Trade Desk Inc. (NASDAQ:TTD)

Gross Profit Margin

The gross profit margin shows a stable and high profitability trend, starting near 79% in early 2021 and peaking around 82.18% towards the end of 2022. Following this peak, a gradual decline is observed through 2023 and into 2025, with the margin tapering down to approximately 78.81%. This indicates a slight erosion in cost control or pricing power over time, though the margin remains relatively strong.

Operating Profit Margin

The operating profit margin exhibits significant volatility over the observed periods. There is a notable increase from about 15.78% in early 2021 to a high of roughly 22.9% by the third quarter of 2021. However, this is followed by a sharp decline towards negative territory in late 2022 (-0.8%), indicating a period of operating losses or higher operating expenses. After this trough, the margin gradually recovers through 2023 and into 2025, trending upwards to close to 18.91%. This pattern suggests cyclical challenges in operational efficiency or elevated costs, eventually addressed to improve profitability.

Net Profit Margin

The net profit margin mirrors the fluctuations seen in the operating margin but with generally higher values, peaking near 27% in the first quarter of 2021. This margin declines sharply in 2022, even dipping into negative in the third quarter (-0.66%), signaling a period of net losses. The subsequent recovery is steady and sustained, reaching approximately 15.72% by early 2025. The net margin trend indicates that after a challenging phase, the company managed to restore profitability at the bottom line, albeit at a lower level than the initial peak.

Return on Equity (ROE)

ROE trends align with overall profitability patterns, starting above 22% in early 2021 and decreasing sharply to negative territory by the third quarter of 2022 (-0.51%). This decline implies diminished returns to shareholders over that period. The data show a recovery phase following this low point, climbing steadily to nearly 17% by early 2025. This improvement suggests enhanced efficiency in generating profits from equity investments after the interim difficulties.

Return on Assets (ROA)

ROA displays a modest but consistent downward trend from about 9.4% in early 2021 to a low point below zero in late 2022 (-0.25%). Post this period, it rises gradually, reaching roughly 7.38% by early 2025. This trajectory reflects challenges in asset utilization during the middle periods, followed by a gradual resumption of effective asset management contributing to increased profitability.

Revenue Trends

The revenue showed a steady and substantial increase over the presented periods. Beginning at approximately $220 million in March 2021, the revenue grew consistently each quarter, reaching an estimated $739 million by September 2025. The growth rate appears robust, with no significant declines, indicating sustained business expansion.

Gross Profit Trends

Gross profit followed a similar upward trajectory to revenue, starting at approximately $169 million in March 2021 and increasing to about $577 million by September 2025. The growth in gross profit aligns with the revenue growth, demonstrating effective cost management relative to sales expansion across the period.

Gross Profit Margin Analysis

The gross profit margin remained relatively stable throughout the periods, fluctuating slightly around the 80% mark. Initially, the margin was close to 79%, peaking above 82% in late 2022. However, there is a subtle downward trend in the margin towards the end of the data set, declining to approximately 79% by September 2025. This suggests that while gross profitability remained strong, there was a mild compression in margin percentages over time.

Summary of Insights

The data indicates consistent and strong growth in both revenue and gross profit over multiple quarters. The stability of the gross profit margin near 80% throughout the period reflects a balanced relationship between revenue growth and cost control. The slight decrease in margin towards the latter periods might warrant monitoring to ensure continued operational efficiency. Overall, the financial trend reflects positive performance with significant scaling of business activities.

Revenue Trends

The revenue exhibits a general upward trend over the analyzed quarters, starting from approximately $220 million and rising to around $739 million by the last reported period. Periodic fluctuations are evident, with some quarters showing sharper increases, especially from the end of 2021 onwards. This steady growth in revenue suggests an expanding business scale or improved market penetration over time.

Income (Loss) from Operations

The operating income shows significant volatility throughout the periods. There are instances of operating losses, notably at the end of 2021 and early 2023, with values turning negative in those quarters. In contrast, other quarters, particularly in late 2022 and the subsequent years, demonstrate strong positive operating income, reaching peaks well above $100 million. This volatility indicates periods of operational challenges followed by recoveries and strengthened profitability.

Operating Profit Margin

The operating profit margin initially shows moderate levels, exceeding 20% in some quarters of 2021, but then declines sharply, even turning negative in one quarter of 2022. After this decline, margins gradually recover and improve steadily, reaching near 19% by the latest quarter. The margin trend implies effective cost control and operational efficiencies being restored and enhanced over time despite intermittent setbacks.

Summary of Financial Performance

Overall, the financial data reveal a pattern of substantial revenue growth coupled with fluctuations in operational profitability. Early signs of operational stress are apparent through loss-making quarters and depressed margins, but subsequent periods show a solid return to profitability and margin expansion. The improvements in profit margins toward the more recent periods indicate a strengthening operational model and enhanced earnings quality relative to revenues.

Revenue

Revenue demonstrated a consistent upward trend from March 2021 through December 2024, beginning at approximately 220 million USD and peaking around 741 million USD in December 2024. After a slight decline in early 2022, revenue rebounded strongly and maintained steady growth through 2023 and 2024, with quarterly increases reflecting expanding business operations or market demand.

Net Income (Loss)

Net income exhibited significant volatility over the examined periods. Initial quarters showed positive earnings, reaching a peak around September 2021 with nearly 59.4 million USD. However, the company experienced losses in early to mid-2022, with negative net income notably recorded at approximately -19.1 million USD in June 2022. From late 2022 onward, net income recovered substantially, achieving new highs by the end of 2024, culminating in over 182 million USD in December 2024. The fluctuations suggest periods of operational challenges followed by strong profitability improvements.

Net Profit Margin

The net profit margin revealed a declining trend from the first quarter of 2021 through early 2022, dropping from approximately 27% to near zero and even slightly negative in the middle of 2022. Subsequently, this margin showed a robust and steady recovery through 2023 and 2024, increasing consistently to exceed 16% by late 2024. This pattern corresponds with the observed volatility in net income and indicates improved cost management or pricing power over time.

Overall Performance

The overall financial performance indicates resilience and growth. Despite experiencing a phase of negative profitability in 2022, the company managed to reverse this trend, as evidenced by rising revenues and expanding profit margins through the subsequent periods. The steady recovery and eventual enhancement of net income and margins highlight effective strategic adjustments and operational improvements.

Insights

The data suggests cyclical challenges in 2022, possibly linked to market conditions or internal factors, leading to temporary losses. However, the sustained upward trajectories in revenue and profitability margins post-2022 imply successful adaptation. The increasing profit margin alongside revenue growth signals an increasingly efficient cost structure or stronger market position. Continued monitoring of these trends will be important to assess future stability and growth trajectory.

The net income (loss) of the company exhibits notable volatility over the presented periods. In early 2021, net income showed a generally positive trend, increasing significantly from approximately $22.6 million in March to nearly $59.4 million in September. However, in the last quarter of 2021, net income sharply declined to about $8 million. This declining trend continued into early 2022, with negative net income reported for the first half of the year, reaching lows near -$19 million. From the third quarter of 2022 onwards, net income recovered strongly, posting positive figures and reaching new highs by the end of 2024, peaking at over $182 million in the final quarter of 2024. Despite some fluctuations in 2025, net income remained robust, ending on a strong note with approximately $115.5 million in the last quarter surveyed.

Stockholders' equity demonstrated a steady and consistent upward trajectory throughout the available quarters. Starting at around $1.08 billion in early 2021, equity increased almost every quarter, exceeding $2.94 billion by the end of 2024. Notably, there was a slight dip observed in 2025, where equity decreased from approximately $2.95 billion to about $2.6 billion by the third quarter of 2025. However, no periods reflect a sharp or sustained drop in equity levels, indicating overall growth in the company’s net assets over time.

The Return on Equity (ROE) closely mirrors the trends observed in net income but shows a general pattern of improvement after a noted dip. Early 2021 ROE levels were relatively strong, consistently above 20%, but dropped sharply in late 2021, reaching a low around -0.51% in September 2022. Following this, a clear recovery trend is noticed, with ROE improving steadily every quarter from late 2022 through 2025. By the third quarter of 2025, ROE increased to nearly 17%, reflecting improved profitability relative to equity despite fluctuations in absolute net income figures.

In summary, the company experienced a period of earnings instability in 2021 and early 2022, with negative profitability and declining returns on equity. However, from late 2022 onwards, there was a marked recovery in profitability, supported by consistent growth in stockholders’ equity and improving ROE percentages. This recovery culminated in significant net income gains and enhanced returns by 2024 and into 2025, notwithstanding a minor pullback in equity during 2025. The overall financial trend suggests strengthening operational performance and capital base stability through the later periods.

The analysis of the quarterly financial data reveals clear patterns and notable shifts in the company's performance over the observed periods.

Net Income (Loss)

The net income demonstrates considerable volatility. Initially, from early 2021 to the end of 2021, net income increased, peaking at 59,384 thousand US dollars in September 2021 before sharply declining to 8,039 thousand by December 2021. In 2022, there is a significant downturn with negative net income in the first two quarters, followed by a recovery and eventual strong growth, reaching a high of 97,323 thousand in December 2022. Throughout 2023 and 2024, net income exhibits a generally increasing trend with notable peaks; particularly, substantial growth is observed in the final quarters of 2024 and early 2025, indicating improved profitability. The values in 2025 continue to show strength, reaching 115,547 thousand by September 2025.

Total Assets

Total assets steadily increased throughout the entire period, reflecting ongoing growth and expansion. Starting from approximately 2.6 billion US dollars in March 2021, total assets rose consistently quarter-over-quarter, surpassing 6 billion by the end of 2024. There is a minor dip visible in early 2023 and again in early 2025, but the general trajectory remains upward, suggesting ongoing investment and asset accumulation that signals capacity for scaling operations.

Return on Assets (ROA)

The Return on Assets percentage shows a declining trend during 2021, falling from over 9% at the start of the period to below 1% by mid-2022, even reaching negative territory briefly. From mid-2022 onward, ROA begins to recover steadily, improving quarter by quarter and reaching a peak of 7.38% by September 2025. This recovery indicates that the company is enhancing its efficiency in generating profit from its asset base after a period of lower returns. The gradual increase in ROA coincides with the improved net income figures in later periods.

Overall, the financial data suggests a period of volatility and challenges in 2021 and early 2022, followed by a marked recovery and growth phase. The company’s asset base expanded continuously, providing a strong foundation for revenue and profit growth. The improvement in ROA reflects better utilization of assets to generate earnings, supporting the notion of enhanced operational efficiency as the company progresses towards 2025.