Ad tech company DoubleVerify plunges 40% today, -62% from peak, 3 years after going public. Earn WOLF STREET downgrade to “Should never have bought”

DoubleVerify is particularly important to us because it blacklists WOLF STREET in the “brand safety” services it offers to advertisers.

By Wolf Richter for WOLF STREET.

DoubleVerify Holdings shares [DV] After reporting earnings last night, the company plunged 40% today to currently $18.25. Shares are now 62% below their June 29, 2021 intraday peak and well below the April 2021 IPO price of $27.

The ad tech company has wedged itself between advertisers and Internet publishers, trying to extort money from both for various services it touts with dubious claims. Before today's mishap, the market cap was $5.3 billion, but now it has fallen by $2.1 billion to $3.2 billion.

Its shares plunged today as the company disclosed some problems and cut its full-year revenue forecast to $663 million to $675 million from $688 million to $704 million; and it lowered its “adjusted EBITDA” guidance; It said: “primarily due to the uneven spending patterns of the select large retail and CPG advertisers that we mentioned last quarter.”

Net income shrank 42% to $7.1 million; and shrunk further after the currency translation adjustment to just $2.5 million, which is close to zero for a company even with a new and improved market cap of $3.2 billion. WOLF STREET downgrades DV from “should have sold already” to “should never have bought”.

The company's IPO took place in April 2021, just two months after the peak of hype and tumult in February 2021. In March 2021, we were amazed at how all of these things fell apart and created our pantheon of imploded stocks, where we have the After placing stocks they fell by 70% or more. And we're now busy making some room for DoubleVerify in this increasingly crowded pantheon.

DoubleVerify is particularly important to us because it blacklists WOLF STREET as part of the brand safety services it offers to advertisers. In fact, advertisers pay DoubleVerify to ensure that their carefully crafted and expensive communications do not reach our readers.

Our readers typically have high incomes; many have significant investments; many work in finance or real estate; many owned businesses, from financial advisory firms to manufacturing companies; many are top managers. A number of them have reached out to me and donated very generously to WOLF STREET (which is primarily funded through donations).

These are readers that advertisers find difficult to reach with their communications, particularly financial services companies. However, some of these advertisers pay DoubleVerify to prevent their communications from reaching our readers. Not only is this a lousy deal for advertisers, but it also costs WOLF STREET significant advertising revenue.

In July 2020, DoubleVerify announced that it had updated some terms after its “social justice hackathon” – we’re not kidding. For example, the company has replaced the word “blacklist” with “exclusion list” in the services it offers to advertisers because, as you know, it contains the word “black.” It also replaced the term “whitelist” as it contains the word “white”.

“DoubleVerify ensures advertisers get what they pay for by ensuring ads are seen by their intended audience and do not appear next to objectionable content,” is how Barron's touted the service today when reporting on the DV consulting debacle – the offensive content These are the articles and charts you see on WOLF STREET.

Advertising technology – from Google on down, including companies like DoubleVerify – has sucked more and more advertising dollars out of the flow between advertisers and publishers, where advertisers pay more and more and publishers get less and less. Meanwhile, there is a long list of online publishers that are losing jobs to the bones have broken down and many of them have closed completely.

Luckily, WOLF STREET is supported primarily by the donations of many generous and loyal readers, the very people DoubleVerify doesn't want to see in its advertisers' communications.

Do you enjoy reading WOLF STREET and would you like to support it? You can donate. I appreciate it very much. Click on the beer and iced tea mug to find out how:

Would you like to be notified by email when WOLF STREET publishes a new article? Login here.