Magnite sees Q1 revenue ex-TAC $109M-$113M, consensus $111.87M

On its Q4 earnings call last night, Magnite CFO David Day said: "Our approach to guidance assumes a continued challenged economic environment. For the first quarter, we expect revenue ex-TAC to be in the range of $109 million to $113 million. We expect revenue ex-TAC attributable to CTV to be in the range of $42.5 million to $44.5 million. This slowing of growth is attributable to an industry-wide slow start to Q1. We expect adjusted EBITDA operating expenses to tick up slightly from Q4 to $92 million to $94 million, which implies adjusted EBITDA margin of approximately 16% for Q1 at the midpoint. For the full year 2023, we continue to expect to grow revenue ex-TAC, despite the global economy and ad spend weakening since our last call. We are cautiously optimistic that CTV growth will improve, both from an industry perspective and from the new and expanded partners, Michael covered earlier. We continue to focus on managing costs with our January reduction in force, which impacted approximately 6% of our workforce. The majority of positions eliminated were from duplicative engineering roles across our two CTV platforms. We expect adjusted EBITDA OpEx to be lower in the second half of the year compared to elevated expenses in the first half as we complete client migrations and support one unified Magnite streaming platform, which we will continue to optimize. This, coupled with a seasonally stronger top line, will result in margins significantly improving throughout the year, with the largest gains in the second half. As we exit 2023, we expect to be back at a run rate in line with our long-term target of adjusted EBITDA margins in the 35% to 40% range. We also expect that our CapEx will be $40 million or less for full year 2023. For the full year, while we are not providing specific adjusted EBITDA guidance, we are targeting adjusted EBITDA to be approximately the same as 2022. We also expect free cash flow to exceed $100 million this year."