Magnite 4th Quarter Earnings


-Revenue was $82.0 million for Q4 2020, up 69% from Q4 2019 on an as reported basis, and up 20% on a pro forma basis(1)

-CTV revenue for Q4 2020 was $15.3 million, up 53% on a pro forma basis(1)

-Online Video (“OLV”) revenue grew 35% year over year in Q4 2020 on a pro forma basis(1)

-Full year 2020 total video (CTV & OLV) pro forma revenue was $106 million or 45% of total revenue on a pro forma basis(1)

-We expect revenue for Q1 2021 to be between $58 to $62 million

-Expect strong CTV growth in Q1 2021 - Renewed Disney / Hulu contract for 18 months

-Net income for Q4 2020 was $5.9 million, or income per share of $0.05, compared to net income of $1.5 million, or income per share of $0.03 for the fourth quarter of 2019

-Adjusted EBITDA(2) was $30.0 million representing a 37% Adjusted EBITDA margin(4), compared to Adjusted EBITDA of $15.3 million for the fourth quarter of 2019

-Q1 2021 Adjusted EBITDA operating expenses expected to be between $51-53 million

Non-GAAP income per share(2) was $0.19, compared to $0.17 non-GAAP income per share for the fourth quarter of 2019

“We had a strong finish to 2020, led by contributions from CTV and OLV formats,” said Michael G. Barrett, President and CEO of Magnite. “As linear TV spend accelerates its move to ad-supported CTV, we believe growth from this secular trend will fuel our growth for the foreseeable future. SpotX is an important strategic win for Magnite and our customers, and is fast growing and highly profitable. Following the closing of the pending acquisition of SpotX, CTV and OLV formats would represent two-thirds of our total company revenue, which would further improve our position in the fastest growing segments of the programmatic marketplace.”

SpotX Preliminary Financial Highlights

Total preliminary non-GAAP net revenue(5) for 2020 was $116 million, of which $67 million was CTV
Total non-GAAP net revenue(5) growth in 2020 was over 25% year-over-year
CTV non-GAAP net revenue(5) growth in 2020 was over 40% year-over-year
Preliminary 2020 Adjusted EBITDA(6) of approximately $35 million for a 30% margin based on non-GAAP net revenue
Acquisition on track to close in Q2 2021, subject to customary closing conditions

Earnings Presentation:…


Frankly, did not like the report. Organic growth in 20s, CTV growth only 53%. The only positive I see is increased profitability. Unless Magnite is about to accelerate after SpotX acquisition we won‘t see Roku or even TTD growth numbers here. Clearly, there was a strong expansion of multiples in past 6 months, but at the end organic business is what matters most. Magnite has recently become the biggest SSP if we don‘t count Google and FB, but I was expecting better fundamental numbers in Q4.

Folks, am I missing something important here?


Folks, am I missing something important here?

I feel like I’m missing something also with MGNI. I’ve heard a lot of people talk throughout MF talk about it’s potential (even as a 10x candidate), but when I look at the Income Statement, it seems that they made more money on a yearly basis in 2015 and 2016 than they have in any of the last three years. The yearly revenue has also been flat during that time, so it’s not a growth company. I understand the excitement about the CTV ad space, but I don’t see a compelling story in the numbers. Am I missing something here? Please fill in the blanks. Thanks.


I will take a stab at this. Here is what I see.

Ok now, roll with me on the numbers that I scoured from around the web (if you have better data, please share).

Magnite CTV Revenue in 2020
-CTV revenue for Q4 2020 was $15.3 million, up 53% on a pro forma basis

SpotX CTV Revenue in 2020

  • $67 million for CTV non-GAAP net revenue(5) growth in 2020, up 40% year-over-year

Magnite /Spot x combined

  • 82.3 in CTV revenue for 2020
  • Growing at a combined avg. of 46.5 percent. This should increase in 2021.


  • Renewed Disney / Hulu contract for 18 months
  • Hulu now counts 92 million monthly ad-supported U.S. viewers, more than doubling in two years.

Hulu Ad Revenue
2016 $0.9 billion
2017 $1.0 billion
2018 $1.5 billion
2019 $1.6 billion
2019 $2.7 billion

The bull case is that Magnite will capture a lot more CTV revenue based on the growth of Hulu and other partners. We know that in addition to more users, the monetization for Magnite of each user will also increase as more money goes to CTV and not linear TV.

I am long MGNI.


Does anyone know if they renewed only HULU or other Disney ABC TV options as well? Bull case would be much stronger if they also became provider for other properties in ABC tent like ESPN/Disney+ .

I am long MGNI with it being my largest position currently though today’s numbers do give me pause and may decide to lighten especially on the options part that expire in June. I was expecting CTV to be higher and was expecting CTV growth to be in the 70% or higher range.

Any insight into their other partnerships if anyone has those would be tremendously helpful.


Well, clearly there are no ads in Disney+ so no adspace to rep…

I am not familiar with ESPN’s CTV / mobile but reading about the pricing models, I don’t believe ESPN+ has ads, either. Or else there is no tier to have “no ads”… that’s not made crystal-clear…

ESPN+ does not have the content that shows on ESPN, fwiw, and they are quite clear about that:

An ESPN+ subscription does not give you access to stream ESPN’s traditional TV networks or the content on them. To stream those networks, you need a television subscription through a cable, satellite or digital provider.

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During the call today the management team was quite excited about the expansion of their relationship with Disney into an “omnichannel” agreement. I was also discussed in the Q&A. You should listen to the call or read the transcript.


Take a look at this.…

From October 1, the video ad management platforms at Disney and Hulu combine as a single one called Disney Hulu XP, helping ad buyers make one buy across the combined footprint and reduce repeat ad exposure on either platform.

In this video interview with Beet.TV, Matthew Barnes, Sr. Director, Programmatic Sales & Strategy at The Walt Disney Company, discusses the launch.

“Any of the inventory that’s available direct on the Hulu side is available programmatically. And, on the Disney side, all of our content that we have enabled to execute programmatically will be available in this offering, which is going to provide the marketplace with scale that they haven’t seen before from a premium publisher of our size.”

Hulu I know for sure has the vast majority of the CTV ad inventory. It’s the only at scale player after YouTube.

That’s referring to selling ad content on Disney Channel and Disney XD, too? Disney retains a decent sized chunk of the adspace on those channels when they are on cable packages, is Magnite repping that, too?

It’s not entirely clear exactly what inventory is available beyond Hulu. There are usually interstitials and other ad spaces that you don’t consider that get loaded into a programmatic ad platform.

My assumption is they are working hard to make a lot more inventory available to programmatic buyers. Disney I think sees the big picture. The next wave of streaming will be free and it will be ad-supported. The paid market is now too crowded with Netflix, HBO, NBC, CBS, FUBO all fighting for share. Free and ad-supported content will be dominant by a few at-scale players.

The switch to programmatic in general display ads was swift. Many publishers that sold direct went out of business over the course of a year when Google bought DoubleClick and accelerated the penetration of programmatic. I expect the same to happen with CTV this year. Buyers will stop buying direct and switch to programmatic because:

  1. Superior data-driven targeting and optimization.
  2. Less implementation and lower costs.
  3. Ability to easily scale up and down the volume.
  4. More sophisticated A.B testing methodology.

I have worked in ad-tech for over ten years and know the space well. Michael Barrett at Magnite is great CEO and has a really strong reputation.

I am long MGNI.