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Greetings, and welcome to the

Thank you, operator. Hello everyone, and thank you for joining us for

Thank you, Matt. Good afternoon, everyone and thank you for joining us today. 2024 was a record year for

Thank you, David, and good afternoon, everyone. We have a lot of exciting information to share on our 2024 results and

Thank you. [Operator Instructions] Our first question is from Matt Swanson with RBC. Please proceed with your question.

Yeah. Thank you guys so much for taking my question and congratulations on the quarter. Chris, you covered a lot of ground there going through those three sets of guidance. Maybe pulling in the zoom lens a little bit. Can you just talk a little bit about what you're kind of thinking through from a macro environment, maybe a more like demand-centric spending environment for both Q1 and for 2025?

Yeah, look, our approach and the simplest way to put it is we've followed how we've done it historically, which means that it requires the low end of each of our KPIs to get to our guide, which gives us the same level of flexibility we've gone into future years in terms of our guide, as well as future long-term models. Given where we are in the first two months of the quarter, we've got very good visibility into obviously Q1. We've leveraged our

Yeah. And Matt, let me just say that we're not seeing any challenges from any clients at this point. So we're feeling very good about where we are versus the macro environment as it exists today.

I appreciate that. And then, David, great to hear that you already have LiveIntent integrated as quickly as January. Can you just talk a little bit more about kind of what you're hearing from customers in terms of their initial use cases and initial adoption? And then to broaden it out, in the 2028 plan, we have some new verticals and new products that are some of those other up drivers. What do you see from when you launch new products that gives you confidence in that long-term ARPU expansion just in customers' desire, I guess, to take more from

Yes. And to be clear, we've been experiencing that type of ARPU growth. So we don't need to grow our ARPU growth as a percentage to hit this plan. We can just continue to do what we're doing as we did to get to the 2025 plan from a revenue perspective by the end of 2024. But

Our next question comes from DJ Hynes with Canaccord Genuity. Please proceed with your question.

Hey. Good evening, guys. Nice set of results. David, maybe I could have you expound on that last point, which is the agency business. Clearly, the ARPU gains suggest there's lots of momentum there. Maybe just talk about what you're hearing from those folks? What kind of visibility you have into the pipelines that they have for pulling in new brands? How are you thinking about the growth opportunity with the agencies for ‘25 and beyond?

Thank you so much, DJ. I appreciate the compliment. What I would tell you is that right now, one of the reasons I think we are drinking out of the fire hose in our agency business is because something that most people don't I think, understand is we are the most profitable partner on average that the agencies work with bar none. Because most of our competitors who have had some challenges over the last number of months, they're charging a meaningful upcharge to data expense. We bundle the data in as a part of the activation and are generally lowering the cost to the agency or increasing their profit depending on how they book it by 25%. So what we're seeing is the agencies are moving more and more brands and more and more volume to us. What we're seeing out of agreements that have already been executed as minimum amounts for this year gives us a tremendous amount of comfort in the projections that we're putting out there.

Yes. Makes sense. Maybe a follow-up to that. It was interesting, one of the agents you called out was kind of a push into creatives. And I'm curious, like how deep does

Yeah, so let me be clear. We do not want to compete with the agencies as it relates to creative. That is not in our roadmap. What we are doing is taking their creative and optimizing it for any screen size, would be a perfect example. So you're opening it on an iPhone, an Android device, an iPad, a laptop, a TV commercial. The dynamic agent is able to optimize that creative for that. Now we have some enterprise clients that are using very basic creative tools versus they might not have an agency. But any time we're working with an agency, and we are not putting out as a standalone product a creative product, we very much want to support the creative assets of the agencies, and we want to utilize our tools to help optimize that creative, look at what has the highest conversion rates by creative and the best return on investment for the client.

Our next question comes from Jason Kreyer with Craig-Hallum. Please proceed with your question.

Hey. Thanks, guys, and congrats on another strong quarter. So look, you guys are working with some of the largest marketing companies. You’re talking about 44% of the Fortune 500. You're just running at a scaled customer ARPU of $2 million today. So, what are the key elements of the strategy that help you increase wallet share, so it's not $2 million but $20 million or $40 million or $80 million over time?

So, great question, Jason. Well, I mean, first, let's start with One

You can - Jason, you can see this really clearly in the earnings supplemental on Slide 10, where if you look at our greater than 1 million scaled customers, which on a brand basis grew 28% year-over-year, but on an ARPU basis, to your question, those greater than 1 million customers on average are already spending almost $7 million. Now if you compare that to our 100k to 1 million customers, the amount of leverage we have, there, call it, just shy of 500k per, we see a substantial growth and ramping as they spend more time on the platform. And then if you reference Slide 11, which is a slide that we produce annually, you'll see we continue to make significant inroads within scaling those customers within the first year, almost now at 1 million per compared to around 600k in the last couple of years in that first year.

Perfect. And then just a follow-up to kind of something we talked about in December. But you spent a lot of time with your biggest customers over the last handful of months here. Just wondering how those conversations continued to progress. And what is it about those conversations that drive them to want to do more with

I think a lot of it goes back to efficiency and effectiveness and superior revenue growth, right? So when you think about artificial intelligence, the vast majority of enterprises that are out there are using it for efficiency in automation, which, of course, we're doing as well. But the ability to drive meaningful revenue growth per dollar invested into the

Our next question comes from Ryan MacDonald with Needham & Company. Please proceed with your question.

Hi. Thanks for taking my question and congrats on a great close to 2024. David, you talked about this concept of One

First of all, thank you, Ryan. We're super proud of the quarter and the year. The answer is absolutely yes. So we're starting, for the first time to see meaningful RFPs coming in as One

If you look inside the sales pipeline, Ryan, just as a point of evidence, what we're seeing is that the average deal size is up 35% year-to-year, so your point of bringing all three of those use cases together.

Appreciate all the color on that. And then, obviously given all the success that the company has had, it's obviously gonna, I think, bring in new competition into the market. We've recently seen sort of reports about Meta trying to go to the agencies to do more on AI-based advertising. Can you just talk about what you're seeing maybe in terms of newer movement or any changes competitively? And whether or not some of this moves from the walled gardens creates any concern in the near term? Thanks.

Yeah. Thank you, Ryan. No, we're not seeing any competition from guys like that. In fact, we continue to grow our business with Meta pretty materially and have a very deep and meaningful relationship with them. They tend to focus on very few, very large partners. You are seeing Google and Meta going at it a little bit against each other. But that has, in no way, shape or form affected us. Quite frankly, I think that it's, in some ways, benefited us, because we're such good partners with Meta, we've been able to drive more business and build a deeper and more meaningful relationship. I would also comment on the fact that we haven't seen any small up and comers either. And I think a lot of that has been the inability for start-ups outside of pure AI to get financing over the last three to four years. So, in a normal world, you would get to our scale and our growth rate and our size, you would have some new start-ups coming after you. We have not seen that either. So it's been a really unique opportunity as we've brought everything together where you would traditionally need upwards of 17 different vendors to put together what the

Our next question comes from Terry Tillman with Truist Securities. Please proceed with your question.

Yeah. Congratulations from me as well. Hi, David, Chris, and Matt. First question might be a multi-parter, and then I had a follow-up. But you all provided some interesting stats in terms of the pipeline and the value of the pipeline kind of ending the year. What I'm curious about is, how do we think about timing of that converting into like meaningful or material revenue. And if some of these are kind of One

Yeah, we're not seeing any change in our deal cycles and that's been something that we've been saying now for, frankly, years. So, without a doubt, some of the bigger deals that come in through the RFP process will be, call it, 7 to 12 months, in that range. And they can move much faster than that by the way. But still the vast majority of the deals we're closing, and it doesn't mean that's to take a long amount of time, are still pilots and proof of concepts. That can be on all three use cases. So it doesn't necessarily stop us from having deals in the pipeline take longer, if you will. I don't expect the conversion of the pipeline to be any different in ‘25 than we've seen in ‘24 or 2023.

And remember, Terry, that seven or eight months, many of those guys entered our pipeline seven or eight months ago. So you're actually seeing a consistent movement from what I would say is the pipeline to RFPs and pilots to convert it to clients to the ability to scale to scaled clients and then ultimately super-scaled clients. So, I think that if you look at our confidence in our business, putting forth a 2028 plan that continues to show a minimum of a 20% organic CAGR, we're feeling very bullish about where the business is right now.

Yeah, that's definitely clear, David. I guess it seems like forever ago, but it really wasn't that long ago in

We've always said we thought mobile would be a big driver into 2026 and beyond and it could happen in 2025. We have a number of clients who have adopted it and we're very, very proud of the product we've built and it's doing quite well. I mean it's growing at a massive rate, but off a zero base, right? So the one challenge about getting bigger and bigger is it's harder for new products to really drive the needle. But if you look at products like connected television, they're still growing above 100% a year. So, now that that's a meaningful revenue, it's starting to really impact what we're seeing as a business. I expect mobile to do that in the years to come.

It's a very natural selling motion for our sellers, right? It's not as though they have to learn a new capability. It's really an extension of how they're selling today as a new channel.

Our next question comes from Arjun Bhatia with William Blair. Please proceed with your question.

Perfect. Thank you, guys. Congrats on the strong close to the year here. Maybe if I can switch back to agencies for a second. Chris, I'm curious what role you see agencies contemplating in that 2028 model. We know they're kind of on the upward part of the S curve in terms of growth right now. But kind of how are you anticipating the growth might shape out over the next couple of years? And then the other piece just in terms of mix - like where are you thinking the agencies are in the pace of adopting digital channel or sorry, direct channels? Is that – are you starting to see that pick up in late ‘24, early ‘25 here? And just how do you think that might trend over the coming years?

Yeah. So we think of the agency first off, which reached, call it, right around 20% of revenue this year, which was obviously expected and substantial growth to be an even bigger part of the pie as we go into deeper into 2028. But we see it as part of the core being able to get to that growth plan by itself just by accessing more and more wallet share and the brand strategy and the brand go to market is one of the fastest ways that we can do that. Obviously, we highlighted a number of other growth drivers incremental to the core that frankly, could drive us north of the $2.1 billion, which is why we said it's an at least. In terms of where we are on getting direct mix, we made really exciting improvements this year. We're still not quite at like roughly 50% direct to 50% integrated. So there's still upside there. And I think as those agencies continue to grow in brands, grow in their channel adoption towards direct mix that that's also going to be accretive to our gross margins in addition to the work we're doing on One

Okay. Understood. And then, just a quick one to put a finer point on it. I know we talked about this a little bit late in 2024, but kind of the fallout from – or the customer conversations that you've had following up with some of your customers post the short report. Has there been any impact or any change in those conversations since that's happened? How are your customers reacting? And what are you seeing from them post some of the events late last year?

Well, I think if we had seen material changes, Arjun, we wouldn't have grown by 50%. What I would tell you is, no. We have seen no material changes from the last update we gave, which was we have not lost any client directly over this and we continue to see that. I was super excited that we were able to announce that our audit committee had done a full review. They brought in a full forensic accounting firm that went through every single one of the transactions that could be deemed a client and a vendor and found no issues whatsoever in there. And then we brought in a law firm that is one of the top data experts in the country. They vetted everything that was in the report, and they found no merit whatsoever in it and they reported that to our audit committee, which was very happy to put this issue behind us.

Our next question comes from Kelly Valentini with Goldman Sachs. Please proceed with your question.

Hi. Thank you for taking my questions, and congrats on the quarter. Wanted to walk through the comments you made on getting those budget penetration to 5% to 15%. I am curious like in the typical customer you see that expansion, how much of that would you expect to be taking share from Walled Gardens versus taking share from other technology providers?

Thank you, Kelly. I appreciate the compliment, and it's a great question. We don't traditionally take business from the Walled Gardens. We traditionally partner with them. So what we're able to do by using our data, we're able to build an attribution model that can go into a Walled Garden or it can go outside of a Walled Garden. So, we see the Walled Gardens more as our partner than our competitor. Now there are a number of companies out there that obviously we're taking meaningful market share from. Hard to grow the business at these rates if we weren't. They're traditionally, I would say, last-generation marketing clouds or last-generation DSPs, where they haven't fully integrated data and AI as native to the application layer. So because of their tech debt, they're not able to get to the type of speed to intelligence that our platform can, which allows for substantially superior return on investment. So, if the market itself is growing 10%, 15%, and we grew 40%, not including political, that would infer everything above that would have been taking market share from competitors.

That makes sense. And then as a follow-up, just curious, anything you can give on what assumptions you're making on AI revenue growth and kind of the 2025 and 2028 targets?

Yeah. We didn't – we haven't broken it out in the 2028 in a line item fashion. We did say it will be one of the five new levers we feel like we have in addition to the core growth business. But I think if you look toward 2024 and our consumption-based revenue, which accelerated by north of 40% year-over-year and that's, call it, roughly half of

And what we're seeing, Kelly, is the ability to meaningfully drive consumption is a substantially better return on investment for us as a company than charging an all you can eat or putting sort of a small price on the AI. Although we will be rolling out AI products in the near term that will be have to be paid for as it relates to sitting on top of the

Okay. Thank you.

Our next question comes from Elizabeth Porter with Morgan Stanley. Please proceed with your question.

Great. Thank you so much. This is Katie on for Elizabeth Porter this afternoon. Wanted to hit on the verticalization piece here.

Yeah. No problem, Katie. Thanks for the question. We've already started to build in fact in a lot of our virtual demos that we'll do with investors, we showcase a CPG real-world demo today, where we're actually using customers and being able to show them what their customers are spending on with their brand as well as with their competitors. So it comes down to in each one of those verticals where we think we're underrepresented today, where there's a massive TAM and amount of marketing and advertising spend, all comes down to the type of data that we can put in front of the marketer and how actionable we can make it for them in a totally different way than what our competitors can do. So it all starts with the data and then the software and the analysis that we put on top of it and the recommendations that they can then perform on the platform coming out of it.

And by the way, a lot of the "vertical competitors" really are more vertically focused from a sales perspective than they are from a platform perspective. So we've invested over the last year pretty heavily in our sales force, as you've seen growing to 180 quota carriers, easy for me to say. And we're expanding out into new verticals with salespeople that we think will really benefit us this year and the years to come.

Helpful. And then, just one quick follow-up on the NRR. In the long-term model, not looking to inflect too materially from the 114% today. Obviously, that's a pretty impressive stat already. But maybe just expand on the different drivers there. Is there any limitation on the upper bound to NRR around expansion activity as you kind of land with these higher ARPU customers? Thank you.

Well, there's no limitation on where it can go, although we continue to guide to 110% to 115%, which has been where we have. We've been sort of between 111% and 114%. What I would say is, first, you've got the agency holdcos, which as their ARPU grows dramatically, that's a big benefit to NRR. And we just don't lose a lot of customers, which is also a very good thing, right? So, I think we can continue to keep it in that range. And then, in the years to come, I think we can begin to look at getting it above that range. But in the short run, we feel very comfortable with 110% to 115%.

And I think there's a really good, Katie, on Slide 11 in the earnings supplemental, we show the life of the cohorting of a customer set. And if you look at those that are spending – that have been on the platform less than a year, they're spending an average of $900k, which is up from $600k last year. That one to three year cohort continues to accelerate to $1.2 million. And then those customers that are with us three or more years, they're continuing to grow. They're now at an average of $2.6 million compared to $2.1 million last year. So, we feel like that 110% to 115% is rooted in deep analysis by cohort and it's also consistent with our growth algorithm, which has historically been about half of our growth coming from our existing customers and half from new.

Our next question comes from Jackson Ader with KeyBanc Capital Markets. Please proceed with your question.

Hey, guys. This is Jack on for Jackson Ader. Wanted to ask on what your political revenue assumptions are implied in your outlook? And do you expect to gain market share with political campaigns?

So there's two pieces – thanks, Jack. Two pieces of the answer there. There's political candidate revenue, which was, call it, $44 million in 2024. And the reason why we broke that out throughout the year in our guide and in our reported results was, it's always been our expectation that in 2025, there shouldn't be any political candidate revenue of any materiality certainly. Then there's the advocacy portion, which is where

Got it. Very helpful. And as a follow-up, how much revenue today is coming from the marketing cloud? And how much do you expect that to be in 2028 as it progresses?

I mean all of it? All our revenue goes through the marketing cloud. So, it's -- don't - maybe you could fine-tune that question.

I'll follow-up with you guys offline on that.

Yeah. Well, I mean we're going to talk in a bit. But literally, Jack, all of our revenue goes through the marketing cloud at this point. So when we consolidated that a few years ago, everything now goes through one user interface with one reporting infrastructure and everything is totally integrated.

Our next question comes from Koji Ikeda with Bank of America. Please proceed with your question.

Yeah. Hey, guys. Thanks so much for taking the questions. Maybe this one's for Chris. And so Chris, when I look at the third-quarter transcripts, I recall that you said you were very comfortable with 2025 consensus revenue growth of 17%. And so I know that was supposed to be without LiveIntent. And that got us to a number that is a couple of millions below the $1.144 million or billion that you're guiding to today without LiveIntent. But if I use that 1.144 number and then compare it to where you ended up at 2024, that implies 14% organic growth versus the third quarter when you said 17. And I know in the Slide 24, it says 21% growth. And so I just want to make sure I'm comparing apples-to-apples here with that original 17% comment from the third-quarter call.

Yeah. And that 17% comment, when we very carefully walked through what we were presuming, that should have gotten most analysts and The Street to around, call it, $1.2 billion in revenue compared to the $1.24 billion that we're at today. So, obviously, you back out $17 million of LiveIntent from the $1.6 billion in revenue we did in 2024 and you back out $44 million of political candidate revenue, you get to a normalized base of $944 million. If you then do the same on 2025 you remove $96 million from LiveIntent – for LiveIntent, which is what we'd expect that business, and that's a 20% growth rate consistent with what we talked about when we made the acquisition. You get to, call it, $1.44 billion. So it's a 21% growth rate, so roughly four points higher than that 17% that we had talked about earlier. We went through the task also on Slide 24 to kind of clearly break out this in steps by quarter and what you'll find is that for each quarter of 2025, growth is effectively between 20% and 22% when you exclude LiveIntent and exclude political candidate revenue itself.

And I think, Koji, it's important because we've got to exclude those two things to get to the 21%. But you really have to exclude the revenue we picked up from LiveIntent in the fourth quarter, right? So even if you just wanted to do apples-to-apples, you would pull that inorganic revenue out. You can't pull it out of 2025 without pulling it out of 2024.

Got it. Thank you for that. And maybe just a quick follow-up. I did want to ask if the conservatism in the guidance or any sort of consideration in the guide this year, just thinking about all the macro and regulatory and tariff noise that's out there. Is there any additional conservatism that you pulled with the guidance this year? Thank you.

We tried to be consistent with our historical approach, which is to build in ample conservatism, so that we don't need the midpoint or even the high end of our metrics to get to our guidance. As I said kind of earlier in the Q&A, we can get to guidance at the low end of each one of our metrics call for. And we obviously made that call based upon our awareness of what's going on in the macro backdrop. David, anything you'd add?

Yes. I would say, Koji, just we've known each other for a while now. We've beat and raised 14 quarters in a row. Our goal is to be here the same time next year and saying we've now beat and raised 18 times in a row and we feel we've put the right guidance out to do that.

Thanks guys.

Thanks Koji.

Our next question comes from Brian Schwartz with Oppenheimer. Please proceed with your question.

Brian, you out there?

Brian, are you on mute?

I am on mute. Sorry about that, everyone. A couple of questions from me. Chris, I just wanted to ask you on the decel in the 1Q guide. I know the comp is a few points harder here and there is political spending headwinds on the comparable. But is there anything else that you're contemplating in that guide to see that type of organic deceleration beyond those items? Did - having one less day, is that also an impact in terms of the 1Q guide? And then I have a follow-up.Thanks.

No, no, that wouldn't be any kind of material impact. As you said, it's 30% all in. The guide is 20% if you adjust for effectively LiveIntent because there really wasn't any political candidate revenue in the first quarter. And just it's our conservatism. We're trying to be consistent with what we've done in the past and just build multiple ways to get to the number and feel like if we do that, we'll be in the same place we've been in the past in terms of what our traditional beats are.

Okay. And then the follow-up question I had on the 2028 guide. I know there was some discussion earlier about the agency business, which is doing really well for you. Is it your expectation, Chris, that, that business could double in terms of its percentage of the revenue mix as we fast forward to 2028? Thanks.

So the base will keep growing, right? So I think doubling in size, I mean, it's not without – it's not outside the realm of possibility. I think it will be a bigger and bigger piece of the pie. Like I said, today, it's about 20% of revenue. I think doubling, there are certainly cases for that, but I wouldn't count on it as we sit here today.

Yes, nor would I, Brian. I think it's going to double as a business. I don't think it's going to double as a percentage.

Our next question comes from

Hi. Good afternoon, and just adding on my congratulations for the quarter. Just double clicking a little bit more on the agency opportunity. I mean, David, can you speak to just the growth opportunity that you have with the top five global holding companies versus maybe your aspirations to expand into the mid-market on the agency side?

Yeah, I mean we are adding mid-market agencies faster than I think we could have even expected. And they're all on platform. So that's a really nice thing for margin in the long term. But what I would say,

Understood. And just my one follow-up towards, Chris. Can you talk about your plans for quota carrying hiring for

Yeah. Slide 17 in the supplemental lays out what our compound growth rates have been through the first -- if you will, the first long-term plan. The quota carrier compound annual growth rate was 22% from 2021 to 2024. We are baking in some efficiency that we frankly have been seeing as of late to where it's our expectation that we can grow the quota carrier base between 10% and 15%. What we found though, is we don't want a growth number to force us down the path of just quantity, what we've continued to do well and this allows for us to focus on that quality element over just throwing bodies at sales.

Our next question comes from Richard Baldry with ROTH Capital Partners. Please proceed with your question.

Thanks. Maybe switching gears. I wanted to look at the balance sheet. You repurchased $31 million worth of shares in the quarter. That's three x what you've done in the rest of the year combined and almost matched your free cash flow. Sort of curious your thought process around the buyback on a go-forward. Do you think you'll run it at a higher percent of the free cash flow? Do you think you'd be opportunistic and ever like look at taking the actual cash balances down to pursue it more aggressively? Just to give us a backdrop for the year ahead. Thanks.

I think, listen, Rich, the stock we thought dropped to a stupid place. So we’ve massively accelerated buying the stock. We still think it's very low, and we'll continue to buy it at an accelerated pace. I don't see any better use for our cash right now than buying our shares back. And yeah, we used about 100% of free cash flow. We expect to drive meaningful free cash flow this year. You could see us do, I would say, at least half and potentially much higher as a percentage of free cash flow as we look at buying the stock back because, once again, it right now is the best investment for us for our cash in the current environment.

And the follow-up for me would be, it looks like we probably have a better M&A environment with an administration that might let more things go through. So how are you thinking about growth, the inorganic growth opportunities now and as you look ahead to the sort of broaden offerings, get into new markets, et cetera?

Yeah. We are seeing more deals now than we have in many years. What I would say, it's still going to be hard to find deals that match our four M&A pillars. If we can find deals that match our four M&A pillars, we will act on them. We have meaningful cash. We have meaningful capacity and we're in a very unique position with the type of free cash flow we expect to generate to be able to do very opportunistic deals. I will say what I say to you whenever we're together. I believe transformative deals transform both companies for the worse. So we won't be doing anything that "is transformative". But we will continue to be very, very opportunistic and look at opportunities where we can take 1 plus 1 and equal 4.

Our next question comes from Ryan MacWilliams with Barclays. Please proceed with your question.

Hey, David and Chris. This is Eamon on for Ryan. Thanks for the question and appreciate all the detail today. Can you help us understand the key levers for the free cash flow and EBITDA margin expansion highlighted by your 2028 guide?

Yeah, certainly. So we talked about getting anywhere from 100 to 300 basis points we think from cost of revenue and that’s really being driven by three different initiatives. The first being our One

Perfect. Thanks, Chris. And then, as a follow-up, have you seen any changes in the environment post U.S. election as it relates to customers' willingness to spend?

We really haven't, Eamon. We've been working with our customers. And as you know, we're very, very close to our customers. I think people always discount what a large percentage of our business we have done when we enter the year. We already have incredible visibility into what we’ve put out. And as Chris has said a couple of times, we've tried to be incredibly conservative in the projections that we put forth. So, we have not had any clients pull back. And thus far, we continue to be full speed ahead.

There are no further questions at this time. I would now like to turn the floor back over to David Steinberg for closing comments.

I could not be prouder of this team to have worked through the turbulence that we've seen over the last quarter and put up the type of results that we've put up as an organization. I think it really shows that our strategy of putting AI and data as foundational to our platform, bringing in the world's best people and letting them do their jobs really can ultimately drive to financial results that show how strong our platform is in the marketplace. And we believe we're going to organically double this business again over the next four years. I could not be more proud of our