LiveRamp Holdings, Inc. (RAMP) - 10-K Summary
Business Context and Reporting Period
Company: LiveRamp Holdings, Inc.
Filing Type: Form 10-K (Annual Report)
Reporting Period: Fiscal year ended March 31, 2026
Business Overview: LiveRamp operates a leading data collaboration platform that unites data across advertisers, ad tech platforms, publishers, and data providers. The company provides identity resolution, data connectivity, and marketplace services to enable people-based marketing and measurement. It operates as a single reportable segment.
Key Financial Metrics
| Metric | Fiscal 2026 | Fiscal 2025 | Change |
|---|---|---|---|
| Total Revenue | $812.9 million | $745.6 million | +9.0% |
| Cost of Revenue | $238.1 million | $215.9 million | +10.3% |
| Gross Profit | $574.8 million | $529.7 million | +9.0% |
| Gross Margin | 70.7% | 71.0% | -30 bps |
| Operating Expenses | $491.4 million | $524.3 million | -6.3% |
| Income from Operations | $83.5 million | $5.4 million | +1,445% |
| Net Earnings | $146.0 million | $(0.8) million | Turnaround |
| Diluted EPS | $2.24 | $(0.01) | N/A |
| Operating Cash Flow | $167.8 million | $154.0 million | +9.0% |
| Cash & Equivalents | $379.5 million | $413.3 million | -8.2% |
Key Operational Metrics:
- Subscription Net Retention: 107% (vs. 104% in FY2025)
- Annualized Recurring Revenue (ARR): $545 million (vs. $504 million in FY2025)
- Remaining Performance Obligation (RPO): $760 million
- Direct Customers: 846 (vs. 846 in FY2025)
Material Changes vs. Prior Period
- Profitability Surge: The company transitioned from a net loss of $0.8 million in FY2025 to net earnings of $146.0 million in FY2026. This was primarily driven by a significant reduction in operating expenses and a substantial income tax benefit.
- Expense Reduction: Total operating expenses decreased by $32.9 million (6.3%), largely due to a $23.7 million decrease in stock-based compensation and reduced headcount-related expenses in R&D and Sales & Marketing.
- Tax Benefit: The company recorded an income tax benefit of $46.7 million (effective rate of -47.6%) compared to an expense of $25.3 million in the prior year. This was driven by a $53.8 million release of valuation allowance on deferred tax assets, supported by sustained profitability.
- Revenue Growth: Revenue grew 9.0%, with Subscription revenue up 8.0% and Marketplace and Other revenue up 12.4%. International revenue grew 21.6%, aided by favorable exchange rates.
- Share Repurchases: The company repurchased 7.1 million shares for $194.4 million in FY2026, compared to 3.8 million shares for $101.1 million in FY2025.
Guidance, Outlook, and Risks
Pending Merger: On May 16, 2026, LiveRamp entered into a definitive agreement to be acquired by a subsidiary of Publicis Groupe S.A. for $38.50 per share in cash. The transaction is expected to close by the end of calendar year 2026, subject to shareholder approval and regulatory conditions. Upon closing, the company will be delisted from the NYSE.
Management Commentary:
- Management expects to maintain R&D spending as a percentage of revenue at similar or increased levels in fiscal 2027.
- The company paused its stock repurchase program following the announcement of the Merger Agreement.
- Growth strategy focuses on expanding the customer base, increasing network density, and extending leadership in identity resolution.
Risks and Contingencies:
- Merger Uncertainty: Risks include failure to obtain regulatory approvals (including CFIUS), shareholder rejection, or termination of the agreement, which could negatively impact the stock price and operations.
- Regulatory Environment: Increasing data privacy regulations (e.g., GDPR, CCPA, state-level laws) and restrictions on third-party cookies could limit data availability and increase compliance costs.
- Customer Concentration: The ten largest customers represented approximately 30% of revenue in FY2026.
- Cybersecurity: As a data collaboration hub, the company faces risks related to data breaches and cyberattacks.
Investor Verification Checklist
- Merger Closing Conditions: Verify the status of shareholder approval and regulatory clearances (CFIUS, antitrust) required to close the Publicis acquisition.
- Tax Valuation Allowance: Confirm the sustainability of the profitability that justified the $53.8 million release of the valuation allowance, as future tax rates depend on continued earnings.
- Stock-Based Compensation Trends: Monitor if the significant reduction in stock-based compensation ($23.7M decrease) is a one-time benefit or a structural change, given the pending merger may alter equity incentive structures.
- Customer Retention: Validate the 107% net retention rate and the stability of the top 10 customers (30% of revenue) amidst the merger uncertainty.
- Cloud Cost Inflation: Review the $26.1 million increase in cloud infrastructure costs and its impact on future gross margins as usage scales.