| COMPANY |
The Trade Desk, Inc. |
| COURT |
United States District Court for the Central District of California |
| CASE NUMBER |
2:25-cv-01396 |
| JUDGE |
The Hon. Christina A. Snyder |
| CLASS PERIOD |
May 9, 2024 through February 12, 2025 |
| SECURITY TYPE |
Class A Common Stock |
LEAD PLAINTIFF DEADLINE IS APRIL 21, 2025.
If you have suffered losses and would like to discuss your rights, please fill out this form or you may contact Jonathan Naji, Esq. at (484) 270-1453 or via e-mail at info@ktmc.com.
Case Background:
A class action lawsuit was filed on behalf of those who purchased or otherwise acquired The Trade Desk, Inc. (“Trade Desk”) (NASDAQ: TTD) Class A common stock between May 9, 2024, and February 12, 2025, inclusive (the “Class Period”).
Leading up to the Class Period, Trade Desk launched Kokai on June 6, 2023, a generative artificial intelligence forecasting tool that enables users to more effectively deploy advertising spending. In a press release announcing the Kokai launch, Trade Desk described Kokai as a “co-pilot to the programmatic marketer” that digests over 13 million advertising impressions every second, helping “advertisers buy the right ad impressions, at the right price, to reach the target audience at the best time.”
Immediately after the Kokai launch, Trade Desk began rolling out Kokai (“the Kokai Rollout”) as the company began transitioning its clients to Kokai from the company’s older ad-buying platform Solimar, among other things. Trade Desk touted the transition to investors as a seamless “switch over to the new” platform, and one “without the disruption that comes from yanking something out of the box and maybe having something totally hate it and just be angry.” Trade Desk further claimed to expect “full adoption” of Kokai “over the course of 2024[.]”
Despite the alleged simplicity of the Kokai Rollout, including with respect to transitioning clients, Trade Desk’s CEO repeatedly expressed the importance of Kokai to the company’s business, describing it as the “largest platform overhaul in our [C]company’s history.”
The Class Period begins on May 9, 2024. After the markets closed the prior day on May 8, 2024, Trade Desk issued a press release announcing its financial results for the first quarter of 2024, ended March 31, 2024. In the release, Trade Desk reported first quarter revenue of $491 million, representing growth of 28% year-over-year. During the corresponding earnings call held that same day, Trade Desk’s CEO touted the success of the Kokai Rollout, stating, “I believe our revenue growth acceleration in the first quarter speaks to the innovation and value that we are delivering to our clients with Kokai.” Trade Desk’s CEO further highlighted how Kokai will allow its users to capitalize on advertising opportunities beyond the technology conglomerates, such as Facebook, Instagram, and Google, i.e., the “open Internet.”
On February 12, 2025, after market hours, Trade Desk issued a press release announcing its financial results for the fourth quarter and full year of 2024. In the release, Trade Desk reported fourth quarter revenue of $741 million—below the company’s previously issued guidance of $756 million and analysts’ estimates of $759.8 million. Additionally, Trade Desk’s revenue guidance of at least $575 million for the first quarter of 2025 missed analysts’ estimates of $581.5 million. During the earnings call held that same day, Trade Desk’s CEO disclosed that Trade Desk has yet to reach full adoption of Kokai, as the company is “maintaining 2 systems, Solimar and Kokai. This slows us down.”
On this news, the price of Trade Desk Class A common stock dropped $40.31 per share, or more than 32%, from a closing price of $122.23 per share on February 12, 2025, to a closing price of $81.92 per share on February 13, 2025.
The complaint alleges that, throughout the Class Period, Defendants made materially false and/or misleading statements, as well as failed to disclose material adverse facts about the company’s business, operations, and prospects. Specifically, Defendants failed to disclose to investors that: (1) Trade Desk was experiencing significant, ongoing, self-inflicted execution challenges rolling out Kokai, including transitioning clients to Kokai from the company’s older platform Solimar; (2) such execution challenges meaningfully delayed the Kokai Rollout; (3) Trade Desk’s inability to effectively execute the Kokai Rollout negatively impacted the company’s business and operations, particularly revenue growth; and (4) as a result, Defendants’ positive statements about the company’s business, operations, and prospects were materially misleading and/or lacked a reasonable basis at all relevant times.
What is a Lead Plaintiff?
A lead plaintiff is a representative party that acts on behalf of other class members in directing the litigation. In order to be appointed lead plaintiff, the Court must determine that the class member’s claim is typical of the claims of other class members, and that the class member will adequately represent the class. Your ability to share in any recovery is not, however, affected by the decision whether or not to serve as a lead plaintiff. Filling out the online form above or communicating with any counsel is not necessary to participate or share in any recovery achieved in this case. Any member of the purported class may move the court to serve as a lead plaintiff through counsel of his/her choice, or may choose to do nothing and remain an inactive class member.