Why The Trade Desk Could See an AI-Fueled Revival in 2025

Published Date : 31/05/2025 

Despite a challenging start to the year, The Trade Desk (TTD) is poised for a significant rebound, driven by its leadership in adtech AI, strong financial performance, and compelling valuation. Here's why investors should consider this stock. 

Following a dismal start to the year for The Trade Desk (TTD), shareholders are hopeful that the second half of 2025 will reprogram the narrative. The stock is down 47% from its 52-week high amid broader market turbulence, even as the advertising technology (adtech) pioneer continues to generate impressive growth.

This recent weakness could be a buying opportunity for investors as The Trade Desk's long-term outlook remains as strong as ever. The company's effort to integrate more artificial intelligence (AI) technology is positioning it to capture a larger share of an estimated $1 trillion advertising market.

Here are three reasons why The Trade Desk stock could stage a big comeback.

1. Adtech AI Leadership

With people increasingly connected to media content, every digital interaction holds the potential to be monetized. The Trade Desk is capitalizing on this evolving industry landscape through its leading demand-side platform (DSP) that empowers advertisers to manage data-driven advertising campaigns across various formats and devices, including mobile devices and connected TVs (CTV).

By processing over 13 million impressions per second, the AI-driven Kokai ecosystem allows ad buyers to target audiences, leveraging real-time data to optimize ad spend based on consumer behavior patterns, identifying high-value marketing opportunities. The ease of use and system effectiveness have made The Trade Desk a go-to solution for major brands and agencies.

While CTV remains a high-growth market, with streaming video services offering more ad-funded options, Trade Desk is also expanding into new verticals, including retail media. The ability to leverage its AI capabilities with first-party data has positioned The Trade Desk as a leader in delivering innovative, high-impact advertising solutions.

### 2. A Strong Start to 2025

In the first quarter, The Trade Desk reported revenue of $616 million, a 25% year-over-year increase, well above the Wall Street estimate of $574 million. Its $0.33 in adjusted earnings per share (EPS) was 27% higher than the prior-year quarter, also beating expectations.

The Trade Desk founder and CEO Jeff Green called the new AI tools and features a 

Frequently Asked Questions (FAQS): 

Q: What is The Trade Desk's main product?

A: The Trade Desk's main product is a demand-side platform (DSP) that helps advertisers manage data-driven advertising campaigns across various formats and devices, including mobile and connected TVs.

Q: How has The Trade Desk performed in the first quarter of 2025?

A: In the first quarter of 2025, The Trade Desk reported revenue of $616 million, a 25% year-over-year increase, and an adjusted earnings per share (EPS) of $0.33, which was 27% higher than the prior-year quarter.

Q: What is the current valuation of The Trade Desk?

A: The Trade Desk is currently trading at a forward price-to-earnings (P/E) ratio of 42 times its consensus 2025 EPS, which is significantly lower than the earnings multiple that averaged nearly 200 in 2024.

Q: What new markets is The Trade Desk expanding into?

A: The Trade Desk is expanding into new verticals, including retail media, and is also leveraging its AI capabilities with first-party data to deliver innovative, high-impact advertising solutions.

Q: Why should investors consider buying The Trade Desk stock?

A: Investors should consider buying The Trade Desk stock due to its leadership in adtech AI, strong financial performance, and a compelling post-sell-off valuation, making it an excellent choice for diversified portfolios. 

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