Company Overview
LivePerson, Inc. operates globally as a provider of digital customer conversation solutions, enabling brands to leverage its platform's intelligence engine to connect with consumers across the United States, Canada, Latin America, South America, Europe, the Middle East, Africa, and the Asia-Pacific. The company functions within the Technology sector, specifically classified under the Software - Application industry, which implies a business model focused on delivering scalable software solutions rather than manufacturing physical goods. Its scale is currently represented by a market capitalization of $31.34M, an annual revenue of $243.74M over the trailing twelve months, and an employee base of 615 individuals. These valuation and revenue figures indicate that the company holds a relatively small market capitalization relative to its revenue base, suggesting a valuation environment where the stock price does not fully reflect the total annual sales generated, a scenario often seen in companies facing revenue contraction or significant investment needs.
Financial Health
The financial performance for the trailing twelve months demonstrates a total revenue of $243.74M paired with a net income of $-67,233,000 and an EBITDA of $-597,000. The substantial gap between the positive revenue of $243.74M and the negative net income of $-67,233,000 reveals a high cost structure where operating expenses significantly exceed gross profits before interest and taxes. The company generated free cash flow of $-34,961,876, which indicates a lack of financial flexibility as the business is currently burning cash rather than generating liquidity for operational reinvestment or shareholder returns. Margins across the board reflect this financial pressure, with a gross margin of 71.5%, an operating margin of 5.8%, and a profit margin of -27.6%. While the gross margin remains healthy at 71.5%, the operating margin of 5.8% suggests high overhead costs are eroding profitability, and the negative profit margin of -27.6% confirms the company is reporting a loss on every dollar of revenue. The balance sheet shows a cash position of $95.00M against total debt of $391.78M, while the debt to equity ratio is listed as N/A due to the negative equity context. This disparity between cash and debt suggests a leveraged balance sheet where liabilities significantly outweigh liquid assets, though the N/A debt-to-equity metric prevents a direct ratio calculation. Liquidity is constrained by a current ratio of 1.12, indicating that the company holds just enough current assets to cover its current liabilities, leaving little room for error in short-term cash flow management. Return on Equity and Return on Assets are both listed as N/A or negative, with ROA specifically at -2.7%, revealing that management is generating a negative return on the assets employed in the business.
Valuation Assessment
Valuation metrics for LivePerson, Inc. present a complex picture due to the company's unprofitable status, with a trailing P/E ratio of N/A and a forward P/E of -0.39. The difference between the non-existent trailing P/E and the negative forward P/E implies that the market is not pricing in near-term earnings recovery based on historical multiples, but rather looking at negative future earnings expectations. The price-to-book ratio stands at -0.70, which indicates that the market is valuing the company at a negative premium relative to its book value, a situation typical for firms with significant liabilities or negative retained earnings. Alternative valuation metrics further complicate the assessment, with a price-to-sales ratio of 0.13 and an EV/EBITDA of -549.61. These alternative metrics suggest the stock is trading at a very low multiple of its sales, yet the negative EV/EBITDA highlights the severe earnings deficit relative to enterprise value. Price volatility is captured by a 52-week high of $21.60 and a 52-week low of $2.39. Without a specific current price provided in the facts to calculate the exact percentage deviation, the stock has experienced a massive range of movement, currently trading somewhere within this wide band between the high of $21.60 and the low of $2.39. The beta value of 1.48 indicates that the stock price is significantly more volatile than the broader market, moving with greater intensity than the S&P 500 index during periods of market fluctuation.
Growth & Income
Growth metrics show a revenue growth rate of -19.0% year-over-year, while earnings growth is listed as N/A due to the negative income. Since earnings are negative, they cannot be growing faster than revenue in a traditional sense; instead, the contraction in revenue of -19.0% is the primary driver of the financial decline. As a non-dividend payer with a dividend yield of N/A and a payout ratio of 0.0%, the company does not distribute cash to shareholders. This means the company reinvests its limited available cash flow, or lack thereof, into operations rather than paying dividends, which is consistent with its current burn rate and debt obligations. The overall growth and income profile is characterized by negative revenue expansion and zero dividend distribution, indicating a phase of business contraction and capital preservation rather than shareholder yield or organic growth acceleration.