LiveRamp Holdings, Inc.

Moat: 3/5

Understandability: 3/5

Balance Sheet Health: 4/5

LiveRamp is a global technology company that helps businesses improve data connectivity by identifying and linking data responsibly across various platforms and channels while respecting consumer privacy.

Investor Relations Previous Earnings Calls

The moat, understandability, and balance sheet health scores reflect a conservative evaluation to ensure a margin of safety in any assessment.

Business Overview: LiveRamp Holdings, Inc., based in San Francisco, California, is a global technology company focused on data connectivity and enabling businesses to use data more effectively while respecting consumer privacy. Its platform helps companies build data strategies that power a wide range of applications, such as marketing, analytics, and customer experience. LiveRamp acts as an intermediary between data providers and data users, providing a data collaboration platform.

The company operates primarily in one reportable segment, its LiveRamp segment. This segment provides solutions centered around its core data collaboration platform, which includes identity resolution, data activation, and measurement and analytics. As discussed in the 10k report they make money through subscriptions, data-driven advertising solutions, and data marketplace arrangements.

Industry Analysis: The industries LiveRamp serves (advertising, e-commerce, financial services, healthcare, etc.) are constantly evolving, creating the demand for innovative solutions to better reach their target audiences. The use of technology for data analysis and marketing personalization is becoming increasingly important. Key trends influencing the industry include:

  • The increase in data privacy regulations
  • The growth of online marketing
  • The rising importance of data analytics and measurement
  • Increased customer expectations for personalized experiences
  • Growing complexity of technology

Margins: LiveRamp’s gross margins are strong, reflecting its software-as-a-service business model and high subscription revenue. However, they’re susceptible to fluctuations in revenue growth and operating expenses due to strategic investments and potential pricing pressure.

  • In the most recent quarter, June 30, 2024, gross margin was a very healthy 72.8%.

Competitive Landscape: The data connectivity space is relatively competitive. Some competitors include Google, Microsoft, and various data management platforms. These companies may have more resources but smaller, less specialized companies have niche expertise. Some main competitive advantages to consider:

  • Network effects of their platforms.
  • Proprietary technology and innovation, giving them an edge for specific data management tasks.
  • Brand recognition for data collection and processing.
  • Established relationships with clients across different industries.
  • High switching costs as integrations in clients business processes can be substantial.

What Makes LiveRamp Different?:

  • Focus on Data Privacy: LiveRamp has a strong focus on data privacy and ethics, incorporating features that are designed to address regulations like GDPR and CCPA. They focus on helping their clients use data responsibly.
  • End-to-End Solution: LiveRamp offers a comprehensive platform that encompasses multiple areas of data connectivity, from identity resolution to data activation and analysis, whereas many competitors only specialize in specific parts of the value chain.
  • Global Reach: LiveRamp operates across North America, Europe, and the Asia-Pacific region, providing a more comprehensive global offering.
  • Data Collaboration Focus: As per their quarterly filings, LiveRamp focus on a “Data Collaboration Platform,” which is made specifically for connecting advertisers, publishers, and data providers in a decentralized, privacy-safe way.
  • Industry leader: They refer to themselves as an industry leader in the customer data platform and data collaboration market, by consistently developing innovative solutions and supporting client success.

Financials (Recent):

  • Revenue Growth: LiveRamp has shown signs of stable growth for their subscription and marketplace segments, and it was mentioned that a multi-year transformation plan is bearing fruit.
    • For the last quarter, Q2 2025, the company posted total revenue of $159.9 million, an increase of 14% year-over-year.
  • Gross Profit and Margin: Gross profit and gross margins are also healthy, reflecting the high profitability of their technology platform.
    • The most recent quarter gross profit was $119.1 million and gross margin was a good 74.5%.
  • Operating Expenses: They are reducing costs to improve profitability. Operating expenses remain high, reflecting significant investment in R&D, marketing, and sales.
    • The operating expense was $119.9 million, which leads to an operating loss of $853,000 for the quarter.
  • Net Earnings: Currently they have not recorded substantial profits, however they are very close to achieving profitability.
    • The company generated a net loss of $11.1 million. However, this was largely driven by non-cash stock compensation expenses and certain losses related to investments.
  • Cash Position: The company maintains a healthy balance of cash and liquid investments, providing enough liquidity to support their ongoing operations and financial obligations.
    • They had $540 million in cash, cash equivalents, and short term investments as of September 30, 2024.

Moat Rating: 3 / 5

  • Justification: LiveRamp has established a moat based on customer lock-in. The company’s technology and its integration into a customer’s business processes creates high switching costs. They also benefit from network effects as their platform enables their clients to better connect with their consumers. Furthermore, their data marketplace offering is hard to replicate. However, the moat is vulnerable to new technologies, increased competition, and regulatory changes as the data collection space is always evolving, and the company’s dominance isn’t guaranteed.
  • Moat Components:
    • Switching Costs: They have very strong switching costs due to their integrations in existing systems, which often makes the switch to other services very complicated.
    • Network Effects: They have some network effects that are getting stronger as the platform becomes more adopted.
    • Intangible Assets: They also have some intangible assets in the form of data and proprietary technology.

Risks to the Moat and Business Resilience:

  • Technological Disruption: New technologies that render their platform obsolete or less relevant could pose a major risk. AI could pose a substantial risk to all companies in the sector.
  • Competition: The data connectivity space is crowded, and newer competitors could emerge with better or cheaper solutions. In the last earnings call, they emphasized that competition was still an issue.
  • Regulatory Changes: The data privacy and security landscape is heavily regulated, which can impose new restrictions and costs on their business.
  • Customer Churn: Although switching costs are high, the possibility exists that existing clients may migrate due to performance issues or other reasons.
  • Reliance on Third-Party Data: Despite an emphasis on 1st party data, some dependencies on third party data or partner data could lead to disruptions.
  • Economic Conditions: Economic uncertainty and downturns could lead to reduced advertising and marketing spending by LiveRamp’s clients.

Business Resilience:

  • Strong existing customer relationships can buffer a sudden decline in performance.
  • Recurring subscription model can guarantee a steady revenue stream even during difficult times.
  • Their push toward their Data Collaboration Platform should improve their sustainability in the future as they try to navigate the modern data privacy landscape.

Understandability Rating: 3 / 5

  • Justification: Understanding the core business of LiveRamp is simple (connecting data). However, valuing the company requires insight into the more complicated and emerging data market, complicated accounting practices for acquisitions, and the complicated mathematics behind their models, as well as future growth assumptions. Furthermore, this industry is complex to understand in general, where it is important to take the time to understand the difference between a 1st party data company vs a 3rd party data company, which is something that is not clear in all cases. It is a tech-company, so technological literacy is needed.

Balance Sheet Health: 4 / 5

  • Justification: LiveRamp has strong liquidity, with $540 million cash on hand. Their balance sheet is mostly comprised of goodwill and acquired intangibles, which makes it harder to determine true balance sheet health. However, their low amounts of debt means that the company is well prepared to withstand future shocks. They have not been generating profit yet, which could cause a worry.

Recent Concerns/Controversies/Problems:

  • The most concerning factor is that the company is currently unprofitable.
  • Their main revenue driver (subscription) showed a slightly lower growth rate than was expected, however, still a good growth rate.
  • They have been very focused on acquiring companies, which are very difficult to value and assess.
  • In Q2 2025 earnings call, they mentioned that their margins had not improved like they have wanted them to do.
  • The company is still spending a great amount in sales, marketing and R&D, which may not result in great profitability.
  • Management has emphasized that they will continue focusing on long term growth while continuing to take cost cutting measures.