TLDR
- TTD stock plummeted 12% after Netflix announced advertising partnership with Amazon DSP
- Morgan Stanley downgraded TTD from overweight to equal weight, slashing price target from $80 to $50
- Partnership strengthens Amazon’s competitive position against The Trade Desk in connected TV advertising
- TTD remains worst-performing S&P 500 stock this year with 60% decline year-to-date
- Analysts express growing concerns about mounting headwinds and slowing growth prospects
The Trade Desk stock experienced a brutal trading session Wednesday, falling 12% after Netflix announced a partnership with Amazon’s demand-side platform. The deal allows advertisers using Amazon DSP to access Netflix ad inventory directly.
This partnership puts Amazon in direct competition with The Trade Desk’s core business model. Both platforms help advertisers purchase and manage digital advertising across multiple channels including connected TV.
The timing proves particularly damaging for TTD shareholders. The stock has already declined 60% year-to-date, earning the distinction as the S&P 500’s worst performer in 2025.
Morgan Stanley Cuts Rating
Adding pressure to Wednesday’s sell-off, Morgan Stanley analyst Matthew Cost downgraded TTD from Buy to Hold. Cost also reduced his price target from $80 to $50, representing a 37.5% cut.
Cost admitted overestimating The Trade Desk’s growth durability. He cited execution challenges, weakness in open web advertising, and intensifying connected TV competition as key concerns.
Morgan Stanley research revealed TTD charges approximately double the fees of competing platforms. This pricing premium is creating client resistance as alternatives become more attractive.
The analyst warned of potential further downgrades if market trends don’t improve. Cost plans to monitor the next earnings report closely for turnaround signals.
Competitive Landscape Shifts
The Netflix-Amazon alliance represents growing consolidation in digital advertising. These partnerships create “walled garden” ecosystems that keep advertising spend within closed platforms.
Amazon has aggressively expanded its advertising reach throughout 2025. The company previously secured partnerships with Roku and now maintains relationships with every major streaming service.
Netflix’s ad-supported tier continues rapid growth since launch. This expansion makes the streaming platform an increasingly valuable partner for Amazon’s advertising ambitions.
The Trade Desk built its reputation as an independent alternative to closed advertising ecosystems. However, the competitive moat appears to be narrowing as tech giants form strategic alliances.
Despite recent challenges, Wall Street maintains mostly positive sentiment toward TTD. The stock holds a consensus Strong Buy rating from 28 analysts, including 14 Buy recommendations, 12 Holds, and two Sells.
The average price target of $72.63 implies 57% upside potential from current levels. However, these targets may face revision following Wednesday’s downgrades and market reaction.
TTD closed at $46.10, down from its 52-week high of $141.53 reached earlier this year.
