LiveRamp reported a solid QQ2 2025 with double-digit top-line growth driven by strength in subscription revenue and a robust data marketplace. Total revenue reached $185.5 million, up 16% year over year, with non-GAAP operating income of $41.0 million and a record non-GAAP operating margin of 22% (GAAP operating income of $7.5 million due to stock-based compensation and intangible amortization). Gross margin held at roughly 75%, underscoring the company’s high-velocity SaaS model and data-centric platform economics. ARR stood at $483 million, up 13% YoY, supported by a 107% subscription net retention and a record 125 million-dollar-plus customers. Marketplace and other revenue accelerated to a 23% growth pace, with data marketplace accounting for about 78% of that segment and contributing to continued strength in CTV channels.
Management framed QQ2 as a productive period in which LiveRamp accelerated network expansion and platform simplification, while prudently navigating a softer near-term IT-spend environment. The company raised full-year guidance for FY25 to $737-739 million in revenue and $133-135 million in non-GAAP operating income, implying ~18% operating margin at the midpoint and signaling progress toward Rule of 40. Management highlighted ongoing leverage from offshoring, product modernization, and higher efficiency as catalysts for margin expansion into FY26 (target 20-25% operating margin) alongside continued 12% revenue growth. The near-term catalyst mix includes Oracle-related marketplace opportunities and strong, multi-year ACV upsells (e.g., a large global ad agency and financial services client), plus notable new logos (including Disney/Netflix-related initiatives in the data collaboration space) that could extend LiveRamp’s addressable market beyond traditional digital advertising.
Key takeaway for investors: LiveRamp’s two-sided clean room network and data collaboration platform offer a scalable growth engine centered on first-party data, privacy-compliant measurement, and AI-enabled use cases. The company’s strong cash generation and active buyback program provide a durable capital base to fund growth initiatives, while the margin trajectory remains a core focus as it integrates Habu and accelerates cost efficiencies to reach a higher Rule of 40 tier in FY26 and beyond.