LivePerson (LPSN) Q2 2024 earnings summary

Executive summary

• Q2 2024 revenue was $79.9M, down 18% year-over-year, with adjusted EBITDA of $8.2M, both at or above guidance, but revenue retention fell to 83% due to customer churn and downsells.

• Net income for Q2 2024 was $41.8M, up from $10.8M in Q2 2023, primarily due to a $73.1M gain on debt extinguishment.

• Completed a key transaction with Lynrock Lake, improving capital structure, reducing debt, and extending maturities.

• Added a new Chief Revenue Officer and launched simplified pricing and packaging to support customer wins and retention.

• Divested Wild Health, reducing expenses and eliminating future liabilities.

Financial highlights

• Q2 2024 revenue: $79.9M, at the high end of guidance, with adjusted EBITDA of $8.2M, above guidance.

• Net income for Q2 2024 was $41.8M, driven by a $73.1M gain on debt extinguishment.

• B2B hosted services revenue was $67.3M; professional services revenue was $12.6M.

• Cash and cash equivalents at June 30, 2024, were $146.0M, down from $210.8M at year-end 2023.

• Gross margin for Q2 2024 was approximately 73%.

Outlook and guidance

• Q3 2024 revenue expected between $69M–$73M, down 28%–32% year-over-year; adjusted EBITDA guidance is $0M–$5M.

• Full-year 2024 revenue guidance is $300M–$315M, down 20%–24% year-over-year; adjusted EBITDA guidance is $15M–$26M.

• B2B core recurring revenue expected to remain at 92% of total revenue.

• Management expects current cash to be sufficient for at least the next 12 months but plans to refinance 2026 Notes before maturity.