Core Viewpoint - The Schall Law Firm is investigating claims against DoubleVerify Holdings, Inc. for potential violations of securities laws following disappointing Q4 earnings and a continued trend of deceleration in growth projections [1][2]. Group 1: Company Performance - DoubleVerify reported disappointing Q4 earnings on February 28, 2025, which contributed to a decline in investor confidence [2]. - The company's fiscal year 2025 projection indicates a growth rate of only 10%, continuing a multiyear deceleration trend [2]. - Following the earnings report, shares of DoubleVerify reached an all-time low on the same day [2]. Group 2: Legal Investigation - The investigation by the Schall Law Firm focuses on whether DoubleVerify issued false or misleading statements or failed to disclose important information to investors [2]. - The firm is encouraging shareholders who suffered losses to participate in the investigation [2].

Shares of advertising technology (adtech) company DoubleVerify (DV -36.03%) sank on Friday after the company reported financial results for the fourth quarter of 2024. As of 3:40 p.m. ET, DoubleVerify stock was down 38% and had hit an all-time low during the trading session.DoubleVerify's financial results didn't satisfy investorsDoubleVerify uses analytics to help advertisers know whether their spending is accomplishing what it's supposed to. During 2024, the company's revenue was up 15% year over year, a ...

Financial Data and Key Metrics Changes - Total revenue for 2024 grew by 15% year-over-year to $657 million, driven by double-digit growth across all three revenue lines [6][49] - Adjusted EBITDA margin was 33% for the full year, with $160 million in net cash from operating activities, up 33% from the previous year [10][57] - Q4 2024 total revenue was $191 million, an 11% increase, with activation revenue growing by 10%, measurement by 7%, and supply side by 34% [46][49] - Net income for 2024 was $56 million, representing a 9% margin, down from a 12% margin in 2023 due to slower revenue growth and higher stock-based compensation [58] Business Line Data and Key Metrics Changes - Activation revenue grew by 13% for the full year, while measurement revenue also increased by 15% [49] - Social measurement revenue grew by 27% for the full year, although growth slowed to 9% in Q4 due to reduced spending from large brand advertisers [49][48] - Supply side revenue grew by 25% year-over-year, driven by increased demand from retail media platforms [9][49] Market Data and Key Metrics Changes - The company measured 8.3 trillion billable media transactions, a 19% increase year-over-year [7][51] - Social media measurement revenue accounted for 48% of total measurement revenue in 2024, up from 43% in 2023 [51] - CTV measurement impression volumes grew by 66% for the full year and 95% in Q4 alone, increasing its share of total measurement impression volume to 11% [37][38] Company Strategy and Development Direction - The company aims to unify media quality, optimization, and performance measurement into a single platform to maximize ad effectiveness [17] - Strategic acquisitions, including Rockerbox, are intended to enhance performance measurement capabilities and expand into mid-market customers [19][62] - The company is focusing on diversifying revenue streams and expanding its customer base, with a goal to increase the number of customers generating over $200,000 in revenue [15][42] Management Comments on Operating Environment and Future Outlook - Management acknowledged challenges in Q4 due to reduced ad spending from large customers and a shift in ad dollars to proprietary platforms [11][12] - Despite these challenges, management remains confident in the long-term growth prospects, citing strategic investments and a strong customer pipeline [16][104] - The company expects 2025 to be a transition year, with revenue growth projected at approximately 10% and adjusted EBITDA margins of 32% [63][66] Other Important Information - The company ended 2024 with $311 million in cash and short-term investments and zero long-term debt [61] - Stock-based compensation expenses are expected to stabilize in the high teens, with $200 million remaining available for share repurchases in 2025 [59][67] - The acquisition of Rockerbox is expected to contribute approximately $8 million to total revenue in 2025 [62] Q&A Session Summary Question: Can you elaborate on the strategic rationale for the Rockerbox acquisition? - The acquisition is aimed at enhancing the customer value proposition by integrating performance measurement with existing solutions, creating a competitive differentiator [71][73] Question: How do you see the ramp-up of new products like Scibids and social solutions throughout 2025? - Management believes that while there are headwinds in 2025, the long-term opportunities from new product launches will be significant, with expectations for growth in 2026 [80][82] Question: What is the company's view on the impact of AI on the advertising ecosystem? - The company is heavily investing in AI to enhance its core value proposition, leveraging AI for measurement and optimization solutions [88][90] Question: Can you provide insights on the advertiser that impacted Q4 results? - The reduction in spend was specific to a CPG customer facing rising commodity costs, and management does not expect similar impacts from other clients in the same vertical [113][115] Question: How do you expect margins to evolve throughout 2025? - Margins are expected to grow as the year progresses, with historical patterns indicating higher margins in the latter half of the year [95][96]

DoubleVerify Holdings, Inc. (NYSE:DV) Q4 2024 Results Conference Call February 27, 2025 4:30 PM ET Company Participants Tejal Engman - Senior Vice President, Investor Relations Mark Zagorski - CEO Nicola Allais - CFO Conference Call Participants Matt Swanson - RBC Eric Sheridan - Goldman Sachs Youssef Squali - Truist Securities Maria Ripps - Canaccord Genuity Andrew Boone - Citizens Brian Pitz - BMO Capital Markets Laura Martin - Needham & Company Arjun Bhatia - William Blair & Company Andrew Marok - Raymon ...

Core Insights - DoubleVerify Holdings (DV) reported revenue of $190.6 million for the quarter ended December 2024, reflecting a year-over-year increase of 10.7% but falling short of the Zacks Consensus Estimate by 3.02% [1] - The company's earnings per share (EPS) was $0.13, down from $0.19 in the same quarter last year, resulting in an EPS surprise of -27.78% compared to the consensus estimate of $0.18 [1] Revenue Breakdown - Revenue from Measurement customers was $64.38 million, which is below the six-analyst average estimate of $67.78 million, showing a year-over-year increase of 6.6% [4] - Revenue from Supply-side customers reached $16.73 million, exceeding the six-analyst average estimate of $15.21 million, with a significant year-over-year growth of 34.4% [4] - Revenue from Activation services was $109.52 million, slightly below the estimated $113.25 million, but still representing a year-over-year increase of 10.2% [4] Stock Performance - Over the past month, DoubleVerify shares have returned +5.3%, contrasting with a -2.2% change in the Zacks S&P 500 composite [3] - The stock currently holds a Zacks Rank 2 (Buy), suggesting potential for outperformance in the near term [3]

Group 1: Earnings Performance - DoubleVerify Holdings (DV) reported quarterly earnings of $0.13 per share, missing the Zacks Consensus Estimate of $0.18 per share, and down from $0.19 per share a year ago [1] - The earnings surprise for this quarter was -27.78%, while the previous quarter saw a positive surprise of 42.86% with actual earnings of $0.10 per share against an expectation of $0.07 [2] - The company posted revenues of $190.6 million for the quarter, missing the Zacks Consensus Estimate by 3.02%, compared to $172.23 million in the same quarter last year [3] Group 2: Stock Performance and Outlook - DoubleVerify shares have increased approximately 12.4% since the beginning of the year, outperforming the S&P 500's gain of 1.3% [4] - The company's earnings outlook is crucial for investors, with current consensus EPS estimates at $0.06 for the next quarter and $0.49 for the current fiscal year, with revenues expected at $158.15 million and $742.56 million respectively [5][8] - The Zacks Rank for DoubleVerify is currently 2 (Buy), indicating expectations for the stock to outperform the market in the near future [7] Group 3: Industry Context - The Internet - Software industry, to which DoubleVerify belongs, is currently ranked in the top 33% of over 250 Zacks industries, suggesting a favorable outlook compared to lower-ranked industries [9] - Another company in the same industry, StoneCo Ltd. (STNE), is expected to report quarterly earnings of $0.32 per share, reflecting a year-over-year decline of 11.1% [10]

Financial Performance - In 2024, the company measured approximately 8.3 trillion Media Transactions, an increase from 7.0 trillion in 2023 and 5.5 trillion in 2022[27]. - The company achieved a compounded annual growth rate of 25% in revenue from 2021 to 2024[30]. - The company has a compounded annual growth rate of 24% in average revenue for its top 100 customers from 2021 to 2024[30]. - The company achieved a net revenue retention rate of 112% in 2024, 124% in 2023, and 127% in 2022, driven by increased advertising volume and successful new solution launches[44]. - The company has maintained over 95% gross revenue retention rates across its customer base from 2022 to 2024, retaining 100% of its top 75 customers[44]. - The company’s sales cycle is long and complex, making it difficult to predict revenue generation from new customers[128]. - Future revenue and operating results may fluctuate significantly, impacting stock price and investor expectations[158]. Customer Base and Relationships - The company serves over 2,000 customers, with 110 customers each representing at least $1 million of annual revenue in 2024, up from 93 in 2023[28]. - The average relationship duration with the top 25, 50, and 75 customers is approximately eight years[30]. - The competitive landscape is evolving rapidly, with no single customer accounting for more than 10% of revenue in 2024, indicating a diversified customer base[104]. - Two programmatic partner platforms collected approximately 22% and 14% of the company's total revenue in 2024, indicating a reliance on specific partners for revenue generation[124]. Advertising and Market Trends - Global digital ad spend, excluding search, reached $329 billion in 2024 and is expected to grow to $448 billion by 2028[31]. - Seasonal fluctuations in revenue are expected, with the fourth quarter typically reflecting the highest measurement activity due to increased holiday advertising[83]. - Seasonal fluctuations in advertising activity could negatively impact revenue and cash flow[102]. - The company has experienced significant growth in social media-related revenues, but public criticism and regulatory scrutiny of social media platforms could negatively impact demand for its solutions[138]. Technology and Innovation - The company leverages AI to enhance content classification and deliver cost-effective video classification solutions[37]. - The company employs advanced AI-driven classification technology for content categorization, utilizing machine learning across various content types[72]. - The company acquired Scibids Technology SAS in August 2023, enhancing its AI-powered digital campaign optimization capabilities[52]. - The company’s DV Authentic Attention solution provides comprehensive data for campaign performance, measuring exposure and engagement metrics in real-time[50]. - The company’s technology is integrated with leading digital advertising platforms, facilitating the distribution of its programmatic solutions and enabling comprehensive data analysis[57]. Operational Structure - The company operates in 31 locations across 25 countries, including major markets like the United States, the United Kingdom, and Australia[28]. - The company employs 225 software and data engineers across seven research and development centers focused on product development as of December 31, 2024[43]. - The engineering team consists of 339 employees as of December 31, 2024, focusing on software development and infrastructure operations[66]. - The product team, with 197 employees, collaborates with sales and marketing to define the product roadmap and ensure high-quality technology[67]. - Approximately 42% of the company's 1,197 employees are located outside of the Americas, indicating a global workforce[88]. Risks and Challenges - The company faces significant risks including technological obsolescence, competitive market pressures, and potential system failures that could disrupt operations[99]. - Economic downturns and unstable market conditions could adversely affect the company's financial condition and results of operations[99]. - The company is exposed to risks associated with cybersecurity, including potential breaches that could harm its reputation and financial condition[108]. - The company must continuously upgrade its platform to remain competitive and meet evolving customer needs[103]. - The reliance on third-party service providers for IT systems introduces risks of performance failures that could disrupt operations[111]. - The company is subject to evolving data privacy regulations, which may require significant resources to comply and could lead to legal or regulatory actions if not adhered to[134]. Financial Position and Capital Structure - As of December 31, 2024, the company reported cash, cash equivalents, and short-term investments totaling $310.6 million, an increase from $310.1 million in 2023 and $267.8 million in 2022[333]. - The company has no outstanding variable rate debt as of December 31, 2024, and has $200.0 million available under the New Revolving Credit Facility, which matures in August 2029[333]. - The company may need additional capital in the future to support growth strategies, including acquisitions and technological enhancements[168]. - The company is subject to taxation in multiple jurisdictions, which could increase effective tax rates and cash tax payments in future periods[156]. Corporate Governance and Compliance - Providence VII U.S. Holdings L.P. owns approximately 16% of the outstanding shares, influencing corporate transactions and potentially affecting stock price[182]. - The company does not intend to pay dividends on its common stock for the foreseeable future, relying on future earnings for growth and acquisitions[198]. - Compliance with public company regulations incurs significant costs, impacting operational expenses and management resources[187]. - The company may face challenges in maintaining effective internal controls, which could affect financial reporting and investor confidence[191]. - The existence of anti-takeover provisions may discourage favorable changes in management or control, potentially affecting stockholder interests[192].

Exhibit 99.1 DoubleVerify Reports Fourth Quarter and Full Year 2024 Financial Results Increased Fourth Quarter Revenue by 11% Year-over-Year to $190.6 Million Achieved 2024 Net Income of $56.2 Million and Adjusted EBITDA of $218.9 Million, representing a 33% Adjusted EBITDA margin Agreed to Acquire Rockerbox, a leader in performance attribution, optimization and marketing measurement, to drive greater ROI for advertisers NEW YORK – February 27, 2025 – DoubleVerify ("DV") (NYSE: DV), the leading software pla ...

Core Viewpoint - Growth investors are focused on stocks with above-average financial growth, but identifying stocks that can fulfill their potential is challenging [1] Group 1: Company Overview - DoubleVerify Holdings (DV) is currently recommended as a growth stock due to its favorable Growth Score and top Zacks Rank [2] - The company operates in the digital media measurement and analytics sector [3] Group 2: Earnings Growth - DoubleVerify has a historical EPS growth rate of 13.2%, but projected EPS growth for this year is expected to be 34.1%, significantly higher than the industry average of 23.1% [4] Group 3: Cash Flow Growth - The year-over-year cash flow growth for DoubleVerify is 44.6%, outperforming the industry average of -14.6% [5] - The company's annualized cash flow growth rate over the past 3-5 years is 38.5%, compared to the industry average of 13.2% [6] Group 4: Earnings Estimate Revisions - Current-year earnings estimates for DoubleVerify have been revised upward, with the Zacks Consensus Estimate increasing by 2.5% over the past month [8] Group 5: Investment Positioning - DoubleVerify has earned a Growth Score of A and carries a Zacks Rank 2 due to positive earnings estimate revisions, positioning it well for potential outperformance [10]

Core Viewpoint - Investors are seeking growth stocks that can deliver above-average growth and exceptional returns, but identifying such stocks can be challenging due to inherent risks and volatility [1] Company Summary: DoubleVerify Holdings (DV) - DoubleVerify is identified as a promising growth stock with a favorable Growth Score and a top Zacks Rank [2] - The company has a historical EPS growth rate of 13.2%, with projected EPS growth of 31.3% this year, surpassing the industry average of 24.2% [4] - Year-over-year cash flow growth for DoubleVerify stands at 44.6%, significantly higher than the industry average of -13.9% [5] - The annualized cash flow growth rate over the past 3-5 years is 38.5%, compared to the industry average of 13.8% [6] - There have been upward revisions in current-year earnings estimates for DoubleVerify, with the Zacks Consensus Estimate increasing by 0.1% over the past month [8] - The combination of a Zacks Rank 2 and a Growth Score of A positions DoubleVerify well for potential outperformance, making it an attractive option for growth investors [10]