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TubeMogul Inc. Revenue Surges on Strong Advertising Spending Growth

By Joe Tenebruso - Mar 2, 2016 at 9:43AM

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The brand advertising platform grew its sales by more than 60% in the fourth quarter.

Image source: TubeMogul.

TubeMogul (TUBE) reported fourth-quarter results on Feb. 29. The company is benefiting from the rapid adoption of both its self-serve and managed brand advertising offerings, which is boosting revenue and improving profitability.

TubeMogul results: The raw numbers

 

Q4 2015

Q4 2014

Growth (YOY)

Revenue

$58.455 million

$36.082 million

62%

Net Loss

$1.500 million

$4.044 million

N/A

Earnings Per Share

($0.04)

($0.14)

N/A

Data source: TubeMogul Q4 2015 earnings press release.

What happened with TubeMogul this quarter?
Total spend -- essentially the amount that TubeMogul's customers spend through its platform, including the cost of media purchases and TubeMogul's fees -- jumped 63% year over year to $134.5 million.

Spend on Tube Mogul's Platform Direct offering, which allows advertisers to run campaigns through a self-serve model, grew 56% to $98.2 million, representing 73% of total spend. And spend on the company's Platform Services offering, which allows advertisers to specify objectives and have TubeMogul's team execute the campaign on their behalf, surged 83% to $36.3 million.

That strong rise in total spend helped drive a 62% year-over-year increase in revenue to $58.5 million.

Gross profit rose 52% to $39.2 million, with gross margin falling to 67%. That was down from 71% in the fourth quarter of 2014, mostly because of the out-performance of Platform Services, which has a lower gross margin than Platform Direct. 

Operating loss was $0.7 million, compared with an operating loss of $2.4 million in the fourth quarter of 2014. Net loss also narrowed, decreasing to $1.5 million from $4 million in the year-ago period.

Looking forward

Tube Mogul expects first-quarter total spend in the range of $108 million to $110 million, and revenue in the range of $40 million to $42 million. In addition, the company anticipates first-quarter gross profit of $28 million to $30 million, and adjusted EBITDA (earnings before interest, taxes, depreciation, and amortization) of minus-$5 million to minus-$3 million.

Management also issued its full-year 2016 outlook, which includes:

  • Total spend in the range of $569 million to $577 million.
  • Revenue between $220 million and $228 million.
  • Gross profit of $152 million to $160 million
  • Adjusted EBITDA of $5 million.

"We finished 2015 with strong financial results overall, but more importantly our continuous innovation sets us up for another successful year in 2016," said CEO Brett Wilson in a press release.

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