NEW YORK - Magnite (NASDAQ:MGNI), a leading sell-side advertising platform, has extended its contract with Disney for an additional two years, strengthening a partnership that now enters its sixth year. Under this agreement, Magnite will remain Disney's preferred supply-side platform, managing programmatic advertising transactions across Disney's vast media portfolio.
This collaboration allows Disney to monetize its ad-supported content, including streaming inventory, by connecting with over 30 demand-side platforms (DSPs) in the United States, with plans to expand this reach globally. Jamie Power, SVP of Addressable Sales at Disney, emphasized the importance of automation and the ease of transactions for clients, highlighting Magnite's role in facilitating buyers' access to Disney's inventory.
The extended partnership will also see Disney utilizing Magnite's ClearLine offering for executing direct deals with key buyers and the monetization of college football live streams on ESPN. Additionally, Disney aims to broaden its advertising reach in Latin America, targeting countries such as Brazil, Chile, Colombia, Mexico, Peru, and Argentina. Podcast inventory, including content from ESPN and ABC News podcasts, will be offered via private marketplaces (PMPs).
Sean Buckley, Chief Revenue Officer at Magnite, expressed gratitude for Disney's continued trust and the opportunity to innovate together, particularly in new areas like live streaming.
Magnite, headquartered in New York with offices globally, provides publishers with technology to monetize content across various platforms, including connected TV (CTV), online video, display, and audio. The company's platform is trusted by agencies and brands worldwide for accessing quality ad inventory and facilitating a significant volume of advertising transactions monthly.
The information for this report is based on a press release statement from Magnite, Inc.
In other recent news, Magnite has exceeded its top-line guidance for Q2 2024, reinforcing its position in the Connected TV (CTV) market. Despite a net loss of $1 million, the company's adjusted EBITDA rose to $45 million, marking a 20% year-over-year increase. Magnite's cash balance also grew to $326 million, which the company plans to use for share repurchases, small acquisitions, and debt repayment.
Benchmark, B.Riley, and Needham have all maintained their Buy ratings on Magnite, despite Disney's Real-Time Ad Exchange (DRAX) discontinuing the use of Magnite's services. The analysts from these firms suggested that the market's response to this development was excessive, as DRAX represents a minimal portion of Magnite's projected net revenue for fiscal 2024.
In addition to the recent developments, Magnite has solidified partnerships with companies like Netflix (NASDAQ:NFLX), United Airlines, and Roku (NASDAQ:ROKU). These partnerships are expected to drive future growth. The company anticipates continued growth in the CTV sector and reaffirms its full-year expectation of at least 10% growth in contribution ex-TAC.
InvestingPro Insights
Magnite's extended partnership with Disney underscores the company's strong position in the digital advertising market, particularly in the rapidly growing connected TV (CTV) sector. This aligns with several key metrics and insights from InvestingPro.
According to InvestingPro data, Magnite's revenue growth stands at 7.5% over the last twelve months, with a quarterly growth of 6.78% in Q2 2024. This growth trajectory is likely to be bolstered by the renewed Disney contract, which could contribute to the expected increase in net income this year, as suggested by one of the InvestingPro Tips.
The company's market capitalization of $1.7 billion reflects its significant presence in the ad-tech industry. Despite not being profitable over the last twelve months, analysts predict that Magnite will turn profitable this year, as noted in another InvestingPro Tip. This optimism may be partly due to strategic partnerships like the one with Disney.
Investors should note that Magnite's stock has shown a large price uptick over the last six months, with a 36.54% total return. This performance aligns with the InvestingPro Tip highlighting the company's high return over the last year, which stands at an impressive 71.21%.
For those interested in a deeper analysis, InvestingPro offers additional tips and insights, with 11 more tips available for Magnite. These could provide valuable context for understanding the company's financial health and market position as it continues to expand its partnerships in the digital advertising space.
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