DoubleVerify(DV) - 2024 Q4 - Annual Results

Executive Summary & Key Highlights This section provides an overview of DoubleVerify's strong financial performance in Q4 and full-year 2024, alongside key strategic developments including the acquisition of Rockerbox Fourth Quarter 2024 Highlights DoubleVerify reported strong Q4 2024 results with revenue increasing 11% year-over-year to $190.6 million, driven by significant growth in supply-side revenue (34%) and CTV measurement (95%). The company achieved a record 39% Adjusted EBITDA margin Q4 2024 Key Financial Highlights | Metric | Value | | :-------------------- | :------------ | | Total Revenue | $190.6 million | | Supply-Side Revenue Growth | 34% YoY | | CTV MTM Growth | 95% YoY | | Net Income | $23.4 million | | Adjusted EBITDA | $73.8 million | | Adjusted EBITDA Margin | 39% | Full Year 2024 Highlights For the full year 2024, DoubleVerify achieved 15% revenue growth to $656.8 million, with a 33% Adjusted EBITDA margin. Growth was primarily fueled by global expansion in Social, CTV measurement, and programmatic activation FY 2024 Key Financial Highlights | Metric | Value | | :-------------------- | :------------ | | Total Revenue | $656.8 million | | Total Revenue Growth | 15% YoY | | Net Income | $56.2 million | | Adjusted EBITDA | $218.9 million | | Adjusted EBITDA Margin | 33% | - Growth was driven by global expansion in Social, CTV Measurement, and Programmatic Activation[1] Strategic Business Developments DoubleVerify announced the acquisition of Rockerbox for $85.0 million in cash, aiming to enhance performance attribution, optimization, and marketing measurement capabilities, and expand into the mid-market direct response advertiser segment. The company also continued its share repurchase program - Agreed to acquire Rockerbox, a leader in performance attribution, optimization, and marketing measurement, for $85.0 million in cash[1][2][13] - The acquisition of Rockerbox is expected to drive greater ROI for advertisers and expand DV's core value proposition into mid-market, direct response advertisers[2] - Repurchased 6.8 million shares for $128.0 million in full-year 2024, with $200.0 million available under the New Repurchase Program as of February 27, 2025[9][11] Detailed Financial Performance This section details DoubleVerify's revenue and profitability performance for Q4 and full-year 2024, highlighting growth drivers and margin achievements Revenue Performance DoubleVerify demonstrated robust revenue growth in both Q4 and the full year 2024, driven by strong performance across Activation, Measurement, and Supply-side segments, with significant expansion in CTV and international markets Fourth Quarter 2024 Revenue Q4 2024 total revenue grew 11% to $190.6 million. Activation revenue increased 10%, Measurement revenue grew 7% (with Social up 9% and International up 11%), and Supply-side revenue surged 34%. CTV Media Transactions Measured (MTM) saw a significant 95% increase Q4 2024 Revenue by Customer Type | Revenue Type | Q4 2024 (in thousands) | Q4 2023 (in thousands) | Change ($) | Change (%) | | :-------------------- | :----------------------- | :----------------------- | :--------- | :--------- | | Activation | $109,517 | $99,402 | $10,115 | 10% | | Measurement | $64,379 | $60,387 | $3,992 | 7% | | Supply-side | $16,725 | $12,442 | $4,283 | 34% | | Total Revenue | $190,621 | $172,231 | $18,390 | 11% | - Social measurement revenue increased by 9% and International measurement revenue increased by 11% (EMEA 10%, APAC 13%)[4] - Media Transactions Measured (MTM) for CTV increased by 95%[4] Full Year 2024 Revenue Full year 2024 total revenue increased 15% to $656.8 million. Activation revenue grew 13%, Measurement revenue increased 15% (with Social up 27% and International up 22%), and Supply-side revenue rose 25%. Total Media Transactions Measured (MTM) increased 19%, while the Measured Transaction Fee (MTF) decreased 4%. Net Revenue Retention (NRR) was 112% FY 2024 Revenue by Customer Type | Revenue Type | FY 2024 (in thousands) | FY 2023 (in thousands) | Change ($) | Change (%) | | :-------------------- | :----------------------- | :----------------------- | :--------- | :--------- | | Activation | $373,101 | $328,936 | $44,165 | 13% | | Measurement | $226,939 | $198,024 | $28,915 | 15% | | Supply-side | $56,809 | $45,583 | $11,226 | 25% | | Total Revenue | $656,849 | $572,543 | $84,306 | 15% | - Media Transactions Measured (MTM) were 8.3 trillion, an increase of 19%[4] - Measured Transaction Fee (MTF) was $0.072, a decrease of 4%, excluding the impact of an introductory fixed fee deal for one large customer[4] - Net Revenue Retention (NRR) of 112%[4] - Social measurement revenue increased by 27% and International measurement revenue increased by 22% (EMEA 25%, APAC 18%)[4] Profitability (Net Income & Adjusted EBITDA) DoubleVerify maintained strong profitability in 2024, achieving a record Adjusted EBITDA margin in Q4 and a consistent margin for the full year, despite a decrease in net income Fourth Quarter 2024 Profitability In Q4 2024, Net Income was $23.4 million (12% margin), and Adjusted EBITDA reached $73.8 million, representing a record 39% Adjusted EBITDA margin, reflecting efficient operations and disciplined growth Q4 2024 Profitability Metrics | Metric | Q4 2024 (in thousands) | Q4 2023 (in thousands) | YoY Change (%) | | :-------------------- | :----------------------- | :----------------------- | :------------- | | Net Income | $23,400 | $33,105 | -29.3% | | Net Income Margin | 12% | 19% | -7 ppts | | Adjusted EBITDA | $73,841 | $65,428 | 12.9% | | Adjusted EBITDA Margin | 39% | 38% | +1 ppt | - The 39% adjusted EBITDA margin in Q4 reflects the efficiency of the operating model and disciplined approach to growth[11] Full Year 2024 Profitability For the full year 2024, Net Income was $56.2 million (9% margin), and Adjusted EBITDA was $218.9 million, maintaining a 33% Adjusted EBITDA margin FY 2024 Profitability Metrics | Metric | FY 2024 (in thousands) | FY 2023 (in thousands) | YoY Change (%) | | :-------------------- | :----------------------- | :----------------------- | :------------- | | Net Income | $56,231 | $71,466 | -21.3% | | Net Income Margin | 9% | 12% | -3 ppts | | Adjusted EBITDA | $218,898 | $187,064 | 17.0% | | Adjusted EBITDA Margin | 33% | 33% | 0 ppts | Product & Platform Innovations This section highlights DoubleVerify's advancements in social media brand safety and suitability, alongside new open web integrations to enhance programmatic media quality Social Media Innovations DoubleVerify expanded its brand safety and suitability solutions across major social platforms, including content-level avoidance for Meta's Facebook and Instagram Feeds and Reels, viewability and IVT measurement for Reels, expanded TikTok coverage to 64 markets, and new brand safety/suitability measurement on Snap and YouTube - Launched content-level avoidance for Meta's Facebook and Instagram Feeds and Reels, powered by DV Universal Content Intelligence™[8] - Expanded viewability and invalid traffic (IVT) measurement for display ads on Reels across Facebook[8] - Expanded brand safety and suitability coverage on TikTok to over 18 international markets, bringing DV's TikTok coverage to 64 markets, and launched TikTok's Video Exclusion List Solution[8] - Expanded viewability and brand safety coverage across additional ad formats on YouTube and launched brand safety and suitability measurement on Snap[8] Open Web Integrations & Expansions DoubleVerify launched integrations with Google Ad Manager and is on track to roll out Criteo and Index Exchange, enabling programmatic buyers to activate media quality data across buy and sell-side environments for improved performance - Launched integrations with Google Ad Manager[6] - On track to roll out integrations with Criteo and Index Exchange imminently[6] - These integrations enable programmatic buyers to activate DoubleVerify's media quality data across both buy and sell-side environments, empowering advertisers to curate inventory at source[6] Corporate Strategy & Capital Allocation This section outlines DoubleVerify's strategic acquisition of Rockerbox to enhance marketing measurement and its ongoing share repurchase program Strategic Investments & Acquisitions DoubleVerify agreed to acquire Rockerbox, Inc. for $85.0 million in cash to enhance performance attribution, optimization, and marketing measurement, and to expand its core value proposition to mid-market, direct response advertisers. The company also announced an Innovation Day for the investment community - Agreed to acquire Rockerbox, Inc. for $85.0 million in cash[13] - Rockerbox is a leader in performance attribution, optimization, and marketing measurement, empowering advertisers to optimize campaigns and maximize ROI[13] - Announced an in-person Innovation Day for the investment community on Wednesday, June 11, 2025, at the New York Stock Exchange[13] Share Repurchase Program DoubleVerify repurchased 6.8 million shares for $128.0 million in full-year 2024 and an additional 1.1 million shares for $22.2 million in January 2025. As of February 27, 2025, $200.0 million remains available under the new repurchase program - Repurchased 6.8 million shares for $128.0 million in full-year 2024[9] - Repurchased 1.1 million shares for $22.2 million in January 2025[9] - $200.0 million available under the New Repurchase Program as of February 27, 2025[9] Financial Guidance This section provides DoubleVerify's financial outlook for the first quarter and full year 2025, including anticipated revenue growth and Adjusted EBITDA margins First Quarter 2025 Outlook For Q1 2025, DoubleVerify anticipates revenue between $151 million and $155 million, representing a 9% year-over-year increase at the midpoint, and Adjusted EBITDA between $37 million and $41 million, with a 25% margin at the midpoint Q1 2025 Guidance | Metric | Range | | :-------------------- | :----------------------- | | Revenue | $151 - $155 million | | YoY Increase (midpoint) | 9% | | Adjusted EBITDA | $37 - $41 million | | Adjusted EBITDA Margin (midpoint) | 25% | Full Year 2025 Outlook For the full year 2025, DoubleVerify expects approximately 10% revenue growth and an Adjusted EBITDA margin of approximately 32% FY 2025 Guidance | Metric | Outlook | | :-------------------- | :----------------------- | | Revenue Growth | Approximately 10% | | Adjusted EBITDA Margin | Approximately 32% | Supplemental Financial Data & Definitions This section defines key business terms and provides information on investor communications, offering clarity on financial metrics and company engagement Key Business Terms This section provides definitions for key business terms used in the financial report, including Activation revenue, Measurement revenue, Supply-Side revenue, Gross Revenue Retention Rate, Net Revenue Retention Rate, Media Transactions Measured (MTM), Measured Transaction Fee (MTF), and International Revenue Growth Rates - Activation revenue: Generated from the evaluation, verification and measurement of advertising impressions purchased through programmatic demand-side and social media platforms[17] - Measurement revenue: Generated from the verification and measurement of advertising impressions that are directly purchased on digital media properties, including publishers and social media platforms[17] - Supply-Side revenue: Generated from platforms and publisher partners who use DoubleVerify's data analytics to evaluate, verify and measure their advertising inventory[18] - Gross Revenue Retention Rate: Total prior period revenue earned from advertiser customers, less the portion of prior period revenue attributable to lost advertiser customers, divided by the total prior period revenue from advertiser customers[18] - Net Revenue Retention Rate: Total current period revenue earned from advertiser customers, which were also customers during the entire most recent twelve-month period, divided by the total prior year period revenue earned from the same advertiser customers, excluding a portion of our revenues that cannot be allocated to specific advertiser customers[19] - Media Transactions Measured (MTM): The volume of media transactions that DoubleVerify's software platform measures[19] - Measured Transaction Fee (MTF): The fixed fee DoubleVerify charges per thousand Media Transactions Measured[20] - International Revenue Growth Rates: Inclusive of foreign currency fluctuations[20] Conference Call & Investor Information DoubleVerify hosted a conference call and live webcast on February 27, 2025, to discuss its Q4 and FY2024 financial results. An archived webcast is available, and the company plans to post additional historical quarterly financial information on its investor relations website - DoubleVerify hosted a conference call and live webcast to discuss its fourth quarter and full-year 2024 financial results on February 27, 2025[15] - The webcast is available on the Investors section of the Company's website at https://ir.doubleverify.com/, with an archived replay available[15] - DoubleVerify plans to post certain additional historical quarterly financial information on its investor relations website[16] Consolidated Financial Statements This section presents DoubleVerify's consolidated balance sheets, statements of operations, stockholders' equity, and cash flows for the reported periods Consolidated Balance Sheets As of December 31, 2024, DoubleVerify reported total assets of $1,276.2 million, a slight increase from $1,243.0 million in 2023. Total liabilities increased to $192.8 million from $169.1 million, while total stockholders' equity grew to $1,083.5 million from $1,073.9 million Consolidated Balance Sheet Highlights (in thousands) | Metric | Dec 31, 2024 | Dec 31, 2023 | | :------------------------- | :----------- | :----------- | | Total Assets | $1,276,210 | $1,243,031 | | Cash and cash equivalents | $292,820 | $310,131 | | Trade receivables, net | $226,225 | $206,941 | | Total Current Assets | $559,051 | $533,002 | | Goodwill | $427,621 | $436,008 | | Total Liabilities | $192,751 | $169,092 | | Total Stockholders' Equity | $1,083,459 | $1,073,939 | Consolidated Statements of Operations and Comprehensive Income For the year ended December 31, 2024, DoubleVerify reported revenue of $656.8 million, up from $572.5 million in 2023. Net income decreased to $56.2 million from $71.5 million in the prior year, with diluted EPS of $0.32 Consolidated Statements of Operations Highlights (in thousands, except per share data) | Metric | FY 2024 | FY 2023 | FY 2022 | | :-------------------------------- | :-------- | :-------- | :-------- | | Revenue | $656,849 | $572,543 | $452,418 | | Income from operations | $82,420 | $85,727 | $59,024 | | Net income | $56,231 | $71,466 | $43,268 | | Diluted EPS | $0.32 | $0.41 | $0.25 | | Total comprehensive income | $44,342 | $74,989 | $37,713 | Consolidated Statements of Stockholders' Equity The Consolidated Statements of Stockholders' Equity detail changes in common stock, treasury stock, additional paid-in capital, retained earnings, and accumulated other comprehensive loss for the years ended December 31, 2022, 2023, and 2024. Key movements in 2024 included a significant increase in treasury stock due to repurchases and an increase in additional paid-in capital from stock-based compensation Consolidated Stockholders' Equity Highlights (in thousands) | Metric | Dec 31, 2024 | Dec 31, 2023 | | :------------------------- | :----------- | :----------- | | Common Stock | $174 | $171 | | Treasury Stock | $(131,620) | $(743) | | Additional Paid-in Capital | $974,383 | $878,331 | | Retained Earnings | $255,214 | $198,983 | | Total Stockholders' Equity | $1,083,459 | $1,073,939 | - Shares repurchased under the Repurchase Program in 2024 amounted to $128,667 thousand[24] - Stock-based compensation expense contributed $92,821 thousand to Additional Paid-in Capital in 2024[24] Consolidated Statements of Cash Flows For the year ended December 31, 2024, net cash provided by operating activities was $159.7 million, an increase from $119.7 million in 2023. Net cash used in investing activities was $44.8 million, and net cash used in financing activities was $129.5 million, primarily due to share repurchases. Cash and cash equivalents decreased to $292.8 million at year-end Consolidated Statements of Cash Flows Highlights (in thousands) | Metric | FY 2024 | FY 2023 | FY 2022 | | :----------------------------------------- | :-------- | :-------- | :-------- | | Net cash provided by operating activities | $159,664 | $119,741 | $94,862 | | Net cash used in investing activities | $(44,841) | $(84,249) | $(39,981) | | Net cash used in financing activities | $(129,450) | $6,489 | $(7,884) | | Net (decrease) increase in cash, cash equivalents, and restricted cash | $(16,516) | $42,319 | $46,213 | | Cash, cash equivalents, and restricted cash—End of period | $293,741 | $310,257 | $267,938 | - Shares repurchased under the Repurchase Program resulted in a cash outflow of $(127,999) thousand in FY2024[25] Non-GAAP Financial Measures This section provides reconciliations of non-GAAP financial measures, such as Adjusted EBITDA, to their GAAP equivalents, along with explanations of their utility and limitations Adjusted EBITDA Reconciliation This section provides a reconciliation of Adjusted EBITDA to Net Income, the most directly comparable GAAP measure, for both the three months and year ended December 31, 2024 and 2023. Adjusted EBITDA excludes items such as depreciation and amortization, stock-based compensation, interest expense, income tax expense, M&A and restructuring costs, offering costs, and other recoveries/expenses Adjusted EBITDA Reconciliation (in thousands) | Metric | Q4 2024 | Q4 2023 | FY 2024 | FY 2023 | | :-------------------------------- | :-------- | :-------- | :-------- | :-------- | | Net income | $23,400 | $33,105 | $56,231 | $71,466 | | Depreciation and amortization | $11,800 | $11,520 | $45,215 | $40,885 | | Stock-based compensation | $22,752 | $16,473 | $90,658 | $59,244 | | Interest expense | $300 | $275 | $1,118 | $1,066 | | Income tax expense | $13,979 | $8,636 | $32,559 | $24,411 | | M&A and restructuring costs (recoveries) | $537 | $(359) | $537 | $1,262 | | Other expense (income) | $1,073 | $(4,373) | $(7,488) | $(11,216) | | Adjusted EBITDA | $73,841 | $65,428 | $218,898 | $187,064 | Explanation and Limitations of Non-GAAP Measures DoubleVerify uses Adjusted EBITDA and Adjusted EBITDA Margin as measures of operational efficiency to evaluate core business operations and trends, believing they are useful for investors for period-to-period comparisons. However, these non-GAAP measures have limitations, as they do not reflect cash requirements for working capital, capital expenditures, income taxes, or debt payments, and may not be comparable to similarly titled measures used by other companies - Adjusted EBITDA and Adjusted EBITDA Margin are used as measures of operational efficiency to understand and evaluate core business operations and trends[29] - Limitations include not reflecting changes in working capital, capital expenditures, income tax expense, interest expense, or cash requirements for asset replacements[32] - These non-GAAP measures may not be comparable to those used by other companies in the industry[30] Stock-Based Compensation Expense Total stock-based compensation expense recorded in the Consolidated Statements of Operations and Comprehensive Income for the full year 2024 was $90.7 million, an increase from $59.2 million in 2023. This expense is allocated across product development, sales, marketing and customer support, and general and administrative functions Stock-Based Compensation Expense (in thousands) | Category | Q4 2024 | Q4 2023 | FY 2024 | FY 2023 | | :-------------------------------- | :-------- | :-------- | :-------- | :-------- | | Product development | $8,796 | $6,366 | $34,802 | $22,955 | | Sales, marketing and customer support | $7,213 | $5,101 | $27,804 | $18,299 | | General and administrative | $6,743 | $5,006 | $28,052 | $17,990 | | Total stock-based compensation | $22,752 | $16,473 | $90,658 | $59,244 | Forward-Looking Statements & Company Information This section includes disclaimers regarding forward-looking statements, an overview of DoubleVerify's mission, and contact information for investor and media relations Forward-Looking Statements Disclaimer This section contains forward-looking statements regarding future revenues, earnings, margins, and financial performance, which are subject to known and unknown risks and uncertainties. These include market competitiveness, technological developments, system failures, economic downturns, data privacy regulations, and international operations. The company cautions that actual events may differ materially from these statements and does not undertake to update them - Forward-looking statements relate to future revenues, earnings, margins, financial performance, or results of operations, including 2025 guidance[33] - Subject to known and unknown risks and uncertainties, such as market competitiveness, system failures, economic downturns, data privacy legislation, and international operations[33] - Actual events may differ materially from forward-looking information, and the company does not undertake any obligation to update or revise these statements[33][35] About DoubleVerify DoubleVerify (DV) is a leading media effectiveness platform that uses AI to improve outcomes for global brands. It aims to create more effective, transparent, and secure digital advertising transactions, thereby preserving the fair value exchange between buyers and sellers - DoubleVerify is the leading software platform for digital media measurement, data and analytics[1] - It is an AI-driven media effectiveness platform that drives superior outcomes for global brands by creating more effective, transparent ad transactions[36] Investor & Media Contacts This section provides contact information for DoubleVerify's Investor Relations and Media inquiries - Investor Relations Contact: Tejal Engman, IR@doubleverify.com[37] - Media Contact: Chris Harihar, Crenshaw Communications, 646-535-9475, chris@crenshawcomm.com[37]