LivePerson(LPSN) - 2025 Q1 - Quarterly Results

First Quarter 2025 Financial Results and Business Highlights LivePerson's Q1 2025 results show a revenue decline to $64.7 million, a narrowed net loss, and strategic customer expansions Q1 2025 Financial Performance LivePerson's Q1 2025 revenue decreased to $64.7 million, while net loss significantly narrowed to $14.1 million, with cash at $176.3 million Q1 2025 Key Financial Metrics vs. Q1 2024 (in millions) | Metric | Q1 2025 | Q1 2024 | Change | | :--- | :--- | :--- | :--- | | Total Revenue | $64.7M | $85.1M | -24.0% | | Net Loss | $(14.1)M | $(35.6)M | Improved | | Net Loss Per Share | $(0.15) | $(0.40) | Improved | | Adjusted EBITDA | $0.2M | $0.5M | -60.0% | | Adjusted Operating Loss | $(5.4)M | $(7.7)M | Improved | Disaggregated Revenue (Three Months Ended March 31, in thousands) | Revenue Source | 2025 | 2024 | | :--- | :--- | :--- | | Hosted services | $55,134 | $71,495 | | Professional services | $9,566 | $13,654 | | Total revenue | $64,700 | $85,149 | - The company's cash balance was $176.3 million at March 31, 2025, compared to $183.2 million at December 31, 2024[9] Business and Customer Update LivePerson secured 50 deals in Q1, including new logos and expansions, while ARPC grew 2.4% and strategic AI integrations advanced - Signed 50 deals in Q1, comprising 45 with existing customers and 5 with new customers[4][6] - Trailing-twelve-months average revenue per enterprise and mid-market customer (ARPC) grew 2.4% to $640,000 from $625,000 in the prior-year period[4] - Key customer deals included expansions with IBM and one of the world's largest banks, and new logos such as one of Canada's largest retailers[6] - The company is advancing strategic partnerships, with a planned launch of an integration with Amazon Connect in the second quarter, noting growing enterprise demand for AI agents[5] Financial Outlook LivePerson provides Q2 and full-year 2025 guidance, anticipating continued revenue decline but stable adjusted EBITDA Second Quarter 2025 Guidance LivePerson projects Q2 2025 revenue between $57 million and $60 million, with an adjusted EBITDA loss ranging from $(4) million to $(2) million Q2 2025 Guidance (in millions) | Metric | Guidance | | :--- | :--- | | Revenue | $57 - $60 | | Revenue growth (YoY) | (29)% - (25)% | | Adjusted EBITDA | $(4) - $(2) | | Adjusted EBITDA margin (%) | (7.0)% - (3.3)% | - Recurring revenue is expected to constitute 93% of total revenue for the second quarter[11] Full Year 2025 Guidance LivePerson reaffirms full-year 2025 revenue guidance of $240 million to $255 million and adjusted EBITDA between $(14) million and $0 million Full Year 2025 Guidance (in millions) | Metric | Guidance | | :--- | :--- | | Revenue | $240 - $255 | | Revenue growth (YoY) | (23)% - (18)% | | Adjusted EBITDA | $(14) - $0 | | Adjusted EBITDA margin (%) | (5.8)% - 0.0% | - The full-year expectations are unchanged from the previous earnings release, with recurring revenue expected to represent 93% of total revenue for the full year[12] Consolidated Financial Statements This section presents LivePerson's detailed statements of operations, cash flows, and balance sheets for the reporting period Condensed Consolidated Statements of Operations Q1 2025 operations show revenue decreased to $64.7 million, total costs significantly reduced, leading to a narrowed net loss of $(14.1) million Statement of Operations Summary (in thousands) | Line Item | Q1 2025 | Q1 2024 | | :--- | :--- | :--- | | Revenue | $64,700 | $85,149 | | Total costs, expenses and other | $81,644 | $121,513 | | Loss from operations | $(16,944) | $(36,364) | | Net loss | $(14,133) | $(35,631) | | Net loss per share, basic | $(0.15) | $(0.40) | Condensed Consolidated Statements of Cash Flows Q1 2025 cash flows show net cash used in operating activities of $(3.1) million, reduced investing outflows, and a $7.0 million decrease in cash to $176.3 million Cash Flow Summary (in thousands) | Activity | Q1 2025 | Q1 2024 | | :--- | :--- | :--- | | Net cash (used in) provided by operating activities | $(3,096) | $1,099 | | Net cash used in investing activities | $(4,145) | $(12,710) | | Net cash used in financing activities | $(26) | $(72,697) | | Net decrease in cash and cash equivalents | $(6,983) | $(83,908) | | Cash and cash equivalents - end of period | $176,254 | $129,017 | Condensed Consolidated Balance Sheets As of March 31, 2025, total assets were $596.2 million, total liabilities $671.2 million, resulting in a stockholders' equity deficit of $(74.9) million Balance Sheet Summary (in thousands) | Account | March 31, 2025 | December 31, 2024 | | :--- | :--- | :--- | | Cash and cash equivalents | $176,254 | $183,237 | | Total current assets | $221,754 | $231,224 | | Total assets | $596,220 | $607,778 | | Total current liabilities | $134,202 | $139,940 | | Convertible senior notes | $528,858 | $527,070 | | Total liabilities | $671,164 | $675,094 | | Total stockholders' equity | $(74,944) | $(67,316) | Reconciliation of Non-GAAP Financial Measures This section reconciles GAAP financial metrics to non-GAAP measures like Adjusted EBITDA, Adjusted Operating Loss, and Free Cash Flow Reconciliation of Adjusted EBITDA and Adjusted Operating Loss Q1 2025 GAAP net loss of $(14.1) million was reconciled to Adjusted EBITDA of $0.2 million, with key adjustments including litigation costs and warrant fair value changes Reconciliation of GAAP Net Loss to Adjusted EBITDA (in thousands) | Description | Q1 2025 | Q1 2024 | | :--- | :--- | :--- | | GAAP net loss | $(14,133) | $(35,631) | | Add: Interest, taxes, D&A, etc. | $14,300 | $19,214 | | Add: Litigation, restructuring, SBC, etc. | $11,183 | $18,252 | | Less: Change in fair value of warrants | $(8,824) | $0 | | Adjusted EBITDA | $167 | $477 | - Litigation, consulting, and other employee costs were a significant adjustment at $5.2 million in Q1 2025, up from $3.8 million in Q1 2024[30][32] Calculation of Free Cash Flow Q1 2025 free cash flow was an outflow of $(6.9) million, an improvement from the prior year, derived from operating activities and capital expenditures Free Cash Flow Calculation (in thousands) | Description | Q1 2025 | Q1 2024 | | :--- | :--- | :--- | | Net cash (used in) provided by operating activities | $(3,096) | $1,099 | | Purchases of property and equipment | $(3,759) | $(11,501) | | Total Free Cash Flow | $(6,855) | $(10,402) | Reconciliation of Non-GAAP Cost and Expense Items This section details adjustments to non-GAAP cost and expense items, notably reducing GAAP general and administrative expenses by excluding litigation and stock-based compensation Q1 2025 GAAP vs. Non-GAAP Expenses (in thousands) | Expense Category | GAAP | Non-GAAP | | :--- | :--- | :--- | | Cost of revenue | $18,218 | $17,922 | | Sales and marketing | $23,485 | $22,107 | | General and administrative | $16,784 | $9,842 | | Product development | $16,034 | $14,662 |