LiveRamp Announces Fourth Quarter and Fiscal Year Results

Q4 Revenue Up 19% and Subscription Revenue Up 22%

Q4 GAAP Gross Margin of 72% and Non-GAAP Gross Margin of 76%

$78 Million of Operating Cash Flow for Full Year

LiveRamp Intends to Repurchase $150 Million of Stock by December 31, 2022

LiveRamp® (NYSE: RAMP), the leading global data enablement platform, today announced its financial results for the quarter and fiscal year ended March 31, 2022.

This press release features multimedia. View the full release here: https://www.businesswire.com/news/home/20220524006020/en/

Fourth Quarter Financial Highlights

All metrics compared to the prior year fourth quarter

  • Total revenue was $142 million, up 19%.
  • Subscription revenue was $116 million, up 22%, and contributed 82% of total revenue.
  • Marketplace & Other revenue was $26 million, up 6%.
  • GAAP gross profit was $102 million, up 25%, and GAAP gross margin of 72% expanded 4 percentage points. Non-GAAP gross profit was $108 million, up 22%, and non-GAAP gross margin of 76% expanded 2 percentage points.
  • GAAP operating loss was $28 million compared to a GAAP operating loss of $52 million in the prior year period. Non-GAAP operating income was $3 million compared to non-GAAP operating income of $1 million in the prior year period.
  • GAAP loss per share was $0.43, and non-GAAP loss per share was $0.01.
  • Net cash provided by operating activities was $59 million compared to net cash used in operating activities of $18 million in the prior year period.

Fiscal Year Financial Highlights

All metrics compared to the prior fiscal year

  • Total revenue was $529 million, up 19%.
  • Subscription revenue was $429 million, up 20%, and contributed 81% of total revenue.
  • Marketplace & Other revenue was $100 million, up 16%.
  • GAAP gross profit was $381 million, up 27%, and GAAP gross margin of 72% expanded 5 percentage points. Non-GAAP gross profit was $404 million, up 25%, and non-GAAP gross margin of 76% expanded 4 percentage points.
  • GAAP operating loss was $66 million compared to a GAAP operating loss of $121 million in the prior year period. Non-GAAP operating income was $42 million compared to non-GAAP operating income of $16 million.
  • GAAP loss per share was $0.50, and non-GAAP earnings per share were $0.48.
  • Net cash provided by operating activities was $78 million compared to net cash used in operating activities of $21 million in the prior fiscal year.
  • In fiscal 2022, LiveRamp repurchased approximately 1.3 million shares for $59 million, including approximately 220,000 shares for $9 million in the fourth quarter. In total, since the inception of the share repurchase program in August 2011, the Company has returned over $1.2 billion in capital to shareholders.

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

“We delivered another solid quarter and our results underscore the critical value our Safe Haven® enterprise platform delivers to customers,” said LiveRamp CEO Scott Howe. “We ended the year with 87 customers paying $1 million or more in annual revenue and with approximately $400 million of ARR. Despite the macroenvironment, we enter FY23 with confidence in our forward outlook. We are executing on our growth strategy, expanding internationally and delivering category-creating innovation to our customers.”

“Our operating trends remain strong,” added LiveRamp President and CFO Warren Jenson. “Our revenue growth was solid, non-GAAP gross margin was 76%, and we were profitable on a non-GAAP operating income basis for the eighth quarter in a row. In addition, we generated $78 million of operating cash flow for fiscal 2022. We are well positioned to deliver both revenue growth and continued operating profit expansion in fiscal 2023.”

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 2022

 

Full Year Fiscal 2022

 

Results

 

Results

 

GAAP

Non-GAAP

 

GAAP

Non-GAAP

Subscription revenue

$116

 

$429

YoY change %

22%

 

 

20%

 

Marketplace & other revenue

$26

 

$100

YoY change %

6%

 

 

16%

 

Total revenue

$142

 

$529

YoY change %

19%

 

 

19%

 

 

 

 

 

 

 

Gross profit

$102

$108

 

$381

$404

% Gross margin

72%

76%

 

72%

76%

YoY change, pts

4 pts

2 pts

 

5 pts

4 pts

 

 

 

 

 

 

Operating income (loss)

($28)

$3

 

($66)

$42

% Operating margin

(20%)

2%

 

(12%)

8%

YoY change, pts

24 pts

1 pts

 

15 pts

4 pts

 

 

 

 

 

 

Net earnings (loss)

($29)

($1)

 

($34)

$34

Earnings (loss) per share

($0.43)

($0.01)

 

($0.50)

$0.48

 

 

 

 

 

 

Shares to Calculate EPS

68.3

68.3

 

68.2

69.6

YoY change %

2%

(2%)

 

3%

1%

Net operating cash flow

$59

 

$78

Free cash flow to equity

$57

 

$74

 

 

 

 

 

 

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 125 supply-side platforms (SSPs) and demand-side platforms (DSPs) live or committed to bid on RampID™ and ATS, including The Trade Desk, Amobee, Criteo, dataxu, and MediaMath. Further, in March 2022, LiveRamp announced an expanded partnership with The Trade Desk to power European Unified ID (EUID) via our ATS infrastructure.
  • To date, over 1,500 publishers, representing more than 11,000 deployed domains, have integrated ATS worldwide, including Amazon Publisher Services, Microsoft, CafeMedia, Leaf Group, Prisma Media and Burda. Through these integrations, LiveRamp is now connected to over 85% of consumer time spent online in the U.S.
  • LiveRamp added 15 net new direct subscription customers in the fourth quarter. Customer count at quarter end was 905, up from 825 a year ago.
  • LiveRamp has 87 customers whose subscription contracts exceed $1 million in annual revenue, up 24% compared to the prior year period.
  • During the fourth quarter, subscription net retention was 111%, and platform net retention was 110%.
  • Current remaining performance obligations (CRPO), which is contracted and committed revenue expected to be recognized over the next 12 months, was $309 million, up 21% 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 2023, LiveRamp expects to report:

● Revenue of approximately $139 million, an increase of 17% year-over-year

● GAAP operating loss of approximately $33 million

● Non-GAAP operating income of approximately $1 million

For fiscal 2023, LiveRamp expects to report:

● Revenue of between $608 million and $625 million, an increase of between 15% and 18% year-over-year

● GAAP operating loss of approximately $93 million

● Non-GAAP operating income of approximately $49 million

Share Repurchase

LiveRamp today also announced that it intends to repurchase approximately $150 million of its common stock by the end of the third quarter of fiscal 2023.

Share repurchases will be made under the Company’s existing share repurchase program that extends through December 31, 2022. Under its share repurchase program, LiveRamp is authorized to repurchase outstanding shares in the open market or privately negotiated transactions depending on prevailing market conditions, corporate and regulatory requirements, stock price, acquisition opportunities and other factors.

“This announcement demonstrates our confidence in LiveRamp, the strength of our operating cash flow, and our commitment to continue delivering value to shareholders,” continued Howe. “Upon completion of the $150 million buyback, LiveRamp will have returned roughly $1.4 billion of capital to shareholders since the inception of its share repurchase program.”

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 leading data enablement platform for the safe and effective use of data. Powered by core identity capabilities and an unparalleled network, LiveRamp enables companies and their partners to better connect, control, and activate data to transform customer experiences and generate more valuable business outcomes. LiveRamp’s fully interoperable and neutral infrastructure delivers end-to-end addressability for the world’s top brands, agencies, and publishers. 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”), including statements regarding financial guidance for the first quarter of fiscal 2023 and the full year ended March 31, 2023. 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 are uncertainties related to COVID-19 and the associated impact 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 working remotely and within a rapidly changing industry, while also avoiding disruption from acquisition and divestiture activities. Our international operations are also subject to risks, including 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’ 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 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 2021 ended March 31, 2021, and LiveRamp's Quarterly Reports on Form 10-Q issued in fiscal year 2022.

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

The forward-looking statements contained in this press release are made as of the date hereof, and 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, RampIDTM, 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

 

 

 

 

 

March 31,

 

 

 

 

 

 

 

 

 

$

%

 

 

 

 

 

2022

 

2021

 

Variance

Variance

 
Revenues

141,725

 

119,175

 

22,550

 

18.9

%

 
Cost of revenue

39,476

 

37,557

 

1,919

 

5.1

%

Gross profit

102,249

 

81,618

 

20,631

 

25.3

%

% Gross margin

72.1

%

68.5

%

 
Operating expenses:
Research and development

45,501

 

46,479

 

(978

)

(2.1

%)

Sales and marketing

54,951

 

53,307

 

1,644

 

3.1

%

General and administrative

29,583

 

32,395

 

(2,812

)

(8.7

%)

Gains, losses and other items, net

183

 

1,345

 

(1,162

)

(86.4

%)

Total operating expenses

130,218

 

133,526

 

(3,308

)

(2.5

%)

 
Loss from operations

(27,969

)

(51,908

)

23,939

 

46.1

%

% Margin

-19.7

%

-43.6

%

 
Total other expense, net

(47

)

(404

)

357

 

88.4

%

 
Loss before income taxes

(28,016

)

(52,312

)

24,296

 

46.4

%

 
Income tax expense (benefit)

1,376

 

(19,465

)

20,841

 

107.1

%

 
Net loss

(29,392

)

(32,847

)

3,455

 

10.5

%

 
Basic loss per share

(0.43

)

(0.49

)

0.06

 

12.1

%

 
Diluted loss per share:

(0.43

)

(0.49

)

0.06

 

12.1

%

 
Basic weighted average shares

68,283

 

67,111

 

 
Diluted weighted average shares

68,283

 

67,111

 

 
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,
$ %

2022

2021

Variance Variance
 
Revenues

528,657

 

443,026

 

85,631

 

19.3

%

 
Cost of revenue

147,427

 

144,004

 

3,423

 

2.4

%

Gross profit

381,230

 

299,022

 

82,208

 

27.5

%

% Gross margin

72.1

%

67.5

%

 
Operating expenses:
Research and development

157,935

 

135,111

 

22,824

 

16.9

%

Sales and marketing

182,763

 

177,543

 

5,220

 

2.9

%

General and administrative

104,591

 

104,201

 

390

 

0.4

%

Gains, losses and other items, net

1,479

 

2,715

 

(1,236

)

(45.5

%)

Total operating expenses

446,768

 

419,570

 

27,198

 

6.5

%

 
Loss from operations

(65,538

)

(120,548

)

55,010

 

45.6

%

% Margin

-12.4

%

-27.2

%

 
Total other income (expense), net

30,463

 

(252

)

30,715

 

n/a

 

 
Loss before income taxes

(35,075

)

(120,800

)

85,725

 

71.0

%

 
Income tax benefit

(1,242

)

(30,532

)

29,290

 

95.9

%

 
Net loss

(33,833

)

(90,268

)

56,435

 

62.5

%

 
Basic loss per share

(0.50

)

(1.36

)

0.87

 

63.6

%

 
Diluted loss per share:

(0.50

)

(1.36

)

0.87

 

63.6

%

 
Basic weighted average shares

68,211

 

66,304

 

 
Diluted weighted average shares

68,211

 

66,304

 

 
 
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,

2022

 

2021

 

2022

 

2021

 
 
Loss before income taxes

(28,016

)

(52,312

)

(35,075

)

(120,800

)

 
Income tax expense (benefit)

1,376

 

(19,465

)

(1,242

)

(30,532

)

 
Net loss

(29,392

)

(32,847

)

(33,833

)

(90,268

)

 
Loss per share:
Basic

(0.43

)

(0.49

)

(0.50

)

(1.36

)

 
Diluted

(0.43

)

(0.49

)

(0.50

)

(1.36

)

 
Excluded items:
Purchased intangible asset amortization (cost of revenue)

4,807

 

4,177

 

18,711

 

18,046

 

Non-cash stock compensation (cost of revenue and operating expenses)

25,782

 

47,124

 

87,257

 

111,707

 

Transformation costs (general and administrative)

-

 

-

 

-

 

3,863

 

Restructuring and merger charges (gains, losses, and other)

183

 

1,345

 

1,479

 

2,715

 

Gain on retained profits interest (other income)

-

 

-

 

(30,235

)

-

 

 
Total excluded items

30,772

 

52,646

 

77,212

 

136,331

 

 
Income before income taxes and excluding items

2,756

 

334

 

42,137

 

15,531

 

 
Income taxes (2)

3,391

 

(2,628

)

8,515

 

(638

)

 
Non-GAAP net earnings (loss)

(635

)

2,962

 

33,622

 

16,169

 

 
Non-GAAP earnings per share:
Basic

(0.01

)

0.04

 

0.49

 

0.24

 

 
Diluted

(0.01

)

0.04

 

0.48

 

0.23

 

 
Basic weighted average shares

68,283

 

67,111

 

68,211

 

66,304

 

 
Diluted weighted average shares

68,283

 

69,935

 

69,560

 

68,963

 

 

(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 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,

 

 

 

2022

 

2021

 

2022

 

2021

 
 
Loss from operations

(27,969

)

(51,908

)

(65,538

)

(120,548

)

 
Excluded items:
Purchased intangible asset amortization (cost of revenue)

4,807

 

4,177

 

18,711

 

18,046

 

Non-cash stock compensation (cost of revenue and operating expenses)

25,782

 

47,124

 

87,257

 

111,707

 

Transformation costs (general and administrative)

-

 

-

 

-

 

3,863

 

Restructuring and merger charges (gains, losses, and other)

183

 

1,345

 

1,479

 

2,715

 

 
Total excluded items

30,772

 

52,646

 

107,447

 

136,331

 

 
Income from operations before excluded items

2,803

 

738

 

41,909

 

15,783

 

 
 

(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 Twelve Months Ended

 

 

 

March 31,

 

March 31,

 

 

 

2022

 

2021

 

2022

 

2021

 
 
Net loss

(29,392

)

(32,847

)

(33,833

)

(90,268

)

 
Income tax expense (benefit)

1,376

 

(19,465

)

(1,242

)

(30,532

)

 
Other expense (income)

47

 

404

 

(30,463

)

252

 

 
Loss from operations

(27,969

)

(51,908

)

(65,538

)

(120,548

)

 
Depreciation and amortization

6,017

 

6,277

 

24,248

 

27,741

 

 
EBITDA

(21,952

)

(45,631

)

(41,290

)

(92,807

)

 
Other adjustments:
Non-cash stock compensation (cost of revenue and operating expenses)

25,782

 

47,124

 

87,257

 

111,707

 

Transformation costs (general and administrative)

-

 

-

 

-

 

3,863

 

Restructuring and merger charges (gains, losses, and other)

183

 

1,345

 

1,479

 

2,715

 

 
Other adjustments

25,965

 

48,469

 

88,736

 

118,285

 

 
Adjusted EBITDA

4,013

 

2,838

 

47,446

 

25,478

 

 
 

(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,

 

$

%

 

2022

 

2021

 

Variance

Variance

 
Assets
Current assets:
Cash and cash equivalents

600,162

 

572,787

 

27,375

 

4.8

%

Restricted cash

-

 

8,900

 

(8,900

)

(100.0

%)

Trade accounts receivable, net

148,343

 

114,284

 

34,059

 

29.8

%

Refundable income taxes

30,354

 

65,692

 

(35,338

)

(53.8

%)

Other current assets

36,975

 

64,052

 

(27,077

)

(42.3

%)

 
Total current assets

815,834

 

825,715

 

(9,881

)

(1.2

%)

 
Property and equipment

45,001

 

44,284

 

717

 

1.6

%

Less - accumulated depreciation and amortization

33,470

 

32,327

 

1,143

 

3.5

%

 
Property and equipment, net

11,531

 

11,957

 

(426

)

(3.6

%)

 
Intangible assets, net

26,718

 

39,730

 

(13,012

)

(32.8

%)

Goodwill

363,845

 

357,446

 

6,399

 

1.8

%

Deferred commissions, net

30,594

 

22,619

 

7,975

 

35.3

%

Other assets, net

85,214

 

30,854

 

54,360

 

176.2

%

 

1,333,736

 

1,288,321

 

45,415

 

3.5

%

 
Liabilities and Stockholders' Equity
Current liabilities:
Trade accounts payable

83,197

 

39,955

 

43,242

 

108.2

%

Accrued payroll and related expenses

39,188

 

46,438

 

(7,250

)

(15.6

%)

Other accrued expenses

46,067

 

58,353

 

(12,286

)

(21.1

%)

Acquisition escrow payable

-

 

8,900

 

(8,900

)

(100.0

%)

Deferred revenue

16,114

 

11,603

 

4,511

 

38.9

%

 
Total current liabilities

184,566

 

165,249

 

19,317

 

11.7

%

 
Other liabilities

86,110

 

42,389

 

43,721

 

103.1

%

 
Stockholders' equity:
Preferred stock

-

 

-

 

-

 

n/a

 

Common stock

14,984

 

14,781

 

203

 

1.4

%

Additional paid-in capital

1,721,118

 

1,630,072

 

91,046

 

5.6

%

Retained earnings

1,420,993

 

1,454,826

 

(33,833

)

(2.3

%)

Accumulated other comprehensive income

5,730

 

7,522

 

(1,792

)

(23.8

%)

Treasury stock, at cost

(2,099,765

)

(2,026,518

)

(73,247

)

(3.6

%)

Total stockholders' equity

1,063,060

 

1,080,683

 

(17,623

)

(1.6

%)

 

1,333,736

 

1,288,321

 

45,415

 

3.5

%

LIVERAMP HOLDINGS, INC. AND SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

(Unaudited)

(Dollars in thousands)

 

 

 

 

 

For the Three Months Ended

 

March 31,

 

2022

 

2021

 
Cash flows from operating activities:
Net loss

(29,392

)

(32,847

)

Non-cash operating activities:
Depreciation and amortization

6,017

 

6,277

 

Loss on disposal or impairment of assets

41

 

54

 

Provision for doubtful accounts

1,090

 

(431

)

Deferred income taxes

(1,084

)

(1,418

)

Non-cash stock compensation expense

25,782

 

47,124

 

Changes in operating assets and liabilities:
Accounts receivable

7,265

 

1,818

 

Deferred commissions

(1,111

)

(1,523

)

Other assets

4,786

 

(26,283

)

Accounts payable and other liabilities

11,321

 

6,731

 

Income taxes

32,971

 

(17,233

)

Deferred revenue

1,258

 

(156

)

Net cash provided by (used in) operating activities

58,944

 

(17,887

)

Cash flows from investing activities:
Capital expenditures

(1,880

)

(376

)

Purchases of investments

-

 

(4,500

)

Cash paid in acquisition, net of cash received

(8,731

)

(58,264

)

Net cash used in investing activities

(10,611

)

(63,140

)

Cash flows from financing activities:
Proceeds related to the issuance of common stock under stock and employee benefit plans

83

 

61

 

Shares repurchased for tax withholdings upon vesting of stock-based awards

(410

)

(538

)

Acquisition of treasury stock

(9,397

)

-

 

Net cash used in financing activities

(9,724

)

(477

)

Effect of exchange rate changes on cash

(137

)

(210

)

 
Net change in cash and cash equivalents

38,472

 

(81,714

)

Cash and cash equivalents at beginning of period

561,690

 

663,401

 

Cash and cash equivalents at end of period

600,162

 

581,687

 

 
Supplemental cash flow information:
Cash (received) during the period for:
Income taxes

(30,101

)

(819

)

 
Operating lease assets obtained in exchange for operating lease liabilities

3,280

 

-

 

 
LIVERAMP HOLDINGS, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
(Unaudited)
(Dollars in thousands)
 
For the Twelve Months Ended
March 31,

2022

2021

 
Cash flows from operating activities:
Net loss

(33,833

)

(90,268

)

Non-cash operating activities:
Depreciation and amortization

24,248

 

27,741

 

Loss on disposal or impairment of assets

183

 

388

 

Gain on distribution from retained profits interest

(30,235

)

-

 

Provision for doubtful accounts

4,217

 

2,915

 

Deferred income taxes

(1,540

)

(1,418

)

Non-cash stock compensation expense

87,257

 

111,707

 

Changes in operating assets and liabilities:
Accounts receivable

(38,611

)

(24,828

)

Deferred commissions

(7,975

)

(6,605

)

Other assets

26,863

 

(18,772

)

Accounts payable and other liabilities

8,850

 

(116

)

Income taxes

33,969

 

(26,215

)

Deferred revenue

4,684

 

4,911

 

Net cash provided by (used in) operating activities

78,077

 

(20,560

)

Cash flows from investing activities:
Capital expenditures

(4,499

)

(2,182

)

Purchases of investments

-

 

(7,500

)

Purchases of strategic investments

-

 

(2,200

)

Distribution from retained profits interest

31,184

 

-

 

Cash paid in acquisition, net of cash received

(19,107

)

(76,012

)

Net cash provided by (used in) investing activities

7,578

 

(87,894

)

Cash flows from financing activities:
Proceeds related to the issuance of common stock under stock and employee benefit plans

6,266

 

8,737

 

Shares repurchased for tax withholdings upon vesting of stock-based awards

(14,626

)

(9,920

)

Acquisition of treasury stock

(58,621

)

(42,312

)

Net cash used in financing activities

(66,981

)

(43,495

)

Effect of exchange rate changes on cash

(199

)

1,010

 

 
Net change in cash and cash equivalents

18,475

 

(150,939

)

Cash and cash equivalents at beginning of period

581,687

 

732,626

 

Cash and cash equivalents at end of period

600,162

 

581,687

 

 
Supplemental cash flow information:
Cash (received) during the period for:
Income taxes

(32,916

)

(2,911

)

 
Operating lease assets obtained in exchange for operating lease liabilities

56,182

 

-

 

 
LIVERAMP HOLDINGS, INC. AND SUBSIDIARIES
CALCULATION OF FREE CASH FLOW TO EQUITY (1)
(Unaudited)
(Dollars in thousands)
 
 
06/30/20 09/30/20 12/31/20 03/31/21 FY2021 06/30/21 09/30/21 12/31/21 03/31/22 FY2022
 
Net Cash Provided by (Used in) Operating Activities

(23,612

)

6,249

 

14,690

 

(17,887

)

(20,560

)

(17,241

)

10,901

 

25,473

 

58,944

 

78,077

 

 
Less:
Capital expenditures

(832

)

(296

)

(678

)

(376

)

(2,182

)

(427

)

(876

)

(1,316

)

(1,880

)

(4,499

)

 
Free Cash Flow to Equity

(24,444

)

5,953

 

14,012

 

(18,263

)

(22,742

)

(17,668

)

10,025

 

24,157

 

57,064

 

73,578

 

(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)
 
FY22 to FY21
06/30/20 09/30/20 12/31/20 03/31/21 FY2021 06/30/21 09/30/21 12/31/21 03/31/22 FY2022 % $
Revenues

99,437

 

104,661

 

119,753

 

119,175

 

443,026

 

119,038

 

127,290

 

140,604

 

141,725

 

528,657

 

19.3

%

85,631

 

 
Cost of revenue

34,465

 

34,897

 

37,085

 

37,557

 

144,004

 

34,315

 

35,079

 

38,557

 

39,476

 

147,427

 

2.4

%

3,423

 

Gross profit

64,972

 

69,764

 

82,668

 

81,618

 

299,022

 

84,723

 

92,211

 

102,047

 

102,249

 

381,230

 

27.5

%

82,208

 

% Gross margin

65.3

%

66.7

%

69.0

%

68.5

%

67.5

%

71.2

%

72.4

%

72.6

%

72.1

%

72.1

%

 
Operating expenses
Research and development

26,989

 

31,035

 

30,608

 

46,479

 

135,111

 

34,776

 

35,788

 

41,870

 

45,501

 

157,935

 

16.9

%

22,824

 

Sales and marketing

38,627

 

41,705

 

43,904

 

53,307

 

177,543

 

41,979

 

39,509

 

46,324

 

54,951

 

182,763

 

2.9

%

5,220

 

General and administrative

23,368

 

24,495

 

23,943

 

32,395

 

104,201

 

24,291

 

23,078

 

27,639

 

29,583

 

104,591

 

0.4

%

390

 

Gains, losses and other items, net

1,995

 

(619

)

(6

)

1,345

 

2,715

 

1,278

 

18

 

-

 

183

 

1,479

 

(45.5

%)

(1,236

)

Total operating expenses

90,979

 

96,616

 

98,449

 

133,526

 

419,570

 

102,324

 

98,393

 

115,833

 

130,218

 

446,768

 

6.5

%

27,198

 

 
Loss from operations

(26,007

)

(26,852

)

(15,781

)

(51,908

)

(120,548

)

(17,601

)

(6,182

)

(13,786

)

(27,969

)

(65,538

)

45.6

%

55,010

 

% Margin

-26.2

%

-25.7

%

-13.2

%

-43.6

%

-27.2

%

-14.8

%

-4.9

%

-9.8

%

-19.7

%

-12.4

%

 
Total other income (expense), net

463

 

(225

)

(86

)

(404

)

(252

)

30,601

 

150

 

(241

)

(47

)

30,463

 

12188.5

%

30,715

 

 
Loss before income taxes

(25,544

)

(27,077

)

(15,867

)

(52,312

)

(120,800

)

13,000

 

(6,032

)

(14,027

)

(28,016

)

(35,075

)

71.0

%

85,725

 

 
Income taxes expense (benefit)

(3,816

)

(3,109

)

(4,142

)

(19,465

)

(30,532

)

(4,365

)

399

 

1,348

 

1,376

 

(1,242

)

95.9

%

29,290

 

 
Net earnings (loss)

(21,728

)

(23,968

)

(11,725

)

(32,847

)

(90,268

)

17,365

 

(6,431

)

(15,375

)

(29,392

)

(33,833

)

62.5

%

56,435

 

 
Diluted earnings (loss) per share

(0.33

)

(0.36

)

(0.18

)

(0.49

)

(1.36

)

0.25

 

(0.09

)

(0.23

)

(0.43

)

(0.50

)

63.6

%

0.87

 

 
Some earnings (loss) per share amounts may not add due to rounding.
 
Basic shares

65,570

 

66,010

 

66,523

 

67,111

 

66,304

 

68,328

 

68,042

 

68,190

 

68,283

 

68,211

 

Diluted shares

65,570

 

66,010

 

66,523

 

67,111

 

66,304

 

69,605

 

69,333

 

69,938

 

69,354

 

69,560

 

LIVERAMP HOLDINGS, INC. AND SUBSIDIARIES
RECONCILIATION OF GAAP TO NON-GAAP EPS (1)
(Unaudited)
(Dollars in thousands, except per share amounts)
 
 
 
06/30/20 09/30/20 12/31/20 03/31/21 FY2021 06/30/21 09/30/21 12/31/21 03/31/22 FY 2022
 
 
Income (loss) before income taxes

(25,544

)

(27,077

)

(15,867

)

(52,312

)

(120,800

)

13,000

 

(6,032

)

(14,027

)

(28,016

)

(35,075

)

Income taxes (benefit)

(3,816

)

(3,109

)

(4,142

)

(19,465

)

(30,532

)

(4,365

)

399

 

1,348

 

1,376

 

(1,242

)

Net earnings (loss)

(21,728

)

(23,968

)

(11,725

)

(32,847

)

(90,268

)

17,365

 

(6,431

)

(15,375

)

(29,392

)

(33,833

)

 
Earnings (loss) per share:
Basic

(0.33

)

(0.36

)

(0.18

)

(0.49

)

(1.36

)

0.25

 

(0.09

)

(0.23

)

(0.43

)

(0.50

)

Diluted

(0.33

)

(0.36

)

(0.18

)

(0.49

)

(1.36

)

0.25

 

(0.09

)

(0.23

)

(0.43

)

(0.49

)

 
Excluded items:
Purchased intangible asset amortization (cost of revenue)

5,306

 

4,350

 

4,213

 

4,177

 

18,046

 

4,645

 

4,612

 

4,647

 

4,807

 

18,711

 

Non-cash stock compensation (cost of revenue and operating expenses)

16,485

 

24,204

 

23,894

 

47,124

 

111,707

 

18,496

 

19,221

 

23,758

 

25,782

 

87,257

 

Restructuring and merger charges (gains, losses, and other)

1,995

 

(619

)

(6

)

1,345

 

2,715

 

1,278

 

18

 

-

 

183

 

1,479

 

Transformation costs (general and administrative)

3,605

 

258

 

-

 

-

 

3,863

 

-

 

-

 

-

 

-

 

-

 

Gain on retained profits interest (other income)

-

 

-

 

-

 

-

 

-

 

(30,052

)

-

 

(183

)

-

 

(30,235

)

Total excluded items

27,391

 

28,193

 

28,101

 

52,646

 

136,331

 

(5,633

)

23,851

 

28,222

 

30,772

 

77,212

 

 
Income before income taxes and excluding items

1,847

 

1,116

 

12,234

 

334

 

15,531

 

7,367

 

17,819

 

14,195

 

2,756

 

42,137

 

Income taxes expense (benefit)

934

 

(1,291

)

2,347

 

(2,628

)

(638

)

865

 

(12

)

4,271

 

3,391

 

8,515

 

Non-GAAP net earnings (loss)

913

 

2,407

 

9,887

 

2,962

 

16,169

 

6,502

 

17,831

 

9,924

 

(635

)

33,622

 

 
Non-GAAP earnings (loss) per share:
Basic

0.01

 

0.04

 

0.15

 

0.04

 

0.24

 

0.10

 

0.26

 

0.15

 

(0.01

)

0.49

 

Diluted

0.01

 

0.03

 

0.14

 

0.04

 

0.23

 

0.09

 

0.26

 

0.14

 

(0.01

)

0.48

 

 
Basic weighted average shares

65,570

 

66,010

 

66,523

 

67,111

 

66,304

 

68,328

 

68,042

 

68,190

 

68,283

 

68,211

 

Diluted weighted average shares

67,337

 

68,804

 

69,775

 

69,935

 

68,963

 

69,605

 

69,333

 

69,938

 

68,283

 

69,560

 

 
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)
 
 
06/30/20 09/30/20 12/31/20 03/31/21 FY2021 06/30/21 09/30/21 12/31/21 03/31/22 FY2022
 
Expenses:
Cost of revenue

34,465

 

34,897

 

37,085

 

37,557

 

144,004

 

34,315

 

35,079

 

38,557

 

39,476

 

147,427

 

Research and development

26,989

 

31,035

 

30,608

 

46,479

 

135,111

 

34,776

 

35,788

 

41,870

 

45,501

 

157,935

 

Sales and marketing

38,627

 

41,705

 

43,904

 

53,307

 

177,543

 

41,979

 

39,509

 

46,324

 

54,951

 

182,763

 

General and administrative

23,368

 

24,495

 

23,943

 

32,395

 

104,201

 

24,291

 

23,078

 

27,639

 

29,583

 

104,591

 

Gains, losses and other items, net

1,995

 

(619

)

(6

)

1,345

 

2,715

 

1,278

 

18

 

-

 

183

 

1,479

 

 
Gross profit:

64,972

 

69,764

 

82,668

 

81,618

 

299,022

 

84,723

 

92,211

 

102,047

 

102,249

 

381,230

 

% Gross margin

65.3

%

66.7

%

69.0

%

68.5

%

67.5

%

71.2

%

72.4

%

72.6

%

72.1

%

72.1

%

 
Excluded items:
Purchased intangible asset amortization (cost of revenue)

5,306

 

4,350

 

4,213

 

4,177

 

18,046

 

4,645

 

4,612

 

4,647

 

4,807

 

18,711

 

Non-cash stock compensation (cost of revenue)

775

 

913

 

988

 

2,624

 

5,300

 

790

 

948

 

1,168

 

1,205

 

4,111

 

Non-cash stock compensation (research and development)

5,886

 

7,713

 

7,376

 

17,985

 

38,960

 

5,348

 

7,184

 

9,264

 

10,316

 

32,112

 

Non-cash stock compensation (sales and marketing)

7,123

 

9,233

 

9,212

 

14,833

 

40,401

 

6,793

 

6,749

 

7,329

 

7,715

 

28,586

 

Non-cash stock compensation (general and administrative)

2,701

 

6,345

 

6,318

 

11,682

 

27,046

 

5,565

 

4,340

 

5,997

 

6,546

 

22,448

 

Restructuring and merger charges (gains, losses, and other)

1,995

 

(619

)

(6

)

1,345

 

2,715

 

1,278

 

18

 

-

 

183

 

1,479

 

Transformation costs (general and administrative)

3,605

 

258

 

-

 

-

 

3,863

 

-

 

-

 

-

 

-

 

-

 

Gain on retained profits interest (other income)

-

 

-

 

-

 

-

 

-

 

(30,052

)

-

 

(183

)

-

 

(30,235

)

Total excluded items

27,391

 

28,193

 

28,101

 

52,646

 

136,331

 

(5,633

)

23,851

 

28,222

 

30,772

 

77,212

 

 
Expenses, excluding items:
Cost of revenue

28,384

 

29,634

 

31,884

 

30,756

 

120,658

 

28,880

 

29,519

 

32,742

 

33,464

 

124,605

 

Research and development

21,103

 

23,322

 

23,232

 

28,494

 

96,151

 

29,428

 

28,604

 

32,606

 

35,185

 

125,823

 

Sales and marketing

31,504

 

32,472

 

34,692

 

38,474

 

137,142

 

35,186

 

32,760

 

38,995

 

47,236

 

154,177

 

General and administrative

17,062

 

17,892

 

17,625

 

20,713

 

73,292

 

18,726

 

18,738

 

21,642

 

23,037

 

82,143

 

Gains, losses and other items, net

-

 

-

 

-

 

-

 

-

 

-

 

-

 

-

 

-

 

-

 

 
Gross profit, excluding items:

71,053

 

75,027

 

87,869

 

88,419

 

322,368

 

90,158

 

97,771

 

107,862

 

108,261

 

404,052

 

% Gross margin

71.5

%

71.7

%

73.4

%

74.2

%

72.8

%

75.7

%

76.8

%

76.7

%

76.4

%

76.4

%

(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 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 INCOME (LOSS) GUIDANCE (1)
(Unaudited)
(Dollars in thousands)
For the quarter ending For the year ending
June 30, 2022 March 31, 2023
 
 
GAAP loss from operations

$

(33,000

)

$

(93,000

)

 
Excluded items:
Purchased intangible asset amortization

 

5,000

 

 

17,000

 

Non-cash stock compensation

 

29,000

 

 

125,000

 

Total excluded items

 

34,000

 

 

142,000

 

 
Non-GAAP income from operations

$

1,000

 

$

49,000

 

(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 2022 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 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.

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, 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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