Viant Technology Inc.

Hello, everyone, and welcome to Viant Technology's fourth quarter 2024 earnings conference call. My name is Crystal, and I will be your operator today. Before I hand the call over to the Viant leadership team, I'd like to go over just a few housekeeping notes for the program. As a reminder, this call is being recorded. After the speaker's remarks, there will be a question and answer session. If you plan to ask a question, please ensure you set your Zoom name to display your full name and firm. If you would like to ask a question during this call, please use the raise hand function located at the bottom of your screen. Thank you for your attendance today. I will now turn the call over to Nick Zangler, VP of Investor Relations for Vyant.

Thank you, Crystal. Good afternoon and welcome to Vine Technologies' fourth quarter 2024 earnings conference call. On the call today are Tim Vanderhoek, co-founder and chief executive officer, Chris Vanderhoek, co-founder and chief operating officer, and Larry Madden, chief financial officer. I'd like to remind you that we will make forward-looking statements on our call today, including but not limited to our guidance for Q1 2025 and other future financial results, our platform development initiatives, and industry trends that are based on assumptions and subject to future events, risks, and uncertainties that could cause actual results to differ materially from those projected. These forward-looking statements speak only as of today and we undertake no obligation to update or revise these statements except as required by law. For more information about factors that may cause actual results to differ materially from forelooking statements and our entire Safe Harbor statement, please refer to the news release issued today, as well as the risks and uncertainties described in our annual report on Form 10-K, the year ended December 31st, 2024, under the heading Risk Factors, and in other filings with the SEC. During today's call, we will also present both GAAP and non-GAAP financial measures. Additional disclosures regarding these non-GAAP measures, including a reconciliation of non-GAAP financial measures, the most directly comparable GAAP financial measures are included in the news release issued today and in our earnings presentation, which have been posted on the investor relations page of the company's website and in our filings with the SEC. I would now like to turn the call over to Tim Vanderhoek, Chief Executive Officer of Viant. Tim?

Thanks, Nick, and thank you all for joining us today. We delivered phenomenal fourth quarter results with performance well ahead of our guidance across all key metrics. Q4 set a new record for spend on our platform with revenue and contribution XTAC year-over-year growth rates accelerating to 40% and 28% respectively. Additionally, Q4 adjusted EBITDA increased 31% year-over-year to $17.1 million, exceeding the high end of our guidance range. I'm proud of our team's consistent execution over the past year, which is clearly demonstrated in our record full-year results. In 2024, we increased revenue by 30% and contribution ex-tac by 24%, driven by the accelerating adoption of our innovative products and services. Our robust top-line performance and disciplined cost management resulted in expanding our adjusted EBITDA as a percentage of contribution XTAC by approximately 500 basis coins to 25% in 2024. We accomplished this while continuing to invest in the rollout of Viant AI. and while making long-term strategic acquisitions, including Iris TV, a leading global content data platform built for CTV. Today, I am pleased to announce the acquisition of Locker, a data collaboration platform specializing in first-party data activation. Locker further strengthens our leadership position in identity and addressability across the open Internet. I will further expand on Locker in a moment. Through Q4, we have now achieved six consecutive quarters of over 20% year-over-year growth in contribution XTAC. While a number of factors are fueling our momentum, I would like to take a moment to highlight the key catalysts driving our recent performance, which we expect to continue into 2025 and beyond. And they consist of... Number one, CTV proliferation. Number two, leadership and addressability. And number three, AI innovation. Beginning with CTV proliferation, I want to remind everyone that we remain in the very early innings of connected TV. We are drafting off of a multi-year tailwind of the ongoing shift of linear ad spend to CTV. As ad spend migrates, advertisers are overwhelmingly choosing to execute CTV campaigns on Viant's buying platform. For the full year 2024, CTV ad spend increased over 40%, nearly double the industry growth rate. And CTV accounted for over 40% of ad spend on our platform. Clearly, Viant is uniquely positioned to win in the large and fast-growing CTV market. We enable advertisers through the use of industry-leading targeting and measurement solutions. We provide advertisers with efficient supply paths, connecting them directly to premium CTV inventory. and we are leading the industry in innovation, enabling advertisers to leverage AI as they plan, execute, and measure their CTV ad campaigns. Chris will elaborate on the near-term and long-term opportunities we see within CTV in a moment. Moving to our leadership position in addressability. we are seeing record demand for the utilization of Viant's patented audience targeting and measurement solution, our Household ID. Across all digital ad channels and particularly within the highly sought after CTV and streaming audio channels, advertisers are eager to execute campaigns with enhanced precision and efficiency through our closed loop capabilities. They are in pursuit of continuous return on ad spend improvement. To achieve this, advertisers are increasingly entrusting Viant and our household ID technology to target specific consumer audiences and accurately measure campaign performance. This is because Viant's household ID is available across about 80% of biddable ad inventory, far surpassing that of alternative identifiers. When it comes to deploying audience targeting at scale across the open Internet, we believe there is no solution with better coverage in the marketplace. This is resonating with advertisers who are voting with their ad budgets. For the full year 2024, advertiser spend associated with our household ID increased over 50%, and we see ample room for future growth. Demand for addressability and measurable insights, especially in cookie-less channels like CTV and audio, is not expected to abate. Moving forward, advertisers will continue to seek out more information about the audiences they are targeting, more information about campaign performance, and more information about the content their ads are associated with. This, we believe, is an irreversible trend, and we expect it to drive incremental usage of our household ID over time. It is also why we made the decision to further enhance our targeting and measurement product suite with the recent acquisition of Iris TV, home of the Iris ID, the industry's leading content identifier for CTV. The IRIS ID complements Household ID, providing advertisers with even more options to deploy addressable ad campaigns and measure performance. The IRIS ID enables advertisers to target CTV ad inventory at the video level rather than the app. providing advertisers the ability to match their brand, product, or service with contextually relevant content while remaining privacy compliant. Using IRIS ID, advertisers can then measure the performance of their ad campaigns delivered across various publisher content, which allows for further campaign refinement. To our knowledge, IRIS ID is the only scaled option in the marketplace today used to deploy contextual targeting within CTV at this level of granularity. Household ID, an industry-leading audience targeting and measurement solution, and IRIS ID, an industry-leading contextual targeting and measurement solution, both reside within Viant. And therefore, we feel we are well positioned to power addressability and measurement across all channels of the open Internet. Addressability is the future of advertising, and our acquisition of Locker is expected to accelerate its arrival across the programmatic ecosystem. Locker is a data collaboration platform built to enable content owners to collect, enrich, and activate first-party data. In partnering with Locker, publishers are able to integrate their first-party data one time with Locker and automatically enable all the other alternative ID partners in the programmatic ecosystem. On a one-for-one basis, each integration requires extensive engineering resources, a deployment of software code, and ongoing maintenance. But with Locker managing the integrations, publishers can integrate with Locker just one time and then seamlessly turn on Locker's partner integrations at will with no additional integrations necessary. With Locker, publishers cut down on the time and resources required to do these cumbersome integrations, which will help them accelerate their advertising business by leveraging their first party data in advertising. Locker enables the application of first party data as a signal in the bid stream, propagating the addressability of ad campaigns while complying with applicable privacy laws. The acquisition is expected to accelerate industry adoption of both Viance Household ID and Iris ID, while at the same time helping publishers offer addressable ad solutions in our collective fight against the walled gardens. And similar to the IRIS ID, we plan to make the locker proposition open to the entire ecosystem, including other alternative identifiers, as we are committed to helping the entire open Internet succeed, not just ourselves. We are excited to welcome the Locker team to Viant. The company's founder, Keith Petri, is a well-known leader in the ad tech industry, having spent 15 years dedicated to the space, and we are excited to have him join the Viant team. Keith will continue to head Locker as the CEO following the transaction. Another area we have out-innovated our peers is with the rollout of Viant AI. We have completed the first two phases of our Viant AI rollout, and we expect to complete the next two phases this year. Collectively, these four phases consist of AI bidding, AI planning, AI measurement and analysis, and AI decisioning. I'll touch on all four. Just 18 months after launch, AI bidding is utilized to power 80% of ad spend on our platform. Advertisers who opt into AI bidding empower Viant's algorithms to search the open internet for attractive ad inventory and transact at the lowest possible clearing price, while ensuring advertiser KPIs are achieved. We launched AI planning in Q3 2024 and our team has been showcasing its capabilities ever since. We have been meeting with marketers and their agencies all over the country who immediately saw the benefits and requested a live demonstration. Simply put, it's a game changer for the ad tech industry. AI planning builds an enterprise-level ad campaign for advertisers in mere seconds, and with a level of efficiency and comprehensiveness humans can't replicate. Better yet, it's easy to use with an incredibly intuitive interface. With Vyant's AI planning, if you can chat, you can build an enterprise-level ad campaign in minutes. What does this mean for our advertiser and agency clients? Number one, a drastic improvement in workflow. Early agency adopters are doubling the amount of new business pitches they can engage in. providing greater opportunity to win incremental new business. Number two, operating structure efficiencies. With Vyan AI doing the heavy lifting, agencies can redeploy their personnel to focus on more strategic initiatives. Number three, return on ad spend improvement. There are literally trillions of ways an ad campaign can be constructed and executed. Leveraging Vyan AI, advertisers can build and execute campaigns that truly optimize return on ad spend, considering numerous variables. Brands and agencies are eager to reap the benefits of AI planning, and they have begun scaling their ad budgets with Vyan, resulting in market share gains as exemplified by our industry-leading growth rates. Vine AI also expands our total addressable market for those millions of small and mid-sized businesses, performance advertisers, and direct-to-consumer e-commerce companies that have so heavily relied on search and social ad channels to fuel their growth. There is a better alternative that unlocks premium content available in the open Internet. Vyan AI, in unison with the household and iris IDs, enable advertisers of all sizes to target and measure across the open internet, which includes the most premium and sought-after ad inventory in connected TV. With the launch of AI planning, we expect to further attract ad budgets, once reserved for search and social channels, into Vyan's ad buying platform. AI measurement and analysis is expected to launch in early Q2, providing advertisers with incremental workflow enhancement through vastly superior reporting capabilities. The days of sifting through 50 pages of ad campaign reports are over. AI measurement and analysis provides advertisers with on-demand insights. Clients need only ask for the insight they are looking for, and Viant AI will deliver. For example, for a given campaign, an advertiser might ask Viant AI, show me the best performing markets, or show me the reach and frequency by channel. Which ad creatives have the highest conversion rate, or how should I optimize my campaign? And Viant AI responds in seconds. AI measurement and analysis streamlines productivity and provides advertisers with the insights they need to continuously improve campaign performance. Finally, we continue to expect to launch AI decisioning in the second half of 2025. With this launch, advertisers can grant Viant AI full autonomy to build and execute media plans, BuyNAI is expected to dynamically adjust campaigns to account for fluid market conditions in the effort of driving the most efficient outcomes. For instance, if BuyNAI identifies an opportunity to shift ad spend more aggressively towards CTV to enhance return on ad spend during a campaign, it will do so. and unlike black box decisioning products available from search and social walled gardens vyan ai is fully transparent advertisers will continue to have access to all campaign data including details on where their ad spend is allocated clearing prices return on ad spend metrics and so much more to sum up my remarks i believe we have made it clear Viant is a leading DSP for addressability, which we anticipate will define the future of nearly all digital ad buying. And with our investments in Viant AI, we are at the forefront of technological innovation in our industry. In my 25 years in ad tech, I have never seen a greater opportunity than that which is presented by advancing AI technology. And Viant is poised to seize this moment. With that, I'll turn it over to Chris. Thanks, Tim. I'm excited to report strength across all digital channels this quarter, which includes CTV, streaming audio, mobile, desktop, and digital out of home. Ad spend in each channel generated double-digit year-over-year growth. indicative of the widespread platform adoption by advertisers and agencies looking to leverage Viant's unique features including household ID, direct access, and the Viant AI product suite. Looking forward, we expect CTV to continue to deliver outsized growth. There is a clear multi-year tailwind as $60 billion in U.S. ad spending has yet to transition out of linear TV. But focusing near-term, we believe 2025 will be a landmark year for live sports monetization across CTV. To provide some perspective, live sports accounted for about 40% of all national TV spending in the fourth quarter of 2024. Over the last several years, publishers have been readying live sports for CTV distribution, and we have now reached the point where live sports are universally available across streaming services. In 2025, these publishers are ready to transact programmatically and are offering greater allocation to real-time bidding transactions. It is worth noting, Viant is one of few enterprise-level DSPs capable of ingesting 40 million real-time bid requests per second, as is often necessary when transacting in a live sports environment. Through partnerships with various live sports providers, including Disney, ESPN, NBCU, Fox Sports, Warner Brothers Discovery, DirecTV, and Fubo, and many others, Viant offers advertisers access to inventory across virtually all major sports leagues, including the NFL, NBA, college football and basketball, the MLB, NHL, NASCAR, the PGA Tour, the U.S. Open, and the Premier League. We are excited to provide our clients with access to the world's most coveted ad inventory in 2025. The migration of live sports from linear to CTV is anticipated to accelerate the shift in ad spending toward the CTV channel. Full conversion implies a CTV total addressable market of $90 billion, up from $30 billion today. However, we believe the CTV TAM opportunity is even larger. In the coming years, we expect portions of search and social ad budgets to divert to CTV, pushing the TAM well above $90 billion. There are over 10 million SMBs, performance advertisers, and direct-to-consumer e-commerce companies allocating spend across search and social channels. They utilize these channels for customer acquisition and for the ease with which ad campaigns can be executed. But these same attributes now exist within the CTV channel, which delivers a more premium and impactful consumer experience. CTV is targetable. It is measurable. And with Vyan AI, we have made it easier to execute a CTV campaign than a search and social campaign. eMarketer estimates search and social collectively to account for over $200 billion in U.S. ad spend. We believe SMBs, performance advertisers, and direct-to-consumer e-commerce companies account for well over 50% of this total, and we expect to take share going forward. Within CTV, and unique to Viant, is our direct access program, which provides advertisers with access to the world's most premium content, eliminating non-value ad middlemen. Advertisers choose direct access for transparency and cost savings, which naturally drives return on ad spend. For the full year 2024, direct access CTV ad spend increased nearly 70% and accounted for over 50% of total CTV ad spend on the platform. We are positioned to win in CTV and believe the DSP that wins the CTV channel will win across the open Internet, particularly as industry consolidation accelerates. We're also very bullish on the prospects for streaming audio growth. In many ways, streaming audio is similar to premium CTV. Audiences are authenticated, which enables addressability, and attention levels are high. Users listen to their favorite podcasts on their way to work and in the gym, where they can remain highly attentive, enhancing the value of streaming audio inventory. We have seen tremendous growth in streaming audio demand, and we expect the channel to represent a much larger percentage of our mix over time. Touching on recent enhancements within our targeting and measurement suite, Household ID was already one of the industry's most comprehensive audience targeting and measurement solutions. But we are enhancing the offering by expanding our existing partnership with TransUnion, a provider of global information and insights. Household ID is now enriched with TransUnion's true audience identity data, which encompasses online, offline, public, and proprietary consumer information. This new integration expands household IDs match rate to 95% of US adults over the age of 18. For advertisers, this not only improves audience targeting and measurement capabilities, but allows for the deployment of addressable campaigns at greater scale. To help illustrate industry demand trends we are seeing around addressability and more specifically our household ID solution, Revenue and contribution extract generated by household ID has increased more than eight times over the last two years. In November, we acquired Iris TV, and we believe that acquisition will cement Viant's status as the best DSP for CTV ad buying. As Tim mentioned, the industry's top audience and contextual identifiers, Viant's household ID and the Iris ID, now reside under one roof. IRIS maintains existing partnerships with premium content owners and platforms, which include the likes of Warner Brothers Discovery, Fox, Univision, Samsung, LG, and Vizio, among many more. By leveraging Viant's existing relationships with premium publishers, we expect to IRIS enable many more premium content owners in the coming months. The IRIS team has been actively co-marketing along with Viant. recently participating in a full slate of meetings at CES, where IRIS announced the addition of TCL to its growing list of IRIS-enabled partners. And today, we are pleased to announce Paramount has also signed on to carry the IRIS IDE. Tim laid out the timeline for our four-phase Viant rollout. I would like to focus on the reaction we received from advertisers and agencies following our launch of AI planning in September and how we are capitalizing on this momentum. After releasing a 12-minute launch video across a number of different social media channels, we immediately began engaging with brands and agencies looking to utilize buy-in AI. Since the launch, we have provided a buy-in AI demo to every major agency holding company and hundreds of independent brands and agencies. At CES alone, our team conducted over 130 Viant AI demos, providing over 300 attendees with a hands-on experience of AI planning and AI measurement and analysis. As a direct result of participating in our demos, many major brands and agencies have expressed interest in obtaining their own custom versions of Viant AI. This calls for a deep level of integration between our AI infrastructure and brand and agency data platforms. Such a connection enables Vyan AI to most effectively merchandise first-party data to plan and execute highly sophisticated ad campaigns capable of achieving heightened levels of precision. This new and innovative concept is likely to forge tightly bound long-lasting partnerships between Viant and our brand and agency clients. We are redefining what it means to collaborate with brand and agency partners by embedding our technology in with theirs. Agencies see how the Viant AI infrastructure combined with their own first-party data can help showcase their unique solutions to their current clients and help to win more new business. We are encouraged by the size of the existing pipeline of clients looking to deploy their own customized versions of Viant AI. As you can see, we are extremely excited by our progress and we look forward to providing incremental updates on Viant AI in the near future. With that, I'll turn it over to Larry to provide more detail on our financial performance.