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1. Company Snapshot

1.a. Company Description

PubMatic, Inc.provides a cloud infrastructure platform that enables real-time programmatic advertising transactions for Internet content creators and advertisers worldwide.The company's solutions include Openwrap, a header bidding solution that provides enterprise-grade management and analytics tools; Openwrap OTT, a header bidding management solution for OTT; Openwrap SDK, a header bidding solution for in-app developers; private marketplace solutions; and media buyer consoles.


In addition, it offers Real-Time Bidding (RTB) programmatic technologies, which provides various selling options across screens and ad formats; digital advertising inventory quality solutions to detect and filter out invalid traffic and other nefarious activity; Ad quality solutions targeting the reduction of security issues, quality issues, and performance issues; Identity Hub, an identity solution that allows for the use of any advertiser preferred user identifier in a scaled and privacy-compliant fashion; Audience Encore, an audience data platform; and cross-platform video, a sell side platform, which connects trusted video buyers to premium publishers.The company's platform supports an array of ad formats and digital device types, including mobile app, mobile web, desktop, display, video, over-the-top (OTT), connected television, and media.PubMatic, Inc.


was incorporated in 2006 and is based in Redwood City, California.

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1.b. Last Insights on PUBM

PubMatic's recent performance was driven by strong Q3 2025 earnings, with revenue of $68 million and positive earnings, surpassing analyst expectations. The company's adjusted EBITDA and cash flow also exceeded guidance. Notably, CTV growth surged over 50% year-over-year, outpacing market growth. This momentum is a testament to PubMatic's digital advertising supply chain solutions. With a solid financial foundation, the company is well-positioned for future growth. According to recent earnings calls, management remains optimistic about the company's prospects.

1.c. Company Highlights

2. PubMatic's Q3 Earnings: A Strong Performance Driven by AI Innovation

PubMatic reported revenue of $74.2 million, exceeding guidance, with adjusted EBITDA of $20.4 million, also ahead of expectations. Earnings per share (EPS) came in at $0.03, beating estimates of -$0.01. The company's strong financial performance was driven by growth in key areas, including omnichannel video revenues, which grew 21% year over year, with CTV growing over 50%. Emerging revenue streams continued their high growth trajectory, increasing by over 80% year over year.

Publication Date: Nov -26

📋 Highlights
  • Q3 Revenue & EBITDA Growth:: Exceeded guidance with strong cash flow; revenue and adjusted EBITDA ahead of expectations, supported by 24% YoY gross impression growth.
  • CTV Revenue Surge:: Grew over 50% YoY (excluding political), driven by premium supply scaling and advertiser diversification.
  • AI Infrastructure Efficiency:: 5x faster bid responses and 85% fewer auction timeouts via NVIDIA collaboration, unlocking $ millions in ad spend recovery.
  • Operational Cash Flow:: Generated $32.4 million net operating cash flow and $22.8 million free cash flow, with $136.5 million cash and zero debt.
  • Future Growth Projections:: Q4 revenue guidance of $73–77 million and adjusted EBITDA of $19–21 million, targeting margin expansion and double-digit revenue growth in 2026.

Revenue Growth Drivers

The company's AI-driven buyer platform is resonating well with performance-focused buyers, laying the foundation for sustainable growth. Regionally, APAC and EMEA revenues grew 12% and 7%, respectively, offsetting a 14% decline in The Americas. The company's focus on generative AI is improving operational agility, streamlining internal workflows, and allowing for the redirection of resources towards growth initiatives without adding structural cost.

Operational Efficiency and AI Innovation

PubMatic's investments in AI are driving operational efficiency, with the company successfully keeping total operating expenses roughly flat at $51 million. The company's AI strategy is driving increased platform usage, generating new revenue streams, and improving operational efficiency and profitability. As Rajeev Goel mentioned, "Our decade-plus experience owning and operating our global private cloud infrastructure has given us several advantages, including the ability to expand capacity while reducing our rate of CapEx and driving down unit costs through optimization initiatives."

Valuation and Outlook

With a P/S Ratio of 1.46 and an EV/EBITDA of 12.26, the market appears to have priced in moderate growth expectations. However, with the company's strong Q3 performance and guidance for Q4, it seems likely that PubMatic will exceed these expectations. Analysts estimate revenue growth of 0.4% for next year, but with the company's focus on AI innovation and secular growth areas, it is possible that actual growth could be higher.

Future Prospects

PubMatic is well-positioned for future growth, with a strong track record of innovation and a leadership position in AI. The company's efforts to drive operational efficiency and improve profitability are expected to continue, with a focus on margin expansion at both gross and adjusted EBITDA levels as revenue growth reaccelerates in '26.

3. NewsRoom

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PubMatic and BrightLine Partner to Turn Interactive CTV into Measurable Performance

Dec -04

Source: businesswire.com

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Pubmatic Q3: Emerging From Challenges With A Promising Outlook

Nov -23

Source: seekingalpha.com

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PubMatic to Participate in Upcoming Financial Conferences

Nov -13

Source: businesswire.com

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Why PubMatic Stock Soared More Than 40% Today

Nov -11

Source: fool.com

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PubMatic, Inc. (PUBM) Q3 2025 Earnings Call Transcript

Nov -11

Source: seekingalpha.com

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PubMatic, Inc. (PUBM) Q3 Earnings and Revenues Surpass Estimates

Nov -10

Source: zacks.com

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PubMatic Announces Third Quarter 2025 Financial Results

Nov -10

Source: businesswire.com

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INVESTOR ALERT: Pomerantz Law Firm Reminds Investors with Losses on their Investment in PubMatic, Inc. of Class Action Lawsuit and Upcoming Deadlines - PUBM

Oct -24

Source: globenewswire.com

4. Business Breakdown

4.a. Revenues by Country

4.b. Revenues by Segment

5. Expected revenues mid-term growth (8.00%)

6. Segments

Specialized Cloud Infrastructure Platform

Expected Growth: 8%

PubMatic's Specialized Cloud Infrastructure Platform growth is driven by increasing demand for programmatic advertising, rising adoption of cloud-based solutions, and growing need for efficient supply-side platforms. Additionally, the company's focus on innovation, strategic partnerships, and expanding global presence contribute to its high growth rate of 8.

7. Detailed Products

OpenWrap

A header bidding solution that enables publishers to manage multiple demand sources and optimize revenue

PubMatic Platform

A comprehensive platform that provides publishers with a suite of tools to manage and optimize their digital advertising business

PubMatic Adaptor for Publishers

A customizable adaptor that enables publishers to integrate with multiple demand sources and optimize revenue

PubMatic Data

A data management platform that provides publishers with insights and analytics to optimize their digital advertising business

PubMatic Identity Hub

A solution that enables publishers to manage and optimize their first-party data and identity graph

8. PubMatic, Inc.'s Porter Forces

Forces Ranking

Threat Of Substitutes

PubMatic's platform provides a unique solution for publishers to manage their digital advertising business, making it difficult for substitutes to emerge.

Bargaining Power Of Customers

PubMatic's customers, mainly publishers, have limited bargaining power due to the company's strong market position and the lack of alternative solutions.

Bargaining Power Of Suppliers

PubMatic's suppliers, mainly data providers and technology partners, have some bargaining power due to the importance of their services, but the company's scale and market position mitigate this power.

Threat Of New Entrants

The high barriers to entry, including the need for significant investments in technology and talent, make it difficult for new entrants to compete with PubMatic.

Intensity Of Rivalry

The digital advertising industry is highly competitive, with many established players, making the intensity of rivalry high for PubMatic.

9. SWOT Analysis

Strength

Weaknesses

Opportunities

Threats

10. Capital Structure

10.a. Balance Sheet

10.b. Weighted Average Cost of capital

Value
Debt Weight 6.91%
Debt Cost 3.95%
Equity Weight 93.09%
Equity Cost 11.50%
WACC 10.97%
Leverage 7.42%

11. Quality Control: PubMatic, Inc. passed 8 out of 9 key points

12.a Historical Valuation

12.b Price/Earnings Ratio

12.c Margin Valuation

12.d Peers Valuation

Peers Group Analysis

Stock-Card
MoneyLion

A-Score: 4.8/10

Value: 4.0

Growth: 6.2

Quality: 6.3

Yield: 0.0

Momentum: 9.0

Volatility: 3.3

1-Year Total Return ->

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Stock-Card
Where Food Comes From

A-Score: 4.7/10

Value: 2.4

Growth: 6.4

Quality: 7.2

Yield: 0.0

Momentum: 8.0

Volatility: 4.3

1-Year Total Return ->

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Stock-Card
Aware

A-Score: 4.4/10

Value: 7.8

Growth: 3.6

Quality: 4.7

Yield: 0.0

Momentum: 8.0

Volatility: 2.3

1-Year Total Return ->

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Stock-Card
Vimeo

A-Score: 4.2/10

Value: 1.8

Growth: 7.6

Quality: 5.6

Yield: 0.0

Momentum: 8.5

Volatility: 1.7

1-Year Total Return ->

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Stock-Card
SurgePays

A-Score: 3.7/10

Value: 7.2

Growth: 2.9

Quality: 2.4

Yield: 0.0

Momentum: 8.5

Volatility: 1.3

1-Year Total Return ->

View Full Report
Stock-Card
PubMatic

A-Score: 3.5/10

Value: 6.3

Growth: 6.6

Quality: 5.0

Yield: 0.0

Momentum: 0.5

Volatility: 2.7

1-Year Total Return ->

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Peers Metrics

12.e Scoring Insights

12.f DCF BETA

Parameters

Short Term Growth

Short term Time

Long-Term Growth

WACC

Target Price

9.28$

Current Price

9.28$

Potential

-0.00%

Expected Cash-Flows