Streaming technology giant Roku Inc. (NASDAQ: ROKU) may have made more headlines recently for the news that Fox Corp. (NASDAQ: FOXA) will acquire the smaller firm for $22 billion, but investors should not overlook the signs that Roku's latest earnings report gave regarding the broader connected TV (CTV) advertising space.
Roku posted year-over-year (YOY) revenue growth of 22% in Q2 2026, alongside GAAP earnings per share (EPS) that beat analyst expectations by a massive 47 cents per share. With major improvements to operating margin and total hours streamed, the company had a banner quarter in many ways.
This success may be a sign that the CTV advertising space has the potential to absorb brand spending in a way that may extend beyond Roku and impact other companies in the ad world as well. CTV ad spend is projected to reach $38 billion this year, with key upfront commitment figures expected to beat primetime linear TV commitments.
The three companies below are either already positioned in the CTV ad space or are quickly expanding into it, and could all appeal to investors expecting a spending surge to fuel industry-wide growth, albeit for different reasons.
The Trade Desk Maneuvers Toward CTV Ads, But Massive Challenges Remain
The Trade Desk (NASDAQ: TTD) aimed to solidify its position in CTV advertising with the launch of the Ventura Ecosystem in February 2026. This platform is a collaborative venture to build revenue efficiency in streaming. TTD's business is complementary to Roku's in that it operates the buy-side platform, providing advertisers the means to purchase ad inventory, while Roku operates on the opposite end with its consumer-facing products.
All that said, though, TTD is making headlines for all the wrong reasons these days. Shares have declined by about three-quarters in the last year to the lowest levels in close to a decade, with the stock hit once again by Q2 2026 results that fell well short of analyst expectations on multiple fronts. Management reduced Q3 forecasts and multiple analysts have downgraded the stock recently.
Declining open web traffic has been a major hurdle for The Trade Desk, compounded by intensifying competition.
A concerted pivot toward the CTV space may not be sufficient to counter these other challenges, even as CTV advertising looks to be more resilient than other corners of the industry.
Magnite Carves Out a Niche in the CTV Sell-Side Space
A major sell-side advertising platform in the CTV space, Magnite (NASDAQ: MGNI), is likely to be impacted by the Fox-Roku deal due to its close ties to Roku's ad ecosystem. Magnite's advantage may lie in the variety of clients it serves outside of Roku's own platform, giving it a diversified portfolio without the same dependency on hardware that can pressure Roku's margins.
Analysts predict that Magnite's earnings will rise by almost 14% in the year to come as demand for CTV advertising rises.
This is after a healthy Q2 2026, in which the company saw a 37% margin after adjusted EBITDA climbed by 30% YOY and management boosted full-year guidance in multiple areas.
Two of Magnite's secret weapons in the ongoing battle for CTV ad business are its AI-based buying systems, which have already shown potential to enhance revenue, and its growing list of major media partnerships.
Both help to drive analyst enthusiasm for MGNI shares, which have nine Buy ratings against just two Holds.
PubMatic's Small Size May Not Take Away From Its Momentum
PubMatic (NASDAQ: PUBM) is a supply-side platform provider for the advertising space that has made a concerted push into the area of CTV at just the right time based on Roku's signal above. The company may be aiming to differentiate itself from other sell-side operators with agentic and AI-driven campaign tools.
To be sure, with a market capitalization under $1 billion, PubMatic is a riskier play than better-established firms in the space in some respects. However, with a new global chief revenue officer leading momentum in the AI and CTV corners of the market, a better-than-expected quarter with multiple wins over analyst predictions for Q2 2026, and surging free cash flow thanks to a variety of new and emerging revenue streams, PubMatic may appeal to investors seeking a new name.
Although PubMatic has yet to achieve sustained profitability, its adjusted EBITDA margin growth is highly promising, and the company has been able to build its financial position while also instituting share repurchases.
Based on analyst ratings, PubMatic may be the most heavily hyped stock on our list: it has 10 Buy ratings compared to just one Hold and one Sell.
The article "Roku's Ad Business Is Growing—These 3 Stocks Could Be Next" first appeared on MarketBeat.
