EPS of $-0.08 increased by 85.2% from previous year
Gross margin of 72.2%
Net income of -5.37M
"Q4 revenue growth exceeded our expectations across the board with total revenue up 16%, subscription up 11% and marketplace up 38%. Revenue was ahead of our guidance by $12 million or 7% and non-GAAP operating income was ahead by $3 million or 20%." - Scott Howe
LiveRamp Holdings Inc (RAMP) QQ4 2024 Results: Data Collaboration Momentum, Habu Integration, and Outlook Toward a Rule-of-40
Executive Summary
LiveRamp reported a strong Q4 FY2024 finish with revenue of $172 million, up 16% year over year, and non-GAAP operating income ahead of guidance by 20%. ARR reached $467 million, up 10% for the year, with quarterly ARR growth accelerating to a double-digit pace for the second consecutive quarter. The company highlighted robust data collaboration demand, led by the Habu acquisition which closed January 31, 2024, and a pipeline now exceeding $40 million. Management reaffirmed a strategic shift toward large, multi-year contracts, higher customer retention, and cross-sell opportunities across LiveRamp and Habu. For FY25, LiveRamp guided to $710–730 million in revenue and $125–129 million of non-GAAP operating income (about 18% margin at the midpoint), signaling a continued move toward sustainable, high-teen to low-20s percent operating income growth on a non-GAAP basis and an improving subscription trajectory. The company also underscored opportunities from PAIR and ATS in a cookie-less future, while cautions include a slower-than-expected cookie deprecation timeline and macro ad-market uncertainty. The outlook emphasizes a Rule-of-40 aspiration, driven by product upgrades, data collaboration leadership, expanded partner ecosystems, and AI-enabled simplification across platforms.
Key Performance Indicators
Revenue
171.85M
QoQ: -1.16% | YoY:15.63%
Gross Profit
124.13M
72.23% margin
QoQ: -3.73% | YoY:18.05%
Operating Income
-14.28M
QoQ: -193.91% | YoY:61.84%
Net Income
-5.37M
QoQ: -138.44% | YoY:85.05%
EPS
-0.08
QoQ: -138.81% | YoY:85.18%
Revenue Trend
Margin Analysis
Key Insights
Revenue: $171.9m in Q4 2024, up 16% YoY (guidance exceeded by $12m, 7%); QoQ not material per quarterly delta.
Gross margin: approximately 75% in Q4 (reported), with 72.2% shown in some data fields; Management cites flat YoY gross margin at 75% in commentary.
Operating income: Non-GAAP operating income $16m in Q4 (GAAP op loss of $14m); Non-GAAP margin ~9% for the quarter; FY24 free cash flow >$100m with $106m for the full year.
ARR and RPO: ARR $467m, up 10% for FY24; Q4 ARR growth accelerated to 7% on a like-for-like basis; Current RPO $414m, up 23%; Total RPO $566m, up 20%.
Net retention: Subscription net retention 103% in Q4, 2 pts above prior quarter; highlights on upsell (e.g., Clean Room and connectivity).
Financial Highlights
- Revenue: $171.9m in Q4 2024, up 16% YoY (guidance exceeded by $12m, 7%); QoQ not material per quarterly delta.
- Gross margin: approximately 75% in Q4 (reported), with 72.2% shown in some data fields; Management cites flat YoY gross margin at 75% in commentary.
- Operating income: Non-GAAP operating income $16m in Q4 (GAAP op loss of $14m); Non-GAAP margin ~9% for the quarter; FY24 free cash flow >$100m with $106m for the full year.
- ARR and RPO: ARR $467m, up 10% for FY24; Q4 ARR growth accelerated to 7% on a like-for-like basis; Current RPO $414m, up 23%; Total RPO $566m, up 20%.
- Net retention: Subscription net retention 103% in Q4, 2 pts above prior quarter; highlights on upsell (e.g., Clean Room and connectivity).
- Customers: 115 customers in the $1m+ cohort in Q4 (highest on record).
- Cash flow and capital allocation: Q4 operating cash flow $28m; FY24 operating cash flow $106m; Buybacks: $15m in Q4; full-year buyback $61m; cash balance at period end ~$336.9m with total cash & short-term investments ~$368.9m; net debt of approximately -$294.6m (net cash).
- Guidance (FY25): Revenue $710–730m; Non-GAAP operating income $125–129m; gross margin ~75%; SBC ~$116m; GAAP op loss in range of -$8m to -$4m; Q1 FY25 guidance: revenue $172m, non-GAAP operating income $25m, op margin ~15%; international sub revenue expected to be down mid-teens; data marketplace growth expected to outpace overall digital ad market; ongoing buyback support.
Income Statement
Metric
Value
YoY Change
QoQ Change
Revenue
171.85M
15.63%
-1.16%
Gross Profit
124.13M
18.05%
-3.73%
Operating Income
-14.28M
61.84%
-193.91%
Net Income
-5.37M
85.05%
-138.44%
EPS
-0.08
85.18%
-138.81%
Key Financial Ratios
currentRatio
2.78
grossProfitMargin
72.2%
operatingProfitMargin
-8.31%
netProfitMargin
-3.13%
returnOnAssets
-0.44%
returnOnEquity
-0.57%
debtEquityRatio
0.04
operatingCashFlowPerShare
$0.43
freeCashFlowPerShare
$0.4
priceToBookRatio
2.36
priceEarningsRatio
-104.41
Net Income vs. Revenue
Expense Breakdown
Management Commentary
- Strategy and long-term positioning: Scott Howe emphasized four corporate priorities for FY25: (1) enhance products and customer experience to improve retention and upsell, (2) extend leadership in data collaboration, (3) scale partner and connectivity ecosystem, and (4) simplify LiveRamp for customers and employees, all aligned toward becoming a Rule-of-40 company. He framed data collaboration as a hedge against third-party signal loss, with ATS and PAIR as key enablers. Quote: “our data collaboration platform seems well positioned to capitalize on the growing need for secure first party data collaboration and to sustain addressable digital advertising in a world of third party signal loss.†(Scott Howe)
- Habu integration and early traction: Howe highlighted rapid people & product integration, a growing pipeline (from $30m to over $40m within four months), and the expectation of continued cross-sell with LiveRamp products. He described Habu team leadership transitions and the potential to unlock new use cases beyond advertising and marketing. Quote: “One month after the deal closed, our incremental data collaboration pipeline was $30 million and now four months in, it's over $40 million.†(Scott Howe)
- Market dynamics and tokens of progress: Lauren Dillard cited the acquisition impact (Habu contributing ~$12m ARR in Q4 and approx. $3m expense), ARR growth trajectory, net retention, and RPO dynamics, noting that the latest quarter benefited from a stronger ad market and sales execution. Quote: “ARR was $467 million, up 10%, reflecting a $12 million impact from Habu and continued growth in customer upsell and new logo.†(Lauren Dillard)
- Cookie deprecation timing and PAIR adoption: Management framed the deprecation timeline as a near-term headwind with longer-term upside in PAIR, ATS, and first-party data activation across Safari/Edge/CTV. Howe indicated they expect a conservative but constructive impact in FY25 and planned market education around PAIR ahead of full deprecation. Quote: “Google's decision to delay Chrome third-party cookie deprecation until early 2025 will have an impact on our payer opportunities.†(Scott Howe)
Q4 revenue growth exceeded our expectations across the board with total revenue up 16%, subscription up 11% and marketplace up 38%. Revenue was ahead of our guidance by $12 million or 7% and non-GAAP operating income was ahead by $3 million or 20%.
— Scott Howe
ARR was $467 million, up 10%, reflecting a $12 million impact from Habu and continued growth in customer upsell and new logo. Subscription net retention was 103%, 2 points better sequentially and ahead of our expectation.
— Lauren Dillard
Forward Guidance
LiveRamp maintains a conservative yet constructive FY25 outlook anchored by ongoing Q4 momentum and a path to improved subscription growth. Key takeaways:
- Revenue: guided to $710–730 million for the year, an 8–11% YoY increase, with subscription growth in the high single digits and fixed subscription in the high single to low double digits; international subscription revenue expected to be down mid-teens due to APAC restructuring.
- Profitability: non-GAAP operating income target of $125–$129 million (about 18% margin at the midpoint), implying ~2 percentage points of margin expansion vs. FY24, with SBC of ~$116 million reflecting the Habu acquisition and normalizing vesting patterns. GAAP operating loss is guided to a range of -$8 million to -$4 million, reflecting non-cash charges and integration costs.
- Cash flow and capital returns: plan to redeploy a meaningful portion of FY25 free cash flow to buybacks (~$15 million per quarter, subject to market conditions); management views this as offsetting dilution from Habu and other hires.
- Growth drivers and risks: the core growth engine remains ARR expansion and higher retention, aided by data collaboration, Clean Rooms, and partnerships (PAIR/ATS). However, the timing and impact of cookie deprecation remain uncertain, with a front-loaded risk that some customers delay adoption. The PAIR timeline (with Google delaying full deprecation into early 2025) is explicitly flagged as a swing factor for FY25.
Overall, investors should monitor: (i) progression of Habu cross-sell and pipeline execution, (ii) uptake of PAIR-enabled activations and ATS deployments, (iii) retention and expansion within large customers, and (iv) the macro ad-market trajectory and cookie deprecation readiness. The company frames 2025 as a year of margin expansion and improved subscription growth, but with near-term volatility tied to industry-wide transitions in identity and measurement in digital advertising.
Competitive Position
Company
Gross Margin
Operating Margin
Return on Equity
P/E Ratio
RAMP Focus
72.23%
-8.31%
-0.57%
-104.41%
PAGS
47.20%
34.30%
3.68%
9.86%
DAVA
22.20%
0.64%
-0.29%
-181.28%
NTNX
85.20%
-2.22%
17.30%
-24.82%
SPLK
84.90%
32.60%
57.60%
15.20%
Gross Profit Margin
Operating Profit Margin
Return on Equity
P/E Ratio Comparison
Investment Outlook
LiveRamp is positioned to benefit from a secular shift toward first-party data and authenticated addressability, underscored by a robust data collaboration platform and the strategic addition of Habu. The FY25 guidance signals a path to margin expansion and improved subscription growth, anchored by higher retention, cross-sell momentum, and a scalable partner ecosystem. The company’s strong balance sheet (net cash, sizable liquidity) supports continued buybacks and investment in growth initiatives, mitigating near-term dilution risk from the Habu integration. Valuation remains relatively rich on revenue multiples, but the growth trajectory and optionality from PAIR/ATS deployments, along with AI-enabled product enhancements, provide a framework for upside if ad markets stabilize and cookie deprecation accelerates in a favorable way. The key variables to monitor are the actual pace of PAIR-enabled activations, the uptake of cross-sell into new verticals, and the timing of ad-market recovery. Overall, for investors with a long-duration horizon and risk tolerance for ad-tech cyclicality, LiveRamp offers a compelling exposure to the data collaboration and identity solutions space, with a reasonable probability of achieving its Rule-of-40 objective in FY25 and beyond.
Key Investment Factors
Growth Potential
Strong growth potential from data collaboration leadership, expansion of Habu-enabled solutions, and cross-sell across LiveRamp and Habu. ARR growth of 10% for FY24, with Q4 ARR growth of 7% on a like-for-like basis, and a pipeline now exceeding $40m, point to a durable growth trajectory as advertisers accelerate first-party data activation post-cookie deprecation.
Profitability Risk
Key risks include the timing and pace of cookie deprecation and PAIR adoption, potential slower-than-expected mix shift to authenticated addressability, competition in the identity/clean-room space, and macro ad-market sensitivity which could impact usage-based revenue (e.g., data marketplace). Also, integration risks with the Habu acquisition could affect synergies and timing of revenue uplift.
Financial Position
Strong liquidity and balance sheet health with net cash around $294.6m and a cash balance of roughly $336.9m at Q4; total assets $1.231b and equity $949m. FY24 free cash flow exceeded $100m (FY24 FCF of $106m) and the company completed substantial share repurchases (FY24 buybacks $61m; Q4 $15m). These buffers support ongoing investment in growth initiatives and a meaningful buyback program to offset dilution from acquisitions.
SWOT Analysis
Strengths
Leading data collaboration platform with scale across publishers, tech platforms, and data providers (ATS, PAIR, and Clean Rooms).
Successful post-acquisition integration of Habu delivering immediate ARR uplift (~$12m) and a growing pipeline (~$40m).
Strong ARR growth and robust net retention (ARR $467m; NRR 103%); high-value, multi-year enterprise relationships.
High recurring revenue mix with improving gross margin (~75%) and improving non-GAAP profitability trajectory.
Extensive multi-channel data ecosystem and cross-cloud interoperability facilitating faster time-to-value for customers.
Weaknesses
Net GAAP income remained negative in Q4 2024; reliance on non-GAAP measures for profitability visibility.
Higher stock-based compensation and ongoing integration costs from Habu weighing on GAAP metrics.
Near-term exposure to macro ad market and cookie deprecation timing uncertainties.
Opportunities
Expanded adoption of PAIR and ATS leading to greater activation of first-party data (especially off Chrome and into DV360, CTV, etc.).
Cross-sell opportunities between LiveRamp and Habu across new verticals (travel, entertainment, automotive, healthcare).
Data marketplace growth and professional services expansion driving marketplace revenue.
AI-enabled platform enhancements (gen AI queries, automated data labeling) to lift usage and reduce friction for non-technical users.