Earnings release
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PubMatic PubMatic Announces Second Quarter 2026 Financial Results August 6 , 2026 Delivered revenue and adjusted EBITDA well ahead of guidance ; Al customer adoption more than doubled sequentially , delivering 80+ agentic campaigns and 4,000+ Al - powered deals ; Total Revenues Grew 11 % , adjusted EBITDA increased 38 % and free cash flow increased 47 % year - over - year ; CTV , Mobile App and Emerging Revenues represented ~ 60 % of total revenue ; Repurchased 2.1 million shares in Q2 2026 , representing 4.2 % of fully diluted shares¹ as of June 30 , 2026 . NO - HEADQUARTERS / REDWOOD CITY , Calif .-- ( BUSINESS WIRE ) -- Aug . 6 , 2026-- PubMatic , Inc. ( Nasdaq : PUBM ) , the leading Al - powered ad tech company delivering digital advertising performance , today reported financial results for the quarter ended June 30 , 2026 . " The second quarter marked an important inflection point for PubMatic . We delivered double - digit revenue growth earlier than anticipated , expanded profitability and strengthened our competitive position across AgenticOS , CTV , and mobile app , " said Rajeev Goel , co - founder and CEO at PubMatic . " Al is transforming how digital advertising is planned , activated and optimized , increasing the emphasis on performance advertising . Our Al - native infrastructure and proprietary intelligence consistently deliver better performance , faster execution and greater efficiency for customers . Every interaction strengthens that intelligence , creating a compounding advantage that is difficult to replicate . Further , we're bringing new forms of advertising , new sources of demand and new intelligence onto our platform that will significantly expand our long - term market opportunities . " Second Quarter 2026 Financial Highlights 1 • Revenue in the second quarter of 2026 was $ 78.6 million , up 11 % compared to the same period of 2025 ; • GAAP net loss was $ ( 1.2 ) million with a margin of ( 1 ) % , or $ ( 0.03 ) per diluted share in the second quarter , compared to GAAP net loss of $ ( 5.2 ) million with a margin of ( 7 ) % , or $ ( 0.11 ) per diluted share in the same period of 2025 ; • Adjusted EBITDA was $ 19.6 million , or 25 % margin , an increase over $ 14.2 million , or 20 % margin in the same period of 2025 ; • Non - GAAP net income was $ 5.9 million , or $ 0.12 per non - GAAP diluted share in the second quarter , compared to non - GAAP net income of $ 2.5 million , or $ 0.05 per non - GAAP diluted share in the same period of 2025 ; • Net cash provided by operating activities was $ 20.2 million , a 36 % increase over $ 14.9 million in the same period of 2025 ; • Free cash flow was $ 13.7 million , a 47 % increase over $ 9.3 million in the same period of 2025 ; • Ended the quarter with total cash , cash equivalents , and marketable securities of $ 137.5 million with no debt ; and • Through June 30 , 2026 , used $ 211.4 million in cash to repurchase 15.5 million shares of Class A common stock with $ 63.6 million available from the 2023 Repurchase Program . Fully diluted shares include common shares outstanding as of June 30 , 2026 plus dilutive securities related to employee stock awards under the treasury stock method , calculated as if the Company were in a net income position . The section titled “ Non - GAAP Financial Measures " below describes our usage of non - GAAP financial measures . Reconciliations between historical GAAP and non - GAAP information are contained at the end of this press release following the accompanying financial data . " We delivered a remarkable quarter , exceeding our guidance on revenue and adjusted EBITDA . We returned to double - digit year - over - year revenue growth ahead of schedule : revenue grew 11 % , adjusted EBITDA increased 38 % and free cash flow increased 47 % , " said Steve Pantelick , CFO at PubMatic . " Over the past three years , targeted investment and innovation in the fastest - growing areas of digital advertising have fundamentally changed our business . Today , approximately 60 % of our revenue comes from CTV , mobile app and emerging revenue streams , roughly double the level of three years ago . Based on this momentum and the strength of our Al - powered products , we anticipate continued double - digit year - over - year revenue growth and meaningful full - year margin expansion . " Business Highlights AgenticOS Drives Superior Open Internet Performance and Customer Adoption • Since launching in January 2026 , PubMatic has delivered measurable performance gains for customers across more than
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80 fully autonomous, end-to-end campaigns globally. This is up from over 30 campaigns a quarter ago, and now includes all five global agency holding companies. Over 4,000 AI-powered deals transacted to date, up from just over 1,000 deals a quarter ago. Level Agency increased ad spend with PubMatic after AgenticOS delivered more than 2x reach per dollar versus its incumbent DSP, while significantly accelerating campaign setup and activation time. Additionally, AgenticOS delivered retargeting at scale within days compared to the 1-2 months ramp typically required by DSP-led campaigns. Havas Media and Telefónica launched Spain's first fully agentic CTV campaign, achieving 18% lower CPM than target while exceeding impression goals by 23% using AgenticOS. Launched advanced guardrail architecture for AgenticOS, giving enterprise buyers configurable control over autonomous campaign execution with human approval workflows, presence-based controls, and full audit trails built directly into the execution layer, reducing barriers to scaling agentic advertising budgets across the platform. New Partnerships Fuel Our Intelligence Advantage Recently partnered with Gracenote to bring real-time content intelligence, including contextual signals and live sports schedules, directly into the PubMatic platform. By embedding this data at the point of auction, coupled with our rich signal data and proprietary bidstream data, our AI-native infrastructure can make increasingly sophisticated decisions within the milliseconds available before every impression is served. Added premium inventory from marquee broadcaster Channel 4 in the UK to expand its access to advertising buyers. New AI-Powered Solutions Launched Launched Decision Fabric, a containerization solution bringing buyer intelligence directly into the auction to improve advertising performance. Launch partners include MiQ, Chalice AI, SWYM.ai and InPowered, who can now run proprietary decision models natively within PubMatic's infrastructure. Expanded Into New Markets, Creating Incremental Growth Opportunities Launched Creator Marketplace, enabling advertisers on PubMatic to connect to premium inventory and reach highly engaged audiences while giving creators new ways to monetize across the open internet. Programmatic trading desk Klever used AgenticOS to help a well-known direct-to-consumer brand expand beyond social channels into premium CTV, and delivered a 5x return on ad spend, which was double the client’s original objective. Diversified Revenue Mix and Expanded Reach On The Buy Side Revenues in Q2 2026 from CTV, mobile app and emerging revenues represented approximately 60% of total revenue, roughly double the share of three years ago. Strength in CTV was led by the Americas, where revenue grew 25% year over year. Global CTV revenue grew 13% year-over-year and represented approximately 20% of total revenue. Q2 2026 revenue from mobile app grew over 40% year-over-year and accounted for approximately 25% of total revenue. Emerging revenues2 in Q2 2026 grew approximately 100% year over year and represented approximately 15% of total revenues in the quarter, which includes revenue from newly launched AI solutions. Ad spend from Activate grew more than 2X over Q2 2025, as buyers and publishers prioritized performance, control and transparency. Ad spend from mid-market focused DSPs grew over 25% year-over-year in Q2 2026. Supply Path Optimization represented over 55% of total activity on our platform in Q2 2026. Operating Priorities Drove Profitable Growth Infrastructure optimization initiatives and investments drove nearly 92 trillion impressions processed in Q2 2026, an increase of 18% over Q2 2025. Cost of revenue per million impressions processed decreased 20% on a trailing twelve month period, as compared to the prior period. Financial Outlook Our outlook assumes that general market conditions do not significantly deteriorate as it relates to current macroeconomic and geopolitical conditions. For the third quarter of 2026, we expect the following: Revenue to be in the range of $75 million to $77 million. Adjusted EBITDA to be in the range of $17.0 million to $19.0 million. Adjusted EBITDA expectation assumes a negative foreign currency exchange impact predominantly from Euro and Pound Sterling. Although we provide guidance for adjusted EBITDA, we are not able to provide guidance for net income (loss), the most directly comparable GAAP measure. Certain elements of the composition of GAAP net income (loss), including stock-based compensation expenses, are not predictable, making it impractical for us to provide guidance on net income or to reconcile our adjusted EBITDA
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guidance to net income without unreasonable efforts. For the same reason, we are unable to address the probable significance of the unavailable information. 2 Emerging revenue includes Activate, Commerce Media, Connect and AI solutions. Chief Financial Officer Planned Retirement Announced In a separate release issued today, the Company announced that Steve Pantelick, Chief Financial Officer, plans to retire after fifteen years in the role. He will continue to serve as CFO into the first quarter of 2027, and then as a senior adviser through July 1, 2027, to support continuity and a smooth transition. The Company has initiated a search for his successor. Conference Call and Webcast details PubMatic will host a conference call to discuss its financial results on Thursday, August 6, 2026 at 1:30 p.m. Pacific Time (4:30 p.m. Eastern Time). A live webcast of the call can be accessed from PubMatic’s Investor Relations website at https://investors.pubmatic.com. An archived version of the webcast will be available from the same website after the call. Non-GAAP Financial Measures In addition to our results determined in accordance with U.S. generally accepted accounting principles (GAAP), including, in particular operating income (loss), net cash provided by operating activities, and net loss, we believe that adjusted EBITDA, adjusted EBITDA margin, non-GAAP net income, non-GAAP earnings per share and free cash flow, each a non-GAAP measure, are useful in evaluating our operating performance. We define adjusted EBITDA as net loss adjusted for stock-based compensation expense, depreciation and amortization, litigation related expenses, interest income, and provision for (benefit from) income taxes. Adjusted EBITDA margin represents adjusted EBITDA calculated as a percentage of revenue. We define non-GAAP net income as net loss adjusted for stock-based compensation expense, litigation related expenses, and adjustments for income taxes. We define non-GAAP free cash flow as net cash provided by operating activities reduced by purchases of property and equipment and capitalized software development costs. In addition to operating income (loss) and net loss, we use adjusted EBITDA and non-GAAP net income as measures of operational efficiency. We believe that these non-GAAP financial measures are useful to investors for period to period comparisons of our business and in understanding and evaluating our operating results for the following reasons: Adjusted EBITDA and non-GAAP net income are widely used by investors and securities analysts to measure a company’s operating performance without regard to items such as stock-based compensation expense, depreciation and amortization, litigation related expenses, interest expense, and provision for (benefit from) income taxes that can vary substantially from company to company depending upon their financing, capital structures and the method by which assets were acquired; and, Our management uses adjusted EBITDA and non-GAAP net income in conjunction with GAAP financial measures for planning purposes, including the preparation of our annual operating budget, as a measure of operating performance and the effectiveness of our business strategies and in communications with our board of directors concerning our financial performance; and adjusted EBITDA provides consistency and comparability with our past financial performance, facilitates period-to-period comparisons of operations, and also facilitates comparisons with other peer companies, many of which use similar non-GAAP financial measures to supplement their GAAP results. Our use of non-GAAP financial measures has limitations as an analytical tool, and you should not consider them in isolation or as a substitute for analysis of our financial results as reported under GAAP. Some of these limitations are as follows: Adjusted EBITDA does not reflect: (a) changes in, or cash requirements for, our working capital needs; (b) the potentially dilutive impact of stock-based compensation; or (c) tax payments that may represent a reduction in cash available to us; Although depreciation and amortization expense are non-cash charges, the assets being depreciated and amortized may have to be replaced in the future, and adjusted EBITDA does not reflect cash capital expenditure requirements for such replacements or for new capital expenditure requirements; and Non-GAAP net income does not include: (a) the potentially dilutive impact of stock-based compensation; (b) non-ordinary course litigation related expenses; or (c) income tax effects for stock-based compensation Because of these and other limitations, you should consider adjusted EBITDA and non-GAAP net income along with other GAAP-based financial performance measures, including net income and our GAAP financial results. Forward Looking Statements This press release contains “forward-looking statements” regarding our future business expectations, including our guidance relating to our revenue and adjusted EBITDA for the third quarter of 2026, our expectations regarding our adjusted EBITDA, free cash flow, free cash flow margin, capital expenditures, future adoption and deployment of our AI-enabled products, future market growth, and our long-term revenue growth. These forward-looking statements are based on our current expectations and assumptions regarding our business, the economy and other future conditions and may differ materially from actual results due to a variety of factors including: our dependency on the overall demand for advertising and the channels we rely on; our existing customers not expanding their usage of our platform, or our failure to attract new publishers and buyers; our ability to maintain
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and expand access to spend from buyers and valuable ad impressions from publishers; the rejection of the use of digital advertising by consumers through opt-in, opt-out or ad-blocking technologies or other means; our failure to innovate and develop new solutions that are adopted by publishers; geopolitical tensions and uncertainty, including the conflicts in Ukraine and the Middle East, and the related measures taken in response by the global community and disruptions to the international supply chain and global commerce; the impacts of inflation and tariffs as well as fiscal tightening; changes in currency exchange environments and continuing volatility in global capital markets; volatile interest rates; public health crises, including the resulting global economic uncertainty; limitations imposed on our collection, use or disclosure of data about advertisements, including as it may impact our use of Artificial Intelligence and additional AI laws and regulations are enacted globally; the lack of similar or better alternatives to the use of third-party cookies, mobile device IDs or other tracking technologies if such uses are restricted; any failure to scale our platform infrastructure to support anticipated growth and transaction volume; liabilities or fines due to publishers, buyers, and data providers not obtaining consents from consumers for us to process their personal data; any failure to comply with laws and regulations related to data privacy, data protection, information security, and consumer protection; and our ability to manage our growth. Moreover, we operate in a competitive and rapidly changing market, and new risks may emerge from time to time. For more information about risks and uncertainties associated with our business, please refer to the “Management’s Discussion and Analysis of Financial Condition and Results of Operations” and “Risk Factors” sections of our SEC filings, including but not limited to, our annual report on Form 10-K and quarterly reports on Form 10-Q, copies of which are available on our investor relations website at https://investors.pubmatic.com and on the SEC website at www.sec.gov. Additional information will also be set forth in our Quarterly Report on Form 10-Q for the quarter ended June 30, 2026. All information in this press release is as of August 6, 2026. We undertake no obligation to update any forward-looking statement, whether as a result of new information, future developments or otherwise, except as may be required by law. About PubMatic PubMatic is the leading AI-powered ad tech company delivering digital advertising performance. Through an intelligent, unified platform that connects buyers, publishers, data partners, and commerce media networks, PubMatic delivers superior performance with greater transparency, control, and efficiency. Since 2006, PubMatic has pioneered major advances in programmatic advertising, from enabling the first OpenRTB transactions to embedding AI-driven optimization and privacy-focused innovation across its platform. With omnichannel scale, proven reliability, and a track record of continuous innovation, PubMatic is building a more intelligent, profitable, and sustainable open internet. Built to Connect. Powered to Perform. CONDENSED CONSOLIDATED BALANCE SHEETS (In thousands) (unaudited) June 30, 2026 December 31, 2025 ASSETS Current assets Cash and cash equivalents $ 119,971 $ 145,518 Marketable securities 17,536 — Accounts receivable, net 383,197 358,240 Prepaid expenses and other current assets 17,162 18,889 Total current assets 537,866 522,647 Property, equipment and software, net 58,528 52,657 Operating lease right-of-use assets 34,518 38,149 Acquisition-related intangible assets, net 1,914 2,704 Goodwill 29,577 29,577 Deferred tax assets 32,128 30,986 Other assets, non-current 5,511 3,475 TOTAL ASSETS $ 700,042 $ 680,195 LIABILITIES AND STOCKHOLDERS' EQUITY Current liabilities Accounts payable $ 390,046 $ 343,619 Accrued liabilities 24,230 25,278 Operating lease liabilities, current 7,842 6,953 Total current liabilities 422,118 375,850 Operating lease liabilities, non-current 32,795 36,910 Other liabilities, non-current 6,401 4,846 TOTAL LIABILITIES 461,314 417,606 Stockholders' Equity Common stock 7 7
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Treasury stock (223,977) (193,471) Additional paid-in capital 341,643 321,062 Accumulated other comprehensive income (loss) (156) 68 Retained earnings 121,211 134,923 TOTAL STOCKHOLDERS’ EQUITY 238,728 262,589 TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY $ 700,042 $ 680,195 CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS (In thousands, except per share data) (unaudited) Three Months Ended June 30, Six Months Ended June 30, 2026 2025 2026 2025 Revenue $ 78,593 $ 71,095 $ 141,160 $ 134,920 Cost of revenue (1) 25,877 26,612 51,971 52,200 Gross profit 52,716 44,483 89,189 82,720 Operating expenses:(1) Technology and development 9,148 9,116 17,134 17,888 Sales and marketing 26,130 25,200 55,095 51,999 General and administrative 16,859 15,628 31,654 30,197 Total operating expenses 52,137 49,944 103,883 100,084 Operating income (loss) 579 (5,461) (14,694) (17,364) Total other income (expense), net 1,302 (609) 1,464 (30) Income (loss) before income taxes 1,881 (6,070) (13,230) (17,394) Provision for (benefit from) income taxes 3,083 (862) 482 (2,700) Net loss $ (1,202) $ (5,208) $ (13,712) $ (14,694) Net income (loss) per share attributable to common stockholders: Basic $ (0.03) $ (0.11) $ (0.29) $ (0.31) Diluted $ (0.03) $ (0.11) $ (0.29) $ (0.31) Weighted-average shares used to compute net loss per share attributable to common stockholders: Basic 46,106 47,185 46,611 47,763 Diluted 46,106 47,185 46,611 47,763 (1) Stock-based compensation expense includes the following: STOCK BASED COMPENSATION EXPENSE (In thousands) (unaudited) Three Months Ended June 30, Six Months Ended June 30, 2026 2025 2026 2025 Cost of revenue $ 357 $ 474 $ 741 $ 948 Technology and development 1,055 1,628 2,084 3,213 Sales and marketing 2,605 3,465 5,662 6,928 General and administrative 4,330 4,234 8,348 8,410 Total stock-based compensation $ 8,347 $ 9,801 $ 16,835 $ 19,499 CONDENSED CONSOLIDATED STATEMENT OF CASH FLOWS (In thousands) (unaudited) Six Months Ended June 30, 2026 2025
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OPERATING ACTIVITIES: Net loss $ (13,712) $ (14,694) Adjustments to reconcile net loss to net cash provided by operating activities: Depreciation and amortization 19,995 23,537 Stock-based compensation 16,835 19,499 Deferred income taxes (1,143) (9,024) Accretion of discount on marketable securities (110) (819) Non-cash lease expense 3,591 3,710 Other (305) (278) Changes in operating assets and liabilities: Accounts receivable (24,957) 41,412 Prepaid expenses and other current assets 4,046 (340) Accounts payable 36,558 (25,865) Accrued liabilities (1,738) (5,559) Operating lease liabilities (3,188) (1,328) Other liabilities, non-current 1,633 275 Net cash provided by operating activities 37,505 30,526 INVESTING ACTIVITIES: Purchases of and deposits on property and equipment (2,966) (2,781) Capitalized software development costs (10,171) (11,180) Purchases of marketable securities (17,429) (26,026) Proceeds from maturities of marketable securities — 39,859 Purchase of equity investment (3,500) — Net cash used in investing activities (34,066) (128) FINANCING ACTIVITIES: Proceeds from issuance of common stock for employee stock purchase plan 1,054 1,357 Proceeds from exercise of stock options 884 1,174 Principal payments on finance lease obligations (75) (70) Payments to acquire treasury stock (30,500) (43,649) Net cash used in financing activities (28,637) (41,188) NET DECREASE IN CASH AND CASH EQUIVALENTS (25,198) (10,790) Effect of foreign currency on cash (349) 814 CASH AND CASH EQUIVALENTS - Beginning of year 145,518 100,452 CASH AND CASH EQUIVALENTS - End of year $ 119,971 $ 90,476 RECONCILIATION OF GAAP NET LOSS TO NON-GAAP ADJUSTED EBITDA AND NON-GAAP NET INCOME (In thousands, except per share amounts) (unaudited) Three Months Ended June 30, Six Months Ended June 30, 2026 2025 2026 2025 Reconciliation of net loss: Net loss $ (1,202) $ (5,208) $ (13,712) $ (14,694) Add back (deduct): Stock-based compensation 8,347 9,801 16,835 19,499 Depreciation and amortization 10,007 11,861 19,995 23,537 Litigation related expenses (2) 594 — 1,032 — Interest income (1,213) (1,379) (2,428) (2,972) Provision for (benefit from) income taxes 3,083 (862) 482 (2,700) Adjusted EBITDA $ 19,616 $ 14,213 $ 22,204 $ 22,670 Revenue $ 78,593 $ 71,095 $ 141,160 $ 134,920 Adjusted EBITDA margin 25% 20% 16% 17% Three Months Ended June 30, Six Months Ended June 30, 2026 2025 2026 2025
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Reconciliation of net loss per share: Net loss $ (1,202) $ (5,208) $ (13,712) $ (14,694) Add back (deduct): Stock-based compensation 8,347 9,801 16,835 19,499 Litigation related expenses (2) 594 — 1,032 — Adjustment for income taxes (1,883) (2,068) (3,714) (4,123) Non-GAAP net income $ 5,856 $ 2,525 $ 441 $ 682 GAAP diluted EPS $ (0.03) $ (0.11) $ (0.29) $ (0.31) Non-GAAP diluted EPS $ 0.12 $ 0.05 $ 0.01 $ 0.01 GAAP weighted average shares outstanding—diluted 46,106 47,185 46,611 47,763 Non-GAAP weighted average shares outstanding —diluted 49,936 50,539 49,809 51,498 (2)Litigation related expenses represents external legal fees and other expenses, net of insurance recoveries, associated with pending litigation that arose outside of the ordinary course of business. These costs related to a discrete matter, and are not representative of our underlying operating performance. We do not adjust for legal expenses incurred in our ordinary course of business. Reported GAAP diluted loss per share for the three and six months ended June 30, 2026 and 2025 were calculated using basic share count. Non-GAAP diluted earnings per share for the three and six months ended June 30, 2026 and three and six months ended June 30, 2025 were calculated using diluted share count which includes approximately 4 million, 3 million, 3 million, and 4 million, respectively, of dilutive securities related to employee stock awards. SUPPLEMENTAL CASH FLOW INFORMATION COMPUTATION OF FREE CASH FLOW, A NON-GAAP MEASURE (In thousands) (unaudited) Three Months Ended June 30, Six Months Ended June 30, 2026 2025 2026 2025 Reconciliation of cash provided by operating activities: Net cash provided by operating activities $ 20,210 $ 14,905 $ 37,505 $ 30,526 Less: Purchases of property and equipment (2,955) (1,340) (2,966) (2,781) Less: Capitalized software development costs (3,592) (4,300) (10,171) (11,180) Free cash flow $ 13,663 $ 9,265 $ 24,368 $ 16,565 View source version on businesswire.com: https://www.businesswire.com/news/home/20260805668883/en/ Investors: investors@pubmatic.com Press Contact: Purpose Worldwide PubMatic@purposenorthamerica.com Source: PubMatic, Inc.