"The Trade Desk , a former highflying digital advertising disruptor, has fallen on hard times this year. Just how hard? The former market darling is neck and neck with financial stock Fiserv as the worst-performing stock in the S&P 500 Index in 2025, having shed 66.2% of its value this year through Dec. 9. A decline like that could portend longer-term secular problems, but could also signal a buying opportunity. So, which is it for the Trade Desk? Let's dig in."
"The problems for The Trade Desk emerged early in the year, when the company missed revenue estimates for its fourth-quarter 2024 earnings release in February. That ignominiously marked the company's first "miss" in 33 quarters, or eight years, as a public company. Revenue did grow more than 22% that quarter, so it wasn't as if results totally fell off a cliff. Still, this year is on pace for a significant deceleration in growth."
"Factoring in The Trade Desk's fourth-quarter outlook, revenue is on pace for $2.89 billion, which would mark 18.2% growth -- an 8-percentage-point deceleration from 2024. In addition, margins are expected to compress, with adjusted ( non-GAAP) earnings per share projected to grow by just 7.2% in 2025. Again, these aren't bad numbers by any means, but with the stock entering the year trading around 71 times adjusted EPS, there wasn't much room for error."
The Trade Desk's stock plunged 66.2% through Dec. 9, 2025, making it one of the worst-performing S&P 500 stocks this year. The company missed revenue estimates for its fourth-quarter 2024 earnings release in February, marking the first miss in 33 quarters. Revenue grew over 22% that quarter, but full-year revenue is on pace for $2.89 billion, or 18.2% growth, an 8-percentage-point deceleration from 2024. Adjusted non-GAAP EPS is projected to grow just 7.2% in 2025, and margins are expected to compress. The stock entered the year trading around 71 times adjusted EPS, leaving little margin for error. Several factors cited include a tough 2024 election-year comparison and a rapid pace of spend.
Read at The Motley Fool
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