PubMatic Reports Q2 2026 Results: Full Earnings Call Transcript

On Thursday, PubMatic (NASDAQ: PUBM ) discussed second-quarter financial results during its earnings call. The full transcript is provided below. APIs provide real-time access to earnings call transcripts and financial data. Visit to learn more.

View the webcast at Summary PubMatic reported impressive financial results for Q2 2026, with revenue growing 11% year-over-year and adjusted EBITDA increasing by 38%. The company returned to double-digit revenue growth ahead of schedule, driven by strong performance in high-value formats such as CTV and mobile app, which now account for 60% of revenue. Notable strategic initiatives include the adoption of AI technologies like Agentic OS and the launch of Decision Fabric, enhancing advertising performance and expanding PubMatic's addressable market.

Significant leadership changes were announced, with CFO Steve Pantolik planning to retire in 2027, and Megan Ram joining as Global Chief Revenue Officer. PubMatic's outlook remains positive, with continued double-digit growth expected in the second half of the year and plans to increase full-year capex to support AI workloads. Full Transcript OPERATOR Hello everyone and welcome. We will begin momentarily.

Annabeth, Operator Hello everyone and welcome to PubMatic's second quarter 2026 earnings call. My name is Annabeth and I will be your Zoom operator today. Thank you for your attendance today. As a reminder, this webinar is being recorded.

I will now turn the call over to Stacey Clements. Stacey Clements, Operator Good afternoon everyone and welcome to PubMatic's earnings call for the second quarter 2026. This is Stacey Clements and I'll be your operator today. Joining me on the call are Rajeev Goel, Co—Founder and CEO, and Steve Pantolik, CFO.

Before we get started, I have a few housekeeping items. Today's prepared remarks have been recorded, after which Rajeev and Steve will host live Q&A. If you plan to ask a question, please ensure you've set your Zoom to display your full name and firm and use the Raise Hand function located at the bottom of your screen. com.

I would like to remind participants that during this call management will make forward—looking statements, including, without limitation, statements regarding our future performance, market opportunity, growth strategy, and financial outlook. Forward—looking statements are based on our current expectations and assumptions regarding our business, macroeconomic environment, and future conditions. These forward—looking statements are subject to inherent risks and uncertainties and changes in circumstances that are difficult to predict. com, including our most recent Form 10—K and any subsequent filings on Forms 10—Q or 8—K.

Our actual results may differ materially from those contemplated by the forward—looking statements. We caution you, therefore, against relying on any of these forward—looking statements. All information discussed today is as of August 6, 2026, and we do not intend and undertake no obligation to update any forward—looking statement, whether as a result of new information, future developments, or otherwise, except as may be required by law.

In addition, today's discussion will include references to certain non—GAAP financial measures, including Adjusted EBITDA, Adjusted EBITDA Margin, non—GAAP Net Income, Cash Flows from Operations, Free Cash Flow, and Free Cash Flow Margin. These non—GAAP measures are presented for supplemental informational purposes only and should not be considered a substitute for financial information presented in accordance with GAAP. A reconciliation of these measures to the most directly comparable GAAP measure is available in our press release. And now I will turn the call over to Rajeev.

Rajeev Goel, Co-Founder and CEO Thank you Stacy and good afternoon everyone. We delivered an outstanding second quarter. More importantly, we returned to double-digit year-over-year revenue growth well ahead of schedule and we expect that growth will accelerate through the second half of the year. I'm extremely proud of what the team has accomplished, in particular our innovation and leadership in Agentic advertising.

Over the past several years we've made disciplined investments to diversify the business and strengthen our competitive position to deliver both faster growth and strong operating leverage. Today, approximately 60% of our business comes from CTV, mobile, app and emerging revenues, all of which fuel profitable double-digit growth. This represents a remarkable transformation of our business and fundamentally strengthens our long-term growth profile. With this strong foundation in place, Steve has announced his plans to retire.

He will remain as CFO into the first quarter of 2027 and then in an advisory role through July 1, ensuring a smooth transition as we conduct a search for successor. Steve and I have worked together for 15 years and it's difficult to overstate the impact he's had on PubMatic. Under his leadership, we built a global company with the financial discipline to invest for the future while consistently generating cash, maintaining a debt-free balance sheet and returning capital to shareholders. I'm deeply grateful for his partnership, his friendship and his many, many contributions to PubMatic.

He's built an exceptional finance organization that positions PubMatic to create long-term value for years to come. Helping us build that future is our new Global Chief Revenue Officer Megan Ram who joins us on Monday, August 10th. Megan brings deep direct-to-brand and performance advertising expertise with established relationships across marquee brands. Her rigor around sales process and execution will enhance our sales effectiveness and is a natural fit with our culture.

Together these strengths will help accelerate adoption of our AI-powered platform while strengthening our commercial capabilities. These leadership milestones reflect the evolution of both our company and our industry. It is clear digital advertising is entering its next major technology transition as AI reshapes how media is bought and sold across the open Internet and PubMatic is at the epicenter of this change with market-leading scale. Since launching Agentic OS in January, we've delivered over 80 Agentic campaigns, including with all five global agency holding companies.

This is up from 30 campaigns just a quarter ago. For years, the walled gardens have delivered superior advertising performance because they operate a single integrated technology platform that optimizes media and audiences for advertisers. With Activate and Agentic OS, we're bringing those same performance and technical advantages to the open Internet. As a result, we're monetizing far more of the value chain between advertisers and publishers than at any point in our history and attracting entirely new customer types to our platform.

And because our business is built on outcomes and usage, we generate revenue when we deliver the best outcomes for our customers. Advantage will be determined not by traditional software user interfaces, but rather by AI-native infrastructure, proprietary intelligence and the ability to consistently deliver superior outcomes. We spent two decades building these capabilities. Today they're redefining how value is created across the open Internet by delivering compelling, measurable outcomes.

Level Agency is a great example of this. In a controlled comparison against their incumbent DSP, Agentic OS delivered in excess of two times more reach per dollar on qualified audiences while significantly accelerating campaign setup and activation time. Additionally, Agentic OS delivered retargeting at scale within days compared to the one to two months ramp typically required by DSP-led campaigns. As a result, Level increased ad spend with PubMatic to expand its buying across the open Internet.

Patrick Van Gorder, Chief Partnership Officer at Level Agency, said it best: what Agentic OS delivered changed how we're thinking about where the open Internet can compete for client budgets, and that's exactly the kind of adaptive advantage and innovation we're always looking for. Level is one of many examples across of BOSS and Telefonica, Amnet and Interbev above O Max, Fleet, Butler, Till and many others. We're consistently delivering better performance, faster execution and greater efficiency and it is changing how buyers are thinking about the value chain.

Those results are driven by our unified platform, where multiple competitive advantages compound and are increasingly difficult to replicate. They're built on years of investment across our infrastructure, intelligence, solutions and customer relationships. First is Agentic OS. We have deployed over 20 agents to automate and optimize core buying and selling workflows.

As Agentic advertising compresses the traditional workflow, more of the transaction runs through PubMatic's infrastructure. This allows us to create more value for our customers and drive incremental revenue back to PubMatic. This week we announced an exciting new agent for enterprise buyers. It provides configurable controls, approved workflows and full audit trails for autonomous campaigns.

As customers move more budget into Agentic buying, trusted governance becomes essential and we believe this capability will help accelerate enterprise adoption of Agentic OS. Second is Activate. Activate enables advertisers to buy directly in our SSP. This significantly increases working media and operational efficiency while also targeting audiences at the point of auction.

The result is better advertiser performance, including Comscore, Nielsen, Experian, TransUnion, PayPal, Intuit, Klarna, Walmart and more. With our own proprietary bitstream data which exists only on PubMatic. As our business continues to grow, particularly in logged-in environments like CTV and mobile app, the quality and depth of those signals continues to improve, making our platform smarter with every campaign and every transaction. This intelligence runs on our AI-native infrastructure.

Through our partnership with Nvidia, we're able to process massive amounts of data and execute increasingly sophisticated AI-driven decisioning in real time. And fourth is our premium SSP inventory which includes nearly the entire open Internet, over 2,000 publishers representing 100,000-plus streamers, mobile apps and websites. Most recently we added marquee broadcaster Channel 4 in the UK and announced a strategic partnership with Sony Pictures Entertainment as their preferred sell-side platform, delivering access to hundreds of millions of monthly users across PlayStation and Sony BRAVIA TVs. Importantly, these advantages reinforce one another.

Premium supply generates unique signals. Those signals strengthen our proprietary intelligence. That intelligence improves advertising outcomes. Better outcomes attract more advertisers, more campaigns and more data, creating a compounding advantage with every transaction.

Building on this advantage, in Q2 we introduced Decision Fabric, the next evolution of our platform. Introduced in June, Decision Fabric enables advertisers, DSPs and technology partners to securely deploy their proprietary models directly within PubMatic's infrastructure. This is commonly referred to as containerization. By running their models closer to our inventory data and the point of auction, customers remove the traffic shaping and latency constraints that have historically limited performance across the open Internet, allowing them to unlock better advertising outcomes.

We're seeing encouraging traction with launch partners including MiQ, Chalice, AI Swim, AI Empowered and a growing number of DSPs. This is an exciting opportunity that we believe will transform the way advertising is transacted on the open Internet. More importantly, our unified platform and compounding intelligence are unlocking performance advertising budgets on PubMatic. It's expanding.

Our Wellness brand expanded into premium CTV without sacrificing the performance measurement and optimization it relies on in social media. Using Agentic OS, the campaign delivered a 5x return on ad spend, double the client's original objective, while significantly accelerating optimization and campaign execution. We're seeing the same trend scale across our DSP partnerships. Smadex, a leading performance CTV advertising platform for apps and games and a business unit of Entravision, partnered with PubMatic to leverage our premium CTV inventory using our first-party audience targeting and cross-device measurement capabilities.

As performance improved, Smadex increased spend on PubMatic over 10x year over year with 75% of that incremental spend flowing into CTV. This kind of measurable performance is unlocking entirely new advertising budgets for PubMatic and it's reshaping the inventory advertisers want to buy. Creator-led video is another incremental opportunity, which now accounts for 26% of all TV and video viewing. Yet much of that market has remained within walled gardens even as TV platforms have brought creator content to the living room.

As brands look to stand out, they're increasingly seeking creators whose audiences, values and content creators naturally align with their brand. With the launch of our Creator Marketplace, we're bringing our infrastructure and Agentic OS to the creator economy, enabling advertisers to connect their premium inventory and reach highly engaged audiences while giving creators new ways to monetize across the Internet. For PubMatic, this positions us well as the creator economy, which is approximately $250 billion globally, moves into the open Internet advertising market, representing an entirely new category of publishers to our platform.

Performance is also driving growth across our live sports marketplace, where activity more than doubled year over year, highlighting the scale of our premium inventory and the strength of our offering. We were recently recognized with several industry awards including The Drum's Technology Innovation Award for helping advertisers buy live sports inventory with precision. As more premium events enter the programmatic market like US Open for Tennis, NFL, NBA, MLB and NCAA, there is significant opportunity to scale growth from this vertical, accelerating the value of our live sports offering.

We recently partnered with Gracenote to bring real-time content and make decisions within the milliseconds available before every impression is served. That's particularly valuable in live sports, where context changes continuously and buyers need to optimize campaigns in real time. Whether it's contextual signals from live sports or commerce signals tied to purchasing behavior, our strategy is the same: bring differentiated data closer to every advertising decision.

As more buyers, publishers and transactions run across our platform, that intelligence compounds and improves advertiser performance, increases publisher yield and makes our platform more valuable with every interaction. That's the power of the platform we built. The investments we made over the last several years are translating into accelerated, profitable growth. By investing early in AI, we've established a leadership position that continues to widen as more customers adopt our platform.

We built a platform that is attracting more buyers, more publishers, more data and more advertising spend. Just as importantly, we're expanding the market we can serve, bringing new forms of advertising, new sources of demand and new intelligence onto our platform. That not only increases the value we can create for customers, it also expands the long-term growth opportunity for PubMatic, which we believe is significantly larger than the business we operate today. I'll now turn the call over to Steve for the financials.

Steve Pantelick, CFO Thank you, Rajeev, and welcome everyone. We delivered an outstanding second quarter, significantly exceeding our expectations on both the top and bottom line. Our revenues grew 11% year over year, adjusted EBITDA increased 38%, and free cash flow increased 47%. We saw strength across channels and formats, underscoring the breadth and depth of our platform.

Our high-value formats and channels gained momentum and scale, and we continue diversifying the business. AI adoption across our company is accelerating innovation, driving revenue growth, improving customer outcomes, and unlocking incremental cost efficiencies. Importantly, we returned to double-digit revenue growth ahead of schedule today. Our revenue mix is fundamentally different than it was three years ago.

The majority of our business now comes from high-value formats and channels, which are the fastest-growing segments of digital advertising. In Q2, approximately 60% of our revenue came from CTV, mobile app, and emerging revenue streams, double that from three years ago. Together these categories grew nearly 40% year over year. Breaking this down further, CTV growth was led by the Americas, which grew 25% year over year, driven by new CTV advertisers and expansion of premium inventory including live sports.

Globally, CTV revenue grew 13% year over year and accounted for approximately 20% of total revenue. Mobile app grew more than 40% year over year and represented approximately 25% of total revenue. Q2 growth was driven by the mediation platform integrations we highlighted last quarter, ongoing product innovation, and continued expansion of our global app publisher base. Emerging revenue streams continued their strong momentum and nearly doubled year over year, reaching an all-time high of approximately 15% of total revenue.