The Trade Desk (NAS:TTD) ROA %

: 3.16% (As of Jun. 2023)

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ROA % is calculated as Net Income divided by its average Total Assets over a certain period of time. The Trade Desk's annualized Net Income for the quarter that ended in Jun. 2023 was $132 Mil. The Trade Desk's average Total Assets over the quarter that ended in Jun. 2023 was $4,173 Mil. Therefore, The Trade Desk's annualized ROA % for the quarter that ended in Jun. 2023 was 3.16%.

The historical rank and industry rank for The Trade Desk's ROA % or its related term are showing as below:

TTD' s ROA % Range Over the Past 10 Years
Min: 1.34 Med: 7.61 Max: 10.81
Current: 3.18

During the past 9 years, The Trade Desk's highest ROA % was 10.81%. The lowest was 1.34%. And the median was 7.61%.

TTD's ROA % is ranked better than
61.53% of 2841 companies
in the Software industry
Industry Median: 0.51 vs TTD: 3.18

The Trade Desk ROA % Historical Data

The historical data trend for The Trade Desk's ROA % can be seen below:

* For Operating Data section: All numbers are indicated by the unit behind each term and all currency related amount are in USD.
* For other sections: All numbers are in millions except for per share data, ratio, and percentage. All currency related amount are indicated in the company's associated stock exchange currency.

* Premium members only.

The Trade Desk Annual Data

Trend

Dec14

Dec15

Dec16

Dec17

Dec18

Dec19

Dec20

Dec21

Dec22

ROA %

9.21

7.61

10.81

4.35

1.34

The Trade Desk Quarterly Data
	Sep18	Dec18	Mar19	Jun19	Sep19	Dec19	Mar20	Jun20	Sep20	Dec20	Mar21	Jun21	Sep21	Dec21	Mar22	Jun22	Sep22	Dec22	Mar23	Jun23
ROA %																-2.15	1.67	6.86	0.89	3.16

Competitive Comparison

For the Software - Application subindustry, The Trade Desk's ROA %, along with its competitors' market caps and ROA % data, can be viewed below:

* Competitive companies are chosen from companies within the same industry, with headquarter located in same country, with closest market capitalization; x-axis shows the market cap, and y-axis shows the term value; the bigger the dot, the larger the market cap. Note that "N/A" values will not show up in the chart.

Annual Data Quarterly Data

The Trade Desk ROA % Distribution

For the Software industry and Technology sector, The Trade Desk's ROA % distribution charts can be found below:

* The bar in red indicates where The Trade Desk's ROA % falls in comparison to its industry or sector. The grey bar indicates the ROA %'s extreme value range as defined by GuruFocus.

The Trade Desk ROA % Calculation

The Trade Desk's annualized ROA % for the fiscal year that ended in Dec. 2022 is calculated as:

ROA %	=	Net Income (A: Dec. 2022 )	/	( (Total Assets (A: Dec. 2021 )	+	Total Assets (A: Dec. 2022 ))	/ count )
	=	53.385	/	( (3577.34	+	4380.679)	/ 2 )
	=	53.385	/	3979.0095
	=	1.34 %

The Trade Desk's annualized ROA % for the quarter that ended in Jun. 2023 is calculated as:

ROA %	=	Net Income (Q: Jun. 2023 )	/	( (Total Assets (Q: Mar. 2023 )	+	Total Assets (Q: Jun. 2023 ))	/ count )
	=	131.756	/	( (3999.638	+	4346.968)	/ 2 )
	=	131.756	/	4173.303
	=	3.16 %

In the calculation of annual ROA %, the net income of the last fiscal year and the average total assets over the fiscal year are used. In calculating the quarterly data, the Net Income data used here is four times the quarterly (Jun. 2023) net income data. ROA % is displayed in the 30-year financial page.

The Trade Desk (NAS:TTD) ROA % Explanation

ROA % measures the rate of return on the total assets (shareholder equity plus liabilities). It measures a firm's efficiency at generating profits from shareholders' equity plus its liabilities. ROA % shows how well a company uses what it has to generate earnings. ROA %s can vary drastically across industries. Therefore, ROA % should not be used to compare companies in different industries. For retailers, a ROA % of higher than 5% is expected. For example, Wal-Mart (WMT) has a ROA % of about 8% as of 2012. For banks, ROA % is close to their interest spread. A banks ROA % is typically well under 2%.

Similar to ROE, ROA % is affected by profit margins and asset turnover. This can be seen from the Du Pont Formula:

	ROA %		(Q: Jun. 2023 )
=	Net Income	/	Total Assets
=	131.756	/	4173.303
=	(Net Income / Revenue)	*	(Revenue / Total Assets)
=	(131.756 / 1857.016)	*	(1857.016 / 4173.303)
=	Net Margin %	*	Asset Turnover
=	7.1 %	*	0.445
=	3.16 %

Note: The Net Income data used here is four times the quarterly (Jun. 2023) net income data. The Revenue data used here is four times the quarterly (Jun. 2023) revenue data.

Be Aware

Like ROE, ROA % is calculated with only 12 months data. Fluctuations in the company's earnings or business cycles can affect the ratio drastically. It is important to look at the ratio from a long term perspective. ROA % can be affected by events such as stock buyback or issuance, and by goodwill, a company's tax rate and its interest payment. ROA % may not reflect the true earning power of the assets. A more accurate measurement is ROC % (ROC).

Many analysts argue the higher return the better. Buffett states that really high ROA % may indicate vulnerability in the durability of the competitive advantage.

E.g. Raising $43b to take on KO is impossible, but $1.7b to take on Moody's is. Although Moody's ROA % and underlying economics is far superior to Coca Cola, the durability is far weaker because of lower entry cost.

The Trade Desk ROA % Related Terms

Thank you for viewing the detailed overview of The Trade Desk's ROA % provided by GuruFocus.com. Please click on the following links to see related term pages.

The Trade Desk (NAS:TTD) Business Description

Industry

GURUFOCUS.COM » STOCK LIST » Technology » Software » The Trade Desk Inc (NAS:TTD) » Definitions » ROA %

Comparable Companies

Traded in Other Exchanges

TTD:Mexico TT8:Germany T2TD34:Brazil TTD:Austria

Address

42 N. Chestnut Street, Ventura, CA, USA, 93001

Website

https://www.thetradedesk.com

The Trade Desk provides a self-service platform that helps advertisers and ad agencies programmatically find and purchase digital ad inventory (display, video, audio, native, and social) on different devices like computers, smartphones, digital out of home, and connected TVs. It utilizes data to optimize the performance of ad impressions purchased. The firm's platform is referred to as a demand-side platform in the digital ad industry. The firm generates its revenue from fees based on a percentage of what its clients spend on advertising. The Trade Desk became a public company in 2016 and has since increased revenue at a 43% average annual rate. During that period, it has been profitable with operating margins of 10%-28%.

Executives

Laura Schenkein	officer: Chief Financial Officer	C/O THE TRADE DESK, INC., 42 NORTH CHESTNUT STREET, VENTURA CA 93001
Andrea Lee Cunningham	director	C/O TRADE DESK, INC., 42 N. CHESTNUT STREET, VENTURA CA 93001
Michelle Hulst	officer: Chief Operating Officer	130 MERCHANT STREET, HONOLULU HI 96813
Jay R Grant	officer: Chief Legal Officer	225 E. 79TH STREET, APT 12E, NEW YORK NY 10075
Thomas Falk	director	2220 WEST 14TH STREET, TEMPE AZ 85281
Blake Jeffrey Grayson	officer: Chief Financial Officer	2212 EVERETT AVENUE E, SEATTLE WA 98102
Lise J Buyer	director	1600 AMPHITHEATRE PARKWAY, MOUNTAIN VIEW CA 94043
Vivian Yang	officer: Chief Legal Officer	C/O VIANT TECHNOLOGY INC., 2722 MICHELSON DRIVE, SUITE 100, IRVINE CA 92612
Susan Vobejda	officer: Chief Marketing Officer	130 EAST RANDOLPH STREET, 7TH FLOOR, CHICAGO IL 60601
Gokul Rajaram	director	301 CONGRESS AVENUE, SUITE 700, AUSTIN TX 78701
Eric B Paley	director, 10 percent owner	C/O THE TRADE DESK, INC., 42 N. CHESTNUT ST., VENTURA CA 93001
Founder Collective Entrepreneurs' Fund, Llc	10 percent owner	1 MIFFLIN PLACE, SUITE 300, CAMBRIDGE MA 02138
David A. Frankel	10 percent owner	1 MIFFLIN PLACE SUITE 300, CAMBRIDGE MA 02138
Founder Collective Gp, Llc	10 percent owner	1 MIFFLIN PLACE SUITE 300, CAMBRIDGE MA 02138
Founder Collective, L.p.	10 percent owner	1 MIFFLIN PLACE, SUITE 300, CAMBRIDGE MA 02138