PubMatic Advances AI Solutions For Ad Buying

PubMatic reported sizable growth in Q3, with revenue totaling $79.6 million, according to AdExchanger. This represents a 17% increase from the same period last year. The company's growth is attributed to advancing AI solutions and increased demand for CTV and mobile app advertising.

CTV spend accounted for 21% of PubMatic's total revenue in Q3, up 30% year over year, while mobile app revenue grew nearly 40% year over year, making up roughly 27% of quarterly revenue. CFO Steve Pantelick shared these figures with investors on Monday afternoon's earnings call.

PubMatic launched AgenticOS, its operating system for agentic advertising, in January, and buyers have used it to run over 120 fully agentic campaigns, with roughly one-third of these campaigns happening in Q3. The company expects this number to increase in the future.

CEO Rajeev Goel suggested that whatever parts of a campaign are not yet being done by AI soon will be, as some clients are 'all in on AI' while others prefer to manually review each step of the campaign. Goel described this as different 'parts of the maturity spectrum'.

However, some experts caution against over-reliance on AI in ad buying, citing potential risks such as a 'winner takes all' situation for brands and concerns over consumer privacy. Jonathan Roberts, head of innovation at People Inc., warned that automating choice can have negative consequences.

Meanwhile, WPP-owned ad agency Ogilvy is partnering with Creative Artists Agency (CAA) to use AI-generated ads featuring CAA's celebrity clients. The ads will use data from CAA's library of digital face and body scans and will be watermarked as AI and approved by the talent featured.

Despite the potential benefits of AI-generated ads, some consumers may be hesitant to accept them due to existing associations with online scam ads. However, with the right approach, AI can provide personalized responses that cater to user preferences while protecting consumer privacy.