LivePerson, Inc. revenue growth accelerated from 16.7% in 2019 to 25.7% in 2020
02/25/2021 • About LivePerson, Inc. (
$LPSN) • By InTwits
LivePerson, Inc. reported 2020 financial results today. Here are the key drivers of the company's long term financial model:
- The company operates at negative EBITDA Margin: -13.8%
- LivePerson, Inc. spends a lot for Stock Based Compensation (SBC): average SBC/Revenue for 2016-2020 is 0.0%. Average EBITDA Margin for the same period was -8.4%
- LivePerson, Inc. has medium CAPEX intensity: 5 year average CAPEX/Revenue was 10.0%. At the same time it's in pair with industry average of 14.0%
- CAPEX is quite volatile: $42m in 2020, $48m in 2019, $22m in 2018, $17m in 2017, $12m in 2016
- The company has unprofitable business model: ROIC is -15.3%
Below you can find a comprehensive analysis of the key data driving the company's performance and the stock price.
Revenue and profitability
The company's Revenue surged on 25.7%. Revenue growth showed acceleration in 20Q4 - it increased 29.2% YoY. Revenue decline was slowing down on average by 8.4 pp per annum in the last 5 years. Having declining revenue the company managed to increase EBITDA margin. EBITDA Margin increased on 8.9 pp from -0.50% to 8.4% in 2020. During 2016-2020 EBITDA Margin bottomed in 2019 at -18.8%.
Gross Margin decreased slightly on 1.9 pp from 73.0% to 71.0% in 2020. During the last 5 years Gross Margin topped in 2018 at 75.0% and was declining since that time. SG&A as a % of Revenue dropped on 15.9 pp from 73.3% to 57.4% in 2020.
Net Income margin increased on 3.6 pp from -32.9% to -29.3% in 2020.
Investments (CAPEX, working capital and M&A)
The company's CAPEX/Revenue was 11.4% in 2020. CAPEX/Revenue increased on 3.4 pp from 7.9% in 2017 to 11.4% in 2020. Average CAPEX/Revenue for the last three years was 12.2%. During the last 5 years CAPEX as a % of Revenue topped in 2019 at 16.3%.
Return on investment
The company operates at negative ROIC (-15.3%) and ROE (-54.8%). ROIC surged on 17.5 pp from -32.8% to -15.3% in 2020. ROE increased on 5.4 pp from -60.2% to -54.8% in 2020. During 2016-2020 ROIC bottomed in 2019 at -32.8%.
Leverage (Debt)
Company's Net Debt / EBITDA is -0.3x and Debt / EBITDA is . Debt jumped on 180% while cash jumped on 271%.
LivePerson, Inc. has no short term refinancing risk: cash is higher than short term debt (7,105.7%).
Management team
LivePerson, Inc.'s CEO Robert P Locascio has spent 25 years with the company. LivePerson, Inc.'s CFO John Collins has spent 1 year with the company.
Financial and operational results
FY ended 12/31/2020
LivePerson, Inc. ($LPSN) key annual financial indicators| mln. $ | 2016 | 2017 | 2018 | 2019 | 2020 | 2020/2019 |
|---|
P&L
|
|---|
| Revenue | 222.8 | 218.9 | 249.8 | 291.6 | 366.6 | 25.7% |
| Gross Profit | 159.6 | 160.7 | 187.4 | 212.7 | 260.4 | 22.4% |
| SG&A | 132.6 | 134.0 | 149.2 | 213.8 | 210.3 | -1.6% |
| EBITDA | -0.7 | -0.8 | -6.7 | -54.7 | -50.4 | |
| Net Income | -25.9 | -18.2 | -25.0 | -96.1 | -107.6 | |
Balance Sheet
|
|---|
| Cash | 50.9 | 56.1 | 66.4 | 176.5 | 654.2 | 270.6% |
| Short Term Debt | 0.0 | 0.0 | 0.0 | 6.6 | 9.2 | 39.4% |
| Long Term Debt | 0.0 | 0.0 | 0.0 | 191.9 | 545.6 | 184.4% |
Cash flow
|
|---|
| Capex | 12.3 | 17.4 | 21.9 | 47.6 | 41.6 | -12.5% |
Ratios
|
|---|
| Revenue growth | -6.8% | -1.8% | 14.1% | 16.7% | 25.7% | |
| EBITDA growth | -107.5% | 8.4% | 752.7% | 716.7% | -7.9% | |
|
|---|
| Gross Margin | 71.6% | 73.4% | 75.0% | 73.0% | 71.0% | -1.9% |
| EBITDA Margin | -0.3% | -0.4% | -2.7% | -18.8% | -13.8% | 5.0% |
| SG&A, % of revenue | 59.5% | 61.2% | 59.7% | 73.3% | 57.4% | -15.9% |
| Net Income Margin | -11.6% | -8.3% | -10.0% | -32.9% | -29.3% | 3.6% |
| CAPEX, % of revenue | 5.5% | 7.9% | 8.8% | 16.3% | 11.4% | -5.0% |
|
|---|
| ROIC | -12.5% | -12.5% | -15.1% | -32.8% | -15.3% | 17.5% |
| ROE | -17.0% | -13.1% | -16.1% | -60.2% | -54.8% | 5.4% |
LivePerson, Inc. ($LPSN) key quoterly financial indicators
| mln. $ | 20Q1 | 20Q2 | 20Q3 | 20Q4 | | YoY change |
|---|
P&L
|
|---|
| Revenue | 78 | 92 | 95 | 102 | | 17.6% | 29.1% | 26.1% | 29.2% |
| EBITDA | -27 | -8 | -26 | 4 | | - | - | - | - |
| Net Income | -37 | -19 | -39 | -13 | | - | - | - | - |
Balance Sheet
|
|---|
| Cash | 171 | 173 | 199 | 654 | | -27.9% | -22.9% | -3.1% | 270.6% |
| Short Term Debt | 7 | 6 | 6 | 9 | | 5.4% | -3.8% | 4.7% | 39.4% |
| Long Term Debt | 194 | 195 | 196 | 546 | | 5.5% | 4.2% | 4.1% | 184.4% |
Ratios
|
|---|
| Gross Margin | 70.8% | 69.8% | 70.8% | 72.5% | | -1.1% | -4.8% | -2.4% | 0.4% |
| EBITDA Margin | -34.5% | -8.8% | -27.4% | 3.8% | | -18.2% | 10.0% | -7.6% | 23.4% |
| Net Income Margin | -47.4% | -20.3% | -40.8% | -13.0% | | -18.9% | 13.5% | -6.4% | 21.6% |
Peers in Application Software
Below you can find LivePerson, Inc. benchmarking vs. other companies in Application Software industry. It's shown for the period of 5 years for the key financial metrics. Each table has median value for all the companies in the industry together with individual financial data of the top-5 companies in the industry by particular financial metric.
Top companies by Revenue growth, %
| Top 5 | FY2016 | FY2017 | FY2018 | FY2019 | FY2020 |
|---|
| VirnetX Holding Corp ($VHC) | - | -0.2% | -95.9% | 34.9% | 355,942.4% |
| AudioEye, Inc. ($AEYE) | - | 175.5% | 106.6% | 90.2% | 90.2% |
| Cloudera, Inc. ($CLDR) | - | 57.2% | 42.6% | 28.9% | 65.5% |
| Integrated Ventures Inc ($INTV) | - | - | - | -8.9% | 62.7% |
| Smartsheet Inc. ($SMAR) | - | 64.3% | 66.1% | 59.7% | 52.4% |
| |
|---|
| Median (92 companies) | 12.0% | 15.7% | 15.2% | 19.5% | 14.5% |
|---|
| LivePerson, Inc. ($LPSN) | - | -1.8% | 14.1% | 16.7% | 25.7% |
Top companies by Gross margin, %
| Top 5 | FY2016 | FY2017 | FY2018 | FY2019 | FY2020 |
|---|
| Aware, Inc. ($AWRE) | 90.3% | 94.6% | 92.3% | 89.7% | 92.8% |
| Alteryx, Inc. ($AYX) | 81.3% | 83.4% | 91.0% | 90.6% | 91.1% |
| Autodesk, Inc. ($ADSK) | 85.2% | 83.2% | 85.2% | 88.9% | 90.1% |
| Smith Micro Software, Inc. ($SMSI) | 73.2% | 77.9% | 83.5% | 90.9% | 89.9% |
| Cadence Design Systems, Inc. ($CDNS) | 85.9% | 87.8% | 87.9% | 88.6% | 88.6% |
| |
|---|
| Median (89 companies) | 63.8% | 64.4% | 65.3% | 67.9% | 69.4% |
|---|
| LivePerson, Inc. ($LPSN) | 71.6% | 73.4% | 75.0% | 73.0% | 71.0% |
Top companies by EBITDA margin, %
| Top 5 | FY2016 | FY2017 | FY2018 | FY2019 | FY2020 |
|---|
| VirnetX Holding Corp ($VHC) | -1,837.2% | -1,118.0% | -40,379.4% | -23,127.1% | 52.2% |
| j2 Global, Inc. ($JCOM) | 41.7% | 36.5% | 35.7% | 38.6% | 40.5% |
| Intelligent Systems Corporation ($INS) | -5.4% | -12.8% | 33.6% | 43.6% | 40.4% |
| Adobe Inc. ($ADBE) | 31.2% | 34.2% | 35.3% | 35.8% | 39.7% |
| SS&C Technologies Holdings, Inc. ($SSNC) | 34.9% | 37.9% | 27.7% | 38.2% | 38.3% |
| |
|---|
| Median (89 companies) | -5.3% | -4.2% | -3.3% | 4.5% | 7.7% |
|---|
| LivePerson, Inc. ($LPSN) | -0.3% | -0.4% | -2.7% | -18.8% | -13.8% |
Top companies by CAPEX/Revenue, %
| Top 5 | FY2016 | FY2017 | FY2018 | FY2019 | FY2020 |
|---|
| MicroStrategy Incorporated ($MSTR) | 0.5% | 0.8% | 1.4% | 2.1% | 234.8% |
| Integrated Ventures Inc ($INTV) | - | - | 199.9% | 15.2% | 27.2% |
| Intelligent Systems Corporation ($INS) | 3.8% | 9.7% | 4.3% | 4.9% | 19.2% |
| PROS Holdings, Inc. ($PRO) | 4.7% | 0.8% | 0.7% | 2.1% | 11.3% |
| Paycom Software, Inc. ($PAYC) | 13.3% | 13.7% | 10.6% | 12.6% | 11.2% |
| |
|---|
| Median (87 companies) | 2.9% | 2.3% | 2.4% | 2.9% | 2.5% |
|---|
| LivePerson, Inc. ($LPSN) | 5.5% | 7.9% | 8.8% | 16.3% | 11.4% |
Top companies by ROIC, %
| Top 5 | FY2016 | FY2017 | FY2018 | FY2019 | FY2020 |
|---|
| VirnetX Holding Corp ($VHC) | -210.9% | -256.8% | -416.3% | -247.2% | 137.3% |
| Manhattan Associates, Inc. ($MANH) | 99.3% | 102.5% | 80.9% | 71.7% | 53.4% |
| Citrix Systems, Inc. ($CTXS) | 16.1% | 16.7% | 25.2% | 29.8% | 33.5% |
| Sonic Foundry, Inc. ($SOFO) | -18.1% | -50.6% | -786.4% | - | 31.3% |
| Paycom Software, Inc. ($PAYC) | 75.4% | 51.1% | 47.5% | 47.5% | 28.7% |
| |
|---|
| Median (92 companies) | -9.2% | -10.2% | -9.8% | -4.2% | -1.8% |
|---|
| LivePerson, Inc. ($LPSN) | -12.5% | -12.5% | -15.1% | -32.8% | -15.3% |
Top companies by Net Debt / EBITDA
| Top 5 | FY2016 | FY2017 | FY2018 | FY2019 | FY2020 |
|---|
| Dropbox, Inc. ($DBX) | - | -3.8x | - | 2.4x | 1,341.0x |
| Avaya Holdings Corp. ($AVYA) | - | - | 7.4x | - | 77.9x |
| Alteryx, Inc. ($AYX) | - | - | 2.5x | 6.1x | 32.2x |
| Five9, Inc. ($FIVN) | -6.7x | -8.6x | 7.3x | 5.3x | 17.6x |
| Synchronoss Technologies, Inc. ($SNCR) | - | - | - | - | 11.6x |
| |
|---|
| Median (54 companies) | -0.9x | -0.8x | -0.7x | 0.4x | 0.2x |
|---|
