LivePerson Announces First Quarter 2025 Financial Results
-- Total Revenue of $64.7 million, above the midpoint of our guidance range --
-- Adjusted EBITDA above the high-end of our guidance range --
Fourth Quarter Highlights
Total revenue was
LivePerson signed 50 deals in total for the first quarter, consisting of 45 existing and 5 new customers. Trailing-twelve-months average revenue per enterprise and mid-market customer (ARPC) increased 2.4% for the first quarter to
"In the first quarter of 2025, we delivered on our financial guidance and made strong progress against our strategy," said
"We continue to observe growing enterprise demand for AI agents and orchestration," said
Customer Expansion
During the first quarter, the Company signed 50 total deals for the quarter, including 45 expansion and renewals and 5 new logo deals. Expansions and renewals included:
- IBM;
- One of the world's largest banks; and
- A global financial technology platform.
New logos included:
- One of
Canada's largest retailers; and - A digital entertainment company.
Net Loss, Adjusted Operating Loss and Adjusted EBITDA
Net loss for the first quarter of 2025 was
Adjusted EBITDA, a non-GAAP financial measure, for the first quarter of 2025 was
A reconciliation of non-GAAP financial measures to GAAP measures has been provided in the financial tables included in this press release. An explanation of the non-GAAP financial measures and how they are calculated is included below under the heading "Non-GAAP Financial Measures."
Cash and Cash Equivalents
The Company's cash balance was
Financial Expectations
The following forward-looking measures and the underlying assumptions involve significant known and unknown risks and uncertainties, and actual results may vary materially from these forward-looking measures. The Company does not present a quantitative reconciliation of the forward-looking non-GAAP financial measures, adjusted EBITDA and adjusted EBITDA margin to the most directly comparable GAAP financial measures (or otherwise present such forward-looking GAAP measures) because it is impractical to forecast certain items without unreasonable efforts due to the uncertainty and inherent difficulty of predicting, within a reasonable range, the occurrence and financial impact of and the periods in which such items may be recognized. In particular, these non-GAAP financial measures exclude certain items, including interest expense, interest income, (benefit from) provision for income taxes, depreciation, amortization of purchased intangibles and finance leases, litigation, consulting and other employee costs, restructuring costs, stock-based compensation expense, impairment of goodwill, impairment of intangibles and other assets, leadership transition costs, working capital adjustment related to the Kasamba divestiture, IT transformation costs, acquisition and divestiture costs, change in fair value of warrants, and other expense, net, which depend on future events that the Company is unable to predict. Depending on the size of these items, they could have a significant impact on the Company's GAAP financial results.
For the second quarter of 2025, we currently expect total revenue to range from
For the full year 2025, we currently expect total revenue to range from
|
Second Quarter 2025 |
|
|
|
|
|
|
Guidance |
|
Revenue (in millions) |
|
|
Revenue growth (year-over-year) |
(29)% - (25)% |
|
Adjusted EBITDA (in millions) |
|
|
Adjusted EBITDA margin (%) |
(7.0)% - (3.3)% |
|
|
|
|
Full Year 2025 |
|
|
|
|
|
|
Guidance |
|
Revenue (in millions) |
|
|
Revenue growth (year-over-year) |
(23)% - (18)% |
|
Adjusted EBITDA (in millions) |
|
|
Adjusted EBITDA margin (%) |
(5.8)% - 0.0% |
Disaggregated Revenue
Included in the accompanying financial results are revenues disaggregated by revenue source, as follows:
|
|
Three Months Ended |
||
|
|
2025 |
|
2024 |
|
|
|
|
|
|
|
(In thousands) |
||
|
Revenue: |
|
|
|
|
Hosted services |
$ 55,134 |
|
$ 71,495 |
|
Professional services |
9,566 |
|
13,654 |
|
Total revenue |
$ 64,700 |
|
$ 85,149 |
Supplemental First Quarter 2025 Presentation
LivePerson will post a presentation providing supplemental information for the first quarter of 2025 on the investor relations section of the Company's web site at www.ir.liveperson.com.
Earnings Teleconference Information
The Company will discuss its first quarter of 2025 financial results during a teleconference today,
The conference call will also be simulcast live on the Internet and can be accessed by logging onto the investor relations section of the Company's web site at www.ir.liveperson.com.
If you are unable to participate in the live call, the teleconference will be available for replay approximately two hours after the call until
About
LivePerson (NASDAQ: LPSN) is a leader in trusted enterprise conversational AI and digital transformation. The world's leading brands — including HSBC,
Non-GAAP Financial Measures
Investors are cautioned that the following financial measures used in this press release and on our earnings call are "non-GAAP financial measures": (i) adjusted EBITDA, or net loss before interest expense, interest income, (benefit from) provision for income taxes, depreciation, amortization of purchased intangibles and finance leases, litigation, consulting and other employee costs, restructuring costs, stock-based compensation expense, impairment of goodwill, impairment of intangibles and other assets, leadership transition costs, working capital adjustment related to the Kasamba divestiture, IT transformation costs, acquisition and divestiture costs, change in fair value of warrants, and other expense, net; (ii) adjusted EBITDA margin, or net loss before interest expense, interest income, (benefit from) provision for income taxes, depreciation, amortization of purchased intangibles and finance leases, litigation, consulting and other employee costs, restructuring costs, stock-based compensation expense, impairment of goodwill, impairment of intangibles and other assets, leadership transition costs, working capital adjustment related to the Kasamba divestiture, IT transformation costs, acquisition and divestiture costs, change in fair value of warrants, and other expense, net, divided by revenue; (iii) adjusted operating loss, or net loss before interest expense, interest income, amortization of purchased intangibles and finance leases, litigation, consulting and other employee costs, restructuring costs, stock-based compensation expense, impairment of goodwill, impairment of intangibles and other assets, leadership transition costs, working capital adjustment related to the Kasamba divestiture, IT transformation costs, acquisition and divestiture costs, change in fair value of warrants, other expense, net, and (benefit from) provision for income taxes; (iv) free cash flow, or net cash used in operating activities less purchases of property and equipment, including capitalized software; (v) non-GAAP cost of revenue, or cost of revenue excluding stock based compensation and IT transformation costs; (vi) non-GAAP sales and marketing expenses, or sales and marketing expenses excluding stock based compensation and leadership transition costs; (vii) non-GAAP general and administrative expenses, or general and administrative expenses excluding stock based compensation, other litigation, consulting and employee costs and leadership transition costs acquisition and divestiture costs; and (viii) non-GAAP product development expenses, or product development expenses excluding stock based compensation, leadership transition costs and IT transformation costs.
Non-GAAP financial information should not be construed as an alternative to any other measures of performance determined in accordance with GAAP, or as an indicator of our operating performance, liquidity or cash flows generated by operating, investing and financing activities as there may be significant factors or trends that it fails to address. We present non-GAAP financial information because we believe that it is helpful to some investors as one measure of our operations.
Forward-Looking Statements
Statements in this press release and on our earnings call regarding LivePerson that are not historical facts are forward-looking statements and are subject to risks and uncertainties that could cause actual future events or results to differ materially from such statements. Any such forward-looking statements, including but not limited to financial guidance, changes to our capital structure, our ability to execute on our transformation strategy, the effects of our cost-reduction efforts and the impact of our new hires, are made pursuant to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. With respect to our financial guidance, we note that it is routine for our internal projections and expectations to change as the quarter and year progress, and therefore it should be clearly understood that the internal projections and beliefs upon which we base our expectations may change. Although these expectations may change, we are under no obligation to inform you if they do. Some of the factors that could cause actual results to differ materially from the forward-looking statements contained herein include, without limitation: our ability to retain existing customers and cause them to purchase additional services and to attract new customers; the intensive personnel, infrastructure and resource commitment required to support our customer base; our ability to retain key personnel, attract new personnel and to manage staff attrition; our ability to successfully integrate acquisitions; our ability to refinance our substantial indebtedness before it becomes due or to secure necessary additional financing on commercially reasonable terms, or at all; lengthy sales cycles; delays in our implementation cycles; payment-related risks; potential fluctuations in our quarterly revenue and operating results; limitations on the effectiveness of our controls; non-payment or late payment of amounts due to us from a significant number of customers; volatility in the capital markets; recognition of revenue from subscriptions; customer retention and engagement; our ability to develop and maintain successful relationships with partners, service partners, social media and other third-party consumer messaging platforms and endpoints; our ability to effectively operate on mobile devices; the highly competitive markets in which we operate; general economic conditions; failures or security breaches in our services, those of our third-party service providers, or in the websites of our customers; regulation or possible misappropriation of personal information belonging to our customers' Internet users; US and international laws and regulations regarding privacy data protection and AI and increased public scrutiny of privacy, security and AI issues that could result in increased government regulation and other legal obligations; ongoing litigation and legal matters; new regulatory or other legal requirements that could materially impact our business; governmental export controls and economic sanctions; industry-specific regulation and unfavorable industry-specific laws, regulations or interpretive positions; future regulation of the Internet or mobile devices; technology-related defects that could disrupt the LivePerson services; our ability to protect our intellectual property rights or potential infringement of the intellectual property rights of third parties; the use of AI in our product offerings or by our vendors; the presence of, and difficulty in correcting, errors, failures or "bugs" in our products; our ability to license necessary third-party software for use in our products and services, and our ability to successfully integrate third-party software; potential adverse impact due to foreign currency and cryptocurrency exchange rate fluctuations; additional regulatory requirements, tax liabilities, currency exchange rate fluctuations and other risks if and as we expand; risks related to our operations in
|
|
|||
|
Condensed Consolidated Statements of Operations |
|||
|
(In Thousands, Except Share and Per Share Data) |
|||
|
Unaudited |
|||
|
|
|||
|
|
Three Months Ended
|
||
|
|
2025 |
|
2024 |
|
Revenue |
$ 64,700 |
|
$ 85,149 |
|
Costs, expenses and other: |
|
|
|
|
Cost of revenue (exclusive of depreciation and amortization shown |
18,218 |
|
24,455 |
|
Sales and marketing |
23,485 |
|
29,230 |
|
General and administrative |
16,784 |
|
21,594 |
|
Product development |
16,034 |
|
24,635 |
|
Depreciation and amortization expense |
5,818 |
|
12,442 |
|
Impairment of goodwill |
— |
|
3,627 |
|
Impairment of intangibles and other assets |
— |
|
2,221 |
|
Restructuring costs |
1,305 |
|
3,309 |
|
Total costs, expenses and other |
81,644 |
|
121,513 |
|
Loss from operations |
(16,944) |
|
(36,364) |
|
Other income, net: |
|
|
|
|
Interest expense |
(7,478) |
|
(701) |
|
Interest income |
1,457 |
|
2,033 |
|
Other income (expense), net |
8,487 |
|
(237) |
|
Total other income, net |
2,466 |
|
1,095 |
|
Loss before (benefit from) provision for income taxes |
(14,478) |
|
(35,269) |
|
(Benefit from) provision for income taxes |
(345) |
|
362 |
|
Net loss |
$ (14,133) |
|
$ (35,631) |
|
|
|
|
|
|
Net loss per share of common stock: |
|
|
|
|
Basic |
$ (0.15) |
|
$ (0.40) |
|
Diluted |
$ (0.24) |
|
$ (0.40) |
|
|
|
|
|
|
Weighted-average shares used to compute net loss per share: |
|
|
|
|
Basic |
91,570,933 |
|
88,081,654 |
|
Diluted |
95,304,938 |
|
88,081,654 |
|
|
|||
|
Condensed Consolidated Statements of Cash Flows |
|||
|
(In Thousands) |
|||
|
Unaudited |
|||
|
|
|||
|
|
Three Months Ended |
||
|
|
2025 |
|
2024 |
|
OPERATING ACTIVITIES: |
|
|
|
|
Net loss |
$ (14,133) |
|
$ (35,631) |
|
Adjustments to reconcile net loss to net cash (used in) provided by operating activities: |
|
|
|
|
Stock-based compensation expense |
4,709 |
|
7,558 |
|
Depreciation |
5,587 |
|
8,225 |
|
Reduction of operating lease right-of-use assets |
35 |
|
653 |
|
Amortization of purchased intangible assets and finance leases |
231 |
|
4,217 |
|
Amortization of debt issuance costs and accretion of debt discount |
1,788 |
|
610 |
|
Impairment of goodwill |
— |
|
3,627 |
|
Impairment of intangibles and other assets |
— |
|
2,221 |
|
Change in fair value of warrants |
(8,824) |
|
— |
|
Interest expense |
5,690 |
|
91 |
|
Allowance for credit losses |
416 |
|
4,722 |
|
Deferred income taxes |
78 |
|
75 |
|
Changes in operating assets and liabilities: |
|
|
|
|
Accounts receivable |
(1,205) |
|
5,422 |
|
Prepaid expenses and other assets |
3,624 |
|
5,779 |
|
Contract acquisition costs |
1,662 |
|
(2,370) |
|
Accounts payable, accrued expenses and other current liabilities |
(5,944) |
|
(15,101) |
|
Deferred revenue |
3,170 |
|
10,852 |
|
Other liabilities |
20 |
|
149 |
|
Net cash (used in) provided by operating activities |
(3,096) |
|
1,099 |
|
INVESTING ACTIVITIES: |
|
|
|
|
Purchases of property and equipment, including capitalized software |
(3,759) |
|
(11,501) |
|
Purchases of intangible assets |
(386) |
|
(1,209) |
|
Net cash used in investing activities |
(4,145) |
|
(12,710) |
|
FINANCING ACTIVITIES: |
|
|
|
|
Payment for repurchase of 2024 convertible senior notes |
— |
|
(72,492) |
|
Principal payments for financing leases |
(26) |
|
(327) |
|
Proceeds from issuance of common stock in connection with the exercise of options |
— |
|
122 |
|
Net cash used in financing activities |
(26) |
|
(72,697) |
|
Effect of foreign exchange rate changes on cash and cash equivalents |
284 |
|
400 |
|
Net decrease in cash and cash equivalents |
(6,983) |
|
(83,908) |
|
Cash, cash equivalents and restricted cash - beginning of year |
183,237 |
|
212,925 |
|
Cash, cash equivalents and restricted cash - end of period |
$ 176,254 |
|
$ 129,017 |
|
|
|||
|
Reconciliation of Non-GAAP Financial Information to GAAP |
|||
|
(In Thousands) |
|||
|
Unaudited |
|||
|
|
|||
|
|
Three Months Ended
|
||
|
|
2025 |
|
2024 |
|
Reconciliation of Adjusted EBITDA: |
|
|
|
|
GAAP net loss |
$ (14,133) |
|
$ (35,631) |
|
Add/(less): |
|
|
|
|
Interest expense |
7,478 |
|
701 |
|
Interest income |
(1,457) |
|
(2,033) |
|
(Benefit from) provision for income taxes |
(345) |
|
362 |
|
Depreciation |
5,587 |
|
8,225 |
|
Amortization of purchased intangibles and finance leases |
231 |
|
4,217 |
|
Litigation, consulting and other employee costs (1) |
5,169 |
|
3,769 |
|
Restructuring costs (2) |
1,305 |
|
3,309 |
|
Stock-based compensation expense |
4,709 |
|
7,558 |
|
Change in fair value of warrants |
(8,824) |
|
— |
|
Impairment of goodwill |
— |
|
3,627 |
|
Impairment of intangibles and other assets |
— |
|
2,221 |
|
Leadership transition costs |
— |
|
1,389 |
|
Working capital adjustment - Kasamba |
— |
|
1,776 |
|
IT transformation costs (3) |
110 |
|
708 |
|
Acquisition and divestiture costs |
— |
|
42 |
|
Other expense, net |
337 |
|
237 |
|
Adjusted EBITDA |
$ 167 |
|
$ 477 |
|
|
|
|
|
|
Reconciliation of Adjusted Operating Loss: |
|
|
|
|
Loss before (benefit from) provision for income taxes |
$ (14,478) |
|
$ (35,269) |
|
Add/(less): |
|
|
|
|
Interest expense |
7,478 |
|
701 |
|
Interest income |
(1,457) |
|
(2,033) |
|
Amortization of purchased intangibles and finance leases |
231 |
|
4,217 |
|
Litigation, consulting and other employee costs (1) |
5,169 |
|
3,769 |
|
Restructuring costs (2) |
1,305 |
|
3,309 |
|
Stock-based compensation expense |
4,709 |
|
7,558 |
|
Change in fair value of warrants |
(8,824) |
|
— |
|
Impairment of goodwill |
— |
|
3,627 |
|
Impairment of intangibles and other assets |
— |
|
2,221 |
|
Leadership transition costs |
— |
|
1,389 |
|
Working capital adjustment - Kasamba |
— |
|
1,776 |
|
IT transformation costs (3) |
110 |
|
708 |
|
Acquisition and divestiture costs |
— |
|
42 |
|
Other expense, net |
337 |
|
237 |
|
Adjusted operating loss |
$ (5,420) |
|
$ (7,748) |
|
—————————————— |
|
|
(1) |
Includes litigation costs of |
|
(2) |
Includes severance costs and other compensation costs of |
|
(3) |
Includes IT infrastructure realignment costs of |
|
|
|||
|
Reconciliation of Non-GAAP Financial Information to GAAP |
|||
|
(In Thousands) |
|||
|
Unaudited |
|||
|
|
|||
|
|
Three Months Ended
|
||
|
|
2025 |
|
2024 |
|
Calculation of Free Cash Flow: |
|
|
|
|
Net cash (used in) provided by operating activities |
$ (3,096) |
|
$ 1,099 |
|
Purchases of property and equipment, including capitalized software |
(3,759) |
|
(11,501) |
|
Total Free Cash Flow |
$ (6,855) |
|
$ (10,402) |
|
|
|||||||||
|
Reconciliation of Non-GAAP Financial Information to GAAP |
|||||||||
|
(In Thousands) |
|||||||||
|
Unaudited |
|||||||||
|
|
|||||||||
|
|
Three Months Ended |
||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
GAAP cost of revenue (1) |
$ 18,218 |
|
$ 16,526 |
|
$ 19,983 |
|
$ 16,432 |
|
$ 24,455 |
|
Stock based compensation |
(186) |
|
(198) |
|
(251) |
|
(288) |
|
(343) |
|
IT transformation costs |
(110) |
|
(110) |
|
(185) |
|
(202) |
|
(383) |
|
Non-GAAP cost of revenue |
$ 17,922 |
|
$ 16,218 |
|
$ 19,547 |
|
$ 15,942 |
|
$ 23,729 |
|
|
|
|
|
|
|
|
|
|
|
|
GAAP sales and marketing expenses (1) |
$ 23,485 |
|
$ 20,281 |
|
$ 22,093 |
|
$ 25,733 |
|
$ 29,230 |
|
Stock based compensation |
(1,378) |
|
(903) |
|
(2,182) |
|
(1,854) |
|
(2,455) |
|
Leadership transition costs |
— |
|
— |
|
(33) |
|
(423) |
|
(404) |
|
Non-GAAP sales and marketing expenses |
$ 22,107 |
|
$ 19,378 |
|
$ 19,878 |
|
$ 23,456 |
|
$ 26,371 |
|
|
|
|
|
|
|
|
|
|
|
|
GAAP general and administrative expenses (1) |
$ 16,784 |
|
$ 16,090 |
|
$ 17,662 |
|
$ 24,415 |
|
$ 21,594 |
|
Stock based compensation |
(1,773) |
|
(948) |
|
(1,725) |
|
(2,318) |
|
(1,798) |
|
Other litigation, consulting and employee costs |
(5,169) |
|
(2,029) |
|
(5,253) |
|
(5,925) |
|
(3,769) |
|
Leadership transition costs |
— |
|
195 |
|
(41) |
|
(785) |
|
(323) |
|
Acquisition and divestiture costs |
— |
|
— |
|
— |
|
(878) |
|
(42) |
|
Non-GAAP general and administrative expenses |
$ 9,842 |
|
$ 13,308 |
|
$ 10,643 |
|
$ 14,509 |
|
$ 15,662 |
|
|
|
|
|
|
|
|
|
|
|
|
GAAP product development expenses (1) |
$ 16,034 |
|
$ 17,292 |
|
$ 18,184 |
|
$ 19,674 |
|
$ 24,635 |
|
Stock based compensation |
(1,372) |
|
(1,107) |
|
(1,217) |
|
(1,440) |
|
(2,962) |
|
Leadership transition costs |
— |
|
— |
|
(48) |
|
(474) |
|
(662) |
|
IT transformation costs |
— |
|
— |
|
— |
|
— |
|
(325) |
|
Non-GAAP product development expenses |
$ 14,662 |
|
$ 16,185 |
|
$ 16,919 |
|
$ 17,760 |
|
$ 20,686 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(1) |
GAAP amounts have been adjusted to remove depreciation and amortization expense as those are now presented separately in the Condensed Consolidated Statements of Operations for each period. |
|
|
|||
|
Condensed Consolidated Balance Sheets |
|||
|
(In Thousands) |
|||
|
Unaudited |
|||
|
|
|||
|
|
|
|
|
|
ASSETS |
|
|
|
|
CURRENT ASSETS: |
|
|
|
|
Cash and cash equivalents |
$ 176,254 |
|
$ 183,237 |
|
Accounts receivable, net |
29,643 |
|
28,737 |
|
Prepaid expenses and other current assets |
15,857 |
|
19,250 |
|
Total current assets |
221,754 |
|
231,224 |
|
Property and equipment, net |
98,316 |
|
100,557 |
|
Contract acquisition costs, net |
32,155 |
|
33,559 |
|
Intangible assets, net |
15,456 |
|
15,070 |
|
|
223,784 |
|
222,554 |
|
Deferred tax assets, net |
4,425 |
|
4,411 |
|
Other assets |
330 |
|
403 |
|
Total assets |
$ 596,220 |
|
$ 607,778 |
|
|
|
|
|
|
LIABILITIES AND STOCKHOLDERS' EQUITY |
|
|
|
|
CURRENT LIABILITIES: |
|
|
|
|
Accounts payable |
$ 15,524 |
|
$ 15,378 |
|
Accrued expenses and other current liabilities |
57,283 |
|
66,582 |
|
Deferred revenue |
61,395 |
|
57,980 |
|
Total current liabilities |
134,202 |
|
139,940 |
|
Convertible senior notes |
528,858 |
|
527,070 |
|
Deferred tax liabilities |
3,622 |
|
3,542 |
|
Other liabilities |
4,482 |
|
4,542 |
|
Total liabilities |
671,164 |
|
675,094 |
|
Commitments and contingencies |
|
|
|
|
Total stockholders' equity |
(74,944) |
|
(67,316) |
|
Total liabilities and stockholders' equity |
$ 596,220 |
|
$ 607,778 |
Investor Relations contact
ir-lp@liveperson.com
View original content to download multimedia:https://www.prnewswire.com/news-releases/liveperson-announces-first-quarter-2025-financial-results-302449205.html
SOURCE LivePerson
