Key Highlights

  • Revenue grew 17% year over year.
  • Adjusted EBITDA was USD 26 million, a 33% margin.
  • GAAP Net Income was USD 5.5 million, or USD 0.11 per diluted share.
  • Cash and marketable securities were USD 144 million with zero debt.

PubMatic, Inc. (NASDAQ:PUBM) reported third quarter 2026 Revenue growth of 17% year over year, with adjusted EBITDA more than doubling to a 33% margin. Reported EPS was USD 0.11 and revenue was USD 79.58 million, compared with estimates of EPS of negative USD 0.02 and revenue of USD 76.09 million.

Co-Founder and Chief Executive Officer Rajeev Goel said CTV, mobile app and emerging revenues, including Activate, AI and commerce related solutions, represented nearly two thirds of revenue, up from approximately 60% a quarter earlier.

Channel Performance

On a global basis, CTV growth accelerated to over 30% year over year and represented 21% of total revenue, with Americas CTV growth over 40%. Mobile app grew nearly 40% and was approximately 27% of total revenue. Emerging revenue streams more than doubled and reached an all time high of approximately 18% of total revenue, driven by adoption of new AI products including AgenticOS. Direct buying in Activate grew more than 8x over the third quarter of last year, and total display revenues grew 10%.

Political revenue was USD 5.6 million, up from USD 1.1 million in the third quarter of last year. Spend through mid-market DSP partners grew more than 40%, and spending across the top 10 ad verticals increased 17%, led by shopping, health and fitness, and hobbies and interest, which in aggregate increased over 30%.

Margins and Profit

Monetized impressions grew 15% while gross impressions processed were reduced by 8%. Gross Margin was nearly 70%, compared with 63% a year ago; management said 5 percentage points came from revenue growth and productivity and an additional 2 percentage points from a change in useful life of server infrastructure. Operating expenses were 8% lower year over year, primarily from productivity gains, with some hiring and go-to-market spend shifting into the fourth quarter.

Adjusted EBITDA was USD 26 million, a 33% margin, compared with USD 11.2 million and a 16% margin a year ago, marking the 42nd consecutive quarter of positive adjusted EBITDA. GAAP net income was USD 5.5 million, or USD 0.11 per diluted share.

Agentic Activity and Cash

Management said buyers have run more than 120 fully agentic campaigns on the platform since January, up from over 80 a quarter earlier, and that publishers have created 14,000 AI powered deals. In one example, a campaign built from a single prompt in PubMatic Assistant had its deal created 75 seconds later.

Cash from operations was USD 30.8 million and free Cash Flow was USD 17.6 million. The company ended the quarter with USD 144 million in cash and marketable securities and zero debt. It used USD 15.2 million to repurchase 1 million Class A shares in the quarter and has bought back 16.5 million Class A shares for USD 226.6 million since the program began in February 2023. The board approved a USD 150 million expansion of the repurchase program and extended it through the end of 2028, leaving approximately USD 198 million allocated.

Outlook Given on the Call

For the fourth quarter, the company gave revenue guidance of USD 91 million to USD 93 million, which it described as 15% growth at the midpoint, with adjusted EBITDA of USD 31 million to USD 33 million. For the full year it gave revenue of USD 312 million to USD 314 million and adjusted EBITDA of USD 79 million to USD 81 million. Full year Capital Expenditure guidance was raised to USD 24 million to USD 28 million.