Magnite Q2 Earnings Call Highlights
Key Points
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- Magnite exceeded Q2 expectations, with revenue rising 11% to $193 million and Contribution ex-TAC increasing 17% to $190 million. CTV led growth, up 36% year over year, while Adjusted EBITDA rose 30% to $71 million, producing a 37% margin.
- The company raised its full-year outlook, now expecting Contribution ex-TAC growth of 13%–14%, Adjusted EBITDA growth above 20%, a margin of at least 37%, and free-cash-flow growth in the high-40% range.
- Magnite is expanding its CTV and commerce-media businesses through partnerships with major media owners and retailers, while developing AI-enabled advertising tools. Management said agentic advertising remains early but could eventually broaden the programmatic market.
Magnite (NASDAQ:MGNI) reported second-quarter results that exceeded its expectations, driven by continued growth in connected television and a return to growth in its DV+ business. The company raised its full-year outlook for Contribution ex-TAC, Adjusted EBITDA growth, margin expansion and free cash flow.
Chief Executive Officer Michael Barrett said total Contribution ex-TAC exceeded consensus expectations by approximately $10 million, with CTV contributing about $6 million of the outperformance and DV+ adding roughly $4 million. Adjusted EBITDA exceeded consensus by $8 million, producing a 37% margin.
“We significantly exceeded expectations across the business,” Barrett said, citing broad-based CTV strength and improving trends in DV+. He said the company expects its momentum to continue.
Q2 Results Led by CTV Growth
Total revenue in the second quarter was $193 million, up 11% from the same quarter of 2025, according to CFO David Day. Contribution ex-TAC rose 17% to $190 million, exceeding the high end of the company’s guidance range.
- CTV Contribution ex-TAC increased 36% year over year to $97 million.
- DV+ Contribution ex-TAC rose 2% to $93 million.
- CTV represented 51% of total Contribution ex-TAC, while mobile represented 35% and desktop accounted for 14%.
- Adjusted EBITDA increased 30% to $71 million, with a 37% margin, compared with 34% a year earlier.
- Net income was $19 million, compared with $11 million in the prior-year quarter.
- GAAP diluted earnings per share were $0.13, versus $0.08 a year earlier, while non-GAAP EPS was $0.26, compared with $0.20.
Day said health and fitness, technology and finance were the strongest advertising verticals during the quarter. Automotive, which had been the company’s largest declining category in the first quarter, returned to growth but remained depressed.
Magnite ended the quarter with $333 million in cash, up from $185 million at the end of the first quarter. Operating cash flow, defined by the company as Adjusted EBITDA less capital expenditures, was $57 million. Net leverage stood at 0.1 times at quarter-end.
The company repurchased or withheld more than 2.1 million shares for approximately $28 million during the quarter. Through the first half of 2026, it repurchased or withheld approximately 4.4 million shares for about $57 million. Magnite had $165 million remaining under its repurchase authorization, which runs through February 2028.
CTV Adoption and International Expansion
Barrett said Magnite’s top 10 CTV accounts grew at a mid- to high-40% year-over-year rate. He attributed the growth primarily to greater adoption of programmatic advertising by premium streamers and buyers, as well as a greater willingness by publishers to use Magnite to bring in demand from DSPs and advertisers with whom they do not have direct relationships.
Magnite reported strong growth across large media owners including Disney and ESPN, Netflix, Roku, VIZIO Walmart and Warner Bros. Discovery. Barrett also highlighted international expansion as a growth driver, saying major streamers rely heavily on programmatic channels to activate demand in markets where they may not have local direct-sales operations.
Mobile in-app, meanwhile, grew 17% year over year. Barrett said Magnite views the market as an attractive long-term opportunity, supported by deeper DSP integrations, publisher onboarding and its SDK strategy.
Day said the difference between CTV revenue growth and CTV Contribution ex-TAC growth was attributable to the declining managed-service business. Managed services represented about 9% of Magnite’s CTV business a year ago and approximately 2% in the second quarter, according to Day. He said the managed-service decline should begin to be lapped early next year.
SpringServe, Commerce Media and AI Strategy
Barrett characterized SpringServe as Magnite’s operating system for CTV monetization, encompassing ad serving, mediation, monetization, demand facilitation and data enablement. During the quarter, Samsung selected SpringServe to power ad serving for premium smart-TV home-screen inventory and open that inventory to programmatic buying through Magnite’s DSP ecosystem.
The company also cited an expansion with WPP, which added pause ads to its media supply hub enabled by SpringServe and integrated open audience segments through ClearLine.
Magnite said 21 commerce-media partners are now deployed and actively ramping across DV+ and CTV. Those partners include Fanatics, CVS Media Exchange, Best Buy and PayPal Ads. Through its Walmart Connect partnership, Magnite is combining Walmart first-party commerce data with premium CTV inventory, including VIZIO supply, while supporting off-site execution and closed-loop measurement.
The company also introduced Magnite Orchestration, which Barrett described as an infrastructure layer designed to enable agents from buyers, sellers, data providers and measurement firms to operate in a trusted environment. Disney Advertising, Spectrum Reach, Kepler, MiQ, Publicis Media Exchange, Dentsu and DirecTV are working with components of Magnite’s AI suite, he said.
Barrett said agentic advertising remains in an early “crawl” phase. He said Magnite has transacted a handful of millions of dollars through agentic tools to date and does not expect that channel to represent a majority of company spend in the near term. Still, he said agentic tools could expand the programmatic addressable market by bringing direct insertion-order deals into the programmatic ecosystem.
Raised Outlook and Margin Expectations
For the third quarter, Magnite expects total Contribution ex-TAC of $188 million to $192 million, representing year-over-year growth of 13% to 15%. CTV Contribution ex-TAC is projected at $98 million to $100 million, or growth of 29% to 32%, while DV+ is expected to range from $90 million to $92 million, representing a decline of 1% to growth of 1%.
The company expects third-quarter Adjusted EBITDA operating expenses of $119 million to $121 million, implying an Adjusted EBITDA margin of 36% to 38%.
For the full year, Magnite raised its forecast for total Contribution ex-TAC growth to 13% to 14%, from prior guidance of at least 11%. It now expects Adjusted EBITDA growth of more than 20%, compared with a prior expectation of mid-teens growth, and Adjusted EBITDA margin of at least 37%, up from at least 35.5%.
Magnite also raised its expectation for free cash flow growth to the high-40% range from the mid-30% range, while reaffirming approximately $60 million in capital expenditures.
Day said the company remains conservative in its outlook due to potential macroeconomic risks. Its forecasts do not include potential market-share gains from remedies that could emerge from the Google Ad Tech trial, for which Magnite said it had no update.
Day, who plans to retire at the end of September after more than 13 years with the company, said Magnite expects continued margin expansion through revenue growth, technology-cost efficiencies and increased use of on-premises infrastructure. He said the company’s historical long-term Adjusted EBITDA margin range of 35% to 40% should not be viewed as a cap on its potential.
About Magnite (NASDAQ:MGNI)
Magnite, Inc (NASDAQ: MGNI) operates as an independent sell-side advertising platform that enables publishers and digital media owners to monetize their inventory through programmatic advertising. Formed in 2020 through the merger of Rubicon Project and Telaria, Magnite combines technologies for desktop, mobile, connected television (CTV) and digital out-of-home (DOOH) ad exchanges. The company provides an end-to-end solution designed to help media owners optimize yield across open marketplaces, private marketplaces and programmatic guaranteed deals.
At the core of Magnite's offering is its supply-side platform (SSP), which connects publishers' ad impressions to demand-side platforms (DSPs) through real-time bidding (RTB).
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