Connected TV drives over half of The Trade Desk’s Q1 business
The Trade Desk, Inc. reported that Connected TV and video now account for over half of its business as advertisers increasingly shift budgets from linear television to programmatic CTV. The company credits this growth to strategic partnerships with premium publishers like Disney, NBCUniversal, and Netflix, alongside advancements in AI-driven decisioning and measurement.
Key Takeaways
- Video and CTV reached a majority share of the channel mix in Q1 2026, accounting for over 50% of the platform’s business.
- Disney is utilizing biddable programmatic advertising and direct integration through The Trade Desk to manage lower ad loads.
- Netflix is expanding advertising capabilities via technological enhancements on the platform, following the launch of its programmatic partnership in mid-2024.
- NBCUniversal has integrated with the platform to improve price discovery and advertiser signals for its premium CTV inventory.
Why It Matters
The transition to a CTV-dominant revenue mix validates The Trade Desk's heavy investment in identity and AI-driven decisioning. By securing direct integrations with streaming giants like Disney and Netflix, the platform acts as a critical gateway for advertisers moving away from fragmented linear budgets toward data-driven, measurable inventory. However, a significant valuation reset—with shares down 75% year-over-year—suggests the market is carefully weighing this CTV momentum against increased competition from walled gardens like Amazon. Watch for the full migration of the client base to the Kokai AI platform by year-end 2025 as a key indicator of future margin efficiency.
Additional Context
The Trade Desk's focus on Connected TV (CTV) coincides with a broader industry shift, as digital video advertising spend is projected to exceed $80 billion in 2026, accounting for more than 60% of total U.S. video ad budgets, per IAB and eMarketer (September 2025). This growth is largely fueled by the rapid erosion of linear TV audiences; projections indicate linear ad spend will decrease by 13% to approximately $51 billion in 2025 as major sports and events migrate to streaming platforms, according to Scale Marketing (February 2025). Despite this, linear TV still commands roughly 86% of total TV ad impressions due to significantly higher ad loads compared to streaming services, per StackAdapt (March 2026). To capture this shifting spend, The Trade Desk has aggressively rolled out its Kokai AI platform. By May 2025, roughly two-thirds of the company's clients had transitioned to Kokai, with management targeting 100% adoption by the end of 2025. Early case studies indicated that campaigns using Kokai saw a 20% drop in customer acquisition costs compared to the legacy Solimar platform, per Investing.com (May 2025). However, the transition has not been without friction; some media buyers expressed concerns regarding UI complexities and fluctuating CPMs during the early phases of the rollout, according to industry feedback reported by PPC.Land (August 2025). Competition is intensifying as streaming platforms build internal capabilities. While The Trade Desk remains a primary partner for Netflix and Disney, Amazon has emerged as a significant threat following its own aggressive expansion into programmatic CTV. New Street Research analysts noted in early 2026 that deals between Amazon Ads and major streamers could potentially siphon spend away from independent DSPs. Nevertheless, The Trade Desk reported a 12% revenue increase to $689 million in Q1 2026, maintaining a customer retention rate above 95% for the tenth consecutive year, according to its May 2026 earnings statement.
Read full article at tradingview.com
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