Rubicon Project posted revenues of $24.9m for the first quarter, exceeding its earlier predicted figure of $23m, although the sum represented a drop of 46% year-over-year, demonstrating the scale of the task ahead as the sell-side operation transitions to a no buyer fee model.
Other positive signs include ad spend on the platform increasing 10% year-over-year to $211m with its take rate standing at 11.8% for the quarter, which it expects to maintain in the second quarter or the year, but its net loss for the period deepened 76% year-over-year to $27.8m.
Audio and video were the fastest growing drivers of revenue increase during the period, with ad spend on desktop devices now generating 57% of income, according to the company’s leadership.
In a pre-prepared statement, Michael Barrett, Rubicon Project chief executive said: “We are performing very well in the early stages of supplier consolidation with our buyer partners while continuing to deliver increasing revenue to our publishers. Top line growth, combined with the cost actions we took in the first quarter, have us on track to be adjusted EBITDA positive in the fourth quarter of this year.”
In November 2017, Rubicon Project announced that it is to drop its buy-side fees as part of its ongoing transparency drive with the impact of this move demonstrated in its previous quarterly results when revenue dropped 57%.
Since then, Rubicon Project has gone about a cost rationalization process including a host of layoffs, with the company’s leadership sounding upbeat on surviving the ongoing round of supply-path optimization which many believe will result in a cull of adtech companies.
Speaking on the company’s subsequent earnings call, both Barrett and Rubicon Project chief technology officer Tom Kershaw shared their opinion that removing their buy-side fees will yield dividends.
Speaking earlier with The Drum on the decision to drop its buy-side fees, Barrett spoke of the “considerable pain” involved in making this decision, but Rubicon Project believes this will build the scale necessary to survive in a world of increased scrutiny around programmatic buying.
Speaking to the company’s anticipated revenue prospects, Barrett echoed sentiments earlier expressed by fellow adtech Criteo and spoke of an anticipated near-term reduction in EMEA revenue and ad spend as publishers adjust to the General Data Protection Regulations (GDPR) in the EU.