Magnite’s first quarter results were met with a notably positive market response, as investors looked past a modest revenue shortfall and focused on the company’s strong profitability. Management attributed performance to a rebound in its DV+ segment and sustained double-digit growth in connected TV (CTV), powered by deeper relationships with major streamers and expanding programmatic adoption. CEO Michael Barrett highlighted the impact of “continued traction with the agency marketplaces and growth in live sports,” with new partnerships and product enhancements helping stabilize the company’s business mix.
Is now the time to buy MGNI? Find out in our full research report (it’s free).
Magnite (MGNI) Q1 CY2025 Highlights:
- Revenue: $155.8 million vs analyst estimates of $159.9 million (4.3% year-on-year growth, 2.6% miss)
- Adjusted EPS: $0.12 vs analyst estimates of $0.06 (significant beat)
- Adjusted EBITDA: $36.8 million vs analyst estimates of $30.43 million (23.6% margin, 20.9% beat)
- Operating Margin: -0.9%, up from -9.3% in the same quarter last year
- Market Capitalization: $2.98 billion
While we enjoy listening to the management's commentary, our favorite part of earnings calls are the analyst questions. Those are unscripted and can often highlight topics that management teams would rather avoid or topics where the answer is complicated. Here is what has caught our attention.
Our Top 5 Analyst Questions Magnite’s Q1 Earnings Call
-
Jason Kreyer (Craig-Hallum): asked about the timing and potential size of market share gains if behavioral remedies are imposed in the Google antitrust case. CEO Michael Barrett explained that Magnite could benefit immediately if behavioral remedies are enacted, without waiting for a structural divestiture. CFO David Day estimated that every 100 basis point increase in market share could lead to approximately $50 million in incremental contribution ex-TAC, with most of the gains flowing through to EBITDA.
-
Daniel Kurnos (Benchmark Company): questioned the impact of shifting transaction types within CTV and the outlook for live sports. Barrett responded that all forms of programmatic transactions are positive at this stage of market development, and that live sports remain resilient to macro pressures, with growing opportunities as more sports content moves to streaming.
-
Laura Martin (Needham): inquired about changes in take rates for various CTV transaction types and the trend of audience curation on the SSP side. Barrett clarified that take rates are higher when Magnite sources demand, particularly in live sports, and confirmed growing interest from data providers seeking to enhance curated audience segments within Magnite’s platform.
-
Robert Coolbrith (Evercore ISI): asked about CTV pricing trends amid increased inventory and the possible effects of Google’s proposed remedies. Barrett noted that while CTV CPMs have declined due to greater supply, this has allowed new advertisers to enter the market, with little impact on Magnite’s take rate. He also emphasized that any fair, level playing field remedy would benefit Magnite’s market share.
-
Eric Martinuzzi (Lake Street): sought clarification on whether there are clear signs of demand softness in key verticals and how Magnite is preparing for macroeconomic uncertainty. Barrett and Day explained that while there is caution around verticals like auto and travel, actual declines have not materialized, and the guidance reflects prudence rather than observed weakness.
Catalysts in Upcoming Quarters
In the coming quarters, the StockStory team will be monitoring (1) the adoption and performance impact of the next-generation SpringServe platform, (2) the pace at which Magnite can capture additional DV+ market share if regulatory changes to Google’s ad tech business take effect, and (3) continued momentum in CTV and live sports, particularly as more inventory becomes available and new advertiser segments are attracted. Execution in these areas will be essential for sustaining margin gains and revenue growth.
Magnite currently trades at $22.30, up from $12.46 just before the earnings. Is the company at an inflection point that warrants a buy or sell? The answer lies in our full research report (it’s free).
The Best Stocks for High-Quality Investors
Market indices reached historic highs following Donald Trump’s presidential victory in November 2024, but the outlook for 2025 is clouded by new trade policies that could impact business confidence and growth.
While this has caused many investors to adopt a "fearful" wait-and-see approach, we’re leaning into our best ideas that can grow regardless of the political or macroeconomic climate. Take advantage of Mr. Market by checking out our Top 5 Strong Momentum Stocks for this week. This is a curated list of our High Quality stocks that have generated a market-beating return of 183% over the last five years (as of March 31st 2025).
Stocks that made our list in 2020 include now familiar names such as Nvidia (+1,545% between March 2020 and March 2025) as well as under-the-radar businesses like the once-micro-cap company Kadant (+351% five-year return). Find your next big winner with StockStory today.
