Bay Street News

LiveRamp Announces Results For First Quarter FY25

Revenue up 14% year-over-year

Second Consecutive Quarter of Double-Digit Revenue Growth

Raises Fiscal 2025 Revenue and Operating Income Guidance

SAN FRANCISCO, Aug. 07, 2024 (GLOBE NEWSWIRE) — LiveRamp® (NYSE: RAMP), the leading data collaboration platform, today announced its financial results for the fiscal 2025 first quarter ended June 30, 2024.

Q1 Financial Highlights1

A reconciliation between GAAP and non-GAAP results is provided in the schedules in this press release.

Commenting on the results, CEO Scott Howe said, “We posted double-digit growth for a second consecutive quarter in both revenue and ARR, and revenue and operating income again exceeded our expectations. Our Data Collaboration Platform is well-positioned for growth, benefiting from multiple industry megatrends — including the shift to cloud computing, the proliferation of AI tools in marketing, growth in Commerce Media and CTV platforms, and the ongoing move to authenticated addressability.”

GAAP and Non-GAAP Results
The following table summarizes the Company’s financial results for the fiscal 2025 first quarter ended June 30, 2024 ($ in millions, except per share amounts):

       
  GAAP   Non-GAAP
  Q1 FY25   Q1 FY24   Q1 FY25   Q1 FY24
Subscription revenue $135   $122    
YoY change % 11%   5%    
Marketplace & Other revenue $41   $32    
YoY change % 28%   21%    
Total revenue $176   $154    
YoY change % 14%   8%    
               
Gross profit $124   $108   $130   $112
% Gross margin 71%   70%   74%   73%
YoY change, pts 0 pts   (1 pt)   1 pt   (2 pts)
               
Operating income (loss) ($5)   $2   $27   $21
% Operating margin (3%)   1%   15%   14%
YoY change, pts (4 pts)   19 pts   2 pts   11 pts
               
Net earnings (loss) ($7)   ($2)   $24   $20
Diluted earnings (loss) per share ($0.11)   ($0.02)   $0.35   $0.29
               
Shares to calculate diluted EPS 66.6   66.5   68.5   67.4
YoY change % 0%   (3%)   2%   (3%)
               
Operating cash flow ($9)   $26    
Free cash flow to equity     ($10)   $26
               
Totals and year-over-year changes may not reconcile due to rounding.
 

A detailed discussion of our non-GAAP financial measures and a reconciliation between GAAP and non-GAAP results is provided in the schedules in this press release.

Additional Business Highlights & Metrics

Financial Outlook

LiveRamp’s non-GAAP operating income guidance excludes the impact of non-cash stock compensation, purchased intangible asset amortization, and restructuring and related charges.

For the second quarter of fiscal 2025, LiveRamp expects to report:

For fiscal 2025, LiveRamp increases its guidance and expects to report:

Conference Call

LiveRamp will hold a conference call today at 1:30 p.m. PT (4:30 p.m. ET) to further discuss this information. Interested parties are invited to listen to a webcast of the conference, which can be accessed on LiveRamp’s investor site. A slide presentation will be referenced during the call and is available here.

About LiveRamp

LiveRamp is a global technology company that helps companies build enduring brand and business value by collaborating responsibly with data. A groundbreaking leader in consumer privacy, data ethics and foundational identity, LiveRamp offers a connected customer view with clarity and context while protecting brand and consumer trust. Our best-in-class enterprise platform enables data collaboration, where companies can share first-party consumer data with trusted business partners securely and in a privacy conscious manner. We offer flexibility to collaborate wherever data lives to support a wide range of data collaboration use cases — within organizations, between brands, and across our global network of premier partners. Global innovators, from iconic consumer brands and tech platforms to retailers, financial services, and healthcare leaders, turn to LiveRamp to deepen customer engagement and loyalty, activate new partnerships, and maximize the value of their first-party data while staying on the forefront of rapidly evolving compliance and privacy requirements. LiveRamp is based in San Francisco, California with offices worldwide. Learn more at LiveRamp.com.

Forward-Looking Statements

This press release contains “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995, as amended (the “PSLRA”). These statements, which are not statements of historical fact, may contain estimates, assumptions, projections and/or expectations regarding the Company’s financial position, results of operations for fiscal 2025 and beyond, market position, product development, growth opportunities, economic conditions, and other similar forecasts and statements of expectation. Forward-looking statements are often identified by words or phrases such as “anticipate,” “estimate,” “plan,” “expect,” “believe,” “intend,” “foresee,” or the negative of these terms or other similar variations thereof.

These forward-looking statements are not guarantees of future performance and are subject to a number of factors and uncertainties that could cause the Company’s actual results and experiences to differ materially from the anticipated results and expectations expressed in the forward-looking statements.

Among the factors that may cause actual results and expectations to differ from anticipated results and expectations expressed in forward-looking statements are uncertainties related to rising interest rates, cost increases, the possibility of a recession, general inflationary pressure, geo-political circumstances that could result in increased economic uncertainties and the associated impacts of these potential events on our suppliers, customers and partners; the Company’s dependence upon customer renewals; new customer additions and upsell within our subscription business; our reliance upon partners, including data suppliers; competition; rapidly changing technology’s impact on our products and services; the risk that we fail to realize the potential benefits of or have difficulty integrating Habu; and attracting, motivating and retaining talent. Additional risks include maintaining our culture and our ability to innovate and evolve while operating in a hybrid work environment, with some employees working remotely at least some of the time within a rapidly changing industry, while also avoiding disruption from reductions in our current workforce as well as disruptions resulting from acquisition, divestiture and other activities affecting our workforce. Our global workforce strategy could possibly encounter difficulty and not be as beneficial as planned. Our international operations are also subject to risks, including the performance of third parties as well as impacts from war and civil unrest, that may harm the Company’s business. The risk of a significant breach of the confidentiality of the information or the security of our or our customers’, suppliers’, or other partners’ data and/or computer systems, or the risk that our current insurance coverage may not be adequate for such a breach, that an insurer might deny coverage for a claim or that such insurance will continue to be available to us on commercially reasonable terms, or at all, could be detrimental to our business, reputation and results of operations. Other business risks include unfavorable publicity and negative public perception about our industry; interruptions or delays in service from data center or cloud hosting vendors we rely upon; and our dependence on the continued availability of third-party data hosting and transmission services. Our clients’ ability to use data on our platform could be restricted if the industry’s use of third-party cookies and tracking technology declines due to technology platform changes, regulation or increased user controls. Changes in regulations and legislation relating to information collection and use represents a risk, as well as changes in tax laws and regulations that are applied to our customers which could cause enterprise software budget tightening. In addition, third parties may claim that we are infringing their intellectual property or may infringe our intellectual property which could result in competitive injury and / or the incurrence of significant costs and draining of our resources.

For a discussion of these and other risks and uncertainties that could affect LiveRamp’s business, reputation, results of operation, financial condition and stock price, please refer to LiveRamp’s filings with the U.S. Securities and Exchange Commission, including the “Risk Factors” and “Management’s Discussion and Analysis of Financial Condition and Results of Operations” sections of LiveRamp’s most recently filed Annual Report on Form 10-K, Quarterly Reports on Form 10-Q and subsequent filings.

The financial information set forth in this press release reflects estimates based on information available at this time.

LiveRamp assumes no obligation and does not currently intend to update these forward-looking statements.

To automatically receive LiveRamp financial news by email, please visit www.LiveRamp.com and subscribe to email alerts.

For more information, contact:

LiveRamp Investor Relations
Investor.Relations@LiveRamp.com

LiveRamp and RampID™ and all other LiveRamp marks contained herein are trademarks or service marks of LiveRamp, Inc. All other marks are the property of their respective owners.

               
LIVERAMP HOLDINGS, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(Unaudited)
(Dollars in thousands, except per share amounts)
               
    For the three months ended June 30,
            $ %
    2024   2023   Variance Variance
               
Revenues   175,961     154,069     21,892   14.2 %
Cost of revenue   51,749     45,621     6,128   13.4 %
Gross profit   124,212     108,448     15,764   14.5 %
% Gross margin   70.6 %   70.4 %      
               
Operating expenses              
Research and development   44,118     34,519     9,599   27.8 %
Sales and marketing   54,175     44,879     9,296   20.7 %
General and administrative   30,961     26,664     4,297   16.1 %
Gains, losses and other items, net   206     116     90   77.6 %
Total operating expenses   129,460     106,178     23,282   21.9 %
               
Income (loss) from operations   (5,248 )   2,270     (7,518 ) (331.2 )%
% Margin   (3.0 )%   1.5 %      
               
Total other income, net   4,444     4,849     (405 ) (8.4 )%
               
Income (loss) from continuing operations before income taxes   (804 )   7,119     (7,923 ) (111.3 )%
Income tax expense   6,685     8,705     (2,020 ) (23.2 )%
               
Net loss   (7,489 )   (1,586 )   (5,903 ) (372.2 )%
               
Basic loss per share   (0.11 )   (0.02 )   (0.09 ) (371.3 )%
               
Diluted loss per share   (0.11 )   (0.02 )   (0.09 ) (371.3 )%
               
Basic weighted average shares   66,621     66,497        
Diluted weighted average shares   66,621     66,497        
               
Some totals may not sum due to rounding.              
               
LIVERAMP HOLDINGS, INC. AND SUBSIDIARIES
RECONCILIATION OF GAAP TO NON-GAAP EPS (1)
(Unaudited)
(Dollars in thousands, except per share amounts)
         
    For the three months ended June 30,
    2024   2023
         
Income (loss) from continuing operations before income taxes   (804 )   7,119  
Income tax expense   6,685     8,705  
Net loss   (7,489 )   (1,586 )
         
Basic loss per share   (0.11 )   (0.02 )
Diluted loss per share   (0.11 )   (0.02 )
         
Excluded items:        
Purchased intangible asset amortization (cost of revenue)   3,846     3,290  
Non-cash stock compensation (cost of revenue and operating expenses)   27,985     13,292  
Restructuring and merger charges (gains, losses, and other)   206     116  
Transformation costs (general and administrative)       1,875  
Total excluded items from continuing operations   32,037     18,573  
         
Income from continuing operations before income taxes and excluding items   31,233     25,692  
Income tax expense (2)   7,371     6,167  
Non-GAAP net earnings from continuing operations   23,862     19,525  
         
Non-GAAP earnings per share from continuing operations:        
Basic   0.36     0.29  
Diluted   0.35     0.29  
         
Basic weighted average shares   66,621     66,497  
Diluted weighted average shares, Non-GAAP   68,463     67,388  
         
         
(1) This presentation includes non-GAAP measures. Our non-GAAP measures are not meant to be considered in isolation or as a substitute for comparable GAAP measures, and should be read only in conjunction with our consolidated financial statements prepared in accordance with GAAP. For a detailed explanation of the adjustments made to comparable GAAP measures, the reasons why management uses these measures and the material limitations on the usefulness of these measures, please see Appendix A.
         
(2) Income taxes were calculated by applying the estimated annual effective tax rate to year-to-date pretax income or loss and adjusting for discrete tax items in the period.  The differences between our GAAP and non-GAAP effective tax rates were primarily due to the net tax effects of the excluded items, coupled with larger pre-tax losses for GAAP purposes versus smaller pre-tax losses or income for non-GAAP purposes.
         
LIVERAMP HOLDINGS, INC. AND SUBSIDIARIES
RECONCILIATION OF GAAP TO NON-GAAP INCOME (LOSS) FROM OPERATIONS (1)
(Unaudited)
(Dollars in thousands)
         
    For the three months ended June 30,
    2024   2023
         
Income (loss) from operations   (5,248 )   2,270
         
Excluded items:        
Purchased intangible asset amortization (cost of revenue)   3,846     3,290
Non-cash stock compensation (cost of revenue and operating expenses)   27,985     13,292
Restructuring and merger charges (gains, losses, and other)   206     116
Transformation costs (general and administrative)       1,875
Total excluded items   32,037     18,573
         
Income from continuing operations before excluded items   26,789     20,843
         
         
(1) This presentation includes non-GAAP measures. Our non-GAAP measures are not meant to be considered in isolation or as a substitute for comparable GAAP measures, and should be read only in conjunction with our consolidated financial statements prepared in accordance with GAAP. For a detailed explanation of the adjustments made to comparable GAAP measures, the reasons why management uses these measures and the material limitations on the usefulness of these measures, please see Appendix A.
         
LIVERAMP HOLDINGS, INC. AND SUBSIDIARIES
RECONCILIATION OF ADJUSTED EBITDA (1)
(Unaudited)
(Dollars in thousands)
         
    For the three months ended June 30,
    2024   2023
         
Net loss from continuing operations   (7,489 )   (1,586 )
         
Income tax expense   6,685     8,705  
         
Total other income, net   (4,444 )   (4,849 )
         
Income (loss) from operations   (5,248 )   2,270  
         
Depreciation and amortization   4,554     4,039  
         
EBITDA   (694 )   6,309  
         
Other adjustments:        
Non-cash stock compensation (cost of revenue and operating expenses)   27,985     13,292  
Restructuring and merger charges (gains, losses, and other)   206     116  
Transformation costs (general and administrative)       1,875  
         
Other adjustments   28,191     15,283  
         
Adjusted EBITDA   27,497     21,592  
         
(1) This presentation includes non-GAAP measures. Our non-GAAP measures are not meant to be considered in isolation or as a substitute for comparable GAAP measures, and should be read only in conjunction with our consolidated financial statements prepared in accordance with GAAP. For a detailed explanation of the adjustments made to comparable GAAP measures, the reasons why management uses these measures, the usefulness of these measures and the material limitations on the usefulness of these measures, please see Appendix A.
 
LIVERAMP HOLDINGS, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED BALANCE SHEETS
(Dollars in thousands)
               
    June 30   March 31   $ %
    2024   2024   Variance Variance
Assets              
Current assets:              
Cash and cash equivalents   310,396     336,867     (26,471 )   (7.9 )%
Restricted cash   2,618     2,604     14     0.5 %
Short-term investments   32,333     32,045     288     0.9 %
Trade accounts receivable, net   206,305     190,313     15,992     8.4 %
Refundable income taxes, net   1,929     8,521     (6,592 )   (77.4 )%
Other current assets   31,456     31,682     (226 )   (0.7 )%
Total current assets   585,037     602,032     (16,995 )   (2.8 )%
               
Property and equipment   25,413     25,394     19     0.1 %
Less – accumulated depreciation and amortization   17,717     17,213     504     2.9 %
Property and equipment, net   7,696     8,181     (485 )   (5.9 )%
               
Intangible assets, net   30,737     34,583     (3,846 )   (11.1 )%
Goodwill   501,721     501,756     (35 )   (0.0 )%
Deferred commissions, net   45,402     48,143     (2,741 )   (5.7 )%
Other assets, net   35,663     36,748     (1,085 )   (3.0 )%
    1,206,256     1,231,443     (25,187 )   (2.0 )%
               
Liabilities and Stockholders’ Equity              
Current liabilities:              
Trade accounts payable   84,769     81,202     3,567     4.4 %
Accrued payroll and related expenses   23,216     61,575     (38,359 )   (62.3 )%
Other accrued expenses   43,220     42,857     363     0.8 %
Deferred revenue   38,433     30,942     7,491     24.2 %
Total current liabilities   189,638     216,576     (26,938 )   (12.4 )%
               
Other liabilities   64,742     65,732     (990 )   (1.5 )%
               
Stockholders’ equity:              
Preferred stock               %
Common stock   15,726     15,594     132     0.8 %
Additional paid-in capital   1,966,578     1,933,776     32,802     1.7 %
Retained earnings   1,306,683     1,314,172     (7,489 )   (0.6 )%
Accumulated other comprehensive income   3,892     3,964     (72 )   (1.8 )%
Treasury stock, at cost   (2,341,003 )   (2,318,371 )   (22,632 )   1.0 %
Total stockholders’ equity   951,876     949,135     2,741     0.3 %
    1,206,256     1,231,443     (25,187 )   (2.0 )%
               
LIVERAMP HOLDINGS, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
(Unaudited)
(Dollars in thousands)
    For the three months ended June 30,
    2024   2023
Cash flows from operating activities:        
Net loss   (7,489 )   (1,586 )
Non-cash operating activities:        
Depreciation and amortization   4,554     4,039  
Loss on disposal or impairment of assets   5     308  
Lease-related impairment and restructuring charges   (36 )    
Provision for doubtful accounts   550     (219 )
Deferred income taxes   28     47  
Non-cash stock compensation expense   27,985     13,292  
Changes in operating assets and liabilities:        
Accounts receivable, net   (16,582 )   (14,391 )
Deferred commissions   2,741     86  
Other assets   3,667     5,008  
Accounts payable and other liabilities   (39,046 )   (25,225 )
Income taxes   6,792     37,236  
Deferred revenue   7,503     7,098  
Net cash provided by (used in) operating activities   (9,328 )   25,693  
Cash flows from investing activities:        
Capital expenditures   (226 )   (53 )
Purchases of investments   (1,967 )    
Proceeds from sales of investments   2,000      
Purchases of strategic investments   (400 )   (500 )
Net cash used in investing activities   (593 )   (553 )
Cash flows from financing activities:        
Proceeds related to the issuance of common stock under stock and employee benefit plans   6,167     5,573  
Shares repurchased for tax withholdings upon vesting of stock-based awards   (6,847 )   (3,892 )
Acquisition of treasury stock   (15,785 )   (20,203 )
Net cash used in financing activities   (16,465 )   (18,522 )
Effect of exchange rate changes on cash   (71 )   (293 )
         
Net change in cash, cash equivalents and restricted cash   (26,457 )   6,325  
Cash, cash equivalents and restricted cash at beginning of period   339,471     464,448  
Cash, cash equivalents and restricted cash at end of period   313,014     470,773  
         
Supplemental cash flow information:        
Cash paid (received) for income taxes, net from continuing operations   (131 )   (28,653 )
Cash paid for operating lease liabilities   2,338     2,459  
Operating lease assets obtained in exchange for operating lease liabilities   850     10,565  
Operating lease assets, and related lease liabilities, relinquished in lease terminations   (555 )   (4,486 )
Purchases of property, plant and equipment remaining unpaid at period end   109      
         
LIVERAMP HOLDINGS, INC AND SUBSIDIARIES
CALCULATION OF FREE CASH FLOW TO EQUITY (1)
(Unaudited)
(Dollars in thousands)
                   
                   
      6/30/2023 9/30/2023 12/31/2023 3/31/2024 FY2024   6/30/2024
                   
Net Cash Provided by (Used in) Operating Activities   $ 25,693   $ 35,764   $ 16,556   $ 27,643   $ 105,656     $ (9,328 )
                   
Less:                
  Capital expenditures     (53 )   (200 )   (2,211 )   (1,791 )   (4,255 )     (226 )
                   
Free Cash Flow to Equity   $ 25,640   $ 35,564   $ 14,345   $ 25,852   $ 101,401     $ (9,554 )
                   
                   
(1) This presentation includes non-GAAP measures. Our non-GAAP measures are not meant to be considered in isolation or as a substitute for comparable GAAP measures, and should be read only in conjunction with our condensed consolidated financial statements prepared in accordance with GAAP. For a detailed explanation of the adjustments made to comparable GAAP measures, the reasons why management uses these measures and the material limitations on the usefulness of these measures, please see Appendix A.
                   
LIVERAMP HOLDINGS, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF OPERATIONS
(Unaudited)
(Dollars in thousands, except per share amounts)
                    Qtr-to-Qtr
    FY2024   FY2025   FY2025 to FY2024
    6/30/23 9/30/23 12/31/23 3/31/24 FY2024   6/30/24   % $
                       
Revenues     154,069     159,871     173,869     171,852     659,661       175,961     14.2 % 21,892  
Cost of revenue     45,621     41,212     44,934     47,722     179,489       51,749     13.4 % 6,128  
Gross profit     108,448     118,659     128,935     124,130     480,172       124,212     14.5 % 15,764  
% Gross margin     70.4 %   74.2 %   74.2 %   72.2 %   72.8 %     70.6 %      
                       
Operating expenses                      
Research and development     34,519     33,733     37,788     45,161     151,201       44,118     27.8 % 9,599  
Sales and marketing     44,879     44,135     46,203     60,476     195,693       54,175     20.7 % 9,296  
General and administrative     26,664     26,009     27,241     30,252     110,166       30,961     16.1 % 4,297  
Gains, losses and other items, net     116     6,574     2,502     2,516     11,708       206     77.6 % 90  
Total operating expenses     106,178     110,451     113,734     138,405     468,768       129,460     21.9 % 23,282  
                       
Income (loss) from operations     2,270     8,208     15,201     (14,275 )   11,404       (5,248 )   (331.2 )% (7,518 )
% Margin     5.0 %   24.3 %   40.2 %   (31.6 )%   1.7 %     (3.0 )%      
                       
Total other income, net     4,849     6,431     6,607     5,070     22,957       4,444     (8.4 )% (405 )
                       
Income (loss) from continuing operations before income taxes     7,119     14,639     21,808     (9,205 )   34,361       (804 )   (111.3 )% (7,923 )
Income tax expense (benefit)     8,705     10,163     8,429     (3,027 )   24,270       6,685     (23.2 )% (2,020 )
Net earnings (loss) from continuing operations     (1,586 )   4,476     13,379     (6,178 )   10,091       (7,489 )   (372.2 )% (5,903 )
                       
Earnings from discontinued operations, net of tax         387     598     805     1,790           N/A  
                       
Net earnings (loss)   $ (1,586 ) $ 4,863   $ 13,977   $ (5,373 ) $ 11,881     $ (7,489 )   (372.2 )% (5,903 )
                       
Basic loss per share                      
Continuing operations     (0.02 )   0.07     0.20     (0.09 )   0.15       (0.11 )   (3.71 ) (0.00 )
Discontinued operations     0.00     0.01     0.01     0.01     0.03       0.00     N/A 0.00  
Basic loss per share     (0.02 )   0.07     0.21     (0.08 )   0.18       (0.11 )   (3.71 ) (0.00 )
                       
Diluted loss per share                      
Continuing operations     (0.02 )   0.07     0.20     (0.09 )   0.15       (0.11 )   (3.71 ) (0.00 )
Discontinued operations     0.00     0.01     0.01     0.01     0.03       0.00     N/A 0.00  
Diluted loss per share     (0.02 )   0.07     0.21     (0.08 )   0.17       (0.11 )   (3.71 ) (0.00 )
                       
                       
Some earnings (loss) per share amounts may not add due to rounding.                  
                       
                       
Basic weighted average shares     66,497     66,284     65,961     66,323     66,266       66,621        
Diluted weighted average shares     66,497     67,868     67,943     66,323     67,918       66,621        
                       
LIVERAMP HOLDINGS, INC. AND SUBSIDIARIES
RECONCILIATION OF GAAP TO NON-GAAP EXPENSES (1)
(Unaudited)
(Dollars in thousands)
    FY2024   FY2025
    6/30/23 9/30/23 12/31/23 3/31/24 FY2024   6/30/24
Expenses:                
Cost of revenue   45,621   41,212   44,934   47,722   179,489     51,749  
Research and development   34,519   33,733   37,788   45,161   151,201     44,118  
Sales and marketing   44,879   44,135   46,203   60,476   195,693     54,175  
General and administrative   26,664   26,009   27,241   30,252   110,166     30,961  
Gains, losses and other items, net   116   6,574   2,502   2,516   11,708     206  
                 
Gross profit, continuing operations:   108,448   118,659   128,935   124,130   480,172     124,212  
% Gross margin   70.4 % 74.2 % 74.2 % 72.2 % 72.8 %   70.6 %
                 
Excluded items:                
Purchased intangible asset amortization (cost of revenue)   3,290   1,217   1,181   3,097   8,785     3,846  
Non-cash stock compensation (cost of revenue)   629   629   817   1,478   3,553     1,596  
Non-cash stock compensation (research and development)   5,077   5,293   6,960   9,859   27,189     10,205  
Non-cash stock compensation (sales and marketing)   3,736   4,786   4,089   6,337   18,948     7,093  
Non-cash stock compensation (general and administrative)   3,850   5,027   5,631   7,106   21,614     9,091  
Restructuring charges (gains, losses, and other)   116   6,574   2,502   2,516   11,708     206  
Transformation costs (general and administrative)   1,875         1,875      
Total excluded items   18,573   23,526   21,180   30,393   93,672     32,037  
                 
Expenses, excluding items:                
Cost of revenue   41,702   39,366   42,936   43,147   167,151     46,307  
Research and development   29,442   28,440   30,828   35,302   124,012     33,913  
Sales and marketing   41,143   39,349   42,114   54,139   176,745     47,082  
General and administrative   20,939   20,982   21,610   23,146   86,677     21,870  
                 
Gross profit, excluding items:   112,367   120,505   130,933   128,705   492,510     129,654  
% Gross margin   72.9 % 75.4 % 75.3 % 74.9 % 74.7 %   73.7 %
                 
(1) This presentation includes non-GAAP measures. Our non-GAAP measures are not meant to be considered in isolation or as a substitute for comparable GAAP measures, and should be read only in conjunction with our consolidated financial statements prepared in accordance with GAAP. For a detailed explanation of the adjustments made to comparable GAAP measures, the reasons why management uses these measures, the usefulness of these measures and the material limitations on the usefulness of these measures, please see Appendix A.
                 
LIVERAMP HOLDINGS, INC. AND SUBSIDIARIES
RECONCILIATION OF GAAP TO NON-GAAP EPS (1)
(Unaudited)
(Dollars in thousands, except per share amounts)
    FY2024   FY2025
    6/30/2023 9/30/2023 12/31/2023 3/31/2024 FY2024   6/30/2024
                 
Income (loss) from continuing operations before income taxes   7,119   14,639 21,808 (9,205 ) 34,361   (804 )
Income tax expense (benefit)   8,705   10,163 8,429 (3,027 ) 24,270   6,685  
Net earnings (loss) from continuing operations   (1,586 ) 4,476 13,379 (6,178 ) 10,091   (7,489 )
                 
Earnings from discontinued operations, net of tax     387 598 805   1,790    
                 
Net earnings (loss)   (1,586 ) 4,863 13,977 (5,373 ) 11,881   (7,489 )
                 
Earnings (loss) per share:                
Basic   (0.02 ) 0.07 0.21 (0.08 ) 0.18   (0.11 )
Diluted   (0.02 ) 0.07 0.21 (0.08 ) 0.17   (0.11 )
                 
Excluded items:                
Purchased intangible asset amortization (cost of revenue)   3,290   1,217 1,181 3,097   8,785   3,846  
Non-cash stock compensation (cost of revenue and operating expenses)   13,292   15,735 17,497 24,780   71,304   27,985  
Restructuring and merger charges (gains, losses, and other)   116   6,574 2,502 2,516   11,708   206  
Transformation costs (general and administrative)   1,875     1,875    
 Total excluded items from continuing operations   18,573   23,526 21,180 30,393   93,672   32,037  
                 
Income from continuing operations before income taxes and excluding items   25,692   38,165 42,988 21,188   128,033   31,233  
Income tax expense   6,167   9,036 10,732 3,947   29,882   7,371  
Non-GAAP net earnings from continuing operations   19,525   29,129 32,256 17,241   98,151   23,862  
                 
Non-GAAP earnings per share from continuing operations:                
Basic   0.29   0.44 0.49 0.26   1.48   0.36  
Diluted   0.29   0.43 0.47 0.25   1.45   0.35  
                 
Basic weighted average shares   66,497   66,284 65,961 66,323   66,266   66,621  
Diluted weighted average shares, Non-GAAP   67,388   67,868 67,943 68,471   67,918   68,463  
                 
                 
Some totals may not add due to rounding                
                 
(1) This presentation includes non-GAAP measures. Our non-GAAP measures are not meant to be considered in isolation or as a substitute for comparable GAAP measures, and should be read only in conjunction with our consolidated financial statements prepared in accordance with GAAP. For a detailed explanation of the adjustments made to comparable GAAP measures, the reasons why management uses these measures and the material limitations on the usefulness of these measures, please see Appendix A.
                 
LIVERAMP HOLDINGS, INC. AND SUBSIDIARIES
RECONCILIATION OF GAAP TO NON-GAAP OPERATING INCOME (LOSS) GUIDANCE (1)
(Unaudited)
(Dollars in thousands)
           
     For the quarter ending   For the year ending
    September 30, 2024   March 31, 2025
           
        Low High
           
GAAP income (loss) from operations   $ (3,000 )   $ (2,000 ) $ 2,000
           
Excluded items:          
Purchased intangible asset amortization     4,000       14,000     14,000
Non-cash stock compensation     29,000       113,000     113,000
Restructuring costs     1,000       2,000     2,000
Total excluded items     34,000       129,000     129,000
           
Non-GAAP income from operations   $ 31,000     $ 127,000   $ 131,000
           
           
(1) This presentation includes non-GAAP measures. Our non-GAAP measures are not meant to be considered in isolation or as a substitute for comparable GAAP measures, and should be read only in conjunction with our condensed consolidated financial statements prepared in accordance with GAAP. For a detailed explanation of the adjustments made to comparable GAAP measures, the reasons why management uses these measures, the usefulness of these measures and the material limitations on the usefulness of these measures, please see Appendix A.
           
APPENDIX A
LIVERAMP HOLDINGS, INC. AND SUBSIDIARIES
Q1 FISCAL 2025 FINANCIAL RESULTS
EXPLANATION OF NON-GAAP MEASURES AND OTHER KEY METRICS
 
To supplement our financial results, we use non-GAAP measures which exclude certain acquisition related expenses, non-cash stock compensation and restructuring charges. We believe these measures are helpful in understanding our past performance and our future results. Our non-GAAP financial measures and schedules are not meant to be considered in isolation or as a substitute for comparable GAAP measures and should be read only in conjunction with our consolidated GAAP financial statements. Our management regularly uses these non-GAAP financial measures internally to understand, manage and evaluate our business and to make operating decisions. These measures are among the primary factors management uses in planning for and forecasting future periods. Compensation of our executives is also based in part on the performance of our business based on these non-GAAP measures.
 
Our non-GAAP financial measures, including non-GAAP earnings (loss) per share, income (loss) from operations and adjusted EBITDA reflect adjustments based on the following items, as well as the related income tax effects when applicable:
 
Purchased intangible asset amortization: We incur amortization of purchased intangibles in connection with our acquisitions. Purchased intangibles include (i) developed technology, (ii) customer and publisher relationships, and (iii) trade names. We expect to amortize for accounting purposes the fair value of the purchased intangibles based on the pattern in which the economic benefits of the intangible assets will be consumed as revenue is generated. Although the intangible assets generate revenue for us, we exclude this item because this expense is non-cash in nature and because we believe the non-GAAP financial measures excluding this item provide meaningful supplemental information regarding our operational performance.
 
Non-cash stock compensation: Non-cash stock compensation consists of charges for associate restricted stock units, performance shares and stock options in accordance with current GAAP related to stock-based compensation including expense associated with stock-based compensation related to unvested options assumed in connection with our acquisitions. As we apply stock-based compensation standards, we believe that it is useful to investors to understand the impact of the application of these standards to our operational performance. Although stock-based compensation expense is calculated in accordance with current GAAP and constitutes an ongoing and recurring expense, such expense is excluded from non-GAAP results because it is not an expense that typically requires or will require cash settlement by us and because such expense is not used by us to assess the core profitability of our business operations.
 
Restructuring charges: During the past several years, we have initiated certain restructuring activities in order to align our costs in connection with both our operating plans and our business strategies based on then-current economic conditions. As a result, we recognized costs related to termination benefits for employees whose positions were eliminated, lease and other contract termination charges, and asset impairments. These items, as well as third party expenses associated with business acquisitions in the current year, reported as gains, losses, and other items, net, are excluded from non-GAAP results because such amounts are not used by us to assess the core profitability of our business operations.
 
Transformation costs: In previous years, we incurred significant expenses to separate the financial statements of our operating segments, with particular focus on segment-level balance sheets, and to evaluate portfolio priorities. Our criteria for excluding transformation expenses from our non-GAAP measures is as follows: 1) projects are discrete in nature; 2) excluded expenses consist only of third-party consulting fees that we would not incur otherwise; and 3) we do not exclude employee related expenses or other costs associated with the ongoing operations of our business. We substantially completed those projects during the third quarter of fiscal year 2018. Beginning in the fourth quarter of fiscal 2018, and through most of fiscal 2019, we incurred transaction support expenses and system separation costs related to the Company’s announced evaluation of strategic options for its Marketing Solutions (AMS) business. In the first and second quarters of fiscal 2021 in response to the potential COVID-19 pandemic impact on our business and again during fiscal 2023 in response to macroeconomic conditions, we incurred significant costs associated with the assessment of strategic and operating plans, including our long-term location strategy, and assistance in implementing the restructuring activities as a result of this assessment.  Our criteria for excluding these costs are the same. We believe excluding these items from our non-GAAP financial measures is useful for investors and provides meaningful supplemental information.
 
Our non-GAAP financial schedules are:
 
Non-GAAP EPS, Non-GAAP Income from Operations, and Non-GAAP expenses: Our Non-GAAP earnings per share, Non-GAAP income from operations, and Non-GAAP expenses reflect adjustments as described above, as well as the related tax effects where applicable.
 
Adjusted EBITDA: Adjusted EBITDA is defined as net income from continuing operations before income taxes, other expenses, depreciation and amortization, and including adjustments as described above. We use Adjusted EBITDA to measure our performance from period to period both at the consolidated level as well as within our operating segments and to compare our results to those of our competitors. We believe that the inclusion of Adjusted EBITDA provides useful supplementary information to and facilitates analysis by investors in evaluating the Company’s performance and trends. The presentation of Adjusted EBITDA is not meant to be considered in isolation or as an alternative to net earnings as an indicator of our performance.
 
Free Cash Flow to Equity: To supplement our statement of cash flows, we use a non-GAAP measure of cash flow to analyze cash flows generated from operations. Free cash flow to equity is defined as operating cash flow less cash used by investing activities (excluding the impact of cash paid in acquisitions), less required payments of debt, and excluding the impact of discontinued operations. Management believes that this measure of cash flow is meaningful since it represents the amount of money available from continuing operations for the Company’s discretionary spending after funding all required obligations including scheduled debt payments. The presentation of non-GAAP free cash flow to equity is not meant to be considered in isolation or as an alternative to cash flows from operating activities as a measure of liquidity.
 

1 Unless otherwise indicated, all comparisons are to the prior year period.

A PDF accompanying this announcement is available at 

http://ml.globenewswire.com/Resource/Download/3e4a3713-6547-47ae-a359-5e0b2099f571


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