Trade Desk Inc Q4 2016 Earnings Call Transcript

The following is excerpted from the question-and-answer section of the transcript.

Question: Shyam Patil - Wedbush Securities - Analyst : Hello, good afternoon, guys. Jeff, could you talk a little bit about how you arrived at the gross spend in revenue guidance for the year? It looks like you're implying growth around or even less than two times to market, after growing much faster the past few years? Certainly [a lot of] large numbers, but aside from that, can you talk about the thought process you uses to get to the guide? And I have one more follow-up.

Question: Shyam Patil - Wedbush Securities - Analyst : Great. Just a follow-up on the spending? When you look at the implied spending of OpEx for this year, how much of that to you consider to be investment? Can you talk about what specific areas you consider investment this year?

Question: Unknown Participant - - Analyst : Thanks for taking my question, this is John on for Brian. First off, congrats on the quarter. A follow-up to the previous question. Once you've made these investments in international and headcount and on the R&D side also, can you talk to the leverage in the model of how that flows through maybe 2018 and beyond? Then I have a quick follow-up, thanks.

Question: Unknown Participant - - Analyst : Great. Thanks guys. Quickly on take-rate? It looks like, in your guidance that it is stepping down a little bit. In the past you have talked about, as you expand into digital video and audio, that's expected to happen, so just curious your thoughts on, is that trend playing along the line with your initial thoughts and any updates there? Thank you.

Question: Mark Mahaney - RBC Capital Markets - Analyst : Okay, I think that's me, it's Mark Mahaney. Two factual questions, please? I think you said it, but the percentage of your revenue or gross and gross spend in 2016 that was international. And commentary over what's implied in your guidance for this next year? The percentage that comes from international, both with spend and with revenue? Thank you very much.

Question: Youssef Squali - Cantor Fitzgerald - Analyst : Two questions. On the margin longer term, how should we think about your ability to hit that 40%-plus that you guys talked about at the IPO? Has the increased level of investments that your were talking about for 2017 either making that potentially harder to get to? Or does it just push it out but in the meantime, we're getting hopefully higher top-line growth? And can you parse out the growth in the fourth quarter, that 70% is still very impressive, between maybe pricing and volume? Thanks.

Question: Youssef Squali - Cantor Fitzgerald - Analyst : That's it, that's exactly it. I'm trying to understand the dynamics going on in the marketplace competitively? And how are volume and pricing driving the top line, relative to prior quarters -- if there has been any change? Maybe there hasn't been.

Question: Youssef Squali - Cantor Fitzgerald - Analyst : Okay. Helpful. Thanks, Jeff.

Question: Kerry Rice - Needham & Company - Analyst : Thanks a lot, great quarter, guys. I noticed in the K that you did provide some qualitative data on cohorts. Can you talk a little bit more about that? If you can give us any growth rates of any your key cohorts? The second question is, maybe relates to the previous question about volume versus pricing, with the header bidding being a key trend in the marketplace, did header bidding raise CTM prices? REFINITIV STREETEVENTS | www.refinitiv.com | Contact Us consent of Refinitiv. 'Refinitiv' and the Refinitiv logo are registered trademarks of Refinitiv and its affiliated companies. FEBRUARY 16, 2017 / 10:00PM, TTD.OQ - Q4 2016 Trade Desk Inc Earnings Call Was that beneficial to you? Can you talk a little bit about the impact of header bidding in Q4 and think about it in 2017? Thanks.

Question: Aaron Kessler - Raymond James - Analyst : Thanks, guys, congrats on the quarter. A couple questions. The Q1 guide, I believe that implies roughly 40% sequential decline? Should we think about the obviously there's seasonality in the business but there's a little more conservatism built in there? Maybe an update on thus far, what you're seeing through mid February? And I think previously you talked about you've touched about 10% of the brands? Where does that statistic stand now? Finally, I think you mentioned international is up 10% today. What's your thoughts on what that looks like, in two to three years? Thank you.

Question: Aaron Kessler - Raymond James - Analyst : Got it. Great. One quick follow-up. Election sounds like it was a decent traction with election in Q4. Can you give us a rough sense of gross spend was in the election that you benefited from?

Question: Aaron Kessler - Raymond James - Analyst : Got it. Great. Thank you.