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Magnite, Inc. (NASDAQ:MGNI) presented its first quarter 2025 financial results on May 7, showing solid growth across key metrics while expressing caution about the economic outlook. The ad tech company reported revenue of $155.8 million, up 4% year-over-year, while its preferred metric of Contribution ex-TAC grew 12% to $145.8 million.
Quarterly Performance Highlights
Magnite delivered strong financial results in the first quarter, with significant improvements in profitability metrics. The company’s Adjusted EBITDA surged 47% year-over-year to $36.8 million, with margins expanding to 25% from 19% in the same period last year. Non-GAAP earnings per share more than doubled to $0.12 from $0.05 in Q1 2024.
"Our Q1 2025 performance exceeded guidance across all key metrics," the company stated in its presentation. The Connected TV (CTV) segment continued to be a growth driver, with Contribution ex-TAC attributable to CTV increasing 15% year-over-year to $63.2 million.
As shown in the following summary of Q1 2025 financial performance:
The company’s Display, Video and Other (DV+) segment also performed well, with Contribution ex-TAC growing 9% year-over-year to $82.6 million. Despite the positive revenue growth, Magnite still reported a net loss of $9.6 million, though this represented a 46% improvement from the $17.8 million loss in Q1 2024.
A comprehensive breakdown of the company’s financial performance shows consistent improvement across most metrics:
Strategic Partnerships
Magnite highlighted several significant partnerships and customer wins during the quarter, reinforcing its position in the digital advertising ecosystem. The company unveiled the next generation of SpringServe, combining ad server capabilities with advanced Magnite Streaming SSP features.
Notable partnerships include Netflix (NASDAQ:NFLX)’s ad tech platform going live in the US, with programmatic capabilities now available in UCAN, EMEA, and LATAM regions, and APAC launch planned for later in Q2. Magnite also expanded its relationship with Disney (NYSE:DIS) for Disney+ inventory and sports across multiple regions, and was named as a global partner for Spotify (NYSE:SPOT) Ad Exchange.
The following slide details these strategic partnerships:
The company’s revenue continues to be predominantly generated in the United States, which accounted for 75% of total revenue in Q1 2025. From a channel perspective, CTV represented 43% of Contribution ex-TAC, followed by Mobile at 40% and Desktop at 17%.
This breakdown of revenue streams by channel and geography illustrates the company’s diverse business mix:
Guidance and Outlook
Looking ahead to the second quarter, Magnite provided guidance while acknowledging economic uncertainties. The company widened its typical guidance ranges for Q2, assuming some softening in the back half of the quarter related to higher-risk verticals such as auto, retail, and travel.
For Q2 2025, Magnite expects:
- Total (EPA:TTEF) Contribution ex-TAC between $154 and $160 million
- CTV Contribution ex-TAC between $70 and $72 million
- DV+ Contribution ex-TAC between $84 and $88 million
- Adjusted EBITDA operating expenses between $110 and $112 million
The company noted that performance in Q2 to date has been in line with prior expectations. However, due to tariff-driven economic uncertainty, Magnite is not reaffirming its full-year 2025 expectations.
The detailed guidance is presented in the following slide:
This cautious approach represents a shift from the company’s outlook in Q3 2024, when it raised full-year growth expectations for Contribution ex-TAC to 11-12% and anticipated being GAAP net income positive for the full year.
Balance Sheet and Cash Flow Analysis
Magnite continues to strengthen its balance sheet, with the net leverage ratio improving to 0.6x in Q1 2025, down from 0.9x reported in Q3 2024 and significantly lower than the 6.2x reported in Q2 2021. This demonstrates the company’s consistent focus on debt reduction and financial stability.
The trend in net leverage ratio is illustrated in this chart:
The company reported cash and equivalents of $429.7 million as of March 31, 2025, down from $483.2 million at the end of 2024. Total debt stood at $556.6 million, resulting in a net debt position of $126.9 million.
Operating cash flow, excluding working capital changes, was $18.2 million in Q1 2025, compared to $10.3 million in Q1 2024. Capital expenditures increased to $18.6 million from $14.7 million in the prior year period.
The following slide provides a detailed breakdown of cash flow and balance sheet highlights:
Magnite’s financial results for Q1 2025 demonstrate continued momentum in revenue growth and significant improvement in profitability metrics. However, the company’s cautious outlook for Q2 and reluctance to reaffirm full-year guidance suggest potential headwinds in the coming quarters due to broader economic uncertainties.
The stock closed at $12.33 on May 7, up 1.05% for the day, suggesting investors were generally positive about the quarterly results despite the cautious forward guidance.
Full presentation:
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