaining broad acceptance across the industry and is becoming the de facto replacement for third-party ad-tracking cookies, which Alphabet's (GOOGL 0.66%) (GOOG 0.77%) Google plans to phase out on its Chrome browser over the next couple of years. Additionally, since UID 2.0 doesn't use personally identifiable information, it appeals to companies that are taking a harder line on consumer privacy. 

The Trade Desk is ramping up its value proposition for customers with its latest ad-trading system, Solimar. This state-of-the-art platform helps marketers better optimize their digital ad campaigns by leveraging their first-party data which is integrated into the process. 

Furthermore, The Trade Desk recently debuted OpenPath, which allows participating publishers to upload their ad inventory directly onto its platform, providing ad-buyers with direct access. While this might not seem like much, it gives companies a viable alternative to the "walled gardens" like Google and Facebook.

If all that weren't enough, it's worth considering the massive market opportunity the company is pursuing. The Trade Desk is targeting a total addressable market of roughly $750 billion in global ad spending, a market that's expected to top $1 trillion in several years' time. 

Given the ad tech giant's industry leadership, its consistently strong growth, and the massive opportunity ahead, the evidence suggests that The Trade Desk stock is an unqualified buy.