Cool. Well, good morning, everyone. My name is Matt Cost from the Morgan Stanley US Internet Research team. Thank you so much for being here. I'm thrilled to be joined by Lisa Utzschneider and Tania Secor, the CEO and CFO of IAS. Thank you so much for being here. Hi, Matt. Thanks for having us. Great. I'm just gonna quickly run through the disclosures, and then we'll jump right into it. For important disclosures, please see the Morgan Stanley Research Disclosure website at morganstanley.com/researchdisclosures. If you have any questions, please reach out to your Morgan Stanley sales representative. All right. Maybe Lisa, we can start with you. For those in the room who are maybe newer to the IAS story, maybe you can give us a quick overview of IAS, where you fit into the ad ecosystem, and how the business has changed in the past few years. Sure. Hi, everyone. I'm Lisa Utzschneider, CEO of IAS. I joined IAS four years ago and thrilled to be here today, and thanks again, Matt, for having us. IAS, we're a leading global media quality company, and if you don't know what that means, the easiest way to explain it is we verify the quality of media for marketers. I'll give a quick example just to level set. For example, Coke. Coke is one of our strategic marketers, and let's say Coke is running a Diet Coke video ad on YouTube. Our solutions verify that the Diet Coke ad was viewed by a human, there was no fraudulent or bot activity, and also, probably most importantly to Coke, that the Diet Coke ad ran adjacent to brand safe and brand suitable content. In terms of where we sit in the digital ecosystem, we sit right in the center integrated across all of the major platforms. Think of platforms like Google and Meta and Amazon, TikTok, Twitter. We're integrated across all of the DSPs. We are global. It's a big differentiator for us that our international footprint is deep and wide. Again, the largest piece of our customer base is our advertiser customer base, with 200 advertisers, and we also have a healthy publisher business. Great. maybe zooming out, you know, for a second before we come back into some of the specifics of IAS. When you look at the ad markets more broadly, just given the overall macro uncertainty, are there any pockets of strength or weakness that you would call out? What is top of mind for your customers right now as they're thinking through their priorities and their budgets for 2023? Sure. I love to speak to tailwinds in the environment and what is propelling our business and our growth. You're probably all familiar with the fact within digital advertising, there's a shift now away from cookie-based advertising, so targeting based on audience data, consumer PII data, and shifting towards contextual advertising. At IAS, we launched a very sophisticated contextual solution called Context Control, and that has been a tailwind for our business as, again, marketers are leaning into sophisticated contextual solutions. The shift to contextual, that has been a major tailwind for our business. The other 2 tailwinds, when you take a look at the macro trends over the last 2 years in particular, there has been explosive consumer adoption of social platforms, especially during the pandemic. Everyone's spending their time at home. They're spending their time on social media and also consuming, streaming, content with connected TV. Explosive opportunity within the social platforms, especially within the live feeds and offering brand safety, brand suitability solutions within the social platforms, and then also connected TV. Great. I mean, you touched on a couple of key areas in there. I guess kind of specifically in your priorities and the products that you're most focused on driving forward in 2023, what would you highlight? Is contextual the biggest area? I noticed you started there. Yeah. I would say in terms of priorities for 2023 and growth accelerators for our business, I would say there are three. Programmatic. Programmatic makes up the majority of digital advertising. In the U.S., it's over 90% is programmatic. Within that programmatic bucket for IAS is Context Control and contextual advertising, offering pre-bid contextual avoidance and contextual targeting within programmatic. The second big bucket or priority for us are the social platforms and live feed in particular. Marketers wanna be where the consumers are, and where the consumers are in the live feeds. They're on TikTok, they're on Meta, they're on Twitter, we are launching or have launched brand safety and suitability solutions within the live feed of TikTok. We also plan to launch a solution with Twitter in short order, Meta is this year. Social platforms, lots of greenfield and runway there. And then I would say the third priority for our business is connected TV or CTV. And we acquired a company called Publica in the summer of 2021. I see a few heads nodding, familiar with Publica. It was a great acquisition. It is fully integrated within IAS, where we're offering robust CTV solution. We have access to massive amounts of programmatic CTV inventory with Publica. And we're also marrying up our rich data from IAS side of the business, which is heavy buy side with marketers, marrying it up with Publica's rich supply side data. That we're able to offer marketers greater transparency into where their ads are running in programmatic CTV. I'd say it's those three areas: programmatic, social platforms, and connected TV. Great. Tania, don't worry, I didn't forget about you back there. Oh, we haven't forgotten about Tania. Maybe I'll shift over to Tania for a second. First of all, I think it would be great just to, you know, for you to quickly introduce yourself. You know, obviously you're new to the IAS CFO seat. You know, as you think about your first year in the role, you know, what are your top priorities and where do you see the opportunity to have the biggest impact? Sure. It's great to be here. Thanks, Matt, for having us. You know, I bring a deep background of media and technology to IAS, having been CFO of the digital media division of IPG, called Reprise. I was then CFO of the digital innovation agency, so I bring a media experience. I've also been CFO of a few private equity and venture capital-backed high-growth technology companies, so both media and tech background. In terms of, you know, my plans and, you know, the areas that I'm focused on in 2023, I'm so excited about the size of our TAMs, the multiple TAMs, the opportunities that Lisa just identified. As CFO, my role is to make sure that we're optimizing the resources that we have, but still investing in the areas where we can really capture and monetize these TAMs. You'll see in our plans for 2023, you know, we're trying to drive efficiencies in our operating line, but also investing in the areas to continue and fuel our future growth. Great. Lisa mentioned a few points, which I'd like to kind of ask you about, Tania, which was, you know, the core business offerings across programmatic verification and then CTV. You know, from a revenue perspective, which ones would you highlight as having the most runway from here, and what are the key drivers there? I'll highlight first and foremost our programmatic revenue. It was 47% of our revenue in 2022, and also in the fourth quarter. Our programmatic business is has been a very high-growth sector for us, fueled by contextual avoidance, and we are expecting double-digit growth in 2023. In fact, we're also expecting a greater contribution from our programmatic revenue streams in 2023. Secondly, I would highlight our measurement business, which is our ad direct business, which grew 6% in 2022. And that growth in 2023 will really be fueled by social, which is also has a very large video component. Video growth has been double digit. Video for consumers, you know, brands really appreciate the experience with video, for consumers, and the growth has been attractive. For us, video is also a premium price product, so that trend is our friend as well. On the CTV side, you know, the industry has very strong growth dynamics with the shift from linear to connected television and Publica will take advantage, will benefit from that trend as well. Great. just one product follow-up, I guess, on Context Control, which Lisa had brought up a moment ago. You know, what sort of feedback are you getting on that product, and is it helping drive, you know, improvement in return on ad spend for customers? Sure. I'll take that one. We have seen tremendous adoption of Context Control. High adoption. The majority of the revenue is contextual avoidance. I like to refer that as set it and forget it. Think of contextual segments like violence, adult, hate speech, the type of content that no Fortune 500 brand would ever wanna run adjacent to. All of our contextual segments, we have over 500 segments now, are embedded in all of the major DSPs, like DV360 and The Trade Desk. Incredible adoption of contextual avoidance, in particular the top 100 advertisers in the U.S. We're also seeing tremendous adoption in EMEA. APAC is when it comes to programmatic, a little more nascent as a region, but we're now focused on the advertisers north of top 100 to continue to drive that adoption of contextual avoidance. We're also pivoting towards contextual targeting. The way contextual targeting works is these are contextual environments where marketers want to run their branded campaigns adjacent to. When we first rolled out the contextual targeting solution, it's more based on was based on campaign by campaign. I can give a quick example. Nestlé is a global marketer of ours. Think of Nestlé, I must be hungry, promoting KitKat, campaign pre-Halloween, right? We can say, recommend to Nestlé, "Oh, pre-Halloween, you might be interested in running that KitKat campaign adjacent to cooking content or Halloween decorations." The product has now evolved where we're able to identify the contextual categories or the content categories that might resonate for various marketers within the candy category or within the beauty category. We're seeing really nice adoption with contextual targeting, and the team will continue to tell the contextual targeting story and add value to our marketers. Great. Let's talk about go-to-market for a second. I think it's often helpful just to talk about the life cycle of a client, you know, the process of acquiring them, what you do to help scale the relationship, and sort of what products and tools people start with and what you're most excited to help cross-sell into in 2023 and 2024. This is one of my favorite topics, is go to market. We hired a new Chief Commercial Officer, Yannis Dosios, who's actually here today with us. He joined IAS last May, and Yannis and I worked together at Yahoo. Yannis rolled out in the back half of 2022 a strategy to focus on two things in particular with top accounts. Accounts that are sitting with our competitors that we wanna go after and pursue and tell our IAS story and bring them into the IAS house, and then also greenfield, like new logos that we can go after. For any of you who dialed into our last earnings call last week, we actually shared that the IAS sales team, in fourth quarter, closed four major accounts, all of them competitive wins. These are competitive jump balls, multi-year, multi-million dollar accounts, Ford, Hershey, Bel, that's Babybel cheese, and Kering, which is a luxury good, luxury vertical, marketer. The reasons why large advertisers are leaning into our solutions, are leaning away from some of our competitors' offerings is a few reasons. Global footprint is one. The accuracy and quality of our technology, the investments we've made, especially in connected TV, in brand safety and brand suitability, and also our investments in global customer service. I have to say, having lived through now 3 down economies, this being the third one right now, marketers really care about global service and driving efficiency and ROI, and I'm just so proud of our team that we're putting these big wins on the board. We are offering value to our marketers and demonstrating differentiation. I hope that gives you sort of perspective on the investments we're making in our go-to-market, how we're turbocharging it, both from product differentiation, our value proposition, and our story is resonating with marketers. A closely related point would be the point of competition. I mean, I think of this space as really a duopoly space with your largest competitor. You know, when it comes down to the IAS offering, you know, what are the reasons that you would highlight the most that people pick you over your competition? In the last couple of years, is there anything you would highlight that you developed that's helped create that differentiation? Sure. Another favorite topic of mine. A couple of reasons for differentiation and why advertisers like a Ford or a Hershey are leaning in and choosing IAS. I mentioned it before about our global footprint. IAS was in EMEA almost nine years ago. Placed ourselves in EMEA and APAC. We have deep roots in both regions. We've also been investing in emerging markets. Think of emerging markets like Latin America, Southeast Asia, India, Northern Europe. These global marketers like Nestlé, Coke, GSK, are having a broad global footprint. It really matters to the marketers because they are running their branded advertising everywhere. Global footprint matters. The differentiation of our product offering and technology, I would say in particular, our Context Control technology, the fact that we can classify content both based on semantic and sentiment or emotion, that's a big differentiator that our tech can detect things like hate speech. Our multimedia classification within the live feeds of the social platforms. TikTok, we have an incredible global partnership with TikTok, and we're now able to classify live video, image, audio, I know it's cool, and text within the live feed of TikTok. We're able to identify objects. We're able to put a timestamp on when I don't know how many of you use TikTok. I don't know, Matt, if you use TikTok. Within these TikTok videos, we can identify the objects, timestamp it, identify brands, identify celebrities. It's incredibly cool technology. It's ML/AI-based. It's getting smarter as we go, and we've just gotten started. I'd say technology. Then I would say the third reason is global service. I mentioned it before, but we invested early on in global service to make sure, especially for these really large multi-million dollar accounts, that we're providing high touch service because they are leaning into IAS, they're investing with us, and they expect a level of service. I would say those are the three reasons, global footprint, quality and accuracy of our technology, and our service. Great. Tania, maybe I'll go back to you, kind of shifting gears into investment priorities. I mean, when you, when you think about your priorities, you know, for 2023, what are the main investment areas that you're most focused on, and how are you thinking about headcount growth this year? Sure. I would highlight in terms of our hiring plans, we are looking to expand our headcount. We're actively doing that now. We did do a restructuring in December of 2022, but we're investing in key areas, I would say, on the commercial side, so customer service, account managers, ex-account executives, and then also on the engineering and product side, in terms of continued investments in our tech, especially as we're expanding our offerings and expanding our TAMs. Great. I guess on the other hand, thinking through margins, you know, how are you assessing puts and takes around leverage potential? How should we think about OpEx discipline versus margin expansion this year? Sure. As we highlighted in our guide, we are forecasting, you know, double-digit growth for IAS across the board. We are guiding margins in the range of 78%-80%, some gross margin compression as our premium products are requiring more data consumption and hosting costs. What you'll see from an operating expense perspective is exactly what I talked about before. The efficiencies that we're driving on our existing team and our existing talent, also investing in areas for growth. Ultimately, what we've guided at the midpoint is approximately 100 basis points of EBITDA margin expansion from 31% in 2022 to 32% in 2023. Great. Lisa, I wanna revisit a topic you touched on before which is CTV. Obviously, you know, a huge area of interest in the entire ad space right now. You know, tell us about the trends you're seeing in your business in CTV, and what do you think would need to change for it to be a larger go-to place for ad dollars in the medium term? Anything that you can share on your work with Netflix would be interesting as well. Sure. I like to describe the opportunity as CTV is first inning heading into second inning of a long game. Tremendous opportunity, this year, almost a $50 billion marketplace with CTV. And I spend a lot of time with the marketers, and when you talk to marketers, let's pick one, like a L'Oréal for example, and you ask L'Oréal, "What will it take for you to move more of your linear TV budget over into programmatic CTV? Like, what are the obstacles?" Consistently, marketers say, "There are two reasons that I'm holding back. The first is I want better transparency with programmatic CTV. I wanna get out of this black box. I want the same level of transparency that I get with linear TV in programmatic CTV," and I'll speak to that in a minute with our solution. The second reason that they give is frequency capping. I know in my house with our girls, they don't even know what the cord is. They're streaming, they're viewing. But what is a frustrating experience for the consumer is you see the same ads over and... Yeah, you're nodding your head, Matt. Like, over and over, it's the same ads, right? That is a poor consumer experience. The marketers don't like it, the consumers don't like it, and the publisher, the video publishers don't want it. Don't like it. We're solving for both. The first, when it comes to transparency, before Publica and IAS, we brought our data together to offer more transparency. What advertisers were getting in connected TV is all a L'Oréal would get is, "Hey, L'Oréal, here's the app where your ad ran, and here's the device." That's it. There's L'Oréal looking at linear TV saying, "Wait a minute, my 30-second spot ran on the TODAY Show today. I know it's NBCUniversal, it's the TODAY Show, I know exactly when it ran. I know the content it ran adjacent to, plus I have all these metrics about reach and frequency and audience and all of this. You're telling me all I get is device and app? Not good enough." Combining our datasets, we're now able to offer the L'Oréals of the world, when they're running their ads on programmatic CTV, app, device, channel, genre, show, like the series of the show. We're providing much more transparency. We're taking the black box out of that experience for the marketer. The video publishers, they also love it because if it drives up engagement, it drives higher yield, it drives better stickiness, like it's a win-win for everyone. Frequency capping, same thing, is we're leaning into solutions and working directly with the video publishers. A good example is Samsung is a strategic partner of ours within the Publica ecosystem. We're helping the Samsungs of the world improve the user experience and get out of this, the same ad delivered over and over, and providing solutions where we're able to stitch in the creative real time, so it's a much more effective and personalized experience for the consumer. That definitely hits close to home. We've all seen the same ad for the same Dodge Durango 5 times in the course of one show, and it gets old. I'd love to, you know, if there's any questions in the audience, you know, take a second to go there. Feel free to raise your hand. I don't know if we have handheld mics. If we don't. Oh, there is one to go around. Think on it. I'll come back. This one on capital allocation, I'll give to both of you. There'll be a part for each. I mean, obviously, you mentioned Publica. You know, when you think about, you know, updates on how the acquisitions have impacted the business, Lisa, you know. Can you give us a, you know, the update on how those are going and areas where you see more room to backfill in the product offering? You know, Tania, how are you thinking about capital allocation more broadly from here? Happy to answer that. Since joining IAS 4 years ago, we've made 4 acquisitions. 3 out of the 4 were tech tuck-ins. The fourth, Publica, strategic acquisition, both from the tech perspective and top-line revenue growth. In terms of our acquisitions, and this is having spent so many years at companies like Microsoft and Amazon, I do know what good looks like in terms of ensuring it's a seamless integration with acquisitions that you make. I'm very proud of the fact that with the acquisitions that we've made, they have been additive to our product and tech portfolio. They have driven meaningful revenue. For example, everything that I've talked about with Context Control was part of our first acquisition of ADmantX. Also, we're creating a one plus one equals three environment with the Publica acquisition. Like, what I was just talking about of leveraging the assets of Publica, marrying them up with the assets of IAS to drive greater value for the entire digital ecosystem, both marketers and publishers. It's a win-win all around. In terms of other opportunities that we're looking at, I would say areas around analytics, insights, outcomes, attention, that whole bucket, helping marketers find greater efficiency, greater ROI with their investments. We're looking at some interesting plays that are additive in CTV. Then we're looking at some interesting plays related to performance marketing. I would add from a capital allocation perspective, we have a very strong balance sheet. Our net debt to EBITDA ratio is just around 1 time, so we have capacity for acquisitions. We're also, you know, investing in organic growth, as I talked about earlier. We've been paying down debt, we did in the fourth quarter, and we are looking to continue to pay down debt. But the attractive thing about our facility is anything that we pay down, we can redraw. Both investments inorganically, but also strong balance sheet capacity for acquisitions. Great. Oh, we have one in the audience. Can we get the mic up front here? Thank you. Up here. Great question. We're following Meta's lead in terms of the roadmap and the plan. Meta did select IAS and two other players as badged verification providers. They've been very public about opening up the live feed so that the three badged players can offer brand safety and brand suitability solution. I can't speak more to the timeline this year, but what I can speak to is that marketers, they can't wait. They just can't wait for Meta to open up the live news feed. In terms of total revenue opportunity, we have not shared what we think that opportunity looks like. There have been some external third-party players, back-of-envelope math. Again, this isn't IAS, back of envelope, roughly $300 million-$400 million in opportunity. Great. Anything else from the audience? All right. If not, I'll close maybe on international, and this one's for you, Lisa. Maybe talk to us about your progress scaling the international footprint, the regions where you're planning to double down on the most in 2023, and then, you know, any differentiation in trends you're seeing across the various markets where you operate. Sure. Again, international is a big differentiator for IAS. You see it in our presence. You see it in our revenue. You see it with the wins that we're putting on the board with our global footprint. We're seeing really nice uptick in Asia, Southeast Asia, India in particular. We're seeing nice growth in Latin America. We're also seeing nice growth in markets like Denmark and Norway, and we'll continue to invest in emerging markets. The other thing that I'll say is everything we build is to scale, that it's global, it's scalable. The majority of our products are offered in over 40 languages. One other thing, I'd be remiss not to say this. I do want to wish everyone a happy International Women's Day. I know March 8th around the world, everyone's celebrating women and female leaders, so I just want to wish everyone happy Women's Day. Great. Well, that's probably a great note to close on. Thank you so much for being here. Thank you, Matt, for having us.