Shares of adtech company PubMatic (PUBM 0.62%) skyrocketed on Tuesday. Investors were impressed with its second-quarter results. Shares were up about 22% at 11:20 a.m. ET.
The tech company bucked a trend of decelerating growth seen by many of its digital advertising peers. PubMatic also provided guidance for double-digit third-quarter revenue growth -- a growth rate well ahead of the decline forecast by Facebook parent Meta Platforms and the guidance for low-single-digit growth from streaming TV platform Roku.
PubMatic's second-quarter revenue increased 27% year over year to $63 million. This was an acceleration from a first-quarter year-over-year growth rate of 25%.
Impressively, PubMatic's net income for the period was $7.8 million, or 12% of revenue. Total cash, cash equivalents, and marketable securities was $183 million. Debt remained at zero.
PubMatic CEO Rajeev Goel noted that these growth rates were well ahead of market growth rates. He is right. A quick look at Meta's second-quarter year-over-year revenue decline of 1% and Roku's platform revenue growth of 26% all but confirms this view.
Where PubMatic really stands out is its guidance. Management guided for a year-over-year growth rate of about 15% despite expected headwinds from further softening in Europe and "muted ad spending" in Asia Pacific amid worsening economic conditions.
This growth would be much higher than Meta's expectation for a year-over-year decline in the third quarter and Roku's forecast for just 3% growth during the period.