Dive Brief:
- The Trade Desk is eliminating about 15% of its workforce, with the digital ad company estimating it will incur related charges ranging from $39 million to $51 million from employee severance and benefit costs. The expenses would be partially offset by a reversal of stock-based compensation, according to a Friday securities filing.
- CEO Jeff Green detailed the layoffs in an email to employees on Thursday indicating the cuts would be swift, according to a copy published on the TTD-affiliated site “The Current.” “In the next 15 mins, you will receive a follow up that tells you if you are affected directly by this restructuring,” Green said, noting that the company has taken steps to give transition packages to those leaving the firm Friday.
- Green also stressed that the Ventura, California-based company was “very healthy,” with about $1.5 billion in cash, no debt on its balance sheet and was positioning itself for growth. “We want our teams to be organized into smaller pods and smaller scrums, but with greater focus,” Green wrote. “Our aim is to position The Trade Desk team to move with greater agility, focus, ownership and speed.”
Dive Insight:
It has been a challenging year for TTD’s leadership and stock as the company has sought to navigate AI’s impact on the media landscape and economic pressures.
In July, Hewlett Packard Enterprise alum Nate Olmstead took the CFO post after his predecessor, Alexander Kayyal, was abruptly terminated in January after serving just five months in the seat. The company tapped interim CFO Tahnil Davis to take the finance reins while it searched for a permanent finance chief.
Last month, Green said in a second-quarter earnings report that the period “did not meet the standard we set for ourselves” and that the company was taking action to upgrade its platform and sharpen its focus as media budgets shift toward the “open internet.”
During the quarter ended June 30, the company’s net income slid to $64 million from $90 million in the year earlier period.
“All of our customers are operating in a fundamentally different environment than they were even a year ago,” Green said according to a transcript of the business’ Q2 earnings call on Aug. 6. “Autos and CPG have both been set back by tariffs and oil prices.”
Meanwhile, the company’s shares have declined by about 63% this year, reducing its market capitalization to about $6.6 billion.
On Friday, S&P Global also announced it would remove TTD from the S&P 500 Index, effective Sept. 21, as part of a number of changes to ensure each index is “more representative of its market capitalization range,” according to an S&P release. Companies must meet certain capitalization and liquidity requirements to be eligible for the indices, according to S&P U.S. Indices Methodology sheet.
A TTD company spokesperson declined to respond to questions about the number of employees laid off and the company’s removal from the S&P index. The company is not commenting beyond Green’s publicly shared email to employees, the spokesperson said.
As of Dec. 31, TTD had 3,843 fulltime employees, according to its 10-K filing.
