Core Viewpoint - The Trade Desk's premium valuation is increasingly difficult to justify due to competitive pressures and slowing growth [2][3][11]. Financial Performance - In Q2 2025, The Trade Desk reported a revenue increase of 19% year-over-year to $694 million, with adjusted EBITDA of approximately $271 million, reflecting a 39% margin [5]. - The first quarter of 2025 saw a revenue increase of 25% to $616 million, while full-year 2024 revenue grew by 26% [7]. - For Q3 2025, management guided revenue of at least $717 million, implying a 14% year-over-year growth [7]. Growth Dynamics - Connected TV (CTV) remains the fastest-growing channel for The Trade Desk, with no signs of slowing down [6]. - However, growth is decelerating, with a drop from 25% in Q1 to 19% in Q2, and guidance suggesting mid-teens growth for the upcoming quarter [7][11]. Competitive Landscape - Netflix's announcement to allow programmatic ad purchases through Amazon's DSP poses significant competitive risks for The Trade Desk [2][9]. - The entry of Amazon into the programmatic advertising space could pressure The Trade Desk's pricing power and market share, as large buyers may prefer Amazon's tools [10]. - The Trade Desk remains the leading independent DSP, with a customer retention rate above 95% and a strong product roadmap [11]. Valuation Concerns - The stock trades at a price-to-earnings multiple in the high 50s, which assumes sustained growth and market share gains without significant pressure from larger platforms [11]. - A more appropriate price-to-earnings ratio in the 30s may better reflect the competitive and execution risks associated with connected TV [12].