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Viant CEO Sees 2023 Rebound for Ad Industry

Software firm saw late '22'adrecession'

Tim Vanderhook, the CEO of digital ad tech company Viant Technology Inc. (Nasdaq: DSP) in Irvine, says the advertising business is the “canary in the coal mine” in terms of signaling economic troubles.

Industrywide troubles began in the second half of last year, he said.

“There was certainly an ad recession” in the latter part of 2022, Vanderhook said. “There wasn’t an overall economic recession, but within our industry the general talk is there has been a substantial slowdown as businesses prepare for consumers to stop spending money.”

Right now, “I would say things are slow but stable at this point.”

Advertisers are “the first to get hit in economic slowdowns but we’re the first to come out of it,” according to the CEO.

Stock Rise, Slump

Viant’s business—known as programmatic advertising—helps marketers and their agencies buy ads anywhere electronically. Its software enables ad buyers to plan, create, execute and measure their digital advertising investments through a cloud-based platform.

Tim Vanderhook founded the advertising software company in 1999 with brothers Chris and Russ. They took Viant public two years ago.

Viant burst out of the gate with shares trading for $64 apiece and a market cap of $3.8 billion after going public in February 2021. The shares have since fallen to about $4.83 each, pulling the market cap down to $298 million as of last week.

Midyear Rebound

Viant’s revenue for the third quarter ended Sept. 30 decreased 4% compared with the same period a year earlier. The company predicted a dramatic drop in revenue for the last three months 2022 compared with the fourth quarter of 2021.

The earnings release for the fourth quarter and full year 2022 is scheduled for March 2, and the company is already looking for a rebound around the middle of this year.

“Midyear this year our industry should be rebounding,” the CEO said. “The U.S. consumer continues to be resilient.”

That resilience is important since consumer spending makes up an estimated 70% of the U.S. economy.

Vanderhook said Viant’s year 2022 “was a tale of two halves.”

“If you look at the beginning [of 2022], we were growing at double-digit rates,” he said. By August, Viant had withdrawn its previously announced guidance for 2022 annual revenue and adjusted EBITDA, a profit measure, “due to current macroeconomic conditions and uncertainty in the market.”

The company in November predicted fourth-quarter revenue of $52 million to $57 million, far below the $82.7 million chalked up in the last three months of 2021.

Job Changes

Viant, a few blocks away from John Wayne Airport, told federal regulators in December that it was laying off 46 people.

The company employed close to 150 people in OC and 350 companywide, as of mid-2022, according to Business Journal data.

“Although we did have layoffs, it was really to create that room to bring in product and engineering talent that we had not been able to get in 2022 and 2021,” Vanderhook said.

“We are hiring in the engineering and product side pretty drastically to continue some other proprietary initiatives that we’ve got under way internally and we’ll look to announce those later this year,” he said.

“It was like a famine I would say in hiring product and engineering talent in 2021 and first half of 2022.”

Viant had 29 jobs posted on its website as of Feb. 8, including 17 in the product and technology area.

No more layoffs are planned.

“We’ve tightened our belt as most organizations have in making sure we’re scrutinizing all variable expenses that are out,” Vanderhook said, expressing a “high degree of confidence” for 2023.

Google Suit

The Viant CEO expressed support for the federal government’s lawsuit against Google for monopolizing digital advertising technologies.

“We view the antitrust action taken by the government as a pretty substantial tailwind for independent demand-side platforms like Viant and some of our competitors. It will be a big boost for the open web as we refer to all of ourselves.”

He added: “This action should be quite a positive.”

Viant is positioning itself to grab a larger share of the digital advertising market, helping advertising agencies and marketers get placement for their customers across a variety of channels, including desktops, mobile phones, connected TVs, streaming audio and digital billboards.

Viant Pushes for Renewable Energy

As part of its overall goals, Viant Technology Inc. last week introduced a carbon impact reduction program known as Adtricity that’s aimed at assisting clients in meeting their sustainability goals.

“We understand that climate change cannot be addressed by one of us alone. It requires participation and action from us all,” CEO Tim Vanderhook said.

“We will be procuring all renewable energy to power all of our software and our data centers by the end of 2023,” Vanderhook told the Business Journal on Feb. 3.

He said company efforts also will include “lining up a clean supply chain path for the publisher partners that we buy advertising from as well.”

“We need to reduce carbon,” he says. Advertisers’ supply chain to procure and create products “needs to be clean and green.”

—Kevin Costelloe

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Kevin Costelloe
Kevin Costelloe
Tech reporter at Orange County Business Journal
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