There are bad earnings reports, and then there’s whatever The Trade Desk just did to its shareholders. The ad-tech darling that once traded like a growth stock unicorn reported Q4 numbers that technically beat estimates — and the stock cratered 16% in premarket trading anyway. When beating expectations still gets you punished, you know the narrative has completely turned against you.
Let’s start with the numbers that should have been good news. Q4 revenue came in at $847 million, up 14% year-over-year, edging past the $841 million Wall Street consensus. Adjusted earnings per share hit $0.59 versus the $0.58 estimate. Full-year 2025 revenue grew 18% to $2.9 billion, with adjusted EBITDA margins of 41%. For most companies, this would be a celebration. For The Trade Desk, it was a funeral.
The coffin nail was the Q1 2026 guidance: revenue of at least $678 million, roughly 1.5% below the $688 million analysts were expecting. That implies about 10% year-over-year growth — a meaningful deceleration from the mid-to-high teens pace investors had been tracking. To make matters worse, management declined to provide full-year 2026 guidance at all, leaving analysts to fill the void with their imaginations. And Wall Street’s imagination, when left unchecked, tends toward the catastrophic.
CEO Jeff Green was unusually candid on the earnings call. He acknowledged softness in consumer packaged goods and automotive advertising categories, headwinds he said the company hasn’t seen in over a decade. He also admitted this wasn’t the company’s best report. In a world where most CEOs treat earnings calls like PR exercises, Green’s honesty was refreshing — and terrifying for bulls.
The damage has been accumulating for a while now. The Trade Desk has lost roughly 66% of its value over the past year and more than 33% year-to-date before this latest hit. Loop Capital wasted no time, downgrading the stock to Hold and slashing its price target from $75 to $25 — a number that would have been unthinkable 18 months ago. Morgan Stanley flagged macro uncertainty, tariff concerns, and consumer spending pressure as factors that are disproportionately weighing on the advertising sector heading into 2026.
Here’s what makes this interesting for traders paying attention: the analyst consensus price target still sits around $48, well above where the stock is trading after the premarket selloff. That gap between where Wall Street says the stock should be and where the market is actually pricing it tells you there’s a tug-of-war happening. Either the analysts are behind the curve and need to slash their targets further, or the market is overshooting to the downside and creating an opportunity.
The Trade Desk’s fundamental pitch hasn’t changed — it’s an independent demand-side platform that doesn’t own ad inventory, which theoretically makes it the most objective buyer in the programmatic advertising ecosystem. The company also authorized a fresh $500 million share repurchase program, signaling that management thinks the stock is cheap. But “cheap” and “done falling” are two very different things, especially when growth is decelerating and the CEO himself is managing expectations downward. For now, this is a show-me story. And so far, the showing hasn’t been great.