Good day, everyone, and welcome to the Direct Digital Holdings Fourth Quarter and full year 2023 Earnings Call. Today's call is being recorded, and all lines have been placed on mute to prevent any background noise. After the speaker's remarks, there will be a question-and-answer session. If you would like to ask a question during this time, simply press star 1 on your telephone keypad, and if you would like to withdraw your question, it is star 1 again. I will now turn the conference over to Brett Milotte, VP of Investor Relations. Please go ahead. Good afternoon, everyone, and welcome to Direct Digital Holdings fourth quarter and full year 2023 earnings conference call. My name is Brett Milotte, and I'm representing Direct Digital Holdings from ICR. On today's call are Direct Digital Holdings Chairman and Chief Executive Officer Mark Walker and Chief Financial Officer Diana Diaz. Information discussed today is qualified in its entirety by the Form 8-K and accompanying earnings release, which has been filed today by Direct Digital Holdings and may be accessed at the SEC's website and DRCT's website. Today's call is also being webcast, and a replay will be posted to DRCT's Investor Relations website. Immediately following the speaker's presentation, there will be a question-and-answer session. Please note that the statements made during this call, including financial projections or other statements that are not historical in nature, may constitute forward-looking statements. These statements are made on the basis of DRCT's views and assumptions regarding future events and business performance at the time they are made and do not undertake any obligation to update these statements. Forward-looking statements are subject to risks, which can cause DRCT's actual results to differ from its historical results and forecasts, including those risks set forth in DRCT's filings at the SEC and on this call, and you can refer to those for more information. This cautionary statement applies to all forward-looking statements made during this call. During this call, DRCT will be referring to non-GAAP financial measures. These non-GAAP measures are not prepared in accordance with the generally accepted accounting principles. Reconciliation of the non-GAAP financial measures with the most directly comparable GAAP measures is available in the earnings release that DRCT filed in its Form 8-K today. I will now hand over the conference to Mark Walker, Chief Executive Officer. Mark? Thanks, Brett. Thank you to everyone joining our fourth quarter and full year 2023 earnings call. 2023 was an inflection point for our company, and I'm incredibly proud to report our strong financial results and operational performance for the year as we're now reporting our eighth quarter of double-digit revenue growth. As we discussed in previous earnings calls, we continue to make significant investments in Direct Digital Holdings' technology stack, advertising platform, and operational structure throughout 2023. Our strong technology partnerships and our overarching business strategy have enabled us to meet a growing number of customers' demands and further the capabilities of our technology platforms. As a result, our open marketplace platform continues to benefit as middle market businesses seek our differentiated, thoughtful approach to advertising solutions. Before we get into more detail about our fourth quarter, I'd like to begin with a quick review of our year. We achieved total full-year revenue of $157.1 million, or 76% growth over the $89.4 million achieved in 2022, and 29% above our initial 2023 guidance. We also achieved Adjusted EBITDA of $11.3 million, 11% higher than the $10.2 million Adjusted EBITDA for the same period in 2022. In 2023, we had a number of achievements, a few of which I wanted to highlight today as we're proud of how our team was able to grow the overall business. Firstly, we announced our new collaboration with Amazon Publisher Services with our Colossus SSP division integrated with Amazon's Transparent Ad Marketplace, or TAM. The integration allowed Colossus SSP's roster of publishers to tap into the benefits of TAM and server-side heterogeneous solutions that offer a direct auction approach. We also announced our partnership with HPE GreenLake, providing an edge-to-cloud platform to build a highly reliable, scalable, and secure production environment across our technology stack. Throughout the year, we had significant growth of the buy-side with strategic wins with growth of our overall client portfolio by 7% and increased revenue per customer up 10% for the year. We began the transition to a cookieless environment and saw the integration roll out of our alternative ID solutions. In addition, we launched our AI yield management tool, which allows us to achieve bid efficiency and revenue optimization, and we continued the transition of DDH, shared services function, for increased operational scale and support. While we saw strong growth in Q4 2023 year over year with revenue of $41 million, which was 33% higher than the same period last year, we were down sequentially from Q3 with Q4 revenue, which was shy of our revised guidance due to two primary factors. In the fourth quarter, based upon value chain changes, it became clear cookie deprecation would begin at Q1 of 2024. In addition, we noticed softer demand than our revised guidance called for. As such, our team proactively began our transition off of cookies for media transactions. As a result, we believe our strategic decision to accelerate our investments has positioned us well for the future and ahead of our peers. In addition, in Q4, we did not complete beta testing on our original schedule for several strategic publishers, including Dotdash Meredith, Weather.com, NBCU, and The Arena Group, which would have increased overall impression count. These strategic publishers have all been launched in Q1 of 2024. We continue to prioritize long-term successes for short-term gains, and we are confident the strategic measures and internal calibrations were made in Q4 2023 will position the company to build on the successes of 2023 and continue revenue growth and market share gains in 2024. Our fourth quarter 2023 Adjusted EBITDA of $2.3 million likewise was affected by the information revenue impacts during the quarter. Our supply-side platform continues to increase publisher-partner engagements in addition to increases in our impression inventory. In the fourth quarter, our sell-side advertising segment processed approximately 400 billion monthly impressions, an increase of 201% over the same period of 2022, with close to 1 trillion monthly bid requests for the quarter. In addition, the company's sell-side advertising platforms received over 83 billion bid responses in the fourth quarter of 2023, an increase of 367% over the same period in 2022. Our buyers within the platform did see some degradation due to our platform transition, decreasing by 50% to 84,000 buyers compared to last year's fourth quarter. However, our revenue per buyer increased by 133% to $397 per customer over the same period. On the buy side, these businesses served approximately 234 customers, an increase of 7% compared to the same period of 2022, with buy-side revenue per customer consistent with the same period last year. As it relates to 2024, our industry outlook and point of view is the following. We believe that the middle market in the digital ad tech space remains fragmented, and consolidation opportunities exist. We will continue to evaluate those opportunities for a creative platform integration, value creation, and strategic fit. We anticipate cookie deprecation will accelerate market consolidation and opportunistic investments. For our buy-side business, the introduction of AI and complex market dynamics will accelerate the market transition in digital media from traditional media. This transition will continue to present opportunities to expand our footprint and gain market share for tech-enabled services. In addition, alternative IDs will take on more importance in the industry, as well as strong understanding of the impact of the Privacy Sandbox on campaign performance, reporting, and delivery. We also believe that the bifurcation of the marketplace between alternative ID, open CPM marketplaces, and walled gardens will continue to exist, along with continued market tension between DSP and SSP relationships. We expect a streamlining of the value chain, and we aim to build strategic relationships with our focus on agency and brand partnerships, continuing to be the cornerstone of our strategy. Finally, AI tools will continue to proliferate through the value chain, allowing companies to leverage these tools and offer these capabilities across both of our business segments, increasing ROI and enhancing performance. For 2024, we're providing revenue guidance for FY 2024 of $170 million-$190 million, or an increase of 50% over last year's performance at the midpoint. I will now hand things over to our CFO, Diana Diaz, who will walk through some of the financial highlights in further detail. Thank you, Mark. As Mark stated, our revenue increased to $41 million in the fourth quarter of 2023, an increase of $10.3 million, or 33%, over the $30.7 million in the same period of last year. We finished the year with total revenue of $157.1 million, which was about 8% below the low point of our guidance range but was an increase of $67.8 million, or 76% growth, over the $89.4 million of revenue achieved in 2022. As Mark mentioned, revenue for the fourth quarter of 2023 was lower than anticipated due to lower than anticipated demand, a delay in the release of tier one publishers from beta testing, and proactive efforts by the company during the fourth quarter to accelerate the transition towards a cookieless advertising platform. Our sell-side advertising segment ended the year with a strong fourth quarter and drove the majority of the increase over the prior year. Colossus SSP grew to $33.4 million for Q4 and contributed $9.8 million of the increase, or 41%, over the $23.6 million of sell-side revenue in the same period of last year. For the full year, our sell-side segment achieved $122.4 million in revenue, an increase of $62.4 million, or 104%, of growth over the $60 million in sell-side revenue in 2022. For the fourth quarter, our buy-side businesses, Orange 142 and Huddled Masses, grew 7% year-over-year and contributed $500,000 of the overall increase, finishing the quarter with $7.6 million in revenue compared to $7.1 million in the same period of 2022. For the full year, our buy-side segment grew to $34.7 million, an increase of $5.3 million, or 18%, over the $29.3 million of buy-side revenue in 2022. For the fourth quarter of 2023, gross profit dollars were $9.3 million compared to $8.7 million for the fourth quarter of 2022, an increase of about $600,000 as a result of higher revenue. Gross margins for the fourth quarter of 2023 were approximately 23% compared to 28% in the same period of last year. Gross profit dollars for the year were $37.6 million compared to $29.3 million for 2022. That was an increase of $8.3 million as a result of higher revenue. Gross margin for 2023 was approximately 24% compared to approximately 33% for 2022. These margin results are in line with our margin expectations given the rate of accelerated growth in our sell-side advertising segment. Our faster-growing sell-side segment has higher cost of revenues compared to our buy-side segment. We also saw higher sell-side fixed costs related to an increase in server capacity and the amount of $1.6 million for 2023 to support our growth. Operating expenses increased to $9.3 million in the fourth quarter of 2023, or an increase of $3 million over the $6.3 million of expenses in the fourth quarter of last year. For the full year 2023, operating expenses were $30.9 million compared to $21.3 million in 2022, an increase of $9.6 million. Increases in compensation, tax, and benefits expense of $600,000 for the fourth quarter and $3.6 million for the year were primarily driven by headcount additions throughout 2023, mainly in our operations area to support our growth as well as in shared services. The increases in general administrative costs of $2.5 million for the fourth quarter and $6 million for the year were due to expenses associated with supporting our growth and ongoing marketing initiatives, as well as our continued transition to an operation as a public company beginning in February 2022. We expect to continue to invest in automation as well as additional headcount to support sales initiatives. As a consequence of the aforementioned revenue and operating expense impacts to our fourth quarter, we saw a net loss of $1.2 million in the fourth quarter compared to net income of $1.4 million in the same period of 2022. For the full year, net income was $2 million in 2023 compared to net income of $4.2 million in 2022. For the fourth quarter, Adjusted EBITDA was $2.3 million compared to Adjusted EBITDA of $3.1 million for the fourth quarter of last year. For the full year, adjusted EBITDA grew to $11.3 million, or 11% higher than the $10.2 million adjusted EBITDA for the full year 2022. Now, turning to the balance sheet, we ended the year with cash and cash equivalents of $5.1 million, an increase of $1.1 million over the $4 million we had as of the end of 2022. Total cash plus our accounts receivable balance as of year-end was $42.3 million compared to $30.4 million at the end of 2022. As part of our initiative to increase shareholder value and continue to facilitate our growth during the fourth quarter of 2023, we retired all outstanding warrants issued in connection with the company's IPO, and we improved our liquidity by securing a revolving credit facility with capacity of $10 million and up to $5 million uncommitted incremental capacity. We expect to continue to take steps in 2024 to improve liquidity in our balance sheet to support our business as well as facilitate inorganic growth opportunities. Now, to touch on guidance. Our guidance is subject to a variety of factors that may change over the year. In particular, it assumes that U.S. economic conditions do not materially deteriorate or that the economy does not otherwise experience significantly reduced advertiser demand. We plan to offer annual guidance and update it throughout the year. At present, we expect fiscal 2024 revenue to be in the range of $170 million-$190 million, or a 15% growth year-over-year at the midpoint. We are off to a good start for 2024. Based on preliminary results through mid-March 2024, we believe sell-side revenue is on pace to grow at a rate of 10%-20% over the prior year first quarter. And now, I'd like to turn it back over to Mark for some closing comments. Thank you, Diana, and thank you to everyone for joining. As always, we appreciate your interest in Direct Digital Holdings and are looking forward to your questions. Operator, please open up the line. Thank you. If you would like to ask a question on the phone line, that is star one on your telephone keypad. We'll take our first question from Darren Aftahi with Roth. Hey guys, good afternoon. Thanks for taking my questions. Mark, I guess the three kind of items you highlighted in terms of the fourth quarter, the lower demand, the pilots not coming out of beta, but the tier one publishers, and then the proactive kind of moves on moving to cookieless. I'm just kind of curious, can you kind of handicap a couple of things? One, how did each of those kind of impact your quarter relative to kind of initial thoughts when you guys gave guidance, I believe, on November 9th? And then as we have moved into 2024, I know you said some of those publishers have come out of beta, but how have those items kind of changed versus the fourth quarter? Thanks. Yeah, thanks for the question, Darren. I think a couple of things. One, I will say that I think our transition to dealing with cookie deprecation was an important strategic move for us. What we're seeing and what we had started to see in Q4 was that cookie deprecation was definitely occurring, even though after it had four years of delay. And so switching over a platform in order to be able to manage and deal with that did take a lot of effort, and we did not anticipate that move until we got into 2024. But once we started seeing the transition in the marketplace and what we started hearing in the industry, we felt like it was a prudent approach for us to go ahead and make that transition in Q4 versus waiting to 2024 before we started making that transition. Again, looking at long-term benefit versus short-term gain. The second thing is, if you look at the amount of impressions that we delivered between Q3 and Q4 as it relates to our SSP, it was roughly about 400 billion for each of those. And if you notice, we were flat. So the way that we have been historically able to grow is really by the increase of impressions that we actually be able to introduce into the marketplace. And so our delay in that beta was actually critical for us to ensure that we're able to grow, especially in light of the transition we were making with cookie deprecation. So I would say that Q4, even though we still performed 33% year-over-year and we were excited about that level of growth, it didn't meet the expectations that we initially thought based upon primarily those two factors and the impression count being really our hedge to make sure that we're able to maintain growth. What we are seeing in Q1 of 2024, after we have started making our move to alternative IDs and our proactive measures for cookie deprecation, we're seeing a 10%-20% growth as it relates to our SSP in comparison to last year's performance, which we feel is really justification of us making the right decision. Can you give any kind of color on maybe? I know January always starts off as a pretty dismal month in digital advertising, but can you talk about maybe the cadence of growth? Has it improved since you've kind of put in since you switched the platform and working with alternative IDs? Is that what's driving the growth? Is it the new publishers coming off of beta which is driving the growth? And just going back to both your comments, sorry. You talked about softer demand. I'm just kind of curious, is the softer demand correlated with the cookies, or is that something that's absolute and unique? Yeah, I would say the softer demand was a combination of the change that we saw with making the transition over cookies because of the platform impact that we actually had in Q4. And we also saw it being lighter going into the holiday season. So it was a combination of both as it relates to Q3. What we attribute the increase in performance in Q4 has everything to do with the increase in publishers that we've actually added, the ones that were delayed in getting out of beta within Q4. And we moved those into Q1. Coupled with the transition that we've made to the alternative IDs, we are seeing an impact based upon that in regards to the level of transitions the level of transactions that we're actually seeing. We also see the benefits of the technology changes that we made in the second half of 2023 as we compare the first quarter to last year. Yes, that is correct. That's helpful. Thanks, guys. Yep. We'll take our next question from Dan Kurnos with The Benchmark Company. Mark, can we stick with that for a second? The Q1 SSP, your sell-side guide, it's lower than 2Q of last year. It feels like there is either some revenue that you've decided isn't going to continue, and I don't want to put words in your mouth, because obviously, Q3 was big and we had a lot of momentum with the partner wins and, yes, the impression growth. And your guidance for the year kind of implies that there is a scaling growth in the SSP over the course of the year, assuming buy-side is, I don't know, 10%. And maybe that's wrong. So if you want to parse out kind of buy-side, sell-side in terms of the guide for next year, that might be helpful. I'm just trying to understand sort of how the choices that you made organically to, let's call this a reset, which is fair as we move towards Cookie Deprecation, and how much of that volume then picks up or comes back to platform, you're assuming in the back half of the year as we think about what you've just kind of laid out for us, if that makes sense? Yeah, absolutely. So I'll parse this out buy-side first, and then I'll go into sell-side. So buy-side, we're still anticipating and projecting out the same 10%-20% growth year-over-year, which has historically been how we performed this going into our third year of being public. As it relates to the sell-side, we think two factors that we're taking into consideration in regards to our projection or pretty much our guidance that we've actually given. Number one, we're expecting the curve to maintain the same trajectory as we have historically in the past. We have no reason to think otherwise. So we're still maintaining that same curve because that's how it's been for the last four years, with Q1 being the lowest, Q4 being the highest, outside of last year's implication of what occurred. What we are seeing is 10%-20% growth year-over-year as it relates to our sell-side platform this year, and they're attributed to those two factors. One, our transition off of cookies, which is one important factor in regards to how the DSPs and also how the marketplace is already making moves to that transition. The second being the increase in publishers that we have historically added and has been a very important part of our growth trajectory. The third being, as Diana pointed out, really the platform change that we made last year and the increase in the capacity that we're actually able to handle the amount of transactions that we can. So without going too far into the future, if you will, we are anticipating the same level of growth curve. What we're seeing in Q1 is 10%-20% above year-over-year. We're expecting and anticipating and working towards maintaining that level of growth trajectory to get to our recommended guidance for the year. Okay, and how should we think about SHE Media, FreeWheel, all these other things that you guys have added since we've talked before about getting deeper into video? I know you guys self-serve has been sort of on the table, but not necessarily. Where do you want to go? Just how do we think about kind of new initiatives and some of the announcements that you guys have made recently? Yeah, I think you're really going to start seeing those impact in Q2, Q3, as those are new ones that we are getting in-staged and moving forward into monetization. So our team has been highly active in getting new publishers, specifically, like you had said, with SHE Media and also FreeWheel and others that we're working towards to really look at those monetizations for Q2 and Q3. One for you, Diana, just to finish up. How do we think about on this reset, how do we think about margins? Do we get margin expansion this year? How do we think about kind of fixed leverage versus variable spend to kind of drive growth? I think we'll be about in the same range on margin by segment. It's just a matter of the mix of sell-side versus buy-side. We had some hosting costs that we saw in the last three quarters of 2023. Those will continue in the first quarter, but should tail off after that from a fixed cost of sales. Should we be looking at the Q4 margin as sort of representative, or the full year margin for 2023 is representative? And then, obviously, adjusting that because sell-side will grow well, actually, I guess sell-side and buy-side could grow similar rates this year, but historically, sell-side was growing faster. Right. I think that if you look at the full year margins by segment, that would be a good indicator of what we'll see in 2024. Okay. Thanks, guys. Appreciate it. Thanks, Dan. We'll take our next question from Michael Kupinski with Noble Capital Markets. Thank you. Thanks for taking my question. I appreciate that. Going back to the cookies, I understand that you indicated that the marketplace is already making moves because of the deprecation of cookies, but it's also my understanding that Google has only deprecated cookies in 1% of its searches on Chrome in the last quarter. I was just wondering, as we kind of cycle towards the deprecation and then full implementation of the deprecation of cookies later this year, how do you, I guess, I'm just trying to understand how you see the market evolving and how that might impact you as we go, especially in the second half of the year when we start to see the full implementation of the deprecation of the cookies from Google. No, I think that's an excellent question. I think cookie deprecation is actually going to open up a host of I think it's actually had an impact on two things. I think, one, it has really introduced a significant amount of innovation as it relates into the ad tech space. I think people looking for how to transact for the trade of media for dollars has really been this year, and starting at the Q4 of last year has really become a moment of innovation for the industry that it probably hadn't seen in the last 10 years. That's number one. I think number two, even though Google has only deprecated 1% of the cookie, there are other media types that have already seen some level of deprecation as it relates to Apple, as it relates to some video, some CTV. I think what you're going to see now in the future and what we've been experiencing is other DSPs have already started changing how they transact off of cookies. And so we work with roughly about 20-25 different DSPs, and not all DSPs treat data the same. And so the new paradigm that we're actually seeing is that we're adjusting how we treat each DSP differently. And we think that that is really part of what's fueling a lot of the innovation that's in the marketplace today. So I think for the last half of the year, the more that you're able to customize and work specifically with certain DSPs, and we are actually in conversation and already running different tests and POCs with them, that is going to give us a competitive advantage in the future. And that's really what we're looking to capture. Thanks, Mark. I was just wondering, in terms of the performance metric that these advertisers are getting, let's say the ROI on the advertising, has that gone down as a result of changes in the deprecation of the cookies and things like that? I think every marketplace is saying something different. We have not experienced the degradation of campaign performance from the conversations that we've had with our clients as clients continue to work with us. And so our anticipation is that there will be different workarounds when cookies completely go away as it relates to campaign reporting. And that's one of the things that we've been working towards with our tech team and with different partners to make sure that the reporting capabilities, as well as the degradation of the campaigns, actually doesn't occur and actually the quality stays intact. So that's been an important proof point that we've been working with our clients on. In terms of the most valued publishers that you work with, where do you think they are in terms of this cookieless environment in implementing and planning for it? Because I know we talked about this in the past, but I was just wondering, do you feel like most of the publishers have already kind of adjusted for it at this point, or what are your thoughts? Yeah, I would say I think the larger publishers have started making the transition is what we have seen and what comes through with the partners that we work with. What we're seeing is the smaller to midsize publishers are a little bit behind, or they are behind. And so I think that the small to midsize publishers have a lot of catch-up to do in comparison to some of your larger more sophisticated publishers that are out there in the marketplace. I think what you're going to see in the future come Q3, Q4 is really a bifurcation of the marketplace as it relates to publishers that have the means and the capability to make those type of adjustments of going to Alternative IDs and working with Privacy Sandbox, and then you're going to have ones that can't. That's really the opportunity that we think we can provide to the marketplace is helping those publishers that are the mid-tier publishers who might not have the means or capability of working with Privacy Sandbox or Alternative IDs. We're there to fill the gap for them. Gotcha. Thank you. That's all I have. All right. Thank you. Thank you. That does conclude today's question and answer session. I would like to turn the call back over to Mark Walker for any additional or closing remarks. All right. Well, thank you very much for joining us for the Q4 and full year 2023 results. We look forward to talking to you at the end of Q1. Thank you. That does conclude today's presentation. Thank you for your participation today, and you may now disconnect.