LiveRamp Holdings, Inc.

Previous wording

Total revenues for the nine months ended December 31, 2024 were $556.9 million, a $69.0 million, or 14.2%, increase compared to the same period a year ago. The increase was due to revenue growth in both Subscription and Marketplace and Other. The Subscription revenue growth was $43.7 million, or 11.5%, primarily due to upsell to existing customers, new logo deals and higher variable revenue. Subscription revenue also included approximately $10.4 million of revenue associated with the fiscal 2024 acquisition of Habu. The Marketplace and Other revenue growth was $25.3 million, or 23.5%, primarily due to Data Marketplace and Services growth. On a geographic basis, U.S. revenue increased $69.8 million, or 15.3%. International revenue decreased $0.8 million, or 2.5%.

Current wording

Total revenues were $194.8 million for the three months ended June 30, 2025, an $18.9 million, or 10.7%, increase compared to the same period a year ago. The increase was due to revenue growth in both Subscription and Marketplace and Other. The Subscription revenue growth was $13.6 million, or 10.1%, primarily due to upsell to existing customers and higher variable revenue. The Marketplace and Other revenue growth was $5.3 million, or 12.8%, primarily due to Data Marketplace and Services growth. On a geographic basis, U.S. revenue increased $18.0 million, or 10.8%. International revenue increased $0.9 million, or 9.4%.

Previous wording

Cost of revenue includes third-party direct costs including identity graph data, other data and cloud-based hosting costs, as well as costs of IT, security and product operations functions. Cost of revenue also includes amortization of acquisition-related intangibles.

Current wording

Cost of revenue includes third-party direct costs including identity graph data, other data and cloud-based hosting costs, as well as costs of IT, security, product operations and professional services functions. Cost of revenue also includes amortization of acquisition-related intangibles.

Previous wording

Cost of revenue was $158.0 million for the nine months ended December 31, 2024, a $26.2 million, or 19.9%, increase from the same period a year ago. Gross profit increased to $398.9 million (71.6% gross margin) from $356.0 million (73.0% gross margin) in the prior period due to the revenue increase of $69.0 million offset partially by an increase in cloud infrastructure costs (increased $12.4 million), services costs (increased $10.4 million) due to higher services revenue, intangible asset amortization (increased $5.6 million) and stock-based compensation expense (increased $2.5 million). U.S. gross margins decreased to 72.5% from 75.0%, and International gross margins increased to 56.1% from 43.1%.

Current wording

Cost of revenue was $58.3 million for the three months ended June 30, 2025, a $6.6 million, or 12.7%, increase from the same period a year ago. Gross profit increased to $136.5 million (70.1% gross margin) from $124.2 million (70.6% gross margin) in the prior period due to the revenue increase of $18.9 million and a decrease in purchased intangible asset amortization of $1.1 million (declining amortization from Habu acquisition in fiscal 2024), offset partially by an increase in cloud infrastructure costs (increased $6.8 million) driven by increased customer usage and platform migration costs, and an increase in services costs (increased $0.7 million) due to headcount and related increases. U.S. gross margins decreased to 70.6% from 71.5%, and International gross margins increased to 60.5% from 55.5%.

Previous wording

Gains, losses and other items, net was $0.1 million for the quarter ended December 31, 2024, a decrease of $2.4 million compared to the same quarter a year ago. The prior year quarter costs primarily related to $1.3 million related to termination benefits for employees whose positions were eliminated, and $1.2 million of third-party merger costs associated with the Habu acquisition.

Current wording

Gains, losses and other items, net was $0.4 million for the three months ended June 30, 2025, an increase of $0.2 million compared to the same period a year ago. The current year relates primarily to adjustments to previous lease restructuring reserves while the prior year costs are primarily related to termination benefits for employees whose positions were eliminated.

Previous wording

Income from operations was $16.9 million for the nine months ended December 31, 2024 compared to income from operations of $25.7 million in the same period a year ago. Operating margin was 3.0% compared to 5.3% in the prior year period. Margins in the prior year period were positively impacted by the acceleration of stock-based compensation previously discussed.

Current wording

Income from operations was $7.2 million for the three months ended June 30, 2025 compared to loss from operations of $5.2 million in the same period a year ago. Operating margin was 3.7% compared to negative 3.0% in the prior year period. Margins were positively impacted by the gross profit increase.

Previous wording

Total other income, net was $4.0 million for the quarter ended December 31, 2024 compared to total other income, net of $6.6 million in the same quarter a year ago. Total other income, net was $12.7 million for the nine months ended December 31, 2024 compared to $17.9 million in the same period a year ago. The quarter and year-to-date decreases are primarily attributable to lower invested cash and short-term investments (the prior year invested cash balance reflected cash prior to the acquisition of Habu) and slightly lower interest rates in the current fiscal year.

Current wording

Total other income, net was $3.7 million for the three months ended June 30, 2025 compared to $4.4 million in the same period a year ago. The decrease is primarily attributable to lower invested cash balances and lower interest rates in the current year.

Previous wording

Income tax expense was $9.2 million on income from continuing operations before income taxes of $18.7 million for the quarter ended December 31, 2024, resulting in a 49.1% effective tax rate. This compares to a prior year quarter income tax expense of $8.4 million on income from continuing operations before income taxes of $21.8 million, or a 38.7% effective tax rate. Income tax expense was $25.8 million on income from continuing operations before income taxes of $29.6 million for the nine months ended December 31, 2024, resulting in an 87.3% effective tax rate. This compares to a prior year period income tax expense of $27.3 million on income from continuing operations before income taxes of $43.6 million, or a 62.7% effective tax rate. Tax expense for all periods reflects the impact of the capitalization of research and development expenditures in accordance with Internal Revenue Code ("IRC") Section 174, as modified by the Tax Cuts and Jobs Act of 2017, without a corresponding deferred tax benefit, the valuation allowance, and nondeductible stock-based compensation.

Current wording

Income tax expense was $3.2 million on income from continuing operations before income taxes of $10.9 million for the three months ended June 30, 2025, resulting in a 29.1% effective tax rate. This compares to a prior year income tax expense of $6.7 million on loss from continuing operations before income taxes of $0.8 million, or a negative 831.5% effective tax rate. Tax expense for all periods reflects the impact of the valuation allowance and nondeductible stock-based compensation. In accordance with Internal Revenue Code ("IRC") Section 174, as modified by the Tax Cuts and Jobs Act of 2017, research and development expenditures are required to be capitalized and amortized over five years (15 years for foreign-based costs). Due to the valuation allowance, the Company has not recorded a deferred tax benefit for future amortization deductions.

Previous wording

The Company’s cash and cash equivalents are primarily located in the United States. At December 31, 2024, approximately $19.8 million of the total cash balance of $376.8 million, or approximately 5.3%, was located outside of the United States. The Company has no current plans to repatriate this cash to the United States.

Current wording

The Company’s cash and cash equivalents are primarily located in the United States. At June 30, 2025, approximately $25.0 million of the total cash balance of $363.6 million, or approximately 6.9%, was located outside of the United States.

Previous wording

Trade accounts receivable, net balances were $210.6 million at December 31, 2024, an increase of $20.3 million, compared to $190.3 million at March 31, 2024. Days sales outstanding ("DSO"), a measurement of the time it takes to collect receivables, was 99 days at December 31, 2024, compared to 101 days at March 31, 2024. DSO can fluctuate due to the timing and nature of contracts that lead to up-front billings related to deferred revenue on services not yet performed, and Data Marketplace contracts, which are billed on a gross basis, recognized on a net basis, but for which the amount that is due to data sellers is not reflected as an offset to accounts receivable. Compared to March 31, 2024, DSO at December 31, 2024 was positively impacted by approximately two days as the increased impact of Data Marketplace gross accounts receivable was offset by collections of Data Marketplace receivables. All customer accounts are actively managed, and no losses in excess of amounts reserved are currently expected.

Current wording

Trade accounts receivable, net balances were $219.8 million at June 30, 2025, an increase of $33.6 million, compared to $186.2 million at March 31, 2025. Days sales outstanding ("DSO"), a measurement of the time it takes to collect receivables, was 103 days at June 30, 2025, compared to 89 days at March 31, 2025. DSO can fluctuate due to the timing and nature of contracts that lead to up-front billings related to deferred revenue on services not yet performed, and Data Marketplace contracts, which are billed on a gross basis, recognized on a net basis, but for which the amount that is due to data sellers is not reflected as an offset to accounts receivable. Compared to March 31, 2025, DSO at June 30, 2025 was negatively impacted by approximately nine days due to the increased impact of Data Marketplace gross accounts receivable. All customer accounts are actively managed, and no losses in excess of amounts reserved are currently expected.

Previous wording

Working capital at December 31, 2024 totaled $412.2 million, a $26.7 million increase when compared to $385.5 million at March 31, 2024.

Current wording

Working capital at June 30, 2025 totaled $410.0 million, a $1.4 million increase when compared to $408.7 million at March 31, 2025.

Previous wording

Management believes that the Company's existing available cash will be sufficient to meet the Company's working capital and capital expenditure requirements for the foreseeable future. However, in light of the risk of recession, the military conflicts in Europe and the Middle East, cost increases, high interest rates, capital markets volatility and general inflationary pressures, our liquidity position may change due to the inability to collect from our customers, inability to raise new capital via issuance of equity or debt, and disruption in completing repayments or disbursements to our creditors. We have historically taken and may continue to take advantage of opportunities to generate additional liquidity through capital market transactions. These impacts have caused significant disruptions to the global financial markets, which could increase the cost of capital and adversely impact our ability to raise additional capital, which could negatively affect our liquidity in the future. The amount, nature, and timing of any capital market transactions will depend on our operating performance and other circumstances; our then-current commitments and obligations; the amount, nature, and timing of our capital requirements; and overall market conditions. If we are unable to raise funds as and when we need them, we may be forced to curtail our operations.

Current wording

Management believes that the Company's existing available cash will be sufficient to meet the Company's working capital and capital expenditure requirements for the short-term (the next 12 months) and separately in the long-term (beyond the next 12 months). However, in light of the recent tariffs and other trade restrictions, risk of recession, the military conflicts in Europe and the Middle East, cost increases, high interest rates, capital markets volatility and general inflationary pressures, our liquidity position may change due to the inability to collect from our customers, inability to raise new capital via issuance of equity or debt, and disruption in completing repayments or disbursements to our creditors. These impacts have caused significant disruptions to the global financial markets, which could increase the cost of capital and adversely impact our ability to raise additional capital, which could negatively affect our liquidity in the future. We have historically taken and may continue to take advantage of opportunities to generate additional liquidity through capital market transactions. The amount, nature, and timing of any capital market transactions will depend on our operating performance and other circumstances; our then-current commitments and obligations; the amount, nature, and timing of our capital requirements; and overall market conditions. If we are unable to raise funds as and when we need them, we may be forced to curtail our operations.

Previous wording

In the nine months ended December 31, 2023, net cash provided by operating activities of $78.0 million resulted primarily from operating results adjusted for non-cash items of $77.2 million and changes in operating assets and liabilities of $0.8 million. Net cash provided by changes in operating assets and liabilities was primarily related to a net reduction in refundable income taxes of $29.6 million, an increase in deferred revenue of $9.7 million, and an increase in other assets of $8.8 million, offset partially by an increase in accounts receivable of $41.0 million. The change in accounts receivable is primarily due to revenue growth and the timing of cash receipts from customers.

Current wording

Net cash used in operating activities for the three months ended June 30, 2025 was $15.8 million and resulted primarily from operating results adjusted for non-cash items of $38.2 million offset by unfavorable changes in operating assets and liabilities of $54.0 million. Net cash used by changes in operating assets and liabilities was primarily related to a decrease in accounts payable and other liabilities of $35.9 million and an increase in accounts receivable of $34.3 million, partially offset by an increase in deferred revenue of $5.7 million and income taxes payable of $4.5 million. The change in accounts payable and other liabilities is primarily due to the payment of annual incentive compensation awards for fiscal year 2025 and the timing of payments to suppliers. The change in accounts receivable is primarily due to revenue growth and the timing of cash receipts from customers.

Previous wording

In the nine months ended December 31, 2024, net cash provided by operating activities of $91.4 million resulted primarily from operating results adjusted for non-cash items of $102.3 million offset by changes in operating assets and liabilities of $10.9 million. Net cash used by changes in operating assets and liabilities was primarily related to an increase in accounts receivable of $21.6 million primarily due to revenue growth and the timing of cash receipts from customers, offset partially by an increase in deferred revenue of $13.9 million. The change in accounts receivable is primarily due to revenue growth and the timing of cash receipts from customers. The change in deferred revenue is primarily due to growth in quarterly and annual upfront billings to customers.

Current wording

Net cash used in operating activities for the three months ended June 30, 2024 was $9.3 million and resulted primarily from operating results adjusted for non-cash items of $25.6 million offset by unfavorable changes in operating assets and liabilities of $34.9 million. Net cash used by changes in operating assets and liabilities was primarily related to a decrease in accounts payable and other liabilities of $39.0 million and an increase in accounts receivable of $16.6 million, partially offset by an increase in deferred revenue of $7.5 million. The change in accounts payable and other liabilities is primarily due to the payment of annual incentive compensation awards for fiscal year 2024 and the timing of payments to suppliers. The change in accounts receivable is primarily due to revenue growth and the timing of cash receipts from customers.

Previous wording

In the nine months ended December 31, 2023, net cash used in financing activities was $43.2 million, consisting of the acquisition of treasury shares pursuant to the board of directors' approved stock repurchase plan of $45.3 million (1.7 million shares) and $5.1 million for shares repurchased for tax withholdings upon vesting of stock-based awards. These uses of cash were partially offset by proceeds of $7.2 million from the sale of common stock from our equity compensation plans.

Current wording

Net cash used in financing activities for the three months ended June 30, 2025 was $34.8 million and consisted of the acquisition of treasury shares pursuant to the board of directors' approved stock repurchase plan, and related excise tax payments, of $29.9 million (1.1 million shares), and $10.8 million for shares repurchased for tax withholdings upon vesting of stock-based awards. These uses of cash were partially offset by $5.9 million of proceeds from the sale of common stock from our equity compensation plans.

Previous wording

In the nine months ended December 31, 2024, net cash used in financing activities was $76.4 million, consisting of the acquisition of treasury shares pursuant to the board of directors' approved stock repurchase plan of $75.7 million (2.8 million shares) and $9.3 million for shares repurchased for tax withholdings upon vesting of stock-based awards. These uses of cash were partially offset by proceeds of $8.6 million from the sale of common stock from our equity compensation plans.

Current wording

Net cash used in financing activities for the three months ended June 30, 2024 was $16.5 million and consisted of the acquisition of treasury shares pursuant to the board of directors' approved stock repurchase plan of $15.8 million (0.5 million shares), and $6.8 million for shares repurchased for tax withholdings upon vesting of stock-based awards. These uses of cash were partially offset by $6.2 million of proceeds from the sale of common stock from our equity compensation plans.

Previous wording

During the nine months ended December 31, 2024, the Company repurchased 2.8 million shares of its common stock for $75.7 million under the modified common stock repurchase program. Through December 31, 2024, the Company had repurchased a total of 40.5 million shares of its common stock for $1.0 billion under the program, leaving remaining capacity of $281.6 million. The repurchase amounts included in the condensed consolidated statements of stockholders' equity include immaterial amounts related to the 1% excise tax on share repurchases, net of share issuances, as a result of the IRA.

Current wording

During the three months ended June 30, 2025, the Company repurchased 1.1 million shares of its common stock for $29.9 million under the modified common stock repurchase program. The repurchase amounts included in the fiscal 2026 condensed consolidated statements of stockholders equity and the condensed consolidated statements of cash flows included amounts related to the 1% excise tax on share repurchases, net of share issuances, as a result of the Inflation Reduction Act of 2022. Through June 30, 2025, the Company had repurchased a total of 42.6 million shares of its common stock for $1.1 billion under the program, leaving remaining capacity of $226.3 million.

Previous wording

The following tables present the Company’s contractual cash obligations and purchase commitments at December 31, 2024 (dollars in thousands). Operating leases primarily consist of our various office facilities. Purchase commitments primarily include contractual commitments for the purchase of data, hosting services, software-as-a-service arrangements, and leasehold improvements. The tables do not include the future payment of liabilities related to uncertain tax positions of $28.3 million as the Company is not able to predict the periods in which the payments will be made. The amount for 2025 represents the remaining three months ending March 31, 2025. All other periods represent fiscal years ending March 31 (dollars in thousands):

Current wording

The following tables present the Company’s contractual cash obligations and purchase commitments at June 30, 2025 (dollars in thousands). Operating leases primarily consist of our various office facilities. Purchase commitments primarily include contractual commitments for the purchase of data, hosting services, software-as-a-service arrangements, and leasehold improvements. The tables do not include the future payment of liabilities related to uncertain tax positions of $31.1 million as the Company is not able to predict the periods in which the payments will be made. The amount for 2026 represents the remaining nine months ending March 31, 2026. All other periods represent fiscal years ending March 31.

Previous wording

Future minimum payments as of December 31, 2024 related to restructuring plans as a result of the Company's exit from certain leased office facilities are (dollars in thousands): Fiscal 2025: $675; and Fiscal 2026: $1,799.

Current wording

Future minimum payments as of June 30, 2025 related to restructuring plans as a result of the Company's exit from certain leased office facilities are (dollars in thousands): Fiscal 2026: $1,124.

Previous wording

For a description of certain risks that could have an impact on results of operations or financial condition, including liquidity and capital resources, see “Risk Factors” contained in Part I, Item 1A, of the Company's Annual Report on Form 10-K for the fiscal year ended March 31, 2024 ("2024 Annual Report") as filed with the Securities and Exchange Commission ("SEC") on May 22, 2024 and Part II, Item 1A of this Quarterly Report on Form 10-Q.

Current wording

For a description of certain risks that could have an impact on results of operations or financial condition, including liquidity and capital resources, see “Risk Factors” contained in Part I, Item 1A, of the Company's 2025 Annual Report on Form 10-K as filed with the Securities and Exchange Commission ("SEC") on May 21, 2025 ("2025 Annual Report").

Previous wording

The Company has a presence in the United Kingdom, France, the Netherlands, Italy, Spain, Brazil, India, Australia, China, Singapore and Japan. Most of the Company’s exposure to exchange rate fluctuation is due to translation gains and losses as there are no material transactions that cause exchange rate impact. In general, each of the foreign locations is expected to fund its own operations and cash flows, although funds may be loaned or invested from the U.S. to the foreign subsidiaries. These advances are considered long-term investments, and any gain or loss resulting from changes in exchange rates as well as gains or losses resulting from translating the foreign financial statements into U.S. dollars are included in accumulated other comprehensive income. Therefore, exchange rate movements of foreign currencies may have an impact on the Company’s future costs or on future cash flows from foreign investments. The Company has not entered into any foreign currency forward exchange contracts or other derivative instruments to hedge the effects of adverse fluctuations in foreign currency exchange rates.

Current wording

The Company has a presence in the United Kingdom, France, the Netherlands, Italy, Spain, Brazil, India, Australia and China. Most of the Company’s exposure to exchange rate fluctuation is due to translation gains and losses as there are no material transactions that cause exchange rate impact. In general, each of the foreign locations is expected to fund its own operations and cash flows, although funds may be loaned or invested from the U.S. to the foreign subsidiaries. These advances are considered long-term investments, and any gain or loss resulting from changes in exchange rates as well as gains or losses resulting from translating the foreign financial statements into U.S. dollars are included in accumulated other comprehensive income. Therefore, exchange rate movements of foreign currencies may have an impact on the Company’s future costs or on future cash flows from foreign investments. The Company has not entered into any foreign currency forward exchange contracts or other derivative instruments to hedge the effects of adverse fluctuations in foreign currency exchange rates.

Previous wording

We prepare our condensed consolidated financial statements in conformity with U.S. GAAP as set forth in the FASB ASC, and we consider the various staff accounting bulletins and other applicable guidance issued by the SEC. These accounting principles require management to make certain judgments and assumptions that affect the reported amounts of assets and liabilities and the disclosure of contingent assets and liabilities as of the date of the financial statements and the reported amounts of revenues and expenses during the reporting periods. The consolidated financial statements in the 2024 Annual Report include a summary of significant accounting policies used in the preparation of the Company’s consolidated financial statements. In addition, the Management’s Discussion and Analysis of Financial Condition and Results of Operations filed as part of the 2024 Annual Report contains a discussion of the policies that management has identified as the most critical because they require management’s use of complex and/or significant judgments. None of the Company’s critical accounting policies have materially changed since the date of the 2024 Annual Report other than as described in the "Accounting Pronouncements Adopted during the Current Year" section of Note 1, “Basis of Presentation and Summary of Significant Accounting Policies,” of the Notes to Condensed Consolidated Financial Statements accompanying this Quarterly Report on Form 10-Q.

Current wording

We prepare our condensed consolidated financial statements in conformity with U.S. GAAP as set forth in the FASB ASC, and we consider the various staff accounting bulletins and other applicable guidance issued by the SEC. These accounting principles require management to make certain judgments and assumptions that affect the reported amounts of assets and liabilities and the disclosure of contingent assets and liabilities as of the date of the financial statements and the reported amounts of revenues and expenses during the reporting periods. The consolidated financial statements in the 2025 Annual Report include a summary of significant accounting policies used in the preparation of the Company’s consolidated financial statements. In addition, the Management’s Discussion and Analysis of Financial Condition and Results of Operations filed as part of the 2025 Annual Report contains a discussion of the policies that management has identified as the most critical because they require management’s use of complex and/or significant judgments. None of the Company’s critical accounting policies have materially changed since the date of the 2025 Annual Report other than as described in the "Accounting Pronouncements Adopted During the Current Year" section of Note 1, "Organization and Summary of Significant Accounting Policies”, of the Notes to Condensed Consolidated Financial Statements accompanying this Quarterly Report on Form 10-Q.

Previous wording

For information on recent accounting pronouncements, see “Accounting Pronouncements Adopted During the Current Year" and “Recent Accounting Pronouncements Not Yet Adopted” under Note 1, “Basis of Presentation and Summary of Significant Accounting Policies,” of the Notes to Condensed Consolidated Financial Statements accompanying this Quarterly Report on Form 10-Q.

Current wording

For information on recent accounting pronouncements, see “Accounting Pronouncements Adopted During the Current Year" and “Recent Accounting Pronouncements Not Yet Adopted” under Note 1, “Organization and Summary of Significant Accounting Policies”, of the Notes to Condensed Consolidated Financial Statements accompanying this report.