Pricing and Take Rate

Pricing and Take Rate

Between $159 million and $177 million of The Trade Desk's $451.5 million FY2025 revenue increase — 35% to 39% of it — came from keeping a larger share of each dollar crossing the platform rather than from more dollars crossing it. The range is the price/volume interaction term, which the upper figure assigns to the rate leg (the rate change applied to FY2025 gross spend) and the lower to the volume leg (the rate change applied to FY2024 gross spend); the rest of this chapter uses the upper convention. The filings show why: the fee base was redescribed in FY2024, third-party data is moving from a client-billed pass-through to a company-priced product, and a 4.5% fee now sits on the publisher side. All three are real, all three are finite.

Source: derived from reported revenue and gross spend, FY2024 and FY2025 Forms 10-K [1]; [10].

What the fee is charged on

Through FY2023 the company described its charge in one sentence: "We charge our clients a platform fee, which is generally a percentage of the clients' purchases through the platform. In addition, we invoice our clients for the cost of advertising inventory purchased, plus data and any add-on features purchased through the platform." [2] The fee was a percentage of media. Data and add-ons were invoiced alongside it and largely passed through.

The FY2024 filing replaced that sentence. "We charge our clients for total spend on our platform, which includes spend and fees on advertising inventory, value-added services and data to support those purchases, in addition to the platform fee that is generally based on a percentage of our clients' total spend on the platform." [3] Two things changed inside one paragraph. Data and add-ons became "value-added services and data" — a category the company charges fees on, not merely invoices. And the percentage fee is now described as applying to total spend, which by the same sentence includes those service and data fees. The percentage sits on top of a wider base.

The gross-spend footnote was rewritten in the same filing, from "the amount of a client's purchases through our platform plus the platform fee" [4] to "the amount of a client's spend on our platform for advertising inventory, value-added services and data; plus the platform fee, which is generally based on a percentage of a client's total spend on our platform." [1]

These are descriptions of contracts, not an announced price change, and the take rate did not move in FY2024 — it moved the year after. What the language records is the architecture that the FY2025 step then used.

Where FY2025's revenue increase came from

Splitting each year's revenue increase into the part explained by more gross spend at the prior year's rate, and the part explained by the change in rate, separates volume from price.

Source: derived from reported revenue and gross spend, FY2021–FY2025 Forms 10-K [1]; [10]; [4]; [9].

Across FY2023 and FY2024 the rate contributed a net negative $6 million to two years of revenue increases totalling $867 million. In FY2025 it contributed $177 million. Held at the FY2024 rate of 20.30%, FY2025 revenue would have been about $2,720 million and growth 11.2% rather than the reported 18.5% — the same figure as gross-spend growth, which is what a fixed percentage fee produces.

The company's own attribution matches. For FY2021 through FY2024 the filings explained revenue growth by volume alone: "more advertisers and more campaigns executed by existing clients" (FY2022 [8] and FY2023 [7]), "more campaigns executed by existing clients, new clients and higher spend per campaign" (FY2024 [6]). No pricing clause appears in any of them.

The FY2025 paragraph adds one: revenue rose partly on "a higher proportion of revenue earned from client spend due to increased utilization of our value-added services and data; and higher platform fees," with "increased pricing associated with value-added services and data" named as a driver [5]. The March 2026 quarter repeats the construction and moves pricing to the front of the list [11].

Data moves from pass-through to product

The mechanism behind "increased pricing associated with value-added services and data" is visible in the product record. In the fourth quarter of 2025 the company overhauled its third-party data marketplace and launched Audience Unlimited, which "enables our users to use third-party data for a single fee" [13]. On the February 2026 call the chief executive described it as "a flat cost structure … for an all-in cost," adding that it is "completely optional" and that clients "can use it or continue to buy third-party data a la carte" [12].

The accounting consequence is set out in the critical accounting policies. Where the company buys data itself and supplies it "generally at no additional charge to our clients outside of our standard fees," the cost is "recorded in platform operations expense" rather than netted against revenue [14]. A la carte, the client buys a data segment, the company bills it and pays the supplier, and only the fee is revenue. Bundled at a price the company sets, the whole charge is revenue and the supplier cost is an operating expense. Same economics to the client; a materially higher reported take rate.

The FY2025 10-K flags the choice explicitly, in both directions. Revenue may fluctuate on "the amount of certain costs of supplier-provided components of value-added services and data recorded as reductions to revenue versus as expenses in platform operations" [15]; platform operations expense may vary for the mirror-image reason [16]. The same filing adds that the company will "continue to monitor changes in our platform and related offerings to assess whether the related third-party costs … should be recognized as reductions to revenue or expenses included in platform operations" [14]. None of that language appears in the FY2023 or FY2024 filings.

Whether the lever has actually been pulled shows in the platform-operations bridge.

Sources: FY2025 Form 10-K, results of operations [5]; Q1 FY2026 Form 10-Q, results of operations [11]. Data-related costs were not named in the FY2025 bridge.

For all of FY2025, the $147 million increase in platform operations was attributed to $123 million of hosting and $20 million of personnel [5]. Data-related costs do not appear. That is the strongest fact against reading the FY2025 take-rate step as an accounting reclassification: on the company's own bridge, it was not one.

In the March 2026 quarter data-related costs appear for the first time as a named driver — $11 million of a $39 million increase [11]. Against a revenue increase of $73 million in the same quarter, an $11 million absorbed data cost is 15% of the increment. That is the bundled model beginning to show up in the cost line, and it explains part of why platform operations reached 26% of revenue in the quarter against 23% a year earlier.

A fee on the sell side

OpenPath connects the platform directly to publishers. Asked in February 2026 about trade-press claims of a conflict of interest, the chief executive gave the price: "We plug in as directly as we possibly can to the seller or the publisher. We charge them 4.5%, which is meant to be nearly breakeven to slightly profitable" [17].

That fee is collected from publishers, so it does not enter gross spend, which measures what clients spend [1]. It reduces what the company remits to suppliers, and under net revenue recognition a smaller supplier payment on the same client billing is more revenue. It therefore lifts the measured take rate without any buyer seeing a higher fee.

Scale is not disclosed. Management said in August 2025 that "a material amount of spend on our platform is now flowing through OpenPath" [18] and in November 2025 that "OpenPath has grown by many multiples this year" [13]. Neither is a number. The bound is arithmetic: producing the entire $177 million rate contribution at 4.5% would require about $3.9 billion of spend routed through OpenPath, roughly 29% of FY2025 gross spend. The FY2025 filing attributes the step to services pricing and platform fees and does not mention OpenPath [5], so the plausible contribution is a fraction of that — but it is not zero, and it is not visible.

The tension worth naming is positional rather than accounting. The company's stated differentiator is that it "delivers valuable insights and results to clients without the conflict of interest and lack of objectivity that come with also selling owned advertising inventory" [1], and management states the principle plainly: "we will always only represent the buy side of digital advertising" [13]. Charging the sell side 4.5% for a supply integration is compatible with that on its own terms — the fee buys a connection, not representation, and publishers on the record report large gains from it. It is also the reason the objection exists, and the company's answer is a margin claim ("nearly breakeven") that no disclosure lets an outsider check.

What stopped being said

For three consecutive fourth-quarter calls the take rate came with an explicit reassurance. In February 2023: "for the ninth year in a row our take rate remained within a very consistent historical range" [19]. In February 2024: "our take rate in 2023 once again remained within a very consistent historical range. We continue to execute on the model set out at the company's inception of keeping take rate consistent while substantially increasing the value that our platform provides" [20]. In February 2025: "As expected, our take rate in 2024 once again remained within a very consistent historical range" [21].

On the February 2026 call, reporting the year in which the rate rose 132 basis points, the sentence is absent. What appears instead is a rebuttal of the opposite concern: "there's been a narrative that our margin or take rate must compress because other platforms offer lower upfront prices for non decisioned, non-data-driven buying. In reality, those business models deliver less value overall" [22]. The words "take rate" appear in the FY2021 through FY2024 Forms 10-K [9] [10] and nowhere in the FY2025 10-K or the Q1 FY2026 10-Q. A definition the company supplied for four years, and a commitment it restated on three calls, both lapsed in the year the number moved.

How much room the lever has left

Gross spend is disclosed annually, so FY2026's split between volume and rate cannot be measured until the FY2026 10-K. What can be framed is the trade-off. The table gives FY2026 revenue growth for combinations of gross-spend growth and take rate.

Source: derived from FY2025 revenue and gross spend as reported [1]. Cells show implied FY2026 revenue growth.

Consensus FY2026 revenue of $3,177 million needs 9.7% gross-spend growth at a flat rate, 7.2% with another 50 basis points of rate, or 4.9% with another 100. The consensus path (see Financials and Estimates) does not require volume to reaccelerate if the rate keeps climbing at the FY2025 pace. That is the load-bearing point for a reader watching gross spend as the health metric: for a second year, reported revenue can run ahead of the money actually crossing the platform.

The read here is that the FY2025 step was earned rather than engineered — it came from repricing and bundling a real product set, not from reclassification, and the company's own expense bridge supports that. But it is a lever with a visible end. Kokai, the platform release that carried the repricing, was already running about three-quarters of client spend by August 2025 [18], so adoption headroom is thin. Bundling raises the cost base as it raises revenue, which the March 2026 quarter already shows. Volume discounts remain a named driver of the rate [10] at a moment when two agency holding companies route 30% of gross billings on contracts terminable at 60 days (see Share or Cycle). And the counter-case is on the record: clients who moved most of their spend onto Kokai grew that spend more than 20% faster than those who had not [18], which is what a price increase paying for itself looks like.

What would change the read: gross spend growth in the FY2026 10-K landing close to revenue growth would say the lever is spent and the toll is back to tracking volume; a second year of a 100-plus basis point gap would say pricing is now carrying the growth rate, and would make client tolerance — not market share — the variable to watch.

Limitations. Gross spend is a management-defined metric disclosed once a year, so the volume/rate split cannot be computed for any quarter and the FY2026 split is unobservable until early 2027. The company publishes no revenue disaggregation, so platform fees, value-added services, data and OpenPath cannot be sized separately; the OpenPath figure above is an upper bound from stated pricing, not a disclosure. FY2021–FY2023 revenue and gross spend are reported in whole millions, which makes those years' take rates precise to roughly a basis point. The bundling mechanism described is inferred from the revenue-recognition policy and the product description; the company does not state which data agreements sit on which side of the line.