LivePerson (LPSN) Q4 2024 earnings summary

Executive summary

• Q4 2024 revenue reached $73.2M, exceeding guidance despite a 23% year-over-year decline, driven by customer cancellations and downsells.

• Adjusted EBITDA was $8.1M, above guidance, with adjusted operating income at $1.0M, a turnaround from a prior loss.

• Achieved three consecutive quarters of sequential bookings growth, with 39 deals in Q4, including 9 new logos and strong traction in regulated industries.

• Launched new AI-driven features and voice integrations, with partnerships and integrations involving Avaya, Cisco, and Amazon Connect.

• Net loss widened to $112.1M in Q4 2024, mainly due to impairments and restructuring; strategic focus for 2025 includes continued investment in technical infrastructure and commercial capabilities.

Financial highlights

• Q4 2024 revenue: $73.2M; adjusted EBITDA: $8.1M; both above guidance.

• Full year 2024 revenue: $312.5M; adjusted EBITDA: $24.1M; both above guidance.

• Recurring revenue accounted for 94% of Q4 revenue; average revenue per customer: $625,000, up 2–2.5% year-over-year.

• Cash and cash equivalents at year-end: $183M, including proceeds from financing activities.

• Free cash flow for 2024: $(40.3)M, improved from $(48.4)M in 2023.

Outlook and guidance

• Q1 2025 revenue expected at $63M–$65M, a sequential and year-over-year decline due to prior customer cancellations and deal timing.

• Full year 2025 revenue guidance: $240M–$255M, with 93–94% recurring revenue.

• Adjusted EBITDA for 2025 expected between a $14M loss and break-even; no positive free cash flow expected.

• Revenue expected to decline through most of 2025, with sequential growth and positive net ARR targeted by year-end.

• Adjusted EBITDA margin for FY25 expected between (5.8)% and 0.0%.