Executive Summary

Q4 FY25 delivered double-digit top-line growth and stronger profitability on a non-GAAP basis: revenue $189.0M (+10% YoY), non-GAAP operating income $23.0M (+43% YoY), and record quarterly free cash flow $62.3M .
Against S&P Global consensus, LiveRamp posted a Beat: revenue $189.0M vs $185.4M*, non-GAAP EPS $0.30 vs $0.28*; gross margin compressed due to platform modernization costs .
Guidance for FY26 and Q1 FY26 was corrected intra-day: Q1 FY26 GAAP operating income $6M and non-GAAP $33M; FY26 GAAP operating income $85–$89M and non-GAAP $178–$182M (prior release had these flipped) .
Key catalysts: launch of Cross-Media Intelligence (CMI) to unify deduplicated cross-screen measurement; strong renewal cycle and rising current RPO; scaling Clean Room adoption with large CTV, retail media, and new AI destinations .
Management’s tone: constructive but cautious on macro; expects margin expansion in FY26 (non-GAAP operating margin ~22% at midpoint) alongside disciplined investment and offshoring benefits .

What Went Well and What Went Wrong

What Went Well

Non-GAAP profitability and cash generation improved: Q4 non-GAAP operating income $23.0M (12.2% margin) and free cash flow $62.3M, with FY25 FCF $152.9M (+51% YoY) .
Renewals and backlog strengthened: 20 multimillion-dollar ACV renewals (about half multiyear), total RPO +25% (to ~$710M), current RPO +14% to $471M, ARR $504M (+8%) .
Strategic product momentum: launch of Cross-Media Intelligence and expanding Clean Room network across CTV, walled gardens, retail media, and AI partners (Perplexity, Chalice), positioning for measurement-led upsell and new logos .

Management quotes:

CEO: “We had a strong finish to fiscal 2025… operating cash flow reaching a record high… rolling out new functionality, such as our new Cross Media Intelligence measurement solution” .
CFO: “Free cash flow was a record $62 million… and a record year for free cash flow at $153 million, up over 50% year-on-year” .

What Went Wrong

Gross margin compression: GAAP gross margin 69% (-300 bps YoY) in Q4 due to temporarily higher cloud hosting expenses from platform modernization .
Customer count declined as smaller accounts churned and international moved from direct to reseller arrangements; direct subscription customers fell to 840 (from 865 in Q3, 885 in Q2) .
Macro caution and elongated sales cycles late in Q4, with some deals slipping to early Q1; management embedded conservatism in FY26 revenue range (6–10% growth) .

Financial Results

Metric	Q2 FY25	Q3 FY25	Q4 FY25
Revenue ($USD Millions)	$185.5	$195.4	$188.7
GAAP Diluted EPS ($)	$0.03	$0.17	$(0.10)
Non-GAAP Diluted EPS ($)	$0.51	$0.55	$0.30
GAAP Gross Margin (%)	72.4%	71.9%	69.3%
Non-GAAP Gross Margin (%)	75%	74%	72%
GAAP Operating Margin (%)	4.0%	7.5%	(6.1%)
Non-GAAP Operating Margin (%)	22%	23%	12.2%
Free Cash Flow ($USD Millions)	$55.4	$44.8	$62.3

Segment Revenue

Segment ($USD Millions)	Q2 FY25	Q3 FY25	Q4 FY25
Subscription Revenue	$143	$146	$145
Marketplace & Other Revenue	$42	$50	$44

KPIs

KPI	Q2 FY25	Q3 FY25	Q4 FY25
$1M+ Subscription Customers (Count)	125	125	128
Direct Subscription Customers (Count)	885	865	840
ARR ($USD Millions)	$483	$491	$504
Current RPO ($USD Millions)	$374	$434	$471
Total RPO ($USD Millions)	—	—	~$710
Subscription Net Retention (%)	107%	108%	104%
Platform Net Retention (%)	110%	111%	106%

Guidance Changes

Metric	Period	Previous Guidance	Current Guidance	Change
Revenue ($USD Millions)	Q1 FY26	$191	$191	Maintained
GAAP Operating Income ($USD Millions)	Q1 FY26	GAAP operating loss of $(33)	GAAP operating income of $6	Raised (corrected)
Non-GAAP Operating Income ($USD Millions)	Q1 FY26	$6	$33	Raised (corrected)
Revenue ($USD Millions)	FY26	$787–$817	$787–$817	Maintained
GAAP Operating Income ($USD Millions)	FY26	GAAP operating loss of $(178)–$(182)	$85–$89	Raised (corrected)
Non-GAAP Operating Income ($USD Millions)	FY26	$85–$89	$178–$182	Raised (corrected)

Note: LiveRamp issued a correction press release clarifying that GAAP operating income and non-GAAP operating income were inverted in the earlier release; corrected figures above are now accurate .

Earnings Call Themes & Trends

Topic	Previous Mentions (Q2 FY25 and Q3 FY25)	Current Period (Q4 FY25)	Trend
AI/technology initiatives	Added AI destinations Perplexity and Chalice; platform update for faster activation; offshoring to improve margins	Emphasis on agentic optimization; CMI feeds proprietary AI models; governance tools for secure data collaboration	Expanding scope and integration
Cross-Media Intelligence (CMI)	Investor Day preview; scaling Clean Room network across premium publishers and CTV	Formal launch; unified deduplicated cross-screen measurement; strong publisher commitments; early pipeline traction	Scaling and commercialization
Macro/tariffs/uncertainty	Cautious selling environment; elongated cycles; optimism with lower rates	Modest lengthening of deal cycles; macro conservatism embedded in FY26 revenue range	Cautious but managed
Product performance (CTV, Oracle transition)	CTV a bright spot; Marketplace +24%; Oracle shutdown expected modest tailwind	CTV marketplace data up ~50% YoY FY25; strong new CTV partnerships coming online	Strengthening
Regional/customer mix	International reseller migration pressuring customer count	International accounted for >half of customer count decline; nearing end of migration	Stabilizing ahead
Regulatory/legal/privacy	Clean Rooms and governance as foundational; cookie deprecation timing reduced urgency	Google Chrome opt-in change a “nonevent”; stronger authenticated ecosystem reach	Resilient approach
R&D execution/platform modernization	Platform refresh, standardized queries to speed time-to-value	Higher cloud hosting costs near-term; margins normalize as migrations complete	Near-term cost, medium-term benefit

Management Commentary

Strategic messages: network-density flywheel (more nodes and edges), CMI as near-term lever for upsell and new logos, AI governance within Clean Rooms, and Rule-of-40 trajectory by FY28 .
CEO Scott Howe: “Cross-Media Intelligence… enables marketers to better measure and optimize advertising campaigns… with unified deduplicated reporting across screens and platforms… industry enthusiasm… could be one of the key levers in driving more meaningful sales acceleration in FY ’26” .
CFO Lauren Dillard: FY26 non-GAAP operating income $178–$182M (22% margin at midpoint) driven by offshoring, cost discipline, and Habu leverage; Q1 FY26 revenue ~$191M and non-GAAP operating margin ~17% .

Q&A Highlights

CMI traction: 30+ customer conversations; insights/measurement pipeline more than doubled; bookings early in Q1 up vs prior year—supports second-half acceleration if macro holds .
Guidance sensitivities: high end assumes stable macro and accelerating subscription growth in H2; low end assumes decelerating macro affecting marketplace/usage; execution on Clean Room/CMI is the swing factor .
Customer count dynamics: decline driven by small accounts and international reseller migration; expected stabilization then improvement as pricing pilots broaden entry for mid-market in FY27 .
Google cookies: customers largely unfazed; authenticated reach exceeds cookie-based reach across top publishers; Chrome cookies still a complementary tool for broad campaigns .
Pipeline/timing: late-quarter hesitancy swept into early Q1; midpoint guidance assumes Q4-like conversion rates with conservatism; low case assumes material tick down .
Competitive landscape: agency acquisition of a competitor seen as potential opportunity; emphasis on innovation and neutrality .
Clean Room adoption: currently ~25% of brand customers; ARR ~4x larger with Clean Room; standardization and AI to simplify onboarding and accelerate value .

Estimates Context

Metric	Q4 FY25 Consensus	Q4 FY25 Actual	Surprise
Revenue ($USD Millions)	$185.4*	$188.7	Beat
Primary EPS (Diluted, $)	$0.28*	$0.30	Beat

Metric	Q1 FY26 Consensus	Q1 FY26 Guidance/Color	Notes
Revenue ($USD Millions)	$191.1*	~$191 guidance	Inline
Primary EPS (Diluted, $)	$0.42*	Non-GAAP operating income $33M; margin ~17%	Margin expansion focus

Values retrieved from S&P Global.*

Where estimates may need to adjust: Q4 beats and strengthened backlog (RPO) support modest upward revisions to FY26 revenue midpoint if macro stabilizes; non-GAAP margin trajectory and CMI adoption could drive EPS estimate upgrades in H2 FY26 .

Key Takeaways for Investors

CMI launch and expanding Clean Room network are core growth drivers, particularly with CTV, walled gardens, and retail media; expect measurement-led upsell to accelerate ARR and retention .
Near-term gross margin headwinds from platform modernization should abate as migrations complete, supporting margin normalization to mid-70s in H2 FY26 .
Strong renewals and RPO growth de-risk FY26; watch conversion rates and macro-sensitive marketplace/usage in H2 .
Capital discipline and offshoring underpin non-GAAP margin expansion (FY26 midpoint ~22%), with continued share repurchases (remaining authorization ~$256M) enhancing per-share metrics .
Customer count mix is improving toward larger enterprise logos; international reseller transition nearing completion—expect stabilization then gradual improvement .
Tactical: Q1 FY26 set-up is solid with slipped Q4 deals closing early; if macro holds, potential for H2 acceleration tied to CMI adoption .
Medium-term thesis: Rule-of-40 progress by FY28 via 10–15% revenue growth and 25–30% operating margin; AI-enabled measurement/optimization and network density are strategic moats .

LiveRamp Holdings, Inc. (RAMP)·Q4 2025 Earnings Summary