What's Happening?
LivePerson, Inc., a provider of conversational AI and digital transformation solutions, announced its financial results for the third quarter of 2025. The company reported a total revenue of $60.2 million,
marking a 19% decrease compared to the same period last year. This decline was primarily attributed to customer cancellations and downsells. Despite the revenue drop, LivePerson signed 28 deals during the quarter, including 26 expansions and renewals and 2 new customer agreements. The company also reported a net income of $8.7 million, a significant improvement from a net loss of $28.3 million in the third quarter of 2024. This turnaround was largely due to a $27.7 million gain on troubled debt restructuring. Adjusted EBITDA for the quarter was $4.8 million, down from $7.3 million in the previous year. LivePerson's CEO, John Sabino, emphasized the company's commitment to strengthening its financial foundation and highlighted product innovations such as the Conversation Simulator and expanded partnerships with Google.
Why It's Important?
The financial results underscore the challenges LivePerson faces in maintaining revenue growth amid customer attrition. The company's efforts to stabilize its financial foundation and innovate its product offerings are crucial for sustaining its market position. The reported gain on debt restructuring indicates a strategic move to improve financial health, which could enhance investor confidence. The expansion of partnerships and product innovations are vital for attracting new customers and retaining existing ones, especially in a competitive AI market. The company's ability to navigate these challenges will significantly impact its future growth and profitability.
What's Next?
LivePerson expects total revenue for the fourth quarter of 2025 to range from $50.5 million to $55.5 million, representing a year-over-year decline of 31% to 24%. The company anticipates recurring revenue to constitute 93% of total revenue. Adjusted EBITDA for the fourth quarter is projected to range from a loss of $0.3 million to a gain of $4.7 million. These forecasts suggest continued financial pressure, but also potential for stabilization. The company's focus on product innovation and strategic partnerships will be critical in reversing the revenue decline and achieving sustainable growth.
