What Happened:

Shares of programmatic advertising platform Pubmatic (NASDAQ: PUBM) fell 6.8% in the after-market session after the company reported first quarter results that beat analysts' revenue, adjusted EBITDA, and earnings per share (EPS) estimates. However, gross margin declined, and net retention rate deteriorated. On a more positive note, revenue and adjusted EBITDA guidance for the next quarter were above Consensus, while full-year free cash flow is expected to be on par with 2022. Management provided a cautious note adding that "macroeconomic conditions continue to be challenging, and advertisers remain cautious" but also added that the company is outperforming the overall addressable market (therefore taking share). Overall, it was a mixed but solid quarter.

What is the market telling us:

PubMatic's shares are quite volatile and over the last year have had 32 moves greater than 5%. In context of that, today's move is indicating the market considers this news meaningful but not something that would fundamentally change its perception of the business.

PubMatic is down 0.08% since the beginning of the year, and at $13.16 per share it is trading 43.6% below its 52-week high of $23.35 from August 2022. Investors who bought $1,000 worth of PubMatic's shares at the IPO in December 2020 would now be looking at an investment worth $446.86.

Is now the time to buy PubMatic? Access our full analysis of the earnings results here, it's free.