Magnite, Inc. (NASDAQ:MGNI) Q1 2026 Earnings Call Transcript

Magnite, Inc. (NASDAQ:MGNI) Q1 2026 Earnings Call Transcript May 6, 2026

Magnite, Inc. beats earnings expectations. Reported EPS is $0.13, expectations were $0.1057.

Operator: Good day, and welcome to the Magnite, Inc. First Quarter 2026 Earnings Conference Call. All participants will be in a listen-only mode. Should you need assistance, please signal a conference specialist by pressing the star key followed by zero. After today’s presentation, there will be an opportunity to ask questions. To ask a question, you may press star, one on a touch-tone phone. To withdraw your question, please note this event is being recorded. I would now like to turn the conference over to Nick Kormeluk, Investor Relations. Please go ahead.

Nick Kormeluk: Thank you, Operator, and good afternoon, everyone. Welcome to Magnite, Inc.’s First Quarter 2026 Earnings Conference Call. As a reminder, this conference call is being recorded. Joining me on the call today are Michael G. Barrett, CEO, and David L. Day, our CFO. We have posted financial highlight slides on our Investor Relations website to accompany today’s presentation. Before we get started, I will remind you that our prepared remarks and answers to questions will include information that might be considered forward-looking statements, including, but not limited to, statements concerning our anticipated financial performance and strategy, including the potential impacts of macroeconomic factors on our business.

These statements are not guarantees of future performance. They reflect our current views with respect to future events and are based on assumptions and estimates and subject to known and unknown risks, uncertainties, and other factors that may cause our actual results, performance, or achievements to be materially different from expectations, or results projected or implied by forward-looking statements. A discussion of these and other risks, uncertainties, and assumptions is set forth in the company’s periodic reports filed with the SEC, including our quarterly reports on Form 10-Q and our 2025 annual report on Form 10-K. We undertake no obligation to update forward-looking statements or relevant risks. Our commentary today will include non-GAAP financial measures, including contribution ex-TAC, or less traffic acquisition costs, Adjusted EBITDA, and non-GAAP income per share.

Reconciliations between GAAP and non-GAAP metrics for our reported results can be found in our earnings press release and in the financial highlights deck that is posted on our Investor Relations website. At times, in response to your questions, we may offer additional metrics to provide greater insight into the dynamics of the business. Please be advised that this additional detail may be one-time in nature, and we may or may not provide an update on the future of these metrics. I encourage you to visit our Investor Relations website to access our press release, financial highlights deck, periodic SEC reports, and the webcast replay of today’s call to learn more about Magnite, Inc. I will now turn the call over to Michael. Please go ahead, Michael.

Michael G. Barrett: Thank you, Nick. Thanks, everyone, for joining us today. We delivered a strong first quarter, exceeding expectations across both revenue and profitability. Top line came in ahead of consensus, with DV+ outperforming our guide and CTV in line. Adjusted EBITDA exceeded consensus by $5 million, driven by earlier-than-expected cost efficiencies, and we are encouraged by the margin expansion we are seeing. Importantly, the broader market trend remains unchanged: ad dollars continue to shift towards streaming. In Q1, CTV contribution ex-TAC grew 30% and represented 51% of total, maintaining the momentum we saw in 2025. That strength was broad-based. We saw continued growth across leading publishers, including LG Ads, Netflix, Paramount, Roku, Vizio Walmart, and Warner Bros.

Discovery. Our top 10 accounts grew in the mid-30% range year-over-year, with the rest of the base growing in the mid-20s. This is not isolated performance. It reflects a platform that is gaining share as the market scales. The acceleration we are seeing in CTV is not surprising. We are materially outpacing the market, and we believe that is sustainable. This is driven by both new wins and expanding partnerships, but more fundamentally, by SpringServe. SpringServe has evolved from a best-in-class ad server into the operating system for CTV monetization. We sit at the center of the transaction, unifying demand, optimizing yield, managing ad experience, and orchestrating data across the workflow. There are point solutions in the market, but no other scaled platform in CTV combines ad serving, mediation, and monetization infrastructure in a single unified layer.

For publishers, this drives higher yield and better control. For buyers, it provides a direct path to the broadest set of premium inventory. And this capability scales across every cohort we serve. We support OEM monetization across home screens in emerging formats, partner with streamers to build and support their offering, and help broadcasters optimize their sales efforts, particularly as live and SMB demand grows. And in live TV, where performance requirements are highest, our differentiation is even more pronounced. Live sports remains one of the largest and least penetrated opportunities in programmatic. We are seeing strong traction here, including more than 80% growth year-over-year in revenue from March Madness. On the demand side, buyer marketplaces are scaling, ClearLine adoption is increasing, and buyers are prioritizing more direct and efficient access to premium CTV supply.

We are also seeing commerce media emerge as an important driver across both DV+ and CTV. These partners are bringing valuable first-party data and incremental demand into the ecosystem, increasingly activating across streaming environments. Our recent announcements with Expedia Group, Walmart Connect, and Roku Curate show further traction on the commerce media front. Across all of these areas, our role is consistent. We are the infrastructure layer that connects the ecosystem. As our capabilities expand, so does our position. We are increasingly the single entry point for buyers to access premium CTV inventory at scale, becoming the easy button for CTV. And as the market consolidates around scaled platforms, we believe our lead is durable and widening.

Turning to DV+, DV+ declined 5% in Q1, which was better than expected. While budget shifts towards CTV continue, we remain confident in the long-term role of DV+. Trends improved exiting Q1 and into Q2, with signs of stabilization driven by mobile in-app, online video, audio, and commerce media. Mobile in-app grew 8% year-over-year and remains a durable growth segment supported by deeper integrations and new publisher and DSP onboarding. Commerce media continues to build momentum, with 21 partners and 13 now deployed and ramping, expanding both our demand footprint and data capabilities across DV+ and CTV. On the Google AdTech remedies, our view remains unchanged, and we continue to believe the potential upside is meaningful. Stepping back, what ties this together is how our platform is evolving, particularly with AI.

We are embedding AI across the platform to improve how media is bought and sold. At the core, AI enhances how inventory is valued, how campaigns are executed, and how decisions are made in real time. For publishers, AI is improving monetization through dynamic pricing and demand optimization. And with ClearLine, AI is simplifying activation, curation, and optimization, reducing friction and enabling faster execution. Across the platform, we are beginning to see the emergence of agentic workflows, enabling greater automation and efficiency for both buyers and sellers. What matters is not a single feature; it is how these capabilities work together across our scaled infrastructure. We are already seeing adoption from the leading players across the ecosystem, using our AI to automate workflows, act on real-time signals, and improve performance.

This is still early, but the direction is clear: AI is increasing efficiency, expanding working media, and driving more volume through platforms like ours. This is a tailwind for Magnite, Inc. Before I conclude, I want to address David’s retirement. As previously announced, David has decided to retire after more than 13 years of exceptional service. He has been an invaluable partner and a steady leader whose financial stewardship helped shape Magnite, Inc. into the company we are today. We are grateful for his leadership and for his commitment to ensuring a smooth transition, as he remains in his role through September 30 while we evaluate internal and external candidates. On behalf of the board and the entire Magnite, Inc. family, I want to thank David and wish him and his family all the best.

With that, I will turn the call over to David for more details on the financials.

David L. Day: Thanks for those kind words, Michael. I appreciate it. We are off to a good start to 2026. Q1 total contribution ex-TAC grew 10% and came in at the top end of our guidance range. As Michael mentioned, CTV increased an impressive 30% year-over-year, and DV+ declined 5% but exceeded our previous expectations. We are pleased with the results and are encouraged by the many positive catalysts that are driving momentum in our business. Total revenue for Q1 was $164 million, up 6% from Q1 2025. Contribution ex-TAC was $161 million, up 10% at the high end of our guidance range. CTV contribution ex-TAC was $82 million, up 30% year-over-year. DV+ contribution ex-TAC was $79 million, a decrease of 5% from the first quarter last year.

Our contribution ex-TAC mix for Q1 was 51% CTV, 34% mobile, and 15% desktop. From an overall vertical perspective, health and fitness, retail, and food and beverage were the strongest performing categories, while automotive and technology were our weakest performing categories. Total operating expenses, which include cost of revenue, were $157 million, flat from last year. Adjusted EBITDA operating expense for the first quarter was $118 million, $4 million better than our guide and an increase from $109 million in the same period last year. Operating expense was better than expected due to significant improvements in cloud spend and some early AI-related productivity gains. Our net income was $4 million for the quarter, compared to a net loss of $10 million for 2025.

Adjusted EBITDA grew 16% year-over-year to $43 million, reflecting a margin of 27% as compared to 25% in Q1 last year. As a reminder, the first quarter is always seasonally our lowest margin quarter. We calculate Adjusted EBITDA margin as a percentage of contribution ex-TAC. GAAP earnings per diluted share were $0.03 for 2026, compared to a net loss of $0.07 for 2025. Non-GAAP earnings per share for 2026 were $0.13, compared to $0.02 in Q1 last year. The reconciliations to non-GAAP income and non-GAAP earnings per share are included with our Q1 results press release. Our cash balance at the end of Q1 was $185 million, a decrease from $553 million at the end of the fourth quarter. The drivers of the change were the $250 million payoff of our convertible debt, planned capital expenditures, share repurchases, and normal seasonality in working capital.

Operating cash flow, which we define as Adjusted EBITDA less CapEx, was $23 million. Capital expenditures, including both purchases of property and equipment and capitalized internal-use software development costs, were $20 million, in line with the expectations we discussed last quarter. Net interest expense for the quarter was $5 million. Net leverage was 0.7x at quarter-end, consistent with our target of less than 1x. During the first quarter, we repurchased or withheld over 2.2 million shares for approximately $29 million. As of quarter-end, $186 million remained available under our current repurchase authorization, which is effective through February 2028. Now that we repaid our convert, we plan to be more aggressive with share repurchases given our expected free cash flow generation.

As discussed last quarter, our capital allocation strategy aims to return approximately 50% of free cash flow to shareholders via share repurchases. We believe our shares currently trade at very attractive levels. For the second quarter, we expect contribution ex-TAC to be in the range of $177 million to $181 million, which represents growth of 9% to 12%. Contribution ex-TAC attributable to CTV to be in a range of $90 million to $92 million, which represents growth of 26% to 29%. DV+ contribution ex-TAC to be in the range of $87 million to $89 million, which represents a decline of 4% to 2%. We anticipate Adjusted EBITDA operating expenses to be in the range of $115 million to $117 million, which implies Adjusted EBITDA margin of 34% to 36%.

And for the full year 2026, we reaffirm total contribution ex-TAC growth to be at least 11%, reaffirm Adjusted EBITDA percentage growth in the mid-teens, raise Adjusted EBITDA margin to be at least 35.5% from greater than 35%, raise free cash flow growth to be in the mid-30% range from greater than 30%, and reaffirm CapEx of approximately $60 million, a reduction from prior year. I want to point out that our estimates do not include any potential market share gains as a result of remedies from the Google AdTech trial. Lastly, a note regarding our tax position: we would not expect to have any significant increases in cash taxes. Finally, on a personal note, I am incredibly pleased with our performance and the robust financial position the company maintains today.

It is from this position of strength that I have decided to retire, marking the end of what has been the most rewarding chapter of my professional life. My journey here from the early days of Rubicon Project through our 2014 IPO, transformative merger with Telaria, and the acquisitions of SpotX and SpringServe has been an exhilarating ride. I am immensely proud of the durable company we have built, our winning culture, and a world-class finance team. While I am looking forward to spending more time with my family, I will continue to energetically serve as CFO through September 30 to ensure our momentum continues uninterrupted and to assist Michael and the board in identifying my successor. I leave with full confidence that Magnite, Inc. is extremely well positioned to lead the future of digital advertising.

Thank you all for an unforgettable decade-plus partnership. We will now open the call for questions.

Operator: We will now open the call for questions. To ask a question, you may press star then 1 on your touch-tone phone. If you are using a speaker phone, please pick up your handset before pressing the keys. If at any time your question has been addressed and you would like to withdraw your question, please press star then 2. We ask that you please limit yourself to one question and one follow-up. If you have additional questions, please rejoin the question queue. At this time, we will pause momentarily to assemble our roster. The first question today comes from Daniel Louis Kurnos with Stifel. Please go ahead.

Q&A Session

Daniel Louis Kurnos: Great. Thanks. Good afternoon. And let me be the first, David, to wish you the best. It has been a pleasure working with you. Michael, let me jump in and unpack DV+ a little bit. Your comments suggest that we are still seeing mix shift to CTV, but your guide suggests— I mean, you talked about stabilization — your guide is almost flat in Q2. I am trying to figure out how much of that is these commerce media wins backing up here and how you think that might trend as we proceed through the year, understanding there is uncertainty in the macro and the pressures we are still seeing in the traditional desktop business. And then, since you brought up live sports, we have a very big event coming up, the Summer World Cup.

We are starting to see more of Fox’s strategy, and we are finally going to get real games on Tubi. They have DTC out there now. How should we think about the impact of that event? It seems like every time we get one of these big events, even starting with the Olympics this year, and you mentioned March Madness, more and more inventory shifts to programmatic. Is that also an incremental catalyst for more inventory to keep moving in that direction?

Michael G. Barrett: Yeah, Dan. I noticed you did not say it was a pleasure to work with me, so that is kind of hurting. But good observation. We do think we have seen stabilization to DV+, driven largely by the fact that the open web display is certainly under siege, but other pockets — mobile in-app, commerce media, as you pointed out, and audio — are growth areas for us. The macro weighs heavy on DV+ particularly, but seeing it return to flattish is something that I think would still outperform the market, and that is kind of where I think we should be in either one of our businesses. On the World Cup, it will certainly be a good guy for us. Given the volume of games and some of the added ad breaks — for instance, the mandatory water breaks — that is going to be a big ad load.

We are expecting good things from it. I am not so sure it will be something that we will be citing as a comp issue in 2027, but it will certainly be part of the portfolio of sports that is going to add to the revenue growth.

Operator: The next question comes from Shyam Vasant Patil with Susquehanna. Please go ahead.

Shyam Vasant Patil: Hey, guys. Congrats on the results, and David, congrats on your retirement as well. I had a couple of questions. David, in your remarks, you talked a little bit — almost a side comment — about an uncertain macro. Did this have any impact on you in Q1 or Q2? Obviously very strong results, but would they have been even better if it were not for some of the macro events? And then, Michael, strong CTV growth and outlook — is there any reason to think that CTV cannot continue to grow at these levels on a secular basis? And related, how are you thinking about the secular profile for desktop and mobile?

David L. Day: Great. On the macro front, it certainly was not an overwhelming drag on the quarter. But you see it in a couple of verticals in particular. Automotive, most importantly, and that is a large vertical, was down significantly. Technology also. So you see some impacts from tariffs, supply chain challenges, and then just uncertainty with things in the Mideast. Those are the data points underlying my comment. It is not booming, but we are not prognosticating doom and gloom either.

Michael G. Barrett: Yes, Shyam. On the CTV front, we are really pleased with the growth rates and feel very strongly that they are sustainable. The market as a whole, from peer reports and analyst expectations, looks like it is growing in the low teens, so we are significantly outperforming market growth, and that has been a stated goal of ours. I think that will continue given the penetration we have with all the top streamers, their growth profiles, and increasing wins across the globe. An untold story for us is the success of these US-based streamers going international — when they go international, we go with them, and they disrupt the local market, forcing adoption of programmatic and streaming. It is a real positive story for us internationally.

As far as DV+ is concerned, it is a portfolio. High-growth areas include in-app mobile and audio — both are promising — and even digital out-of-home is growing fast. We think DV+ as a whole is an important part of the business and will be a positive contributor. It is just hard to swag on a specific basis going forward.

Operator: The next question comes from Jason Michael Kreyer with Craig-Hallum. Please go ahead.

Jason Michael Kreyer: Great. Thank you. Michael, I wanted to ask on AI. I know you have brought some new solutions to market in the last several weeks. Can you talk about demand and adoption trends of AI-enabled tools? And what pain points exist in the industry that you can leverage AI to make more efficient? And then, David, congratulations on your retirement. It has been my pleasure working with you for most of that 13 years. I wanted to touch on the EBITDA OpEx that came in better in Q1, and you are guiding better for Q2. You outlined cloud and AI benefits. How durable are those savings, and is there more to squeeze out as we move forward?

Michael G. Barrett: Great question, Jason. Wow. No love for David. AI in 2026 will be the story of AI with modest amounts of revenue flowing through. There are several working initiatives, several different standards. A lot of it is replacing direct-sold — not truly real-time programmatic — but bringing more dollars into the programmatic ecosystem because it is so much easier to do it agentically. The biggest benefit you are going to see is workflow and productivity. Instead of toggling between 13 different dashboards, you can use natural language to ask the agent to perform a task. It will free up a lot of bandwidth for traders, be more efficient, and drive more working media. We are exceptionally well positioned with the tools we have built and are building to catch it when the dollars start to flow. I would imagine 2027 will be the year where AI results in real revenue, and we are well positioned to take advantage.

David L. Day: I think as a general matter, the savings are very durable. The primary drivers are twofold: moving some of our activity from the cloud to on-prem, and our dev team optimizing how we run more efficiently on the cloud. I am excited about that. That said, we have resources going into product development later in the year. We have a lot of new business and volume increases. I would not go too crazy with lowering costs, but the trend line is definitely durable. We have more to come as we bring a new data center in Northern California online later in the year. There is lots of opportunity, particularly as we spring into 2027 on the margin expansion front.

Operator: The next question comes from Laura Anne Martin with Needham. Please go ahead.

Laura Anne Martin: Hey. I have two. Taboola said on their call this morning that they see programmatic workflows being replaced by agentic. You just mentioned you thought it might be additive, but why do we not have agentic buy-side agents talking directly to agentic sell-side agents in the ad business and therefore getting rid of most of the 40% to 50% take rate that currently sits in the open web programmatic ecosystem? Second, on pricing power — at Possible, everybody is introducing AI products, and nobody is charging for them. They are table stakes, making products more interesting, more automated, higher ROAS, but are we actually going to get price uplift from these AI innovations, or does it just become table stakes where we spend money on AI but do not get revenue upside?

Michael G. Barrett: Hi, Laura. On agentic replacing the need for software companies: as we said in our previous quarter script and this one, AI is a real tailwind for us. It makes things easier to work with. It lets our publishers go from a dozen dashboards — a SpringServe dashboard, a DV+ dashboard — to one, and they can execute more seamlessly. The agent-to-buyer connection makes a ton of sense. But who is to say that the buyer agent is not ours that they are utilizing, just like they utilize ClearLine? There is real upside there. Also, if you want to conduct conversations, execute plans, and buy programmatically from tens of thousands of buyer agents, that is where we really shine. We ensure those are the agents you want to talk to, that it is brand-safe inventory, we are collecting payment, policing fraud, and our plumbing and servers are being utilized to make it happen.

We feel there is going to be more volume on the platform than we have ever seen, and yes, we will charge for that and it will improve, not pressure, our margin profiles.

David L. Day: Building on that, particularly in CTV where we do have lower take rates at the moment, those are stabilizing. There is so much value-add. As we provide additional value-added services, we only see those increasing in the future, and that value-add will be accelerated with the AI implementations we are making.

Operator: The next question comes from Analyst with B. Riley. Please go ahead.

Analyst: Great. Thank you very much. A couple of questions from me. And, David, all the best. First, on commerce media, you have talked about 21 partners and 13 now deployed. Can you give us a sense of the scale of this business currently and how fast it might be growing? And then on live sports, you called it out as a sizable opportunity. Can you talk about penetration levels of live sports with programmatic and where it could be over time? Thank you.

Michael G. Barrett: Sure. Commerce media is super exciting for us. We mentioned the number of partners, and that total keeps growing. The most important thing is how quickly the strategy has changed for commerce media players. Chapter one was: take my valuable retail data, park it in one DSP, and force all the advertisers that want to utilize that data to go through that DSP. Now you are seeing that unwind. The strategy now is to keep the data close to the retail media partner, working with an SSP like Magnite, Inc. That way you can democratize it and allow multiple DSPs to access it in a safe, privacy-compliant way. That is a huge tailwind for us. As far as contribution, it has been a significant contributor and will expand because many of these players are now adding CTV to the inventory mix.

They start with owned and operated inventory, then go off-net; typically that has been in DV+. Now their advertisers are saying, “I do a lot of advertising on TV, and I want to do that with your data.” We are the perfect on-ramp for that to occur. On live sports, we are just scratching the surface. As a consumer, you see live sports everywhere in streaming. But programmatically, very little inventory is bought and sold programmatically. So when we say gains like 80% plus for March Madness, it is still minuscule compared to the opportunity that is coming. We are super excited about the World Cup and the fall slate of sports. Little by little, it is getting more programmatically driven, and it is a big tailwind for us.

Operator: The next question comes from Shweta Khajuria with Wolfe Research. Please go ahead.

Shweta Khajuria: Hi. This is Ken on for Shweta. Congrats, David, on the retirement. Two for me. Michael, can you provide us an update on the impact of OpenPath, particularly with smaller advertisers and agencies? And David, can you provide the puts and takes of EBITDA in the second half of 2026? Thank you.

Michael G. Barrett: Yeah. On OpenPath, as we have talked about, it came as a shock to the system a couple of quarters ago. We stated that all the big buyers from the agencies that use Magnite, Inc. as an invaluable partner had flipped it back on. You can see in our results it is certainly not deteriorating. So the OpenPath extinction event came and went, and we are still here and doing quite well.

David L. Day: On EBITDA in the second half, we mentioned we expect 11% or greater growth on the top line — stable and steady. On the cost side, we have cloud usage savings, but we also have volume growth and resources that will neutralize some of that savings at least this year. As mentioned, EBITDA margin is increasing — we expected something north of 35% and now expect about 35.5% this year. We are in a great spot. What is really great is our EBITDA margin is increasing and it is cost-driven at this point. To the extent we have upside on revenue, that upside will flow almost 100% to free cash flow. We feel really well positioned.

Operator: The next question comes from Robert James Coolbrith with Evercore ISI. Please go ahead.

Robert James Coolbrith: Good afternoon. Congratulations on a great run to David, and best wishes on your retirement. Michael, you are great too. On AI creative generation, any update on the role you are playing there? We are beginning to see more tools released to general availability. Are you seeing more AI-generated creative showing up in the market? Could that catalyze incremental demand and creative refresh, and what does that do for CTV? And related on AI, we heard some speculation about different ad tech players monetizing AI engine inventory itself. Do you think there is an opportunity for Magnite, Inc. there?

Michael G. Barrett: Hey, Robert. As you know, we purchased a couple of quarters ago a company called SpringServe Streamr, which is one of the leading tools that allows small to medium-sized businesses to create TV ads, track them, measure them, and buy them on our platform with access to all the premium streamers. That product is really taking off. Our role is not to chase down the SMB directly, but to put those tools in the hands of folks that have those relationships — either large aggregators that now bring that demand onto our platform, or publishing partners that offer it as self-serve to their small advertisers. It has turned out to be a wonderful acquisition, and we are starting to see the benefits reflected in the growth rates of CTV.

On monetizing AI engine inventory, it is very early, but the encouraging thing is the ad-supported ones are reaching out for third-party demand. History is pretty clear: initially, if you are just going to work with one DSP, maybe there is not a need for someone like Magnite, Inc. But once you work with three, four, five, six, seven — and do it globally with specialty DSPs — SSPs become invaluable. We feel very encouraged by the initial direction and believe we are well positioned when the time is right.

Operator: The next question comes from Barton Evans Crockett with Rosenblatt. Please go ahead.

Barton Evans Crockett: Thanks for taking the questions. First, perspective on an environment where agencies could be working with a single integrated interface — through Quad or something — to place outcome-driven marketing dollars across social walled gardens, search, AI environments, and the open web. If the front end is simplified and built on an LLM, does that impact take rates or revenue flows? Do you think that is where it is going? And second, on Google AdTech antitrust: we are sitting here in May without a decision on remedies. If a remedy decision were to come out today, when could you begin to see the impact? Is it pushed into 2027, and how much time would implementation take given legal and technical considerations?

Michael G. Barrett: I certainly think simplified buying tools for agencies that deliver on marketers’ goals are where many people want to go. Our role remains quite valuable and necessary in that world. We are the system of record — the rails upon which the transactions take place. It is one thing to have an agent talk to another agent; it is another to be involved in complex transactions in real time, doing it trillions of times a day. You really need the infrastructure, and that is where we shine. I do not think there is a change to our take rates in that world. It is just easier for sellers and buyers — fewer interfaces and knobs — perhaps freeing up more working media. Our role remains unchanged as that system of record, so I feel confident in the durability of our take rates.

On Google AdTech antitrust, it really depends upon the remedy. Some are behavioral; some would require Google to do technical work. Even in their case, they cited a six- to nine-month window for changing two of the things they were talking about. But I definitely think there would be some instant gains. We see all the inventory, bring it to auction, and our win rate is very low when it goes up against Google. If there were a behavior change, the impact could be somewhat instantaneous. I do not think all the benefits are pushed to 2027. We are disappointed there has not been a ruling yet, but we anticipate a favorable ruling for us and impact in 2026.

Operator: The next question comes from Matthew John Swanson with RBC Capital Markets. Please go ahead.

Matthew John Swanson: Hey, guys. This is Cameron on for Matt Swanson. Congrats on the quarter, and congrats, David. Going back to CTV and DV+ for a second, we have seen CTV hit an inflection point for the business. Last quarter, we talked about accelerated reallocation of budget from DV+ to CTV. While there are areas of growth in mobile and commerce for DV+, to what extent does this reallocation remain a headwind? Has it accelerated this quarter, and do you expect it to continue for the year?

Michael G. Barrett: Great question. I do not know if we have seen an acceleration, and you can see the freshening of DV+ growth rate exceeding our expectation. I think there is stabilization. A big slug of that portfolio is open web display, and it is safe to say that is going to be a negative grower. But could that be outpaced by mobile app, audio, commerce media, and digital out-of-home? Certainly. Our long-term expectation for DV+ is that it is a grower, but it is certainly not going to have the profile of a CTV growth rate. Increasingly, our revenue balance will be more CTV than DV+.

Operator: The next question comes from Analyst with Lake Street Capital Markets. Please go ahead.

Analyst: Hey, guys. Thanks for taking my question. Just a quick one. CTV is now over 50% of total contribution ex-TAC. How should we look at incremental margins on CTV versus DV+? Is there a mix shift that structurally lifts margins by itself, or are there offsetting costs?

David L. Day: It is generally equal. We do not see headwinds by having a greater proportion of our business be CTV. In fact, as we mentioned earlier, we have significant gains in the cost basis on our CTV business with our cloud costs going down. It will not be one of the more significant drivers — more neutral — but positive on the cost side.

Operator: This concludes our question and answer session. I would like to turn the conference back over to Michael G. Barrett for any closing remarks.

Michael G. Barrett: Thank you, Operator. CTV’s long-awaited ramp in programmatic has clearly arrived, and the investments we have made over the past several years are now translating into profitable, scalable growth. We believe CTV is in a powerful phase of its evolution. The shift to programmatic is real, and as the channel matures, it is increasingly taking share from both linear television and other digital formats. Before we close, I want to thank our team at Magnite, Inc. The progress we discussed today is a direct result of your hard work, innovation, and commitment to our partners. Your efforts continue to position us at the center of this transformation. We are confident in the momentum of the business and in the long-term opportunity ahead. Thank you for joining us today. We look forward to updating you next quarter. With that, I will turn it back over to Nick to cover our upcoming marketing events.

Nick Kormeluk: Thanks, Michael. We look forward to seeing many of you at our upcoming investor events. To tick through them for your info and participation: we have a post-Q1 virtual NDR tomorrow hosted by B. Riley; an in-person AI tech demo with SSR in New York City on May 12; the Needham Conference in New York on May 13; the B. Riley Conference in Marina del Rey on May [inaudible]; the RBC Bus Tour in New York on May 27; the Craig-Hallum Conference in Minneapolis on May 28; the BFA Conference in San Francisco on June 2; Rothschild Redburn Investor Meeting in San Francisco on June 3; Evercore’s conference in San Francisco on June 3 as well; a Bronto NDR with RBC on June 9; a Chicago NDR with Benchmark on June 10; the ROTH Virtual AdTech Summit on June 15; and analyst and investor meetings with a variety of our covering analysts in Cannes the week of June 22. Thank you, and have a great evening. We look forward to seeing many of you at our events.

Operator: The conference has now concluded. Thank you for attending today’s presentation. You may now disconnect.