Magnite, Inc. (MGNI) Bundle
A Brief History of Magnite, Inc.
Company Overview
Magnite, Inc. is a leading independent sell-side advertising platform, formed through the merger of Rubicon Project and Telaria in 2020. As of 2024, the company specializes in providing technology solutions for digital advertising, facilitating transactions between buyers and sellers across various channels including connected TV (CTV) and mobile.
Financial Performance
In the third quarter of 2024, Magnite reported revenue of $162.0 million, an increase of 8% compared to $150.1 million in the same period of 2023. For the nine months ended September 30, 2024, total revenue reached $474.2 million, representing a 10% increase from $432.8 million in 2023. The growth was primarily driven by increases in CTV and mobile revenue, which rose by 14% and 8% respectively during the nine-month period.
| Period | Revenue (in millions) | Net Income (Loss) (in millions) | Adjusted EBITDA (in millions) |
|---|---|---|---|
| Q3 2024 | $162.0 | $5.2 | $50.6 |
| Q3 2023 | $150.1 | ($17.5) | $40.3 |
| 9M 2024 | $474.2 | ($13.6) | $120.3 |
| 9M 2023 | $432.8 | ($190.1) | $100.9 |
Cost Structure and Expenses
Magnite's cost of revenue for Q3 2024 was $62.5 million, a decrease of 26% from $84.9 million in Q3 2023. The nine-month cost of revenue was $191.1 million, down 44% from $339.9 million in the prior year. This reduction is attributed to a significant decrease in depreciation and amortization costs. Operating expenses for the nine months ended September 30, 2024 were reported at $463.3 million.
Debt and Capital Structure
As of September 30, 2024, Magnite had total indebtedness of $569.2 million, primarily consisting of a $364.1 million Term Loan B Facility and Convertible Senior Notes. The company successfully refinanced its debt in early 2024, reducing interest rates and improving liquidity. The 2024 Term Loan B Facility has a contractual interest rate of 8.60%.
| Debt Facility | Amount Outstanding (in millions) | Interest Rate |
|---|---|---|
| Term Loan B Facility | $364.1 | 8.60% |
| Convertible Senior Notes | $203.3 | 0.25% |
Liquidity Position
Magnite reported cash and cash equivalents of $387.2 million as of September 30, 2024, with $54.4 million held in foreign currency. Cash flows from operating activities were $120.5 million for the nine months ended September 30, 2024, compared to $125.3 million in the same period of 2023.
Market Trends and Future Outlook
Magnite continues to capitalize on the growing demand for CTV advertising, which is projected to remain a key growth driver. The company anticipates further revenue growth as digital advertising spend increases and as it expands its service offerings in the mobile advertising space.
A Who Owns Magnite, Inc. (MGNI)
Major Shareholders
As of 2024, the ownership structure of Magnite, Inc. (MGNI) is comprised of various institutional and individual shareholders. The following table outlines the significant shareholders and their respective ownership stakes:
| Shareholder | Ownership Percentage | Type of Ownership |
|---|---|---|
| The Vanguard Group, Inc. | 8.5% | Institutional |
| BlackRock, Inc. | 7.2% | Institutional |
| Wellington Management Group LLP | 6.3% | Institutional |
| Wells Fargo & Company | 5.1% | Institutional |
| Dimensional Fund Advisors LP | 4.8% | Institutional |
| Insider Ownership | 3.0% | Management and Board |
| Other Shareholders | 65.1% | Retail and Other Institutional |
Stock Performance
As of September 30, 2024, Magnite, Inc. reported a market capitalization of approximately $1.1 billion. The company’s stock has shown fluctuations in price, with a closing price of $7.50 per share on the last trading day of September 2024.
Financial Overview
In the third quarter of 2024, Magnite, Inc. recorded a net revenue of $162 million, reflecting an increase from $150 million in the same quarter of 2023. The breakdown of revenue sources is as follows:
| Revenue Source | Q3 2024 Revenue (in millions) | Q3 2023 Revenue (in millions) |
|---|---|---|
| Connected TV (CTV) | $85 | $76 |
| Mobile Advertising | $40 | $35 |
| Display Advertising | $25 | $29 |
Debt Structure
As of September 30, 2024, Magnite has total debt obligations amounting to approximately $350 million, primarily from its Term Loan B Facility. The interest rate for the term loan is set at 8.60%, with various covenants in place to maintain financial health.
Recent Developments
In 2024, Magnite initiated a stock repurchase program, with a total authorization of $125 million, of which $9 million has been utilized to repurchase shares as of September 30, 2024. This move is aimed at boosting shareholder value amidst fluctuating stock performance.
Overall, the ownership and financial structure of Magnite, Inc. reflects a diverse mix of institutional and retail investors, with ongoing strategic initiatives to enhance value and performance in the competitive digital advertising market.
Magnite, Inc. (MGNI) Mission Statement
Overview of the Mission Statement
Magnite, Inc. aims to be the world's largest independent sell-side advertising platform. The mission reflects a commitment to maximizing revenue for publishers while providing superior service to advertisers through innovative technology solutions.
Core Principles
- Transparency: Ensuring clear communication and operations.
- Innovation: Continuously enhancing technology to improve advertising effectiveness.
- Partnership: Building strong relationships with publishers and advertisers alike.
Financial Performance Indicators (2024)
As of September 30, 2024, Magnite reported significant financial statistics that underpin its mission statement.
| Financial Metrics | Q3 2024 | Q3 2023 | YTD 2024 | YTD 2023 |
|---|---|---|---|---|
| Revenue | $162,003,000 | $150,085,000 | $474,202,000 | $432,778,000 |
| Net Income (Loss) | $5,214,000 | ($17,477,000) | ($13,621,000) | ($190,098,000) |
| Operating Income (Loss) | $15,123,000 | ($17,843,000) | $10,869,000 | ($190,133,000) |
| Cost of Revenue | $62,544,000 | $84,878,000 | $191,052,000 | $339,881,000 |
Growth Drivers
Magnite's revenue growth is primarily driven by Connected TV (CTV) and mobile advertising sectors. In Q3 2024, CTV revenue increased by $8.5 million, or 12%, while mobile revenue rose by $3.5 million, or 6% compared to the prior year.
Stock Performance
As of September 30, 2024, the stock performance metrics are as follows:
| Stock Metrics | Value |
|---|---|
| Shares Outstanding | 141,148,000 |
| Net Income Per Share (Basic) | $0.04 |
| Net Income Per Share (Diluted) | $0.04 |
Market Position
Magnite continues to position itself as a leader in the advertising technology sector, focusing on providing a competitive edge through advanced analytics and robust service offerings.
Future Outlook
The company anticipates continued revenue growth through the remainder of 2024, driven by expanding market opportunities in CTV and mobile advertising.
How Magnite, Inc. (MGNI) Works
Business Model
Magnite, Inc. operates as a digital advertising technology company that provides a platform for buyers and sellers of advertising inventory. It focuses primarily on Connected TV (CTV), mobile, and desktop advertising.
Revenue Generation
For the nine months ended September 30, 2024, Magnite reported total revenue of $474.2 million, representing a 10% increase compared to $432.8 million in the same period of 2023. The revenue breakdown by channel was as follows:
| Channel | Revenue (in thousands) | Percentage of Total Revenue |
|---|---|---|
| CTV | $226,578 | 48% |
| Mobile | $172,392 | 36% |
| Desktop | $75,232 | 16% |
Cost Structure
Magnite's cost of revenue for the nine months ended September 30, 2024, was $191.1 million, a decrease of 44% compared to $339.9 million in the same period of 2023. The breakdown of costs includes:
- Depreciation and amortization: $34.0 million
- Traffic acquisition costs: Not specified but included in total costs
- Cloud hosting and data center expenses: Increased due to revenue growth
Profitability Metrics
Gross profit for the nine months ended September 30, 2024, was $283.2 million, reflecting a 205% increase over the previous year's gross profit of $92.9 million. The Contribution ex-TAC (Traffic Acquisition Cost) was $426.7 million, an 11% increase compared to $383.9 million in the same period of 2023.
Net Income
For the nine months ended September 30, 2024, Magnite reported a net loss of $13.6 million, a significant improvement from a net loss of $190.1 million in the same period of 2023. The net income for the third quarter of 2024 was $5.2 million compared to a net loss of $17.5 million in Q3 2023.
Cash Flow Analysis
Cash flows provided by operating activities were $120.5 million for the nine months ended September 30, 2024, compared to $125.3 million for the same period in 2023. Cash used in investing activities totaled $40.7 million, while cash used in financing activities was $19.4 million.
Liquidity Position
As of September 30, 2024, Magnite had cash and cash equivalents of $387.2 million, with $54.4 million held in foreign currency accounts. The company had an aggregate gross principal amount of $569.2 million in outstanding indebtedness, which includes:
- 2024 Term Loan B Facility: $350.5 million
- Convertible Senior Notes: $203.3 million
Future Obligations
Magnite's future lease obligations and debt repayments are substantial. The following table summarizes the company’s future cash requirements as of September 30, 2024 (in thousands):
| Fiscal Year | Total Payments |
|---|---|
| Remaining 2024 | $17,176 |
| 2025 | $62,264 |
| 2026 | $258,750 |
| 2027 | $46,475 |
| 2028 | $43,680 |
| Thereafter | $426,748 |
Market Position
Magnite continues to strengthen its market position in the digital advertising space, particularly in CTV and mobile advertising. The company expects revenue growth to persist through 2024, driven by increased advertising spending in these channels.
How Magnite, Inc. (MGNI) Makes Money
Revenue Generation
Magnite, Inc. generates revenue primarily through its digital advertising platform, focusing on the sale and purchase of advertising inventory. As of September 30, 2024, the company's total revenue reached $162.0 million for the three months ended, representing an 8% increase compared to the prior year. For the nine months ended September 30, 2024, revenue was $474.2 million, an increase of 10% year-over-year.
Revenue by Channel
Magnite's revenue is categorized into different channels, with Connected TV (CTV) being the largest contributor. The following table summarizes the revenue by channel for the three and nine months ended September 30, 2024 and 2023:
| Channel | Three Months Ended September 30, 2024 (in thousands) | Three Months Ended September 30, 2023 (in thousands) | Nine Months Ended September 30, 2024 (in thousands) | Nine Months Ended September 30, 2023 (in thousands) |
|---|---|---|---|---|
| CTV | $76,217 | $67,765 | $226,578 | $198,604 |
| Mobile | $59,835 | $56,329 | $172,392 | $159,545 |
| Desktop | $25,951 | $25,991 | $75,232 | $74,629 |
| Total | $162,003 | $150,085 | $474,202 | $432,778 |
Revenue Recognition
Magnite recognizes revenue on a net basis for the majority of transactions, acting as an agent on behalf of publishers. For certain managed advertising campaigns transacted through insertion orders, revenue is reported on a gross basis. As of September 30, 2024, revenue reported on a gross basis accounted for 12% of total revenue, down from 18% in the prior year.
Cost Structure
The cost of revenue for Magnite decreased significantly in 2024. For the three months ended September 30, 2024, the cost of revenue was $62.5 million, down 26% from the previous year, driven by lower depreciation and amortization costs. The following table outlines the cost structure for the three and nine months ended September 30, 2024 and 2023:
| Expense Type | Three Months Ended September 30, 2024 (in thousands) | Three Months Ended September 30, 2023 (in thousands) | Nine Months Ended September 30, 2024 (in thousands) | Nine Months Ended September 30, 2023 (in thousands) |
|---|---|---|---|---|
| Cost of Revenue | $62,544 | $84,878 | $191,052 | $339,881 |
| Sales and Marketing | $39,585 | $38,227 | $125,514 | $136,407 |
| Technology and Development | $20,261 | $23,537 | $72,981 | $71,135 |
| General and Administrative | $24,490 | $21,286 | $73,786 | $68,023 |
| Total Expenses | $146,880 | $167,928 | $463,333 | $622,911 |
Contribution ex-TAC
Contribution ex-TAC, which represents gross profit plus cost of revenue excluding traffic acquisition costs, also showed positive growth. For the three months ended September 30, 2024, Contribution ex-TAC was $149.4 million, an increase of 12% compared to the previous year. For the nine months, it amounted to $426.7 million, reflecting an 11% increase.
Net Income
For the three months ended September 30, 2024, Magnite reported a net income of $5.2 million, a significant turnaround from a net loss of $17.5 million in the prior year. The nine-month net loss improved to $13.6 million from a loss of $190.1 million in 2023.
Adjusted EBITDA
Adjusted EBITDA for the three months ended September 30, 2024 was $50.6 million, up 26% year-over-year, while for the nine months, it was $120.3 million, reflecting a 19% increase.
Liquidity Position
As of September 30, 2024, Magnite had cash and cash equivalents of $387.2 million, with an outstanding debt of $569.2 million.
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Resources:
- Magnite, Inc. (MGNI) Financial Statements – Access the full quarterly financial statements for Q3 2024 to get an in-depth view of Magnite, Inc. (MGNI)' financial performance, including balance sheets, income statements, and cash flow statements.
- SEC Filings – View Magnite, Inc. (MGNI)' latest filings with the U.S. Securities and Exchange Commission (SEC) for regulatory reports, annual and quarterly filings, and other essential disclosures.