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Share Name | Share Symbol | Market | Type |
---|---|---|---|
LiveRamp Holdings Inc | NYSE:RAMP | NYSE | Common Stock |
Price Change | % Change | Share Price | High Price | Low Price | Open Price | Shares Traded | Last Trade | |
---|---|---|---|---|---|---|---|---|
0.00 | 0.00% | 32.94 | 0 | 09:21:18 |
First $100 Million Revenue Quarter
GAAP Gross Margin Increases to 63% – Non-GAAP Gross Margin Surges to 69%
Operating Cash Flow Positive $16 Million
LiveRamp® (NYSE: RAMP), the trusted platform that makes data accessible and meaningful, today announced its financial results for the third quarter ended December 31, 2019.
This press release features multimedia. View the full release here: https://www.businesswire.com/news/home/20200205005789/en/
Financial Highlights:
“LiveRamp has emerged as the safe and neutral choice for using data effectively,” said LiveRamp CEO Scott Howe. “Leading brands, agencies and publishers around the world are relying on us to provide the foundational infrastructure for navigating a complex ecosystem of evolving regulations and technologies. In addition, our Authenticated Traffic Solution continues to gain global acceptance as the ecosystem welcomes a simple and unbiased standard.”
“Our business model demonstrated its strong potential this quarter,” said LiveRamp President and CFO Warren Jenson. “We reported our first $100 million revenue quarter, our non-GAAP gross margin expanded to 69%, and we were operating cash flow positive.”
GAAP and Non-GAAP Results:
The following table summarizes the Company’s financial results for its third fiscal quarter ($ in millions):
Q3 Fiscal 2020
Q3 Fiscal 2019
Results
Results
GAAP
Non-GAAP
GAAP
Non-GAAP
Subscription revenue
$82
—
$65
—
YoY change %
25%
42%
Marketplace & other revenue
$21
—
$15
—
YoY change %
38%
13%
Total revenue
$102
—
$80
—
YoY change %
28%
35%
Gross profit
$64
$71
$45
$51
% Gross margin
63%
69%
56%
64%
YoY change, pts
6 pts
5 pts
(2) pts
(6) pts
Operating loss
($41)
($6)
($48)
($11)
% Operating margin
(41%)
(5%)
(60)%
(14%)
YoY change, pts
20 pts
8 pts
(13) pts
(7) pts
Net loss1
($38)
($2)
($15)
$2
YoY change %
nm
nm
nm
nm
Loss per share1
($0.56)
($0.03)
($0.20)
$0.03
YoY change %
nm
nm
nm
nm
Shares to Calculate EPS
67.5
67.5
77.4
80.7
YoY change %
(13%)
(13%)
Net operating cash flow
$16
—
($11)
—
YoY change %
nm
—
nm
Free cash flow to equity
—
$13
—
($13)
YoY change %
—
nm
—
nm
1 From continuing operations, does not include AMS results.
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 Metrics & Highlights
Financial Outlook
LiveRamp’s non-GAAP guidance excludes the impact of non-cash stock compensation, purchased intangible asset amortization, and restructuring charges.
For fiscal 2020, LiveRamp expects to report:
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 provides the identity platform leveraged by brands and their partners to deliver innovative products and exceptional experiences. Powered by its core capabilities in data accessibility, identity, connectivity, and data stewardship, LiveRamp makes it easy to connect the world’s data, people and applications. For more information, visit www.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, 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 relate to 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 relate to maintaining our culture and our ability to innovate and evolve within a rapidly changing industry including digital advertising, while also avoiding disruption from acquisition and divestiture activities. Our international operations are also subject to risks 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’ computer systems 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 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 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 2019 ended March 31, 2019.
The financial information set forth in this press release reflects estimates based on information available at this time. These amounts could differ from actual reported amounts stated in LiveRamp’s Quarterly Report on Form 10-Q for the period ended December 31, 2019, which LiveRamp expects to file on February 5, 2020.
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.
LiveRampⓇ, IdentityLink™ , AbilitecⓇ, Safe HavenⓇ 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 December 31,
$
%
2019
2018
Variance
Variance
Revenues102,217
80,021
22,196
27.7%
Cost of revenue37,966
34,838
3,128
9.0%
Gross profit64,251
45,183
19,068
42.2%
% Gross margin62.9%
56.5%
Operating expenses: Research and development27,403
20,469
6,934
33.9%
Sales and marketing51,993
40,054
11,939
29.8%
General and administrative26,107
27,828
(1,721)
(6.2%)
Gains, losses and other items, net233
5,043
(4,810)
(95.4%)
Total operating expenses105,736
93,394
12,342
13.2%
Loss from operations(41,485)
(48,211)
6,726
14.0%
% Margin-40.6%
-60.2%
Total other income3,158
10,404
(7,246)
(69.6%)
Loss from continuing operations before income taxes(38,327)
(37,807)
(520)
(1.4%)
Income taxes (benefit)(287)
(22,546)
22,259
98.7%
Net loss from continuing operations(38,040)
(15,261)
(22,779)
(149.3%)
Earnings from discontinued operations, net of tax-
1,071,661
(1,071,661)
(100.0%)
Net earnings (loss)(38,040)
1,056,400
(1,094,440)
(103.6%)
Basic earnings (loss) per share: Continuing operations(0.56)
(0.20)
(0.37)
(185.9%)
Discontinued operations-
13.85
(13.85)
(100.0%)
Net earnings (loss)(0.56)
13.65
(14.21)
(104.1%)
Diluted earnings (loss) per share: Continuing operations(0.56)
(0.20)
(0.37)
(185.9%)
Discontinued operations-
13.85
(13.85)
(100.0%)
Net earnings (loss)(0.56)
13.65
(14.21)
(104.1%)
Basic weighted average shares67,473
77,398
Diluted weighted average shares67,473
77,398
LIVERAMP HOLDINGS, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(Unaudited)
(Dollars in thousands, except per share amounts)
For the Nine Months Ended
December 31,
$
%
2019
2018
Variance
Variance
Revenues274,871
207,304
67,567
32.6%
Cost of revenue115,852
82,958
32,894
39.7%
Gross profit159,019
124,346
34,673
27.9%
% Gross margin57.9%
60.0%
Operating expenses: Research and development77,570
54,379
23,191
42.6%
Sales and marketing140,341
109,317
31,024
28.4%
General and administrative78,687
71,129
7,558
10.6%
Gains, losses and other items, net2,554
5,533
(2,979)
(53.8%)
Total operating expenses299,152
240,358
58,794
24.5%
Loss from operations(140,133)
(116,012)
(24,121)
(20.8%)
% Margin-51.0%
-56.0%
Total other income13,820
10,479
3,341
31.9%
Loss from continuing operations before income taxes(126,313)
(105,533)
(20,780)
(19.7%)
Income taxes (benefit)(5,931)
(21,274)
15,343
72.1%
Net loss from continuing operations(120,382)
(84,259)
(36,123)
(42.9%)
Earnings from discontinued operations, net of tax-
1,158,267
(1,158,267)
(100.0%)
Net earnings (loss)(120,382)
1,074,008
(1,194,390)
(111.2%)
Basic earnings (loss) per share: Continuing operations(1.77)
(1.09)
(0.68)
(62.3%)
Discontinued operations-
14.99
(14.99)
(100.0%)
Net earnings (loss)(1.77)
13.90
(15.67)
(112.7%)
Diluted earnings (loss) per share: Continuing operations(1.77)
(1.09)
(0.68)
(62.3%)
Discontinued operations-
14.99
(14.99)
(100.0%)
Net earnings (loss)(1.77)
13.90
(15.67)
(112.7%)
Basic weighted average shares68,021
77,260
Diluted weighted average shares68,021
77,260
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 Nine Months Ended
December 31,
December 31,
2019
2018
2019
2018
Loss from continuing operations before income taxes(38,327)
(37,807)
(126,313)
(105,533)
Income taxes (benefit)(287)
(22,546)
(5,931)
(21,274)
Net loss from continuing operations(38,040)
(15,261)
(120,382)
(84,259)
Earnings from discontinued operations, net of tax-
1,071,661
-
1,158,267
Net earnings (loss)(38,040)
1,056,400
(120,382)
1,074,008
Earnings (loss) per share: Basic(0.56)
13.65
(1.77)
13.90
Diluted(0.56)
13.65
(1.77)
13.90
Excluded items: Purchased intangible asset amortization (cost of revenue)5,369
3,359
13,861
12,877
Non-cash stock compensation (cost of revenue and operating expenses)30,295
26,082
72,279
61,547
Accelerated depreciation (cost of revenue and operating expenses)-
1,959
3,569
1,959
Restructuring and merger charges (gains, losses, and other)233
5,043
2,554
5,533
Separation and transformation costs (general and administrative)-
700
-
2,822
Total excluded items, continuing operations35,897
37,143
92,263
84,738
Loss from continuing operations before income taxes and excluding items(2,430)
(664)
(34,050)
(20,795)
Income taxes (benefit) (2)(227)
(2,941)
(253)
(7,809)
Non-GAAP net earnings (loss) from continuing operations(2,203)
2,277
(33,797)
(12,986)
Non-GAAP earnings (loss) per share from continuing operations: Basic(0.03)
0.03
(0.50)
(0.17)
Diluted(0.03)
0.03
(0.50)
(0.17)
Basic weighted average shares67,473
77,398
68,021
77,260
Diluted weighted average shares67,473
80,674
68,021
77,260
(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.
(2) Income taxes were calculated using an effective non-GAAP tax rate of 9.3% and 442.9% in the third quarter of fiscal 2020 and 2019, respectively, and 0.0% and 37.6% for the nine months ended December 31, 2019 and 2018, respectively. The difference between our GAAP and non-GAAP tax rates were primarily due to the net tax effects of the excluded items.
LIVERAMP HOLDINGS, INC. AND SUBSIDIARIES
RECONCILIATION OF GAAP TO NON-GAAP LOSS FROM OPERATIONS (1)
(Unaudited)
(Dollars in thousands)
For the Three Months Ended
For the Nine Months Ended
December 31,
December 31,
2019
2018
2019
2018
Loss from continuing operations(41,485)
(48,211)
(140,133)
(116,012)
Excluded items: Purchased intangible asset amortization (cost of revenue)5,369
3,359
13,861
12,877
Non-cash stock compensation (cost of revenue and operating expenses)30,295
26,082
72,279
61,547
Accelerated depreciation (cost of revenue and operating expenses)-
1,959
3,569
1,959
Restructuring and merger charges (gains, losses, and other)233
5,043
2,554
5,533
Separation and transformation costs (general and administrative)-
700
-
2,822
Total excluded items35,897
37,143
92,263
84,738
Loss from continuing operations before excluded items(5,588)
(11,068)
(47,870)
(31,274)
(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
RECONCILIATION OF ADJUSTED EBITDA (1)
(Unaudited)
(Dollars in thousands)
For the Three Months Ended
For the Nine Months Ended
December 31,
December 31,
2019
2018
2019
2018
Net loss from continuing operations(38,040)
(15,261)
(120,382)
(84,259)
Income taxes (benefit)(287)
(22,546)
(5,931)
(21,274)
Other income(3,158)
(10,404)
(13,820)
(10,479)
Loss from operations(41,485)
(48,211)
(140,133)
(116,012)
Depreciation and amortization8,104
8,853
27,958
25,274
EBITDA(33,381)
(39,358)
(112,175)
(90,738)
Other adjustments: Non-cash stock compensation (cost of revenue and operating expenses)30,295
26,082
72,279
61,547
Restructuring and merger charges (gains, losses, and other)233
5,043
2,554
5,533
Separation and transformation costs (general and administrative)-
700
-
2,822
Other adjustments30,528
31,825
74,833
69,902
Adjusted EBITDA(2,853)
(7,533)
(37,342)
(20,836)
(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)
December 31,
March 31,
$
%
2019
2019
Variance
Variance
Assets Current assets: Cash and cash equivalents767,200
1,061,473
(294,273)
(27.7%)
Restricted cash14,815
-
14,815
n/a
Trade accounts receivable, net87,709
78,563
9,146
11.6%
Refundable income taxes17,129
7,890
9,239
117.1%
Other current assets46,219
44,150
2,069
4.7%
Total current assets933,072
1,192,076
(259,004)
(21.7%)
Property and equipment43,519
64,852
(21,333)
(32.9%)
Less - accumulated depreciation and amortization23,137
38,809
(15,672)
(40.4%)
Property and equipment, net20,382
26,043
(5,661)
(21.7%)
Software, net of accumulated amortization24,891
6,861
18,030
262.8%
Goodwill297,780
204,656
93,124
45.5%
Deferred income taxes36
35
1
2.9%
Deferred commissions, net13,451
10,741
2,710
25.2%
Other assets, net54,240
32,499
21,741
66.9%
1,343,852
1,472,911
(129,059)
(8.8%)
Liabilities and Stockholders' Equity Current liabilities: Trade accounts payable34,417
31,203
3,214
10.3%
Accrued payroll and related expenses21,211
18,715
2,496
13.3%
Other accrued expenses74,079
40,916
33,163
81.1%
Acquisition escrow payable14,815
-
14,815
n/a
Deferred revenue4,553
4,284
269
6.3%
Total current liabilities149,075
95,118
53,957
56.7%
Deferred income taxes1,505
39
1,466
3759.0%
Other liabilities50,731
46,922
3,809
8.1%
Stockholders' equity: Common stock14,343
14,187
156
1.1%
Additional paid-in capital1,479,018
1,406,813
72,205
5.1%
Retained earnings1,549,223
1,669,605
(120,382)
(7.2%)
Accumulated other comprehensive income6,776
7,801
(1,025)
(13.1%)
Treasury stock, at cost(1,906,819)
(1,767,574)
(139,245)
(7.9%)
Total stockholders' equity1,142,541
1,330,832
(188,291)
(14.1%)
1,343,852
1,472,911
(129,059)
(8.8%)
LIVERAMP HOLDINGS, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
(Unaudited)
(Dollars in thousands)
For the Three Months Ended
December 31,
2019
2018
Cash flows from operating activities: Net earnings (loss)(38,040)
1,056,400
Earnings from discontinued operations, net of tax-
(1,071,661)
Non-cash operating activities: Depreciation and amortization8,104
8,853
Loss on disposal or impairment of assets-
2,870
Provision for doubtful accounts1,253
628
Deferred income taxes6,548
16,089
Non-cash stock compensation expense30,295
26,082
Changes in operating assets and liabilities: Accounts receivable(593)
(32,362)
Deferred commissions(2,104)
(988)
Other assets6,301
(6,151)
Accounts payable and other liabilities9,776
22,989
Income taxes(5,634)
(33,631)
Deferred revenue(102)
(40)
Net cash provided by (used in) operating activities15,804
(10,922)
Cash flows from investing activities: Capital expenditures(2,773)
(1,938)
Cash paid in acquisition, net of cash received-
-
Net cash used in investing activities(2,773)
(1,938)
Cash flows from financing activities: Payments of debt-
(230,000)
Proceeds related to the issuance of common stock under stock and employee benefit plans1,313
9,234
Shares repurchased for tax withholdings upon vesting of stock-based awards(4,150)
(22,282)
Acquisition of treasury stock(20,715)
(18,341)
Acquisition of treasury stock from tender offer-
(503,393)
Net cash used in financing activities(23,552)
(764,782)
Cash flows from discontinued operations: From operating activities-
(13,336)
From investing activities-
2,251,032
Effect of exchange rate changes on cash-
-
Net cash provided by discontinued operations-
2,237,696
Effect of exchange rate changes on cash278
(327)
Net change in cash, cash equivalents and restricted cash(10,243)
1,459,727
Cash, cash equivalents and restricted cash at beginning of period792,258
87,047
Cash, cash equivalents and restricted cash at end of period782,015
1,546,774
Supplemental cash flow information: Cash paid (received) during the period for: Income taxes19
124
LIVERAMP HOLDINGS, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
(Unaudited)
(Dollars in thousands)
For the Nine Months Ended
December 31,
2019
2018
Cash flows from operating activities: Net earnings (loss)(120,382)
1,074,008
Earnings from discontinued operations, net of tax-
(1,158,267)
Non-cash operating activities: Depreciation and amortization27,958
25,274
Loss (gain) on disposal or impairment of assets(140)
3,345
Provision for doubtful accounts3,683
1,259
Deferred income taxes1,465
28,533
Non-cash stock compensation expense72,279
61,547
Changes in operating assets and liabilities: Accounts receivable(11,851)
(35,011)
Deferred commissions(2,710)
(3,035)
Other assets2,404
(4,887)
Accounts payable and other liabilities12,597
18,504
Income taxes(13,423)
(50,047)
Deferred revenue(235)
(1,555)
Net cash used in operating activities(28,355)
(40,332)
Cash flows from investing activities: Capitalized software-
(1,322)
Capital expenditures(10,302)
(3,973)
Proceeds from sales of property and equipment517
-
Payments for investments-
(2,500)
Cash paid in acquisition, net of cash received(105,365)
-
Net cash used in investing activities(115,150)
(7,795)
Cash flows from financing activities: Payments of debt-
(233,293)
Fees from debt refinancing-
(300)
Proceeds related to the issuance of common stock under stock and employee benefit plans3,405
17,355
Shares repurchased for tax withholdings upon vesting of stock-based awards(18,057)
(36,906)
Acquisition of treasury stock(121,188)
(64,107)
Acquisition of treasury stock from tender offer-
(503,393)
Net cash used in financing activities(135,840)
(820,644)
Cash flows from discontinued operations: From operating activities-
40,980
From investing activities-
2,236,530
Effect of exchange rate changes on cash-
(172)
Net cash provided by discontinued operations-
2,277,338
Effect of exchange rate changes on cash(113)
(1,811)
Net change in cash, cash equivalents and restricted cash(279,458)
1,406,756
Cash, cash equivalents and restricted cash at beginning of period1,061,473
140,018
Cash, cash equivalents and restricted cash at end of period782,015
1,546,774
Supplemental cash flow information: Cash paid during the period for: Income taxes6,171
666
LIVERAMP HOLDINGS, INC. AND SUBSIDIARIES
CALCULATION OF FREE CASH FLOW TO EQUITY (1)
(Unaudited)
(Dollars in thousands)
06/30/18
09/30/18
12/31/18
03/31/19
FY2019
06/30/19
09/30/19
12/31/19
FY2020
Net Cash Provided by (Used in) Operating Activities-Continuing Operations(2,280)
(27,130)
(10,922)
38,354
(1,978)
(15,408)
(28,751)
15,804
(28,355)
Less (plus): Capitalized software(899)
(423)
-
-
(1,322)
-
-
-
-
Capital expenditures(712)
(1,323)
(1,938)
(3,347)
(7,320)
(4,888)
(2,641)
(2,773)
(10,302)
Required debt payments(592)
(2,701)
-
-
(3,293)
-
-
-
-
Free Cash Flow to Equity(4,483)
(31,577)
(12,860)
35,007
(13,913)
(20,296)
(31,392)
13,031
(38,657)
(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.
LIVERAMP HOLDINGS, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(Unaudited)
(Dollars in thousands, except per share amounts)
Q3 FY20 to Q3 FY19
06/30/18
09/30/18
12/31/18
03/31/19
FY2019
06/30/19
09/30/19
12/31/19
YTD FY2020
%
$
Revenues62,471
64,812
80,021
78,316
285,620
82,511
90,143
102,217
274,871
27.7%
22,196
Cost of revenue23,654
24,466
34,838
37,760
120,718
36,426
41,460
37,966
115,852
9.0%
3,128
Gross profit38,817
40,346
45,183
40,556
164,902
46,085
48,683
64,251
159,019
42.2%
19,068
% Gross margin62.1%
62.3%
56.5%
51.8%
57.7%
55.9%
54.0%
62.9%
57.9%
Operating expenses Research and development16,970
16,940
20,469
31,318
85,697
23,722
26,445
27,403
77,570
33.9%
6,934
Sales and marketing33,323
35,940
40,054
49,223
158,540
43,144
45,204
51,993
140,341
29.8%
11,939
General and administrative18,125
25,176
27,828
27,749
98,878
25,318
27,262
26,107
78,687
(6.2%)
(1,721)
Gains, losses and other items, net1
489
5,043
14,400
19,933
2,276
45
233
2,554
(95.4%)
(4,810)
Total operating expenses68,419
78,545
93,394
122,690
363,048
94,460
98,956
105,736
299,152
13.2%
12,342
Loss from operations(29,602)
(38,199)
(48,211)
(82,134)
(198,146)
(48,375)
(50,273)
(41,485)
(140,133)
14.0%
6,726
% Margin-47.4%
-58.9%
-60.2%
-104.9%
-69.4%
-58.6%
-55.8%
-40.6%
-51.0%
Total other income (expense)356
(281)
10,404
8,311
18,790
5,882
4,780
3,158
13,820
(69.6%)
(7,246)
Loss from continuing operations before income taxes(29,246)
(38,480)
(37,807)
(73,823)
(179,356)
(42,493)
(45,493)
(38,327)
(126,313)
(1.4%)
(520)
Income taxes (benefit)(1,428)
2,700
(22,546)
(24,135)
(45,409)
(353)
(5,291)
(287)
(5,931)
98.7%
22,259
Net loss from continuing operations(27,818)
(41,180)
(15,261)
(49,688)
(133,947)
(42,140)
(40,202)
(38,040)
(120,382)
(149.3%)
(22,779)
Earnings from discontinued operations, net of tax24,803
61,803
1,071,661
4,227
1,162,494
-
-
-
-
(100.0%)
(1,071,661)
Net earnings (loss)(3,015)
20,623
1,056,400
(45,461)
1,028,547
(42,140)
(40,202)
(38,040)
(120,382)
(103.6%)
(1,094,440)
Diluted earnings (loss) per share(0.04)
0.27
13.65
(0.67)
13.71
(0.61)
(0.59)
(0.56)
(1.77)
(104.1%)
(14.21)
Diluted loss per share continuing operations(0.36)
(0.53)
(0.20)
(0.73)
(1.79)
(0.61)
(0.59)
(0.56)
(1.77)
(181.9%)
(0.36)
Some earnings (loss) per share amounts may not add due to rounding. Basic shares76,935
77,448
77,398
68,299
75,020
68,906
67,684
67,473
68,021
Diluted shares76,935
77,448
77,398
68,299
75,020
68,906
67,684
67,473
68,021
LIVERAMP HOLDINGS, INC. AND SUBSIDIARIES
RECONCILIATION OF GAAP TO NON-GAAP EPS (1)
(Unaudited)
(Dollars in thousands, except per share amounts)
06/30/18
09/30/18
12/31/18
03/31/19
FY2019
06/30/19
09/30/19
12/31/19
YTD FY2020
Loss from continuing operations before income taxes(29,246)
(38,480)
(37,807)
(73,823)
(179,356)
(42,493)
(45,493)
(38,327)
(126,313)
Income taxes (benefit)(1,428)
2,700
(22,546)
(24,135)
(45,409)
(353)
(5,291)
(287)
(5,931)
Net loss from continuing operations(27,818)
(41,180)
(15,261)
(49,688)
(133,947)
(42,140)
(40,202)
(38,040)
(120,382)
Earnings from discontinued operations, net of tax24,803
61,803
1,071,661
4,227
1,162,494
-
-
-
-
Net earnings (loss)(3,015)
20,623
1,056,400
(45,461)
1,028,547
(42,140)
(40,202)
(38,040)
(120,382)
Earnings (loss) per share: Basic(0.04)
0.27
13.65
(0.67)
13.71
(0.61)
(0.59)
(0.56)
(1.77)
Diluted(0.04)
0.27
13.65
(0.67)
13.71
(0.61)
(0.59)
(0.56)
(1.77)
Excluded items: Purchased intangible asset amortization (cost of revenue)5,970
3,548
3,359
2,981
15,858
3,123
5,369
5,369
13,861
Non-cash stock compensation (cost of revenue and operating expenses)17,798
17,667
26,082
41,175
102,722
18,630
23,354
30,295
72,279
Accelerated depreciation (cost of revenue and operating expenses)-
-
1,959
1,853
3,812
1,906
1,663
-
3,569
Restructuring and merger charges (gains, losses, and other)1
489
5,043
14,400
19,933
2,276
45
233
2,554
Separation and transformation costs (general and administrative)-
2,122
700
(705)
2,117
-
-
-
-
Total excluded items, continuing operations23,769
23,826
37,143
59,704
144,442
25,935
30,431
35,897
92,263
Loss from continuing operations before income taxes and excluding items(5,477)
(14,654)
(664)
(14,119)
(34,914)
(16,558)
(15,062)
(2,430)
(34,050)
Income taxes (benefit)(1,078)
(3,790)
(2,941)
(5,155)
(12,964)
(216)
190
(227)
(253)
Non-GAAP net earnings (loss) from continuing operations(4,399)
(10,864)
2,277
(8,964)
(21,950)
(16,342)
(15,252)
(2,203)
(33,797)
Non-GAAP earnings (loss) per share from continuing operations: Basic(0.06)
(0.14)
0.03
(0.13)
(0.29)
(0.24)
(0.23)
(0.03)
(0.50)
Diluted(0.06)
(0.14)
0.03
(0.13)
(0.29)
(0.24)
(0.23)
(0.03)
(0.50)
Basic weighted average shares76,935
77,448
77,398
68,299
75,020
68,906
67,684
67,473
68,021
Diluted weighted average shares76,935
77,448
80,674
68,299
75,020
68,906
67,684
67,473
68,021
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 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
RECONCILIATION OF GAAP TO NON-GAAP EXPENSES (1)
(Unaudited)(Dollars in thousands)
06/30/18
09/30/18
12/31/18
03/31/19
FY2019
06/30/19
09/30/19
12/31/19
FY2020
Expenses, continuing operations: Cost of revenue23,654
24,466
34,838
37,760
120,718
36,426
41,460
37,966
115,852
Research and development16,970
16,940
20,469
31,318
85,697
23,722
26,445
27,403
77,570
Sales and marketing33,323
35,940
40,054
49,223
158,540
43,144
45,204
51,993
140,341
General and administrative18,125
25,176
27,828
27,749
98,878
25,318
27,262
26,107
78,687
Gains, losses and other items, net1
489
5,043
14,400
19,933
2,276
45
233
2,554
Gross profit, continuing operations:38,817
40,346
45,183
40,556
164,902
46,085
48,683
64,251
159,019
% Gross margin62.1%
62.3%
56.5%
51.8%
57.7%
55.9%
54.0%
62.9%
57.9%
Excluded items: Purchased intangible asset amortization (cost of revenue)5,970
3,548
3,359
2,981
15,858
3,123
5,369
5,369
13,861
Non-cash stock compensation (cost of revenue)711
782
1,052
2,163
4,708
755
1,060
1,028
2,843
Non-cash stock compensation (research and development)4,342
3,745
5,945
14,193
28,225
4,451
6,346
6,462
17,259
Non-cash stock compensation (sales and marketing)9,920
9,854
9,460
14,736
43,970
8,920
9,758
15,670
34,348
Non-cash stock compensation (general and administrative)2,824
3,286
9,625
10,083
25,818
4,504
6,190
7,135
17,829
Accelerated depreciation (cost of revenue)-
-
1,527
1,445
2,972
1,487
1,245
-
2,732
Accelerated depreciation (general and administrative)-
-
432
408
840
419
418
-
837
Restructuring and merger charges (gains, losses, and other)1
489
5,043
14,400
19,933
2,276
45
233
2,554
Separation and transformation costs (general and administrative)-
2,122
700
(705)
2,117
-
-
-
-
Total excluded items23,769
23,826
37,143
59,704
144,442
25,935
30,431
35,897
92,263
Expenses, continued operations excluding items: Cost of revenue16,972
20,136
28,900
31,171
97,179
31,061
33,786
31,569
96,416
Research and development12,628
13,195
14,524
17,125
57,472
19,271
20,099
20,941
60,311
Sales and marketing23,403
26,086
30,594
34,487
114,570
34,224
35,446
36,323
105,993
General and administrative15,301
19,768
17,071
17,963
70,103
20,395
20,654
18,972
60,021
Gains, losses and other items, net-
-
-
-
-
-
-
-
-
Gross profit, continuing operations excluding items:45,499
44,676
51,121
47,145
188,441
51,450
56,357
70,648
178,455
% Gross margin72.8%
68.9%
63.9%
60.2%
66.0%
62.4%
62.5%
69.1%
64.9%
(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.
LIVERAMP HOLDINGS, INC. AND SUBSIDIARIES
RECONCILIATION OF GAAP TO NON-GAAP OPERATING LOSS GUIDANCE (1)
(Unaudited)
(Dollars in thousands)
For the year ending
March 31, 2020
Low Range
High Range
Revenues$ 376,000
$ 381,000
GAAP loss from operations(186,000)
(184,000)
Excluded items: Purchased intangible asset amortization19,000
19,000
Accelerated depreciation4,000
4,000
Non-cash stock compensation97,000
97,000
Gains, losses and other items, net3,000
3,000
Total excluded items123,000
123,000
Non-GAAP loss from operations$ (63,000)
$ (61,000)
(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 Q3 FISCAL 2020 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 per share, income 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 associates 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.
Separation and transformation costs: In the prior year, 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. Our criteria for excluding separation and 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 believe excluding these items from our non-GAAP financial measures is useful for investors and provides meaningful supplemental information.
Accelerated depreciation: In the current year we are excluding depreciation costs associated with the reduced useful life of certain IT equipment in connection with the Company's migration to a cloud-based data center solution. This migration is part of our AMS separation strategy. These costs are excluded from our non-GAAP results because of the short-term nature of the incremental expenses and such amounts are not used by us to assess the core profitability of our business operations.
Other key metrics may be defined as:
Subscription net retention: The current period subscription revenue (net) from customers who have been on the platform for one year or more, divided by the prior year quarter subscription revenue (net), inclusive of upsell, churn and downsell.
Platform net retention: The current period subscription and marketplace revenue (net) from customers who have been on the platform for one year or more, divided by the prior year quarter subscription and marketplace revenue (net), inclusive of upsell, churn and downsell.
Annualized recurring revenue (ARR): The ending MRR (last month of quarter), annualized. Recurring revenue is fixed and contracted subscription revenue and does not include any variable or non-recurring revenue amounts.
Our non-GAAP financial schedules are:
Non-GAAP EPS, Non-GAAP Income from Operations, and Non-GAAP Expenses and Gross Profit: Our Non-GAAP earnings per share, Non-GAAP income from operations, and Non-GAAP expenses and Gross profit 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.
View source version on businesswire.com: https://www.businesswire.com/news/home/20200205005789/en/
LiveRampⓇ Investor Relations Lauren Dillard Investor.Relations@LiveRamp.com ERAMP
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