PubMatic Announces First Quarter 2026 Financial Results

Published: 2026-05-07 16:06:06 ET PUBM

Delivered revenue and adjusted EBITDA ahead of guidance; 1,000+ AI-powered deals on PubMatic AgenticOS; 20+ AI agents available on AgenticOS, reduces operational workflows to minutes; Net cash generated from operations was $17.3 million, up 11% over Q1 2025; Repurchased 1.0 million shares in Q1 2026, representing 2.1% of fully diluted shares1 as of March 31, 2026.

Published on 05/07/2026 at 04:06 pm EDT

PubMatic, Inc. (Nasdaq: PUBM), the leading AI-powered ad tech company delivering digital advertising performance, today reported financial results for the quarter ended March 31, 2026.

“We delivered an exceptional first quarter, exceeding guidance on both revenue and adjusted EBITDA. Adoption of our AI capabilities continues to accelerate, with more than 20 agents now embedded across our platform and fully autonomous campaigns scaling globally. Importantly, the repeat engagement we’re seeing from customers underscores that AgenticOS is simplifying the ecosystem and redefining how value is created,” said Rajeev Goel, co-founder and CEO at PubMatic. “Each additional campaign compounds our data advantage, delivers measurable performance, and accelerates our underlying growth. As an early leader in AI, our multi-year investments are driving new revenue streams, expanding operating leverage, and strengthening our competitive position.”

First Quarter 2026 Financial Highlights

The section titled “Non-GAAP Financial Measures” below describes our usage of non-GAAP financial measures. Reconciliations between historical GAAP and non-GAAP information are contained at the end of this press release following the accompanying financial data.

“Our first-quarter results exceeded expectations on both revenue and profitability, reflecting the breadth and strength of our diversified platform. Excluding the legacy DSP referenced in mid-2025, our underlying business grew 13% year-over-year and represented 83% of total revenues,” said Steve Pantelick, CFO at PubMatic. “We also delivered our 40th consecutive quarter of positive adjusted EBITDA, highlighting the durability of our model, ongoing productivity gains, and expense discipline. AI is an increasingly important financial lever for PubMatic, powering revenue growth, expanding margins, and improving efficiency across the business. These benefits compound as adoption scales. We expect to return to double-digit revenue growth in the second half of 2026, with corresponding margin expansion.”

Business Highlights

AgenticOS Adoption Drives Momentum

Top Global Commerce Media Partners Added

New Partnerships Expand Scale and Data Integrations

New AI-Powered Solutions Drive Performance and Streamline Omnichannel Workflows

Diversified revenue mix and expanded reach on the buy side

Operating priorities drove profitable growth

Financial Outlook

Our outlook assumes that general market conditions do not significantly deteriorate as it relates to current macroeconomic and geopolitical conditions.

For the second quarter of 2026, we expect the following:

Although we provide guidance for adjusted EBITDA, we are not able to provide guidance for net income (loss), the most directly comparable GAAP measure. Certain elements of the composition of GAAP net income (loss), including stock-based compensation expenses, are not predictable, making it impractical for us to provide guidance on net income or to reconcile our adjusted EBITDA guidance to net income without unreasonable efforts. For the same reason, we are unable to address the probable significance of the unavailable information.

Conference Call and Webcast details

PubMatic will host a conference call to discuss its financial results on Thursday, May 7, 2026 at 1:30 p.m. Pacific Time (4:30 p.m. Eastern Time). A live webcast of the call can be accessed from PubMatic’s Investor Relations website at https://investors.pubmatic.com. An archived version of the webcast will be available from the same website after the call.

___________________________ 1 Fully diluted shares include common shares outstanding as of March 31, 2026 plus dilutive securities related to employee stock awards under the treasury stock method, calculated as if the Company were in a net income position.

2 Emerging revenue includes Activate, Commerce Media, Connect and AI Solutions.

Non-GAAP Financial Measures

In addition to our results determined in accordance with U.S. generally accepted accounting principles (GAAP), including, in particular operating loss, net cash provided by operating activities, and net loss, we believe that adjusted EBITDA, adjusted EBITDA margin, non-GAAP net income, non-GAAP earnings per share and free cash flow, each a non-GAAP measure, are useful in evaluating our operating performance. We define adjusted EBITDA as net loss adjusted for stock-based compensation expense, depreciation and amortization, litigation related expenses, interest income, and benefit from income taxes. Adjusted EBITDA margin represents adjusted EBITDA calculated as a percentage of revenue. We define non-GAAP net income as net loss adjusted for stock-based compensation expense, litigation related expenses, and adjustments for income taxes. We define non-GAAP free cash flow as net cash provided by operating activities reduced by purchases of property and equipment and capitalized software development costs.

In addition to operating loss and net loss, we use adjusted EBITDA and non-GAAP net loss as measures of operational efficiency. We believe that these non-GAAP financial measures are useful to investors for period to period comparisons of our business and in understanding and evaluating our operating results for the following reasons:

Our use of non-GAAP financial measures has limitations as an analytical tool, and you should not consider them in isolation or as a substitute for analysis of our financial results as reported under GAAP. Some of these limitations are as follows:

Because of these and other limitations, you should consider adjusted EBITDA and non-GAAP net loss along with other GAAP-based financial performance measures, including net income and our GAAP financial results.

Forward Looking Statements

This press release contains “forward-looking statements” regarding our future business expectations, including our guidance relating to our revenue and adjusted EBITDA for the second quarter of 2026, our expectations regarding our adjusted EBITDA, free cash flow, capital expenditures, future adoption and deployment of our AI-enabled products, future market growth, and our long-term revenue growth. These forward-looking statements are based on our current expectations and assumptions regarding our business, the economy and other future conditions and may differ materially from actual results due to a variety of factors including: our dependency on the overall demand for advertising and the channels we rely on; our existing customers not expanding their usage of our platform, or our failure to attract new publishers and buyers; our ability to maintain and expand access to spend from buyers and valuable ad impressions from publishers; the rejection of the use of digital advertising by consumers through opt-in, opt-out or ad-blocking technologies or other means; our failure to innovate and develop new solutions that are adopted by publishers; geopolitical tensions and uncertainty, including the conflicts in Ukraine and the Middle East, and the related measures taken in response by the global community and disruptions to the international supply chain and global commerce; the impacts of inflation and tariffs as well as fiscal tightening; changes currency exchange environments and continuing volatility in global capital markets; volatile interest rates; public health crises, including the resulting global economic uncertainty; limitations imposed on our collection, use or disclosure of data about advertisements, including as it may impact our use of Artificial Intelligence and additional AI laws and regulations are enacted globally; the lack of similar or better alternatives to the use of third-party cookies, mobile device IDs or other tracking technologies if such uses are restricted; any failure to scale our platform infrastructure to support anticipated growth and transaction volume; liabilities or fines due to publishers, buyers, and data providers not obtaining consents from consumers for us to process their personal data; any failure to comply with laws and regulations related to data privacy, data protection, information security, and consumer protection; and our ability to manage our growth. Moreover, we operate in a competitive and rapidly changing market, and new risks may emerge from time to time. For more information about risks and uncertainties associated with our business, please refer to the “Management’s Discussion and Analysis of Financial Condition and Results of Operations” and “Risk Factors” sections of our SEC filings, including but not limited to, our annual report on Form 10-K and quarterly reports on From 10-Q, copies of are available on our investor relations website at https://investors.pubmatic.com and on the SEC website at www.sec.gov. Additional information will also be set forth in our Quarterly Report on Form 10-Q for the quarter ended March 31, 2026. All information in this press release is as of May 7, 2026. We undertake no obligation to update any forward-looking statement, whether as a result of new information, future developments or otherwise, except as may be required by law.

About PubMatic

PubMatic is the leading AI-powered ad tech company delivering digital advertising performance. Through an intelligent, unified platform that connects buyers, publishers, data partners, and commerce media networks, PubMatic delivers superior performance with great transparency, control, and efficiency. Since 2006, PubMatic has pioneered major advances in programmatic advertising, from enabling the first OpenRTB transactions to embedding AI-driven optimization and privacy-focused innovation across its platform. With omnichannel scale, proven reliability, and a track record of continuous innovation, PubMatic is building a more intelligent, profitable, and sustainable open internet. Built to Connect. Powered to Perform.

CONDENSED CONSOLIDATED BALANCE SHEETS

(In thousands)

(unaudited)

March 31, 2026

December 31, 2025

ASSETS

Current assets

Cash and cash equivalents

144,876

145,518

Accounts receivable, net

336,904

358,240

Prepaid expenses and other current assets

22,397

18,889

Total current assets

504,177

522,647

Property, equipment and software, net

50,139

52,657

Operating lease right-of-use assets

36,267

38,149

Acquisition-related intangible assets, net

2,309

2,704

Goodwill

29,577

Deferred tax assets

32,409

30,986

Other assets, non-current

4,563

3,475

TOTAL ASSETS

659,441

680,195

LIABILITIES AND STOCKHOLDERS' EQUITY

Current liabilities

Accounts payable

342,644

343,619

Accrued liabilities

18,616

25,278

Operating lease liabilities, current

7,601

6,953

Total current liabilities

368,861

375,850

Operating lease liabilities, non-current

34,779

36,910

Other liabilities, non-current

4,801

4,846

TOTAL LIABILITIES

408,441

417,606

Stockholders' Equity

Common stock

Treasury stock

(202,296

)

(193,471

)

Additional paid-in capital

330,962

321,062

Accumulated other comprehensive income (loss)

(86

)

Retained earnings

122,413

134,923

TOTAL STOCKHOLDERS’ EQUITY

251,000

262,589

TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY

659,441

680,195

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS

(In thousands, except per share data)

(unaudited)

Three Months Ended March 31,

2026

2025

Revenue

62,567

63,825

Cost of revenue(1)

26,094

25,588

Gross profit

36,473

38,237

Operating expenses:(1)

Technology and development

7,986

8,772

Sales and marketing

28,965

26,799

General and administrative

14,795

14,569

Total operating expenses

51,746

50,140

Operating loss

(15,273

)

(11,903

)

Total other income, net

162

579

Loss before income taxes

(15,111

)

(11,324

)

Benefit from income taxes

(2,601

)

(1,838

)

Net loss

(12,510

)

(9,486

)

Net loss per share attributable to common stockholders:

Basic

(0.27

)

(0.20

)

Diluted

(0.27

)

(0.20

)

Weighted-average shares used to compute net loss per share attributable to common stockholders:

Basic

47,120

48,346

Diluted

47,120

48,346

(1)Stock-based compensation expense includes the following:

STOCK BASED COMPENSATION EXPENSE

(In thousands)

(unaudited)

Three Months Ended March 31,

2026

2025

Cost of revenue

$ 384

$ 474

Technology and development

1,029

1,585

Sales and marketing

3,057

3,463

General and administrative

4,018

4,176

Total stock-based compensation

$ 8,488

$ 9,698

CONDENSED CONSOLIDATED STATEMENT OF CASH FLOWS

(In thousands)

(unaudited)

Three Months Ended March 31,

2026

2025

OPERATING ACTIVITIES:

Net loss

(12,510

)

(9,486

)

Adjustments to reconcile net loss to net cash provided by operating activities:

Depreciation and amortization

9,988

11,676

Stock-based compensation

8,488

9,698

Deferred income taxes

(1,423

)

(4,754

)

Accretion of discount on marketable securities

—

(454

)

Non-cash lease expense

1,840

1,928

Other

(676

)

(223

)

Changes in operating assets and liabilities:

Accounts receivable

21,335

75,691

Prepaid expenses and other current assets

4,082

5,681

Accounts payable

(997

)

(62,578

)

Accrued liabilities

(11,382

)

(11,287

)

Operating lease liabilities

(1,444

)

(590

)

Other liabilities, non-current

)

319

Net cash provided by operating activities

17,295

15,621

INVESTING ACTIVITIES:

Purchases of and deposits on property and equipment

(11

)

(1,441

)

Capitalized software development costs

(6,579

)

(6,880

)

Purchases of marketable securities

—

(15,307

)

Proceeds from maturities of marketable securities

—

13,559

Purchase of equity investment

(3,000

)

—

Net cash used in investing activities

(9,590

)

(10,069

)

FINANCING ACTIVITIES:

Proceeds from exercise of stock options

477

563

Principal payments on finance lease obligations

(36

)

(35

)

Payments to acquire treasury stock

(8,500

)

(5,000

)

Net cash used in financing activities

(8,059

)

(4,472

)

NET INCREASE (DECREASE) IN CASH AND CASH EQUIVALENTS

(354

)

1,080

Effect of foreign currency on cash

(288

)

279

CASH AND CASH EQUIVALENTS - Beginning of year

145,518

100,452

CASH AND CASH EQUIVALENTS - End of year

144,876

101,811

RECONCILIATION OF GAAP NET LOSS TO NON-GAAP ADJUSTED EBITDA AND NON-GAAP NET LOSS

(In thousands, except per share amounts)

(unaudited)

Three Months Ended March 31,

2026

2025

Reconciliation of net loss:

Net loss

(12,510

)

(9,486

)

Add back (deduct):

Stock-based compensation

8,488

9,698

Depreciation and amortization

9,988

11,676

Litigation related expenses(2)

438

—

Interest income

(1,215

)

(1,593

)

Benefit from income taxes

(2,601

)

(1,838

)

Adjusted EBITDA

2,588

8,457

Revenue

62,567

63,825

Adjusted EBITDA margin

Three Months Ended March 31,

2026

2025

Reconciliation of net loss per share:

Net loss

(12,510

)

(9,486

)

Add back (deduct):

Stock-based compensation

8,488

9,698

Litigation related expenses(2)

438

—

Adjustment for income taxes

(1,831

)

(2,055

)

Non-GAAP net loss

(5,415

)

(1,843

)

GAAP diluted EPS

(0.27

)

(0.20

)

Non-GAAP diluted EPS

(0.11

)

(0.04

)

GAAP weighted average shares outstanding—diluted

47,120

48,346

Non-GAAP weighted average shares outstanding—diluted

47,120

48,346

(2)Litigation related expenses represents external legal fees and other expenses, net of insurance recoveries, associated with pending litigation that arose outside of the ordinary course of business. These costs related to a discrete matter, and are not representative of our underlying operating performance. We do not adjust for legal expenses incurred in our ordinary course of business.

Reported GAAP and Non-GAAP diluted loss per share for the three months ended March 31, 2026 and 2025 were calculated using basic share count.

SUPPLEMENTAL CASH FLOW INFORMATION

COMPUTATION OF FREE CASH FLOW, A NON-GAAP MEASURE

(In thousands)

(unaudited)

Three Months Ended March 31,

2026

2025

Reconciliation of cash provided by operating activities:

Net cash provided by operating activities

$ 17,295

$ 15,621

Less: Purchases of property and equipment

(11)

(1,441)

Less: Capitalized software development costs

(6,579)

(6,880)

Free cash flow

$ 10,705

$ 7,300

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