TTD's 27% Slide Intensifies Credibility and Competition Concerns

What happened

The Trade Desk's stock has dropped 27% over the past month, driven by macro volatility, rising costs, and fierce CTV competition, despite its AI and open-internet initiatives. This decline validates the DeepValue report's warning of a credibility crisis, exacerbated by recent CFO turnover and Amazon's exclusive CTV deals with Roku and Netflix. Filings reveal that platform operations expenses, particularly from hosting and new data centers, are growing faster than revenue, squeezing margins and overshadowing growth bets. The upcoming Feb 25, 2026 earnings report is a critical binary event, where missing the reaffirmed Q4 guidance of ≥$840M revenue could break investor trust and trigger further downside. Market sentiment has hardened from viewing issues as temporary to recognizing structural threats from governance instability and Amazon's encroachment on premium CTV inventory.

Implication

The sharp stock decline reflects eroding confidence in TTD's ability to manage rising capex and hosting costs, which threaten operating leverage and long-term profitability. Amazon's exclusive CTV partnerships pose a direct challenge to TTD's neutral DSP positioning, risking market share erosion unless offset by competitive wins. Upcoming earnings on Feb 25 are pivotal; a miss would validate bearish scenarios and could drive the stock toward the DeepValue report's bear case of $16, while a beat might offer a cautious entry only if accompanied by a credible capex outlook. Investors must scrutinize management's communication and stability, as prolonged CFO interim status or poor disclosure quality could sustain multiple compression. Ultimately, any investment hinges on proof that TTD can normalize infrastructure spend while defending its CTV access against Amazon's aggressive moves.

Thesis delta

The 27% slide reinforces the DeepValue report's 'WAIT' rating, indicating that TTD's credibility and competition woes are intensifying rather than easing. No fundamental shift in the thesis is required, but the decline heightens the urgency for the company to deliver on Feb 25 earnings and provide clarity on capex and leadership stability to avoid further downside.