LivePerson (LPSN) Misses Q3 EPS by 52c, Revenues Beat; Lowers FY20 EPS Guidance, Raises FY20 Revenue Outlook
LivePerson (NASDAQ: LPSN) reported Q3 EPS of ($0.58), $0.52 worse than the analyst estimate of ($0.06). Revenue for the quarter came in at $94.8 million versus the consensus estimate of $92.64 million.
"A second consecutive quarter of 25%-plus revenue growth validates that LivePerson is at the forefront of a consumer-led, structural demand shift to Conversational AI," said CEO and Founder, Rob LoCascio. "Consumers are turning to AI-powered messaging as a preferred alternative to visiting stores, calling 1-800 numbers or surfing the web, and LivePerson's Conversational Cloud is setting the industry standard for this new set of technologies. To further unlock the potential of this market, we are excited to announce a first-of-its kind partnership with Infosys, a leader in next-generation digital services and consulting. We will work with Infosys to transform our technology infrastructure on the public cloud, to build integrated solutions and a global practice around our Conversational Cloud to sell into their channels and global enterprise customer base, and to redefine how the world's top brands communicate."
"In the third quarter, LivePerson continued to generate a strong payback on recent go-to-market and product investments, setting records for key financial metrics including revenue, contract signings, ARPU and revenue retention. Our field organization executed across the board, and it was great to see EMEA rebound to 15% year-over-year growth, and to begin rebuilding momentum in new logos, where contract values signed increased more than 300% quarter over quarter, returning to pre-pandemic levels. We also continued to demonstrate the adaptability and scalability of our financial model, as we delivered a multi-year high adjusted EBITDA margin of 16%, and generated positive year-to-date free cash flow. With strong momentum in the business, we are once again raising guidance for 2020 and targeting our first $100 million quarter in Q4."
LivePerson sees Q4 2020 EPS of ($0.36)-($0.33), versus the consensus of ($0.03). LivePerson sees Q4 2020 revenue of $98-100 million, versus the consensus of $97.36 million.
LivePerson sees FY2020 EPS of ($1.80)-($1.77), versus the consensus of ($0.35). LivePerson sees FY2020 revenue of $362.5-364.5 million, versus the consensus of $359.71 million.
Other Full Year 2020 Assumptions
- Approximately $38.0 million ($0.58 per share) of non-recurring charges including lease restructuring expense of $24.0 million, IP litigation expense of approximately $4.8 million, severance, restructuring and compensation related costs of $5.6 million, sales tax liability of $2.3 million, employee benefit costs of $0.8 million and consulting costs of $0.7 million to $0.9 million.
- Amortization of purchased intangibles of $2.8 million
- Non-cash interest expense of approximately $11.3 million
- Stock-based compensation expense of approximately $65.4 million
- Depreciation and amortization of approximately $23.9 million
- Cash taxes paid of $2.0 million to $3.0 million. A GAAP tax liability of $1.0 million to $2.0 million
- Capital expenditures of approximately $45.0 million
Furthermore, as a percent of revenue for the year, including amortization of intangibles and stock-based compensation, but excluding non-recurring expenses discussed above, we anticipate gross profit to be approximately 70.5%, sales and marketing 40.0%, product development 32.0% and G&A at 16.0%.
For earnings history and earnings-related data on LivePerson (LPSN) click here.