Integral Ad Science at Baird Conference: Strategic Growth and AI Focus

Integral Ad Science (NASDAQ:IAS) presented a strategic overview at the Baird Global Consumer, Technology & Services Conference 2025 on Thursday, 05 June 2025. The company showcased its robust growth and future plans, highlighting a 17% revenue increase in Q1 2024. While there is optimism in their AI-driven strategy and international expansion, challenges remain in navigating the competitive landscape.

Key Takeaways

• Integral Ad Science reported a 17% revenue growth in Q1 2024, with programmatic business up by 24%.
• The company is leveraging AI across its product suite to enhance accuracy and efficiency.
• A significant focus is on expanding social media measurement and capitalizing on short-form video platforms.
• New CFO Alpana Wegner will join on June 10, succeeding interim CFO Jill Putman.
• IAS is targeting double-digit growth and over 30% EBITDA margin, with a focus on emerging markets.

Financial Results

• Q1 2024 saw a 17% increase in overall revenue year-over-year.
• Programmatic business experienced a 24% growth, driven by advertiser budget shifts.
• Publisher business grew by 33%, aided by the Publica acquisition and Oracle account wins.
• International revenue accounted for 31% of total revenue, with an 18% growth in international markets.
• The company raised its 2025 revenue guidance midpoint, indicating strong future prospects.

Operational Updates

• Alpana Wegner is set to become the new CFO, starting June 10, 2025.
• IAS continues to integrate Oracle accounts, focusing on cross-selling and upselling.
• Expansion efforts are directed towards the mid-market segment and emerging markets like Latin America, Southeast Asia, and India.
• The company conducted first-to-market alpha testing in China with luxury brands and CPG companies.

Future Outlook

• IAS plans to invest in social media measurement, particularly on platforms like Meta, TikTok, and YouTube.
• There is a strong emphasis on programmatic optimization and performance-driven solutions.
• The company aims to enhance its CTV presence using the Publica platform.
• Investments in AI and data are set to improve contextual targeting and media quality.

Q&A Highlights

• AI’s impact on IAS includes improvements in accuracy, product velocity, and dynamic optimization.
• Growth levers identified include social platforms, programmatic optimization, and CTV.
• The capital allocation strategy involves paying down debt and exploring M&A opportunities in performance, data, and CTV.
• Success is defined by helping customers achieve higher performance and efficiency in digital advertising.

For a more detailed understanding, readers are encouraged to refer to the full transcript below.

Full transcript - Baird Global Consumer, Technology & Services Conference 2025:

Vic Kasevavotla, Senior Research Analyst, Baird: Awesome. Alright. I think we can go ahead and get started here.

Thanks everybody for joining us today. For those of you who don’t know me, my name is Vic Kasevavotla. I’m one of our senior research analysts here at Baird. I lead our coverage of the Internet sector. Very excited to be hosting the conference this week, and right now, it’s my pleasure to welcome Integral Ad Science to the stage.

And joining me from the company is the CEO, Lisa Schneider. We have about thirty minutes scheduled for this fireside chat. Plenty to talk about, so we’ll dive right in. But Lisa, maybe just to start for the benefit of those who are less familiar with the company, if you could start off just giving us a brief overview of IAS and the value proposition that you offer to your customers.

Lisa Cheniere, CEO, Integral Ad Science: Sure. Thanks, Vic, for having me. And hi, everyone. I’m Lisa Cheniere, CEO of IAS. Pleasure to be here today.

IES, we’re a leading global measurement and optimization company. We’ve been around for fifteen years. I joined the company just six years ago, and we took it public in June of twenty twenty one. Our core customer base are Fortune 500 advertisers. That makes up 84% of our revenue, as well as we have a robust publisher business at 16% of our revenue.

And, ultimately, what we do is we ensure that global brands like a Nestle, a L’Oreal, or a Coke, wherever they run their digital advertising across any tech platform, any DSP, we ensure that their ads are viewed. They’re viewed by humans. No fraudulent bot activity. And, also, their brands run adjacent to brand safe, brand suitable content. In addition to protecting, Fortune 500 brand equity on behalf of these advertisers, we also focus on performance to ensure that the brands are getting the highest efficiency, highest ROI as they run their digital advertising.

Vic Kasevavotla, Senior Research Analyst, Baird: A lot to talk about as it relates to the business, but maybe we can start off just talking about some news from this week, which is that you guys

Lisa Cheniere, CEO, Integral Ad Science: announced the new in the week.

Vic Kasevavotla, Senior Research Analyst, Baird: A new CFO. Maybe you want to spend a minute talking about

Lisa Cheniere, CEO, Integral Ad Science: Yeah, so we were thrilled to announce Tuesday morning of this week that we hired a new CFO. Her name’s Alpana Wegner. She has deep software SaaS experience. She’s been a public CFO in her last two public companies. We were thrilled to bring her on board.

She starts actually next Tuesday, June 10. Prior to Alpana, we’ve had an interim CFO Jill Putman, who has been our audit chair and a board member, and she’s been interim for the last five months. We conducted a robust search. I was deeply involved in the interviews, and we had a really strong slate of CFO candidates. And, again, we’re just thrilled to bring on Alpana.

She has deep financial expertise, deep in FP and A analytics, analyzing monetization, also is a really strong people leader. So just can’t wait for her to start.

Vic Kasevavotla, Senior Research Analyst, Baird: That’s great. Well, looking forward to to getting to to know her. Well, think one of the big themes this week throughout our conversations has been the macro environment. Obviously, you have a unique perspective with the the type of business that you operate. We’d great to hear your perspective on, you know, what you’re seeing out there right now and how advertisers are responding to all the the kind of

Lisa Cheniere, CEO, Integral Ad Science: puts and takes in the backdrop right now. Sure. So from a macro perspective, and I spoke to this in our last, q one earnings call a few weeks ago, I spend a lot of time personally, with our customers, both the brands, the major platforms and publishers, especially over the last few months, just listening intently into their perception of the macro, their plans. And what we’re seeing is more of a shift. We’re not seeing a pullback on ad budgets.

That shift is reflected in our q one results. So we posted strong, earnings in q one, both top line and, from an EBITDA perspective, 17% growth year over year. And the shift I’m talking about is from open web display, to optimization. That’s our programmatic business where we posted 24% growth for the quarter. Brands are leaning into programmatic because of the flexibility of programmatic.

They’re tapping into their working media budgets. They’re loving the fact that we have really doubled down in offering optimization or programmatic products that provide greater transparency, taking the black box out of programmatic buying, linking media quality data with media cost, helping the the brands drive higher outcomes. And from a vertical perspective, we’re very diverse, from a vertical perspective, but the verticals in q one where we really saw strength in leaning into optimization was insurance, the insurance category coming out of the LA fires as well as financial services.

Vic Kasevavotla, Senior Research Analyst, Baird: A lot to unpack there. So maybe maybe it would good to kind of go through each of the different parts of your business and and unpack some of the trends. So maybe first, you referenced the q one results. You know, in your measurement segment, you guys have talked about kind of this bifurcation of growth between social and the open web. You you just referenced it just now in your last answer.

Maybe you could elaborate a little more on what you’re seeing in those two environments, and as you play this forward, how you think that can affect your business and get your perspective there.

Lisa Cheniere, CEO, Integral Ad Science: Sure. As I like to say, with the major marketers, the brands want to be where the users are. And where the users are spending a disproportionate amount of their time, I know I see it in my house with a teenager, they’re spending it on social platforms, right, especially with the explosion of short form video, viewing content, sharing content, ingesting content, short form video, and then also within the landscape of CTV or streaming. And because that’s where the users are spending their time, the brands, they are shifting billions and billions of ad dollars into CTV and the social platforms, tailwind for our business. So in Q1, we had social growth of 15%, which we’re very pleased with.

We’re very pleased with the adoption we’re seeing of our social measurement products. You’re familiar with total media quality. That’s our post measurement classification of the live feeds in of the social platforms. The brands want to rest assured wherever they’re running their digital advertising, whether it be the major social platforms like a Meta, YouTube, TikTok, as well as back half of last year launching the product in Pinterest and Reddit as well as Snap. They just want to know where they’re running their ads.

It’s brand safe and brand suitable. So that again is a reflection of the adoption of that product that we’re seeing, as well as I mentioned before, optimization in particular. Last year, over the last, I’d say twelve to eighteen months, we’ve really invested both on the back end when it comes to all things optimization from a product perspective, from a streamlining and simplifying the integrations within the DSPs so that we have pre bid post bid capability. We brought in a new chief product officer, Sristi Gupta, as well as new product leaders who are fluent in all things programmatic. And we’ve been beefing up our front end too from a sales and service perspective, bringing in more programmatic expertise.

And the clients are loving the value that we’re driving, they love the transparency that we’re offering in performance.

Vic Kasevavotla, Senior Research Analyst, Baird: Few things I want to come back to there, but maybe we should spend a minute also just talking about your publisher business. It seems like that’s been a great source of strength for you. The segment I think has been growing above the consolidated average for the past few quarters. So what’s driving that part of your business?

Lisa Cheniere, CEO, Integral Ad Science: Yeah, sure. So we were also pleased with our 33% growth in Q1 on Publisher. A couple of tailwinds to speak to on our Publisher business. Publica is a leading CTV platform. We actually acquired Publica shortly after taking the company public.

It’s a big differentiator, for IES as we’re helping large OEMs like Samsung drive higher yields, higher monetization of their programmatic CTV inventory. Over the last, I’d say, six to twelve months, we have been really focused on refining the bidding capabilities and functionalities within Publica, and you’re seeing the results of that. And that is a tailwind for our publisher business. And then with our traditional publishers, so we have integrations with over 400 publishers. So think of publishers like the New York Times, like Reuters, that have adopted IAS’s verification measurement solutions.

And we’re seeing nice uptick there, especially with the Oracle wins that we made last year. It was the summer of Oracle, as you know, last year. And we won a good amount of publisher business, and we’ve integrated those publishers, and they’re now ramping.

Vic Kasevavotla, Senior Research Analyst, Baird: Yep. That would be a good segue because I was going to ask about the Oracle wins from last year. Just maybe talk a little bit more about how those integrations are going. And know part of the view is the ability to cross sell more products to those customers over Where does that stand and what’s your perspective on that today?

Lisa Cheniere, CEO, Integral Ad Science: Sure. One of my favorite topics. So last year, as everyone recalls, Oracle exited their advertising business in June. And what was a three horse race has become now a two horse race. So last summer, the team did a great job of winning a sizable amount of the Oracle accounts.

We had over a 70% win rate. We won over 75 accounts as well as we brought their talent over. Everyone knows how strong the Oracle talent is. So we hired the global CRO of the Oracle advertising business, Mark Rebowski, as well as brought over 30 employees. And I think of Q4 of last year as the integration onboarding of this new business.

The new business included brands and publishers and platforms. And now the team is cranking on cross sell and upsell. And with this robust business, we continue to target double digit growth for our business as well as north of 30% EBITDA margin. And this is beyond the 2025 guide that we shared in our q one earnings call.

Vic Kasevavotla, Senior Research Analyst, Baird: Maybe staying with that theme of customer focus. You’ve talked a lot about recently just the new focus on or not new, but continued focus on the middle markets part of the segment. You obviously mostly work with large advertisers today. Just talk a little bit about why that middle market opportunity could be significant and the process you’ve gone about going to market with that group relative to your main customer base.

Lisa Cheniere, CEO, Integral Ad Science: Yeah. So we see mid market as a new revenue channel for IS. Think of it as a new TAM. So our as I mentioned before, our existing customer base, we have over 2,000 advertisers, many of them Fortune 500 accounts, brand marketers, and they make up the majority of our revenue today. Mid market, we define it as spending between 200,000 and a million on IS annually.

And when you take a look at the mid market channel, these are performance marketers. So these are performance marketers who deeply care about efficiency, ROI, selling as many products as they can, signing up as many new subscribers as they can. And they know that because of our programmatic offerings, we have tools today where we can provide greater transparency into their programmatic buying, so it’s less of a black box. We can connect the media quality signals with the media cost, a QCPM, so that the advertisers have a better understanding of how we’re driving efficiency and ROI. And they provide their outcome data to us so that we can connect the dots and say, based on the hundred thousand dollars you spend in Google DB three sixty, here’s the transparency of what’s happening with that hundred thousand.

Here are the SSPs that are efficient and performing well. Turn them up real time. Here are the SSPs that are inefficient. Turn them off. And because of that transparency, we helped you sign up new more subscribers.

And here is the incremental return, from investing in our products. We then take that outcome data and we feed it right back into our models so that for future bidding, that advertiser gets, almost dynamic optimization from us so that we help that advertiser better understand, don’t bid on this impression, bid on that one. It has higher media quality, higher likelihood of driving up more subscribers for you. This product is called Total Visibility. It has completely taken off.

It is the sweet spot of mid market because we are combining that media quality, media cost to outcome. We saw a tremendous adoption rate last year, and it is a reflection of that 24% growth I mentioned in q one. ’1 other data point that we’re seeing from a programmatic perspective, getting back to Oracle, is now that we’ve onboarded these Oracle accounts, and Oracle did have a robust mid market business, in Q1, we’re actually seeing accelerated adoption rate out of the previous Oracle targeting customers. And we’re seeing accelerated revenue out of those Oracle targeted or performance customers. So again, it’s a testament to the value that we’re offering to our entire advertiser base.

Also, great work the team is doing in demonstrating the value and driving the cross sellupsell.

Vic Kasevavotla, Senior Research Analyst, Baird: And maybe just staying along that theme of customer segments, another area that seems to be growing well is your international business. Maybe just talk a little bit about what you’re doing with that group and how you’re going to market and which countries you

Lisa Cheniere, CEO, Integral Ad Science: think represent the biggest opportunities right now for you. Sure. We’re very, very pleased with our international performance too. It’s a big differentiator between us and our nearest competitor. We break out the full revenue in international, represents 31% outside of The Americas.

Q1, we posted 18% growth in international, and, and it reflects the breadth and depth of the relationships we have in major regions like EMEA, like APAC, the investments we’re making in emerging markets like Latin America, Southeast Asia, India, and we also announced first to market in China in December, where we’ve been running an alpha. The verticals in particular that have been asking about China, the alphas with luxury brands, luxury CPG. And we also had an event in Shanghai with 40 potential partners sharing how our capabilities are available to global brands who want to run verification when they’re running digital advertising in China, as well as offering IES’ solutions outside of China. So those emerging markets in particular, we’re seeing tremendous growth. We’re very thoughtful about putting where we put the boots on the ground, both from a sales and service perspective.

But again, we’re very, very pleased with our international growth. Yeah.

Vic Kasevavotla, Senior Research Analyst, Baird: Maybe I want to shift gears a little bit and talk about product development and and what’s evolving there. You know, one of the other big themes at this conference this week has been AI and the impact that’s having on different industries and companies. Would be great to hear your perspective on AI, how that’s going to affect your business and some of the use cases that you’re seeing emerging and maybe how that’s affecting your approach to tech and development of the company.

Lisa Cheniere, CEO, Integral Ad Science: Yeah, sure. So science is in the name of We’ve been in AI or leveraging AI for years. A third of our engineering team is made up of data scientists. When you take a look at the suite of our products, the majority of our products are powered by AI. Premium products like total media quality, the classification product, context controls, our contextual targeting solution, our new products in 2025, and they are all out in market mid q two.

I mean, talk about shipping fast. The majority of our new products too are powered by AI, But we view AI as a critical tool to both improve the accuracy of our classification products, the velocity of shipping our products, dynamic optimization, as I mentioned before, enabling brands and helping brands to drive up performance, drive up efficiency and ROI. So we are all in in AI, both from a product and tech perspective. But I would say we are AI first in running our company too. So we have a complete corporate AI strategy for the company.

We are going across all of the functions internally, whether it be finance, service, sales. I could keep going marketing, and have a robust plan in terms of how we’re driving efficiencies, how we’re freeing up time for employees to spend less time on the manual stuff and more time on the mission critical stuff that matters for customers. And this corporate strategy we review on a quarterly basis with our board.

Vic Kasevavotla, Senior Research Analyst, Baird: Yep. And maybe to put a finer point on on some of the things you mentioned there. You know, feels like the last couple of years have been, you know, very robust in terms of new product announcements, the the growth of the portfolio that you’re offering. Just as you think about the product road map going forward or partnership roadmap, what should investors kind of be looking out for as opportunities for you over the next few years?

Lisa Cheniere, CEO, Integral Ad Science: Yeah, great question. So I would say when you take a look at the growth levers for the business, it stays within the wheelhouse that we’re in, in terms of social, right? So the largest social platforms will continue to innovate with Meta, with TikTok, with YouTube, continue to drive adoption of the post measurement total media quality. We have global brands that have adoption, for example, in a hundred markets. That is dozens of languages.

That is meaningful scale. Continue to drive that cross sell, upsell, continue to drive, pre bid social optimization on the metas and TikToks of the world so that a brand can say, okay, when I am in meta, I want to identify the content I want to be adjacent to, the content I want to not be adjacent to, and then confirm it once the impressions run. So social platforms really important runway. And there are additional inventories within those platforms that we have yet to launch our solutions. Second lever is all things optimization.

And you can see it loud and clear with the 24% we put up, but the brands, they deeply care about greater transparency and programmatic buying, seeking out solutions that are differentiated, that drive up performance, efficiency, outcomes, and we will continue to invest in all things performance, and especially go after the programmatic CTV inventory. CTV, that’s the fastest growing channel. We’ve made deep investments in CTV. We love the 33% growth that we’re putting on the board. So I would say those three areas in particular.

And then the other area where we’re investing a lot of time and energy right now is in our data, in terms of productizing our data, leveraging our media quality data, layering our media quality data on top of interesting third party data sets. So we have a partnership with TrueData. We’re layering their audience data. We’re layering brands first party data to create enhanced contextual targeting, again, to drive up that efficiency and ROI. So again, we see lots of runway, lots of greenfields, both on a channel platform perspective, but also continue to drive cross sell, upsell with our enterprise accounts.

Those are the top 100. Go hard after mid market. Continue to invest in the emerging markets.

Vic Kasevavotla, Senior Research Analyst, Baird: Okay. It might be a good segue to talk about just some things as it relates to this year. You know, wanna talk about the the guidance for 2025. When you posted Q1 results, you raised the midpoints of the guide for 2025. Obviously, lot of puts and takes in the backdrop right now.

What gave you the confidence to raise the guidance for this year despite all the changing dynamics in the macro that we’re seeing?

Lisa Cheniere, CEO, Integral Ad Science: Sure. So we’re pleased again with our Q1 performance and the fact that to your point we moved up the midpoint of the annual guide and posted the 12% growth for the annual guide. A few things that we talked about on the call that continue to be the tailwind. It’s the bet that we made on performance. We made a big bet last year on performance.

It is clearly paying off with that 24% in Q1. The differentiation that we’re offering the brands, the fact that we’re helping the brands drive efficiency, ROI, differentiated value, we’re feeling very confident about our performance capabilities. The second is the fact that we have diversification in our verticals. We aren’t overly dependent on one vertical or another. And across the verticals, we are just seeing strength with the product adoption.

And then also, as we spoke to before, at a macro level, we’re seeing a shift and we’re seeing a shift towards performance. That’s the big bet we made last year. We have all of our products in market in 2025. So it’s all about execution as a team, continue to execute the business, continue to drive value.

Vic Kasevavotla, Senior Research Analyst, Baird: And you touched on this a little bit in your prior answer, but as we think about the biggest areas of investment for 2025, anything you’d call it in particular? Dunson, you touched on a lot of it in your prior answer, but anything else you’d mention on that front?

Lisa Cheniere, CEO, Integral Ad Science: Yeah, just to reiterate, the investments include: continue to strengthen our classification capabilities. Our technology is differentiated in the market. We hear that loud and clear. We see it with our 15% growth in social. Meta selected IES last summer to build the pre bid social optimization with Meta, which is now in market.

That is a reflection that’s not even just our customers are seeing the differentiation of our classification tech. The platforms are seeing it too. So continue to invest in the modeling, in AI, so that we can detect all the inappropriate stuff at greater velocity, greater accuracy, continue to double down in performance. Again, we love the adoption rate that we’re seeing. We love the value that we’re driving.

CTV continues to be a long game, continued investment there, as well as our data strategy. And we love the green shoots that we’re seeing in these enhanced contextual segments that we’re offering to brands. And again, it all comes down to executing the business. And I couldn’t be prouder of our team right now in terms of how we’re executing the business and just keep doing that in 2025.

Vic Kasevavotla, Senior Research Analyst, Baird: And maybe we can spend a minute touching on capital allocation as well. Obviously a very profitable company, a lot of free cash flow as well. How are you thinking about capital allocation right now?

Lisa Cheniere, CEO, Integral Ad Science: Yeah, so we are pleased with the fact that we paid down our debt. M and A is we continue to apply a build partner by lens to everything that we do, and we’re taking a look at interesting M and A opportunities tied to what I spoke to before, things like performance, interesting data sets, outcomes, and CTV.

Vic Kasevavotla, Senior Research Analyst, Baird: Just about coming up on time here, I wanted to leave a little bit at the end just to maybe ask you, when we fast forward twelve months here at this conference again, what’s going to define success for IAS? What are you most excited about and what are you looking to measure progress in this upcoming year?

Lisa Cheniere, CEO, Integral Ad Science: Great question. I would define success based on our customers’ success. Our customers’ success is helping them drive higher performance, higher outcomes, higher efficiency in wherever they’re running digital impressions. We ride along every single impression with them and our customer success is our success. And with that, the customers, again, they are hitting their ROI metrics.

They continue to adopt our products. They continue to lean into our solutions. And we continue to grow the company, as I mentioned before, targeting that double digit growth.

Vic Kasevavotla, Senior Research Analyst, Baird: I think that might be a good place for us to wrap up here. Well, thank you Lisa for joining us today. Thanks to everyone in the audience. Everyone. Let us know if you have any follow ups and we’ll leave it there.

Thanks everybody.

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