What Happened?
Shares of advertising software maker The Trade Desk (NASDAQ: TTD) jumped 11.3% in the afternoon session after the major indices popped (Nasdaq +3.4%, S&P 500 +2.5%) in response to the positive outcome of U.S.-China trade negotiations, as both sides agreed to pause some tariffs for 90 days, signaling a potential turning point in ongoing tensions. This rollback cuts U.S. tariffs on Chinese goods to 30% and Chinese tariffs on U.S. imports to 10%, giving companies breathing room to reset inventories and supply chains.
However, President Trump clarified that tariffs could go "substantially higher" if a full deal with China wasn't reached during the 90-day pause, but not all the way back to the previous levels.
Still, the agreement has cooled fears of a prolonged trade war, helping stabilize expectations for global growth and trade flows and fueling renewed optimism.
The optimism appeared concentrated in key trade-sensitive sectors, particularly technology, retail, and industrials, as lower tariffs reduce cost pressures and restore cross-border demand.
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What The Market Is Telling Us
The Trade Desk’s shares are very volatile and have had 24 moves greater than 5% over the last year. But moves this big are rare even for The Trade Desk and indicate this news significantly impacted the market’s perception of the business.
The previous big move we wrote about was 3 days ago when the stock gained 17.4% on the news that the company reported strong first quarter 2025 results which significantly beat analysts' EBITDA and revenue estimates. Sales rose by 25% as more buyers adopted its open-internet tools like Kokai and identity tech such as UID2, now being used by major publishers across the globe. Looking ahead, Q2 guidance for revenue was roughly in line while EBITDA guidance beat. Zooming out, this was a strong quarter, especially considering the weak print last quarter that had investors worried.
The Trade Desk is down 32.4% since the beginning of the year, and at $79.56 per share, it is trading 43% below its 52-week high of $139.51 from December 2024. Investors who bought $1,000 worth of The Trade Desk’s shares 5 years ago would now be looking at an investment worth $2,561.
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