LiveRamp Announces Fourth Quarter and Fiscal Year Results
LiveRamp announces Q4 revenue growth of 5% and full-year revenue growth of 13%. GAAP gross margin of 71% and non-GAAP gross margin of 75%. Full-year operating cash flow of $34 million. $150 million in shares repurchased in full year.
Positive
Q4 revenue increased by 5% compared to the prior year quarter. Full-year revenue increased by 13% compared to the previous fiscal year. Non-GAAP gross margin remained steady at 75%. Full-year operating cash flow was $34 million. $150 million in shares were repurchased in the full year.
Negative
GAAP gross margin declined by 1 percentage point to 71%. Non-GAAP gross margin declined by 2 percentage points to 75%.
05/24/2023 - 04:05 PM
Q4 Revenue Up 5% and Full Year Revenue Up 13%
Q4 GAAP Gross Margin of 71% and Non-GAAP Gross Margin of 75%
Full Year Operating Cash Flow of $34 Million
$150 Million in Shares Repurchased in Full Year
SAN FRANCISCO --(BUSINESS WIRE)--
LiveRamp® (NYSE: RAMP), the leading data collaboration platform, today announced its financial results for the quarter and fiscal year ended March 31, 2023.
This press release features multimedia. View the full release here: https://www.businesswire.com/news/home/20230524005702/en/
Fourth Quarter Financial Highlights
All metrics compared to the prior year fourth quarter.
Total revenue was $149 million , up 5% .
Subscription revenue was $121 million , up 5% , and contributed 81% of total revenue.
Marketplace & Other revenue was $28 million , up 6% .
GAAP gross profit was $105 million , up 3% , and GAAP gross margin of 71% declined by 1 percentage point. Non-GAAP gross profit was $111 million , up 3% , and non-GAAP gross margin of 75% declined by 2 percentage points.
GAAP operating loss was $47 million compared to $28 million in the prior year period. Non-GAAP operating income was $14 million compared to $3 million in the prior year period.
The Company accelerated the vesting of certain time-vesting restricted stock units that would have otherwise vested over the next six months to take advantage of cash tax savings opportunities. In the fourth quarter, the Company recognized $23 million of stock-based compensation expense and $2 million of payroll tax expense related to the accelerated vesting. The accelerated vesting was not contemplated in the Company’s financial outlook for the fourth quarter and fiscal 2023. The payroll tax expense impacted both GAAP and non-GAAP operating income, while the stock-based compensation expense only impacted GAAP operating income.
GAAP diluted loss per share was $0.48 , and non-GAAP diluted earnings per share was $0.32 .
Net cash provided by operating activities was $31 million compared to $59 million in the prior year period.
Fiscal Year Financial Highlights
All metrics compared to the prior fiscal year.
Total revenue was $597 million , up 13% .
Subscription revenue was $483 million , up 13% , and contributed 81% of total revenue.
Marketplace & Other revenue was $114 million , up 14% .
GAAP gross profit was $426 million , up 12% , and GAAP gross margin of 71% declined by 1 percentage point. Non-GAAP gross profit was $450 million , up 11% , and non-GAAP gross margin of 75% declined by 1 percentage point.
GAAP operating loss was $126 million compared to $66 million in the prior year. Non-GAAP operating income was $61 million compared to $42 million in the prior year.
GAAP diluted loss per share was $1.79 , and non-GAAP diluted earnings per share was $0.86 .
Net cash provided by operating activities was $34 million compared to $78 million in the prior year.
In FY23, LiveRamp repurchased 6.1 million shares for $150 million . Since inception of the share repurchase program in August 2011, the Company has returned approximately $1.4 billion in capital to shareholders. To date in FY24, the Company has repurchased 0.5 million shares for $12 million . There is $206 million currently available under the share repurchase authorization that expires on December 31, 2024.
A reconciliation between GAAP and non-GAAP results is provided in the schedules to this press release.
LiveRamp CEO Scott Howe said, “We delivered an in-line quarter, hitting our key financial targets. We enter fiscal 2024 as a more efficient company, with a leaner cost structure and encouraging sales momentum, particularly upselling customers to our data collaboration platform. We expect this momentum to build in FY24 as our recently announced integrations and partnerships – such as with Google PAIR, Snowflake and Twilio – gain traction in the market.”
GAAP and Non-GAAP Results
The following table summarizes the Company’s financial results for its fourth quarter and fiscal year ($ in millions):
Q4 Fiscal 2023
Full Year Fiscal 2023
Results
Results
GAAP
Non-GAAP
GAAP
Non-GAAP
Subscription revenue
$121
—
$483
—
YoY change %
5%
13%
Marketplace & other revenue
$28
—
$114
—
YoY change %
6%
14%
Total revenue
$149
—
$597
—
YoY change %
5%
13%
Gross profit
$105
$111
$426
$450
% Gross margin
71%
75%
71%
75%
YoY change, pts
(1 pt)
(2 pt)
(1 pt)
(1 pt)
Operating income (loss)
($47 )
$14
($126 )
$61
% Operating margin
(32% )
10%
(21% )
10%
YoY change, pts
(12 pts)
8 pts
(9 pts)
2 pts
Net earnings (loss)
($31 )
$21
($119 )
$58
Diluted earnings (loss) per share
($0.48 )
$0.32
($1.79 )
$0.86
Shares to calculate diluted EPS
65.1
66.3
66.4
67.1
YoY change %
(5% )
(3% )
(3% )
(4% )
Net operating cash flow
$31
—
$34
—
Free cash flow to equity
—
$31
—
$30
Totals may not sum 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 to this press release
Additional Business Highlights & Metrics
The Company’s Authenticated Traffic Solution (ATS) has reached global scale. There are currently more than 165 supply-side platforms (SSPs) and demand-side platforms (DSPs) live or committed to bid on RampID™ and ATS, including The Trade Desk, Xander, Amobee, Criteo, Roku Oneview, and MediaMath.
To date, over 14,000 publisher domains, including 70% of the comScore 100 largest publishers, have integrated ATS worldwide, including Amazon Publisher Services, Microsoft, Hearst, CafeMedia, Leaf Group, Prisma Media and Burda. Through these integrations, LiveRamp is now connected to over 90% of consumer time spent online in the US.
In February 2023, LiveRamp announced enhanced product capabilities natively built on Snowflake, a leading data cloud warehouse. Last year, LiveRamp’s identity solutions were natively integrated into Snowflake. Now LiveRamp’s data activation solutions will be natively built into Snowflake, along with an easy-to-use, marketer-friendly user interface, allowing customers to easily activate hundreds of marketing and media destinations directly from Snowflake.
In March 2023, LiveRamp announced that its activation network now extends to mar-tech capabilities through a new partnership with Twilio. This integration will enable marketers to seamlessly activate their LiveRamp audiences in SMS and Email on Twilio, enabling new audience activation channels, as well as the centralization of measurement across advertising and marketing channels.
In March 2023, LiveRamp announced a new partnership with Adobe Real-Time Customer Data Platform to natively offer LiveRamp’s people-based identifier, RampID. Through a new LiveRamp app available in Adobe Exchange, marketers will be able to activate their customer data on RampID via downstream activation partners including DSPs, SSPs, CTV destinations, and other premium publishers.
LiveRamp added 10 net new direct subscription customers in the fourth quarter. Customer count at quarter end was 920, up from 905 a year ago.
At the end of the fourth quarter, LiveRamp had 95 customers whose subscription contracts exceed $1 million in annual revenue, up from 87 in the prior year period.
During the fourth quarter, subscription net retention was 97% , and platform net retention was 99% .
Current remaining performance obligations (CRPO), which is contracted and committed revenue expected to be recognized over the next 12 months, at the end of the fourth quarter was $338 million , up 9% compared to the prior year period.
Financial Outlook
LiveRamp’s non-GAAP guidance excludes the impact of non-cash stock compensation, purchased intangible asset amortization, and restructuring charges.
For the first quarter of fiscal 2024, LiveRamp expects to report:
Revenue of approximately $147 million , an increase of 3% year-over-year
GAAP operating loss of approximately $8 million
Non-GAAP operating income of approximately $15 million
For fiscal 2024, LiveRamp expects to report:
Revenue of between $610 million and $620 million , an increase of between 2% and 4% year-over-year
GAAP operating income of between $3 million and $6 million
Non-GAAP operating income of between $90 million and $93 million .
Conference Call
LiveRamp will hold a conference call at 1:30 p.m. PT today to further discuss this information. Interested parties are invited to listen to the call which will be broadcast via the Internet and can be found on LiveRamp’s investor site . A slide presentation will be referenced during the call and can be accessed here .
About LiveRamp
LiveRamp is the data collaboration platform of choice for the world’s most innovative companies. A groundbreaking leader in consumer privacy, data ethics, and foundational identity, LiveRamp is setting the new standard for building a connected customer view with unmatched clarity and context while protecting precious brand and consumer trust. LiveRamp offers complete flexibility to collaborate wherever data lives to support the widest range of data collaboration use cases—within organizations, between brands, and across its premier global network of top-quality partners. Hundreds of global innovators, from iconic consumer brands and tech giants to banks, retailers, and healthcare leaders, turn to LiveRamp to build enduring brand and business value by deepening customer engagement and loyalty, activating new partnerships, and maximizing 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 2024 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, 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; and attracting 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 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 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, please refer to LiveRamp’s Annual Report on Form 10-K for our fiscal year 2022 ended March 31, 2022, and LiveRamp's Quarterly Reports on Form 10-Q issued in fiscal year 2023.
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.
ERAMP
LiveRampⓇ and RampIDTM 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
March 31,
$
%
2023
2022
Variance
Variance
Revenues
148,626
141,725
6,901
4.9
%
Cost of revenue
43,472
39,476
3,996
10.1
%
Gross profit
105,154
102,249
2,905
2.8
%
% Gross margin
70.8
%
72.1
%
Operating expenses:
Research and development
52,220
45,501
6,719
14.8
%
Sales and marketing
57,506
54,951
2,555
4.6
%
General and administrative
32,832
29,583
3,249
11.0
%
Gains, losses and other items, net
9,723
183
9,540
5213.1
%
Total operating expenses
152,281
130,218
22,063
16.9
%
Loss from operations
(47,127
)
(27,969
)
(19,158
)
(68.5
%)
% Margin
-31.7
%
-19.7
%
Total other income (expense), net
4,735
(47
)
4,782
10174.5
%
Loss from continuing operations before income taxes
(42,392
)
(28,016
)
(14,376
)
(51.3
%)
Income tax expense (benefit)
(6,460
)
1,376
(7,836
)
(569.5
%)
Net loss from continuing operations
(35,932
)
(29,392
)
(6,540
)
(22.3
%)
Earnings from discontinued operations, net of tax
4,568
-
4,568
n/a
Net loss
(31,364
)
(29,392
)
(1,972
)
(6.7
%)
Basic earnings (loss) per share:
Continuing operations
(0.55
)
(0.43
)
(0.12
)
(28.2
%)
Discontinued operations
0.07
-
0.07
n/a
Basic loss per share
(0.48
)
(0.43
)
(0.05
)
(11.9
%)
Diluted earnings (loss) per share:
Continuing operations
(0.55
)
(0.43
)
(0.12
)
(28.2
%)
Discontinued operations
0.07
-
0.07
n/a
Diluted loss per share:
(0.48
)
(0.43
)
(0.05
)
(11.9
%)
Basic weighted average shares
65,126
68,283
Diluted weighted average shares
65,126
68,283
LIVERAMP HOLDINGS, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(Unaudited)
(Dollars in thousands, except per share amounts)
For the Twelve Months Ended
March 31,
$
%
2023
2022
Variance
Variance
Revenues
596,583
528,657
67,926
12.8
%
Cost of revenue
170,084
147,427
22,657
15.4
%
Gross profit
426,499
381,230
45,269
11.9
%
% Gross margin
71.5
%
72.1
%
Operating expenses:
Research and development
189,195
157,935
31,260
19.8
%
Sales and marketing
202,437
182,763
19,674
10.8
%
General and administrative
125,351
104,591
20,760
19.8
%
Gains, losses and other items, net
35,316
1,479
33,837
2287.8
%
Total operating expenses
552,299
446,768
105,531
23.6
%
Loss from operations
(125,800
)
(65,538
)
(60,262
)
(91.9
%)
% Margin
-21.1
%
-12.4
%
Total other income, net
6,946
30,463
(23,517
)
(77.2
%)
Loss from continuing operations before income taxes
(118,854
)
(35,075
)
(83,779
)
(238.9
%)
Income tax expense (benefit)
5,252
(1,242
)
6,494
522.9
%
Net loss from continuing operations
(124,106
)
(33,833
)
(90,273
)
(266.8
%)
Earnings from discontinued operations, net of tax
5,404
-
5,404
n/a
Net loss
(118,702
)
(33,833
)
(84,869
)
(250.8
%)
Basic earnings (loss) per share:
Continuing operations
(1.87
)
(0.50
)
(1.37
)
(277.1
%)
Discontinued operations
0.08
-
0.08
n/a
Basic earnings (loss) per share
(1.79
)
(0.50
)
(1.29
)
(260.7
%)
Diluted earnings (loss) per share:
Continuing operations
(1.87
)
(0.50
)
(1.37
)
(277.1
%)
Discontinued operations
0.08
-
0.08
n/a
Diluted earnings (loss) per share:
(1.79
)
(0.50
)
(1.29
)
(260.7
%)
Basic weighted average shares
66,352
68,211
Diluted weighted average shares
66,352
68,211
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
For the Twelve Months Ended
March 31,
March 31,
2023
2022
2023
2022
Loss from continuing operations before income taxes
(42,392
)
(28,016
)
(118,854
)
(35,075
)
Income tax expense (benefit)
(6,460
)
1,376
5,252
(1,242
)
Net loss from continuing operations
(35,932
)
(29,392
)
(124,106
)
(33,833
)
Earnings from discontinued operations, net of tax
4,568
-
5,404
-
Net loss
(31,364
)
(29,392
)
(118,702
)
(33,833
)
Loss per share:
Basic
(0.48
)
(0.43
)
(1.79
)
(0.50
)
Diluted
(0.48
)
(0.43
)
(1.79
)
(0.50
)
Excluded items:
Purchased intangible asset amortization (cost of revenue)
3,336
4,807
16,825
18,711
Non-cash stock compensation (cost of revenue and operating expenses)
44,658
25,782
125,800
87,257
Transformation costs (general and administrative)
3,663
-
9,025
-
Restructuring and merger charges (gains, losses, and other)
9,723
183
35,316
1,479
Gain on retained profits interest (other income)
-
-
-
(30,235
)
Total excluded items, continuing operations
61,380
30,772
186,966
77,212
Income from continuing operations before income taxes and excluding items
18,988
2,756
68,112
42,137
Income tax expense (benefit) (2)
(2,141
)
3,391
10,121
8,515
Non-GAAP net earnings (loss) from continuing operations
21,129
(635
)
57,991
33,622
Non-GAAP earnings (loss) per share from continuing operations:
Basic
0.32
(0.01
)
0.87
0.49
Diluted
0.32
(0.01
)
0.86
0.48
Basic weighted average shares
65,126
68,283
66,352
68,211
Diluted weighted average shares
66,268
68,283
67,097
69,560
(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
For the Twelve Months Ended
March 31,
March 31,
2023
2022
2023
2022
Loss from continuing operations
(47,127
)
(27,969
)
(125,800
)
(65,538
)
Excluded items:
Purchased intangible asset amortization (cost of revenue)
3,336
4,807
16,825
18,711
Non-cash stock compensation (cost of revenue and operating expenses)
44,658
25,782
125,800
87,257
Transformation costs (general and administrative)
3,663
-
9,025
-
Restructuring and merger charges (gains, losses, and other)
9,723
183
35,316
1,479
Total excluded items
61,380
30,772
186,966
107,447
Income from continuing operations before excluded items
14,253
2,803
61,166
41,909
(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
For the Twelve Months Ended
March 31,
March 31,
2023
2022
2023
2022
Net loss from continuing operations
(35,932
)
(29,392
)
(124,106
)
(33,833
)
Income tax expense (benefit)
(6,460
)
1,376
5,252
(1,242
)
Other expense (income)
(4,735
)
47
(6,946
)
(30,463
)
Loss from operations
(47,127
)
(27,969
)
(125,800
)
(65,538
)
Depreciation and amortization
4,226
6,017
20,787
24,248
EBITDA
(42,901
)
(21,952
)
(105,013
)
(41,290
)
Other adjustments:
Non-cash stock compensation (cost of revenue and operating expenses)
44,658
25,782
125,800
87,257
Transformation costs (general and administrative)
3,663
-
9,025
-
Restructuring and merger charges (gains, losses, and other)
9,723
183
35,316
1,479
Other adjustments
58,044
25,965
170,141
88,736
Adjusted EBITDA
15,143
4,013
65,128
47,446
(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)
March 31,
March 31,
$
%
2023
2022
Variance
Variance
Assets
Current assets:
Cash and cash equivalents
464,448
600,162
(135,714
)
(22.6
%)
Short-term investments
32,807
7,500
25,307
337.4
%
Trade accounts receivable, net
157,379
148,343
9,036
6.1
%
Refundable income taxes, net
28,897
30,354
(1,457
)
(4.8
%)
Other current assets
31,028
29,475
1,553
5.3
%
Total current assets
714,559
815,834
(101,275
)
(12.4
%)
Property and equipment
39,393
45,001
(5,608
)
(12.5
%)
Less - accumulated depreciation and amortization
32,308
33,470
(1,162
)
(3.5
%)
Property and equipment, net
7,085
11,531
(4,446
)
(38.6
%)
Intangible assets, net
9,868
26,718
(16,850
)
(63.1
%)
Goodwill
363,116
363,845
(729
)
(0.2
%)
Deferred commissions, net
37,030
30,594
6,436
21.0
%
Other assets, net
41,045
85,214
(44,169
)
(51.8
%)
1,172,703
1,333,736
(161,033
)
(12.1
%)
Liabilities and Stockholders' Equity
Current liabilities:
Trade accounts payable
86,568
83,197
3,371
4.1
%
Accrued payroll and related expenses
33,434
39,188
(5,754
)
(14.7
%)
Other accrued expenses
35,736
46,067
(10,331
)
(22.4
%)
Deferred revenue
19,091
16,114
2,977
18.5
%
Total current liabilities
174,829
184,566
(9,737
)
(5.3
%)
Other liabilities
71,798
86,110
(14,312
)
(16.6
%)
Stockholders' equity:
Preferred stock
-
-
-
n/a
Common stock
15,399
14,984
415
2.8
%
Additional paid-in capital
1,855,916
1,721,118
134,798
7.8
%
Retained earnings
1,302,291
1,420,993
(118,702
)
(8.4
%)
Accumulated other comprehensive income
4,504
5,730
(1,226
)
(21.4
%)
Treasury stock, at cost
(2,252,034
)
(2,099,765
)
(152,269
)
(7.3
%)
Total stockholders' equity
926,076
1,063,060
(136,984
)
(12.9
%)
1,172,703
1,333,736
(161,033
)
(12.1
%)
LIVERAMP HOLDINGS, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
(Unaudited)
(Dollars in thousands)
For the Three Months Ended
March 31,
2023
2022
Cash flows from operating activities:
Net loss
(31,364
)
(29,392
)
Earnings from discontinued operations, net of tax
(4,568
)
-
Non-cash operating activities:
Depreciation and amortization
4,226
6,017
Loss on disposal or impairment of assets
16
41
Lease impairments
9,380
-
Provision for doubtful accounts
48
1,090
Deferred income taxes
(89
)
(1,084
)
Non-cash stock compensation expense
44,658
25,782
Changes in operating assets and liabilities:
Accounts receivable
15,048
7,265
Deferred commissions
(4,313
)
(1,111
)
Other assets
6,117
4,786
Accounts payable and other liabilities
(6,060
)
11,321
Income taxes
(6,371
)
32,971
Deferred revenue
3,937
1,258
Net cash provided by operating activities
30,665
58,944
Cash flows from investing activities:
Capital expenditures
(103
)
(1,880
)
Purchases of investments
(25,197
)
-
Proceeds from sales of strategic investments
994
-
Cash paid in acquisition, net of cash received
-
(8,731
)
Net cash used in investing activities
(24,306
)
(10,611
)
Cash flows from financing activities:
Proceeds related to the issuance of common stock under stock and employee benefit plans
4
83
Shares repurchased for tax withholdings upon vesting of stock-based awards
(218
)
(410
)
Acquisition of treasury stock
-
(9,397
)
Net cash used in financing activities
(214
)
(9,724
)
Cash flows from discontinued operations:
From operating activities
4,568
-
Net cash provided by discontinued operations
4,568
-
Effect of exchange rate changes on cash
219
(137
)
Net change in cash and cash equivalents
10,932
38,472
Cash and cash equivalents at beginning of period
453,516
561,690
Cash and cash equivalents at end of period
464,448
600,162
Supplemental cash flow information:
Cash paid (received) during the period for:
Income taxes related to continuing operations
1,076
(30,101
)
Income taxes related to discontinued operations
(7,025
)
-
Operating lease liabilities
2,510
2,591
Operating lease assets obtained in exchange for operating lease liabilities
-
3,280
Purchases of property, plant, & equipment, net remaining unpaid at end of period
47
696
LIVERAMP HOLDINGS, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
(Unaudited)
(Dollars in thousands)
For the Twelve Months Ended
March 31,
2023
2022
Cash flows from operating activities:
Net loss
(118,702
)
(33,833
)
Earnings from discontinued operations, net of tax
(5,404
)
-
Non-cash operating activities:
Depreciation and amortization
20,787
24,248
Loss on disposal or impairment of assets
4,137
183
Lease impairments
27,545
-
Gain on sale of strategic investments
(194
)
-
Gain on distribution from retained profits interest
-
(30,235
)
Provision for doubtful accounts
1,776
4,217
Deferred income taxes
115
(1,540
)
Non-cash stock compensation expense
125,800
87,257
Changes in operating assets and liabilities:
Accounts receivable
(12,123
)
(38,611
)
Deferred commissions
(6,436
)
(7,975
)
Other assets
7,705
26,863
Accounts payable and other liabilities
(15,369
)
8,850
Income taxes
596
33,969
Deferred revenue
4,208
4,684
Net cash provided by operating activities
34,441
78,077
Cash flows from investing activities:
Capital expenditures
(4,696
)
(4,499
)
Purchases of investments
(28,197
)
-
Proceeds from sales of investments
3,000
-
Purchases of strategic investments
(500
)
-
Proceeds from sales of strategic investments
1,394
-
Distribution from retained profits interest
-
31,184
Cash paid in acquisition, net of cash received
-
(19,107
)
Net cash provided by (used in) investing activities
(28,999
)
7,578
Cash flows from financing activities:
Proceeds related to the issuance of common stock under stock and employee benefit plans
6,259
6,266
Shares repurchased for tax withholdings upon vesting of stock-based awards
(2,272
)
(14,626
)
Acquisition of treasury stock
(149,997
)
(58,621
)
Net cash used in financing activities
(146,010
)
(66,981
)
Cash flows from discontinued operations:
From operating activities
5,404
-
Net cash provided by discontinued operations
5,404
-
Effect of exchange rate changes on cash
(550
)
(199
)
Net change in cash and cash equivalents
(135,714
)
18,475
Cash and cash equivalents at beginning of period
600,162
581,687
Cash and cash equivalents at end of period
464,448
600,162
Supplemental cash flow information:
Cash paid (received) during the period for:
Income taxes related to continuing operations
5,801
(32,916
)
Income taxes related to discontinued operations
(8,332
)
-
Operating lease liabilities
8,243
10,108
Operating lease assets obtained in exchange for operating lease liabilities
69
56,182
Operating lease assets relinquished in exchange for operating lease liabilities
(6,781
)
-
Purchases of property, plant, & equipment, net remaining unpaid at end of period
47
696
LIVERAMP HOLDINGS, INC. AND SUBSIDIARIES
CALCULATION OF FREE CASH FLOW TO EQUITY (1)
(Unaudited)
(Dollars in thousands)
06/30/21
09/30/21
12/31/21
03/31/22
FY2022
06/30/22
09/30/22
12/31/22
03/31/23
FY2023
Net Cash Provided by (Used in) Operating Activities-Continuing Operations
(17,241
)
10,901
25,473
58,944
78,077
(33,369
)
21,375
15,770
30,665
34,441
Less:
Capital expenditures
(427
)
(876
)
(1,316
)
(1,880
)
(4,499
)
(1,741
)
(2,673
)
(179
)
(103
)
(4,696
)
Free Cash Flow to Equity
(17,668
)
10,025
24,157
57,064
73,578
(35,110
)
18,702
15,591
30,562
29,745
(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
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(Unaudited)
(Dollars in thousands, except per share amounts)
FY23 to FY22
06/30/21
09/30/21
12/31/21
03/31/22
FY2022
06/30/22
09/30/22
12/31/22
03/31/23
FY2023
%
$
Revenues
119,038
127,290
140,604
141,725
528,657
142,243
147,099
158,615
148,626
596,583
12.8
%
67,926
Cost of revenue
34,315
35,079
38,557
39,476
147,427
41,021
42,304
43,287
43,472
170,084
15.4
%
22,657
Gross profit
84,723
92,211
102,047
102,249
381,230
101,222
104,795
115,328
105,154
426,499
11.9
%
45,269
% Gross margin
71.2
%
72.4
%
72.6
%
72.1
%
72.1
%
71.2
%
71.2
%
72.7
%
70.8
%
71.5
%
Operating expenses
Research and development
34,776
35,788
41,870
45,501
157,935
47,661
46,139
43,175
52,220
189,195
19.8
%
31,260
Sales and marketing
41,979
39,509
46,324
54,951
182,763
51,280
45,949
47,702
57,506
202,437
10.8
%
19,674
General and administrative
24,291
23,078
27,639
29,583
104,591
27,144
28,718
36,657
32,832
125,351
19.8
%
20,760
Gains, losses and other items, net
1,278
18
-
183
1,479
739
13,111
11,743
9,723
35,316
2287.8
%
33,837
Total operating expenses
102,324
98,393
115,833
130,218
446,768
126,824
133,917
139,277
152,281
552,299
23.6
%
105,531
Loss from operations
(17,601
)
(6,182
)
(13,786
)
(27,969
)
(65,538
)
(25,602
)
(29,122
)
(23,949
)
(47,127
)
(125,800
)
(91.9
%)
(60,262
)
% Margin
-14.8
%
-4.9
%
-9.8
%
-19.7
%
-12.4
%
-18.0
%
-19.8
%
-15.1
%
-31.7
%
-21.1
%
Total other income (expense), net
30,601
150
(241
)
(47
)
30,463
699
2,248
(736
)
4,735
6,946
(77.2
%)
(23,517
)
Income (loss) from continuing operations before income taxes
13,000
(6,032
)
(14,027
)
(28,016
)
(35,075
)
(24,903
)
(26,874
)
(24,685
)
(42,392
)
(118,854
)
(238.9
%)
(83,779
)
Income taxes expense (benefit)
(4,365
)
399
1,348
1,376
(1,242
)
2,315
3,562
5,835
(6,460
)
5,252
522.9
%
6,494
Net earnings (loss) from continuing operations
17,365
(6,431
)
(15,375
)
(29,392
)
(33,833
)
(27,218
)
(30,436
)
(30,520
)
(35,932
)
(124,106
)
(266.8
%)
(90,273
)
Earnings from discontinued operations, net of tax
-
-
-
-
-
-
-
836
4,568
5,404
n/a
5,404
Net earnings (loss)
17,365
(6,431
)
(15,375
)
(29,392
)
(33,833
)
(27,218
)
(30,436
)
(29,684
)
(31,364
)
(118,702
)
(250.8
%)
(84,869
)
Diluted earnings (loss) per share
0.25
(0.09
)
(0.23
)
(0.43
)
(0.50
)
(0.40
)
(0.45
)
(0.46
)
(0.48
)
(1.79
)
(260.7
%)
(1.29
)
Some earnings (loss) per share amounts may not add due to rounding.
Basic shares
68,328
68,042
68,190
68,283
68,211
68,403
67,096
64,784
65,126
66,352
Diluted shares
69,605
69,333
69,938
69,354
69,560
69,195
67,568
65,356
66,268
67,097
LIVERAMP HOLDINGS, INC. AND SUBSIDIARIES
RECONCILIATION OF GAAP TO NON-GAAP EXPENSES (1)
(Unaudited)
(Dollars in thousands)
06/30/21
09/30/21
12/31/21
03/31/22
FY2022
06/30/22
09/30/22
12/31/22
03/31/23
FY2023
Expenses, continuing operations:
Cost of revenue
34,315
35,079
38,557
39,476
147,427
41,021
42,304
43,287
43,472
170,084
Research and development
34,776
35,788
41,870
45,501
157,935
47,661
46,139
43,175
52,220
189,195
Sales and marketing
41,979
39,509
46,324
54,951
182,763
51,280
45,949
47,702
57,506
202,437
General and administrative
24,291
23,078
27,639
29,583
104,591
27,144
28,718
36,657
32,832
125,351
Gains, losses and other items, net
1,278
18
-
183
1,479
739
13,111
11,743
9,723
35,316
Gross profit, continuing operations:
84,723
92,211
102,047
102,249
381,230
101,222
104,795
115,328
105,154
426,499
% Gross margin
71.2
%
72.4
%
72.6
%
72.1
%
72.1
%
71.2
%
71.2
%
72.7
%
70.8
%
71.5
%
Excluded items:
Purchased intangible asset amortization (cost of revenue)
4,645
4,612
4,647
4,807
18,711
4,643
4,637
4,209
3,336
16,825
Non-cash stock compensation (cost of revenue)
790
948
1,168
1,205
4,111
1,163
1,293
1,208
2,653
6,317
Non-cash stock compensation (research and development)
5,348
7,184
9,264
10,316
32,112
11,656
12,360
10,654
20,737
55,407
Non-cash stock compensation (sales and marketing)
6,793
6,749
7,329
7,715
28,586
5,884
6,116
5,871
11,558
29,429
Non-cash stock compensation (general and administrative)
5,565
4,340
5,997
6,546
22,448
5,522
7,524
11,891
9,710
34,647
Restructuring and merger charges (gains, losses, and other)
1,278
18
-
183
1,479
739
13,111
11,743
9,723
35,316
Transformation costs (general and administrative)
-
-
-
-
-
-
1,250
4,112
3,663
9,025
Gain on retained profits interest (other income)
(30,052
)
-
(183
)
-
(30,235
)
-
-
-
-
-
Total excluded items
(5,633
)
23,851
28,222
30,772
77,212
29,607
46,291
49,688
61,380
186,966
Expenses, continued operations excluding items:
Cost of revenue
28,880
29,519
32,742
33,464
124,605
35,215
36,374
37,870
37,483
146,942
Research and development
29,428
28,604
32,606
35,185
125,823
36,005
33,779
32,521
31,483
133,788
Sales and marketing
35,186
32,760
38,995
47,236
154,177
45,396
39,833
41,831
45,948
173,008
General and administrative
18,726
18,738
21,642
23,037
82,143
21,622
19,944
20,654
19,459
81,679
Gains, losses and other items, net
-
-
-
-
-
-
-
-
-
-
Gross profit, continued operations excluding items:
90,158
97,771
107,862
108,261
404,052
107,028
110,725
120,745
111,143
449,641
% Gross margin
75.7
%
76.8
%
76.7
%
76.4
%
76.4
%
75.2
%
75.3
%
76.1
%
74.8
%
75.4
%
(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)
06/30/21
09/30/21
12/31/21
03/31/22
FY2022
06/30/22
09/30/22
12/31/22
03/31/23
FY 2023
Income (loss) from continuing operations before income taxes
13,000
(6,032
)
(14,027
)
(28,016
)
(35,075
)
(24,903
)
(26,874
)
(24,685
)
(42,392
)
(118,854
)
Income taxes (benefit)
(4,365
)
399
1,348
1,376
(1,242
)
2,315
3,562
5,835
(6,460
)
5,252
Net earnings (loss) from continuing operations
17,365
(6,431
)
(15,375
)
(29,392
)
(33,833
)
(27,218
)
(30,436
)
(30,520
)
(35,932
)
(124,106
)
Earnings from discontinued operations, net of tax
-
-
-
-
-
-
-
836
4,568
5,404
Net earnings (loss)
17,365
(6,431
)
(15,375
)
(29,392
)
(33,833
)
(27,218
)
(30,436
)
(29,684
)
(31,364
)
(118,702
)
Earnings (loss) per share:
Basic
0.25
(0.09
)
(0.23
)
(0.43
)
(0.50
)
(0.40
)
(0.45
)
(0.46
)
(0.48
)
(1.79
)
Diluted
0.25
(0.09
)
(0.23
)
(0.43
)
(0.50
)
(0.40
)
(0.45
)
(0.46
)
(0.48
)
(1.79
)
Excluded items:
Purchased intangible asset amortization (cost of revenue)
4,645
4,612
4,647
4,807
18,711
4,643
4,637
4,209
3,336
16,825
Non-cash stock compensation (cost of revenue and operating expenses)
18,496
19,221
23,758
25,782
87,257
24,225
27,293
29,624
44,658
125,800
Restructuring and merger charges (gains, losses, and other)
1,278
18
-
183
1,479
739
13,111
11,743
9,723
35,316
Transformation costs (general and administrative)
-
-
-
-
-
-
1,250
4,112
3,663
9,025
Gain on retained profits interest (other income)
(30,052
)
-
(183
)
-
(30,235
)
-
-
-
-
-
Total excluded items from continuing operations
(5,633
)
23,851
28,222
30,772
77,212
29,607
46,291
49,688
61,380
186,966
Income from continuing operations before income taxes and excluding items
7,367
17,819
14,195
2,756
42,137
4,704
19,417
25,003
18,988
68,112
Income taxes expense (benefit)
865
(12
)
4,271
3,391
8,515
1,237
4,557
6,468
(2,141
)
10,121
Non-GAAP net earnings (loss) from continuing operations
6,502
17,831
9,924
(635
)
33,622
3,467
14,860
18,535
21,129
57,991
Non-GAAP earnings (loss) per share from continuing operations:
Basic
0.10
0.26
0.15
(0.01
)
0.49
0.05
0.22
0.29
0.32
0.87
Diluted
0.09
0.26
0.14
(0.01
)
0.48
0.05
0.22
0.28
0.32
0.86
Basic weighted average shares
68,328
68,042
68,190
68,283
68,211
68,403
67,096
64,784
65,126
66,352
Diluted weighted average shares
69,605
69,333
69,938
68,283
69,560
69,195
67,568
65,356
66,268
67,097
(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
June 30, 2023
March 31, 2024
Low
High
GAAP income (loss) from operations
(8,000
)
3,000
6,000
Excluded items:
Purchased intangible asset amortization
3,000
7,000
7,000
Non-cash stock compensation
18,000
78,000
78,000
Transformation costs
2,000
2,000
2,000
Total excluded items
23,000
87,000
87,000
Non-GAAP income from operations
$
15,000
$
90,000
$
93,000
(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
Q4 FISCAL 2023 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 leasehold improvement write offs. These items, 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.
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LiveRamp Investor Relations
Investor.Relations@LiveRamp.com
ERAMP
Source: LiveRamp
Q4 revenue grew by 5% compared to the prior year quarter.
Full-year revenue increased by 13% compared to the previous fiscal year.
The non-GAAP gross margin remained steady at 75%.
The full-year operating cash flow was $34 million.
$150 million in shares were repurchased in the full year.