0001595974-26-000022
SEC filingQ1 2026 revenue up 6% YoY to $164.4M, driven by 30% CTV Contribution ex-TAC growth; net income turned positive to $4.4M.
For the three months ended March 31, 2026, Magnite reported revenue of $164.4 million, a 6% increase from $155.8 million in the prior-year period. Gross profit rose 12% to $104.0 million, with gross margin expanding to 63.3% from 59.7%, driven by a 4% decline in cost of revenue primarily due to lower traffic acquisition costs as revenue reported on a gross basis fell from 11% to 4% of total revenue. Operating income swung to $7.7 million from a loss of ($1.4) million, reflecting improved operating leverage. Net income reached $4.4 million compared to a net loss of ($9.6) million in Q1 2025, helped by lower interest expense ($4.6 million vs $5.2 million) and a favorable foreign exchange swing (gain of $0.1 million vs loss of $2.2 million). Adjusted EBITDA increased 16% to $42.9 million.
Magnite tracks performance by channel using Contribution ex-TAC, a non-GAAP measure that excludes traffic acquisition costs. CTV Contribution ex-TAC surged 30% to $82.3 million, far outpacing the 18% growth in CTV revenue due to a mix shift from gross to net basis transactions. The company noted that this shift depresses reported revenue but enhances margin. Mobile and desktop Contribution ex-TAC each declined 5% to $55.4 million and $23.3 million, respectively, reflecting broader ad market softness in those channels. CTV now represents 51% of total Contribution ex-TAC, up from 43% a year ago, underscoring its role as the primary growth engine.
Management expects full-year 2026 revenue to increase compared to the prior year, with CTV as the biggest growth driver. Contribution ex-TAC is also expected to rise for the remainder of 2026, again led by CTV. The company continues to invest in CTV technology, including the SpringServe platform and the Streamr.ai acquisition (closed September 2025), which aims to make CTV accessible to small and medium businesses. Additionally, the April 2025 antitrust ruling against Google (and Magnite's subsequent lawsuit) may create a more level playing field for its display business. However, macroeconomic uncertainties, including inflation and tariffs, remain headwinds. No specific quantitative guidance was provided.
As of March 31, 2026, Magnite held $184.6 million in cash and cash equivalents, a significant decrease from $553.4 million at December 31, 2025. The decline was primarily driven by the repayment of $205.1 million in convertible senior notes that matured on March 15, 2026, along with $14.5 million in share repurchases and $13.1 million in capital expenditures. Total debt stood at $350.8 million (net of issuance costs), entirely under the 2024 Term Loan B Facility, with no borrowings on the $170.9 million revolver. Stockholders' equity was $917.9 million, slightly down from $922.4 million due to repurchases and other comprehensive loss.
Magnite has $173.0 million in non-cancelable contractual obligations as of March 31, 2026, primarily related to cloud-managed services and software agreements. Additionally, $34.1 million in future lease commitments not yet commenced were disclosed, including a $32.8 million lease starting in 2030. The contractual obligations timing shows $85.2 million due within one year, $85.6 million in years one to three, and $2.1 million beyond three years.
During Q1 2026, Magnite repurchased $14.5 million of common stock (1.1 million shares) and retired them. No dividends were paid. Capital expenditures totaled $13.1 million (8.0% of revenue), split between property and equipment ($9.4M) and capitalized software ($3.7M). Debt decreased by $205.3 million net, reflecting the full repayment of the convertible notes plus scheduled term loan payments.
Magnite operates as a single reportable segment. Revenue for Q1 2026 was $164.4 million, up 5.5% year-over-year. Geographic mix was 75% United States ($123.3M) and 25% International ($41.1M). Channel mix (from Note 3) showed CTV 52%, Mobile 34%, Desktop 14%.