Netflix Partners with Amazon, Slashing The Trade Desk’s Stock
URGENT UPDATE: In a shocking move for the advertising technology sector, Netflix has just announced a partnership with Amazon that allows advertisers to purchase ads on its platform through Amazon’s demand-side platform, Amazon DSP. This development, confirmed earlier today, marks a significant blow to adtech rival The Trade Desk, whose stock has plummeted over 10% in response.
The partnership, which will begin in Q4 of this year, enables advertisers to utilize Amazon’s self-service software to plan and buy ads across Netflix, significantly intensifying the competition in the connected-TV (CTV) space. Jeff Green, CEO of The Trade Desk, previously downplayed Amazon as a competitor, but analysts are now expressing serious concerns about his stance as the company’s stock has halved in value this year.
According to analysts at Morgan Stanley, who downgraded The Trade Desk’s stock from overweight to equal-weight today, the company’s price target has also been slashed from $80 to $50. They cited “lingering execution concerns, softness in the open web ad market, and intensifying competition in CTV,” particularly due to the rapid emergence of Amazon DSP as a formidable challenger.
The Trade Desk’s shares have now dropped over 60% year-to-date, with the latest announcement compounding the company’s challenges. The Trade Desk remains in a precarious position, having previously held an edge in key media partnerships. However, Amazon’s recent deals with Roku and Disney have shifted the landscape significantly.
“It is glaringly obvious The Trade Desk is under attack,” noted analysts at Lightshed Partners in their commentary on this partnership. A spokesperson for The Trade Desk emphasized their commitment to an open and competitive marketplace, asserting that they believe such competition will ultimately benefit their business.
As the landscape of adtech continues to evolve rapidly, this partnership between Netflix and Amazon is poised to have profound implications for the industry. Advertisers will be watching closely to see how this new collaboration shapes ad purchasing strategies and affects the competitive dynamics of the market.
Stay tuned for updates on this developing story, as the situation continues to unfold, impacting thousands of advertisers and reshaping the adtech ecosystem.
