Magnite reports strong Q2 2024 results, highlights Netflix partnership

Magnite's Q2 2024 earnings show revenue growth and strategic partnerships, signaling positive momentum in ad tech.

Luís Daniel Rijo

Aug 12, 2024 — 3 min read

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Magnite last week announced its financial results for the second quarter of 2024. The report revealed significant growth and strategic partnerships that could reshape the landscape of programmatic advertising in connected TV (CTV) and beyond.

Magnite reported total revenue of $162.9 million for Q2 2024, marking a 7% increase compared to the same period in 2023. This growth was primarily driven by the company's CTV segment, which saw a 12% year-over-year increase in contribution ex-TAC (traffic acquisition costs), reaching $63.0 million. The DV+ segment, which includes desktop and mobile advertising, also showed positive momentum with a 7% year-over-year growth, contributing $83.8 million in ex-TAC revenue.

One of the most notable highlights of Magnite's Q2 report was its recently announced partnership with Netflix. According to Michael G. Barrett, President and CEO of Magnite, the company is working closely with Netflix to support their expanding advertising business. This collaboration involves an expanded programmatic launch scheduled for this summer, with a broader rollout planned for 2025. The Netflix partnership is expected to significantly boost Magnite's position in the CTV advertising market.

In addition to the Netflix deal, Magnite reported progress with other major partners, including Roku. The company noted an acceleration in Roku's transition to programmatic CTV advertising, indicating a broader industry trend towards more automated and data-driven ad buying in the streaming television space.

Magnite also highlighted a recent win in the commerce media sector through a partnership with United Airlines. This collaboration will involve powering advertising solutions for United's inflight personal device entertainment system, opening up new revenue streams and advertising opportunities in the travel sector.

The financial results showed improvements in several key metrics. Magnite reported a net loss of $1.1 million for Q2 2024, a substantial improvement from the $73.9 million loss in the same quarter of 2023. Adjusted EBITDA (Earnings Before Interest, Taxes, Depreciation, and Amortization) reached $44.7 million, representing a 20% year-over-year increase and a 30% margin when calculated as a percentage of contribution ex-TAC.

Non-GAAP earnings per share also saw significant growth, rising to $0.14 in Q2 2024 from $0.09 in Q2 2023, marking a 56% increase. This improvement in profitability metrics suggests that Magnite's strategic initiatives and operational efficiencies are beginning to yield positive results.

Looking ahead, Magnite provided guidance for the third quarter of 2024, projecting total contribution ex-TAC to be between $146 million and $150 million. The company expects CTV contribution ex-TAC to accelerate further, forecasting growth between 18% and 22% year-over-year, reaching $62 million to $64 million.

For the full year 2024, Magnite reaffirmed its expectations of at least 10% growth in contribution ex-TAC, with CTV growing faster than DV+. The company also anticipates expanding its Adjusted EBITDA margin by 100 to 150 basis points compared to 2023, with Adjusted EBITDA growth projected to be in the mid-teens.

These results and projections come at a time when the advertising industry is undergoing significant changes. The shift towards streaming and connected TV has been accelerating, driven by changing consumer behaviors and technological advancements. Programmatic advertising, which allows for more precise targeting and real-time bidding, has become increasingly important in this new landscape.

Magnite's strong performance in CTV and its partnerships with major streaming platforms position the company to capitalize on these trends. The Netflix partnership, in particular, could be a game-changer, as Netflix has been rapidly expanding its advertising-supported tier since its launch in late 2022.

Despite these challenges, Magnite's Q2 results and forward-looking guidance suggest a positive outlook for the company. The diversification of its partnerships across streaming platforms, airlines, and other sectors could provide resilience against industry-specific headwinds.

In conclusion, Magnite's Q2 2024 earnings report paints a picture of a company gaining momentum in the rapidly evolving digital advertising landscape. With strong growth in CTV, strategic partnerships with major players like Netflix and Roku, and improving financial metrics, Magnite appears well-positioned to capitalize on the ongoing shift towards programmatic advertising in streaming media.