Strong Kokai Adoption Fuels TTD's Revenue Pipeline & Growth Prospects

Core Insights - The Trade Desk, Inc. (TTD) launched Kokai in 2023, a next-generation platform utilizing Koa AI to enhance programmatic advertising through advanced analytics and integrations, potentially reshaping TTD's revenue and competitive position [2][4] Group 1: Kokai Platform Features and Adoption - Kokai employs a distributed AI architecture with specialized models for various functions, improving efficiency and reliability in ad performance [3] - Nearly all TTD clients have tested Kokai, with 85% adopting it as their default platform, leading to significant performance improvements: 26% better cost per acquisition, 58% better cost per unique reach, and a 94% higher click-through rate [4][10] - Successful case studies include Specsavers reducing appointment booking costs by 43% and Danone increasing conversion rates by one-third for its Actimel brand [5] Group 2: Market Position and Competitive Landscape - TTD is well-positioned for market share growth in 2026, supported by Kokai's adoption, growth in connected TV (CTV) and retail media, and strong client retention, despite competition from Magnite, Inc. and Taboola.com Inc. [6] - Magnite reported a strong third quarter with 18% CTV growth, driven by its SpringServe ad server, while Taboola's new platform, Realize, enhances performance advertising capabilities across the open web [7][8] Group 3: Financial Performance and Valuation - TTD shares have declined by 71.7% over the past year, contrasting with the 61.6% growth of the Zacks Internet – Services industry [11] - TTD's forward price/earnings ratio stands at 26.86X, lower than the industry average of 29.52X [12] - The Zacks Consensus Estimate for TTD's earnings for 2025 has remained stable over the past 60 days [13]