PubMatic Reports 4% Revenue Decline and Widened Net Loss in Q1 2025

PubMatic, Inc. reported a decline in financial performance for the first quarter of 2025, with revenues totaling $63.8 million, a decrease of 4% from $66.7 million in the same period of 2024. The company's net loss widened to $9.5 million, compared to a loss of $2.5 million in the prior year. This resulted in a basic and diluted net loss per share of $0.20, compared to $0.05 in the previous year. The decrease in revenue was attributed to changes in bidding methodologies by one of its buyers, which negatively impacted revenue generation.

In terms of operational metrics, PubMatic served approximately 1,950 publishers and app developers as of March 31, 2025, an increase from about 1,800 in the same period last year. However, the company's gross profit margin fell to 60% from 62%, primarily due to the revenue decline. The cost of revenue increased slightly to $25.6 million, driven by higher depreciation and amortization costs, although the cost per million impressions processed decreased by approximately 22% year-over-year.

Strategically, PubMatic has continued to invest in its technology and development, with expenses rising by 10% to $8.8 million, reflecting increased personnel costs. Sales and marketing expenses also grew by 8% to $26.8 million, driven by higher personnel and travel costs. General and administrative expenses increased by 4% to $14.6 million, primarily due to higher personnel costs. The company anticipates that these expenses will continue to rise in absolute terms as it expands its workforce and invests in technological innovation.

On the balance sheet, PubMatic reported total assets of $668.6 million as of March 31, 2025, down from $739.5 million at the end of 2024. Current liabilities decreased significantly to $350.2 million from $418.8 million, largely due to a reduction in accounts payable. The company had cash and cash equivalents of $101.8 million, along with marketable securities of $42.3 million, providing a solid liquidity position.

Looking ahead, PubMatic expects its revenues to be influenced by macroeconomic conditions and the ongoing impacts of the bidding methodology changes. The company remains focused on expanding its customer base and enhancing its platform capabilities to drive future growth. Despite the challenges, PubMatic aims to leverage its technology and operational efficiencies to improve outcomes for both publishers and buyers in the digital advertising ecosystem.