Data collaboration platform LiveRamp (NYSE:RAMP) met Wall Street’s revenue expectations in Q4 CY2025, with sales up 8.6% year on year to $212.2 million. On the other hand, next quarter’s revenue guidance of $205 million was less impressive, coming in 0.9% below analysts’ estimates. Its non-GAAP profit of $0.76 per share was 12.8% above analysts’ consensus estimates.
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LiveRamp (RAMP) Q4 CY2025 Highlights:
- Revenue: $212.2 million vs analyst estimates of $212 million (8.6% year-on-year growth, in line)
- Adjusted EPS: $0.76 vs analyst estimates of $0.67 (12.8% beat)
- Adjusted Operating Income: $61.66 million vs analyst estimates of $55.9 million (29.1% margin, 10.3% beat)
- Revenue Guidance for Q1 CY2026 is $205 million at the midpoint, below analyst estimates of $206.9 million
- Operating Margin: 18.6%, up from 7.5% in the same quarter last year
- Customers: 140 customers paying more than $1 million annually
- Net Revenue Retention Rate: 103%, down from 105% in the previous quarter
- Annual Recurring Revenue: $527 million vs analyst estimates of $529.9 million (7.3% year-on-year growth, miss)
- Market Capitalization: $1.43 billion
StockStory’s Take
LiveRamp’s Q4 results were met positively by the market, as the company delivered revenue in line with Wall Street expectations and significantly surpassed non-GAAP profit estimates. Management attributed the quarter’s performance to a combination of strong customer expansion, the growing adoption of its clean room and measurement offerings, and progress with usage-based pricing models for both direct brands and reseller partners. CEO Scott Howe highlighted notable upsell wins with major enterprise clients and pointed to the company’s record operating margin and free cash flow as evidence of improved execution. Demand for cross-platform measurement and commerce media use cases was particularly strong, further supporting growth in annual recurring revenue and customer count.
Looking ahead, LiveRamp’s management sees AI integration and the continued rollout of usage-based pricing as central to its growth strategy. Howe described AI as a “tailwind” driving greater data movement across the company’s platform, which directly benefits LiveRamp’s revenue model as these activities increase. CFO Lauren Dillard emphasized that, despite macro uncertainty, the team expects the combination of new enterprise partnerships, expanding reseller arrangements, and incremental demand from AI-driven applications to support high single-digit revenue growth and margin expansion. Management remains focused on operational discipline and is confident that ongoing investments in platform upgrades and pricing flexibility will position the company well for future opportunities.
Key Insights from Management’s Remarks
Management cited robust customer growth, expanded AI partnerships, and a shift toward usage-based pricing as key factors underpinning the quarter’s performance and its forward outlook.
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Customer expansion momentum: LiveRamp saw a notable increase in both total customers and million-dollar-plus clients, driven by successful upsell activity with large brands in ecommerce, social media, and quick-service restaurants. Management credited renewals and cross-sell of clean room solutions for supporting this growth.
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AI ecosystem partnerships: The company actively expanded its network of AI partners, signing over 20 agreements with both established players like Google and AI-native startups. These partnerships allow AI-driven applications to securely access LiveRamp’s data collaboration infrastructure, fueling new use cases in marketing and advertising.
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Commerce media and vertical growth: Management highlighted rapid early-stage growth in sectors such as travel, food delivery, and financial services, as brands in these areas launch their own commerce media networks. LiveRamp’s platform enhancements and new self-serve features are enabling better support for smaller and more diverse client segments.
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Usage-based pricing adoption: A year-long pilot of usage-based pricing with direct brand customers yielded positive feedback, encouraging broader deployment to reseller partners such as advertising agencies and ad tech platforms. This model lowers entry costs and aligns revenue more closely with platform utilization, which management sees as unlocking incremental growth potential.
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Clean room and CTV traction: Clean room insights, which enable privacy-compliant data collaboration for measurement and targeting, continued to be a catalyst for expansion within existing accounts. Connected TV (CTV) integrations, including with Netflix, are outpacing overall marketplace growth and are viewed as a significant tailwind for future quarters.
Drivers of Future Performance
Management expects AI adoption, expanded partner integrations, and the continued rollout of usage-based pricing to shape LiveRamp’s revenue and margin trajectory over the next year.
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AI-driven data volume growth: Howe emphasized that as marketing organizations increase reliance on AI for personalized targeting and measurement, more data will flow through LiveRamp’s network. This dynamic is expected to accelerate revenue growth without a proportional rise in costs, supporting ongoing operating margin expansion.
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Broader deployment of usage-based pricing: The company is preparing to transition more clients—both direct and through resellers—to usage-based pricing, which is expected to improve customer acquisition and retention, particularly among mid-sized and SMB clients. Management believes this pricing flexibility can drive modest upside in recurring revenue in the back half of next year.
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Ongoing product upgrades and partnerships: Investments in platform modernization, new integrations with partners like Publicis and Uber, and a robust pipeline of AI and commerce media collaborations are expected to support sustained sales momentum. Dillard noted that these initiatives are also improving deal cycles and conversion rates, despite some variability in renewal timing and contract length.
Catalysts in Upcoming Quarters
In the coming quarters, the StockStory team will be closely monitoring (1) the pace of adoption and monetization for usage-based pricing across new and existing customer segments, (2) the expansion and revenue contribution from AI-driven partnerships and commerce media verticals, and (3) the continued performance of clean room and CTV solutions as drivers of upsell and retention. Additional focus will be on the company’s ability to maintain operating discipline while investing in strategic growth initiatives.
LiveRamp currently trades at $23.25, up from $22.42 just before the earnings. At this price, is it a buy or sell? The answer lies in our full research report (it’s free).
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