Wrapping up Q2 earnings, we look at the numbers and key takeaways for the advertising & marketing services stocks, including Ibotta (NYSE: IBTA) and its peers.
The sector is on the precipice of both disruption and growth as AI, programmatic advertising, and data-driven marketing reshape how things are done. For example, the advent of the Internet broadly and programmatic advertising specifically means that brand building is not a relationship business anymore but instead one based on data and technology, which could hurt traditional ad agencies. On the other hand, the companies in the sector that beef up their tech chops by automating the buying of ad inventory or facilitating omnichannel marketing, for example, stand to benefit. With or without advances in digitization and AI, the sector is still highly levered to the macro, and economic uncertainty may lead to fluctuating ad spend, particularly in cyclical industries.
The 7 advertising & marketing services stocks we track reported a satisfactory Q2. As a group, revenues along with next quarter’s revenue guidance were in line with analysts’ consensus estimates.
In light of this news, share prices of the companies have held steady as they are up 3% on average since the latest earnings results.
Weakest Q2: Ibotta (NYSE: IBTA)
Originally launched as a way to make grocery shopping more rewarding for budget-conscious consumers, Ibotta (NYSE: IBTA) is a mobile shopping app that allows consumers to earn cash back on everyday purchases by completing tasks and submitting receipts.
Ibotta reported revenues of $86.03 million, down 2.2% year on year. This print fell short of analysts’ expectations by 5%. Overall, it was a softer quarter for the company with a significant miss of analysts’ EPS estimates.
“Ibotta is working hard to bring the power of performance marketing to the CPG industry, allowing our clients to drive profitable revenue growth at scale,” said Ibotta CEO and founder, Bryan Leach.
Ibotta delivered the weakest performance against analyst estimates of the whole group. Unsurprisingly, the stock is down 23.4% since reporting and currently trades at $26.11.
Read our full report on Ibotta here, it’s free.
Best Q2: Liberty Broadband (NASDAQ: LBRDK)
Operating across the United States, Liberty Broadband (NASDAQ: LBRDK) is a provider of high-speed internet, cable television, and telecommunications services across various markets.
Liberty Broadband reported revenues of $261 million, up 6.1% year on year, outperforming analysts’ expectations by 3.7%. The business had an exceptional quarter.
Liberty Broadband delivered the biggest analyst estimates beat among its peers. The market seems content with the results as the stock is up 3.3% since reporting. It currently trades at $61.49.
Is now the time to buy Liberty Broadband? Access our full analysis of the earnings results here, it’s free.
QuinStreet (NASDAQ: QNST)
Founded during the dot-com era in 1999 and specializing in high-intent consumer traffic, QuinStreet (NASDAQ: QNST) operates digital performance marketplaces that connect clients in financial and home services with consumers actively searching for their products.
QuinStreet reported revenues of $262.1 million, up 32.1% year on year, exceeding analysts’ expectations by 0.7%. Still, it was a mixed quarter because it struggled in other parts of the business.
Interestingly, the stock is up 6.9% since the results and currently trades at $17.31.
Read our full analysis of QuinStreet’s results here.
Omnicom Group (NYSE: OMC)
With a vast network of creative agencies that helped craft some of the most memorable ad campaigns in history, Omnicom Group (NYSE: OMC) is a strategic holding company that provides advertising, marketing, and communications services to many of the world's largest companies.
Omnicom Group reported revenues of $4.02 billion, up 4.2% year on year. This result beat analysts’ expectations by 1.2%. It was a satisfactory quarter as it also logged organic revenue in line with analysts’ estimates.
The stock is up 8.2% since reporting and currently trades at $76.60.
Read our full, actionable report on Omnicom Group here, it’s free.
Magnite (NASDAQ: MGNI)
Born from the 2020 merger of Rubicon Project and Telaria, Magnite (NASDAQ: MGNI) operates the world's largest independent sell-side advertising platform that automates the buying and selling of digital advertising inventory across all channels and formats.
Magnite reported revenues of $173.3 million, up 6.4% year on year. This number came in 2.2% below analysts' expectations. Taking a step back, it was still a satisfactory quarter as it put up a beat of analysts’ EPS estimates.
The stock is up 7.2% since reporting and currently trades at $24.07.
Read our full, actionable report on Magnite here, it’s free.
Market Update
Thanks to the Fed’s rate hikes in 2022 and 2023, inflation has been on a steady path downward, easing back toward that 2% sweet spot. Fortunately (miraculously to some), all this tightening didn’t send the economy tumbling into a recession, so here we are, cautiously celebrating a soft landing. The cherry on top? Recent rate cuts (half a point in September 2024, a quarter in November) have propped up markets, especially after Trump’s November win lit a fire under major indices and sent them to all-time highs. However, there’s still plenty to ponder — tariffs, corporate tax cuts, and what 2025 might hold for the economy.
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