Financial Data and Key Metrics Changes - The company reported Q3 revenue growth of 5% year-over-year, totaling 6.5 million compared to Q3 last year [37][45][48] - Adjusted EBITDA margin improved to 18%, up from 8% in Q3 last year and 13% in Q2 [48][36] - Positive free cash flow of 2.3 million in Q3 2022 [20][37] Business Line Data and Key Metrics Changes - CTV revenue from ad serving and personalization grew 9% year-over-year, while measurement revenue increased by 8% [10][17] - Ad serving and personalization accounted for 77% of total revenue, with measurement making up 23% [17] - The company achieved a revenue less cost of revenue ratio of 77%, improving from 75% in Q3 last year [47] Market Data and Key Metrics Changes - CTV video impression volume grew by 7%, with 55% of all video impressions coming from CTV [46] - Mobile volume represented 35% of all video impressions, growing by 8%, while desktop volume decreased by 12% [46] - The company noted a significant shift in TV viewership, with linear TV viewership falling below 50% in the U.S. for the first time [10] Company Strategy and Development Direction - The company is focused on expanding margins and positioning for accelerated growth as the macro environment improves [8][9] - Innovid is investing in generative AI technologies to enhance its platform, allowing clients to create unique ads based on data feeds [12][40] - The company plans to showcase product innovations and strategies for 2024 at the upcoming Investor Day [42][99] Management's Comments on Operating Environment and Future Outlook - Management expressed cautious optimism regarding the ad demand environment, noting some positive trends while acknowledging ongoing uncertainties [78] - The company anticipates continued strong financial performance in Q4, raising its revenue and adjusted EBITDA guidance for the full year [36][21] - Management highlighted the importance of optimizing CTV ad investments and the potential for significant growth as the market normalizes [41][91] Other Important Information - The company ended Q3 with 20 million drawn on its revolving debt facility [20] - The new CFO, Anthony Callini, emphasized the company's scalable model and potential for healthy margins [43][91] Q&A Session Summary Question: Can you frame the opportunity for Instant Optimization and its expected influence on results? - Management discussed the integration of platforms to enhance campaign strategy and optimization, leveraging unique data sets [52][53] Question: What is the current brand advertiser sentiment and how does it vary across verticals? - Management noted that CPG and pharma are investing more aggressively, while financial services and technology companies are seeing decreases [62][64] Question: How should investors think about Innovid's margin profile going forward? - Management indicated a target of 30%+ adjusted EBITDA margins, emphasizing the scalability of the business model [68][91] Question: How does Innovid benefit from the trend of live sports streaming? - Management highlighted that live sports are a significant driver of viewership behavior and brand advertising, which is beneficial for the company [92][93]
Innovid (CTV) - 2023 Q3 - Earnings Call Transcript