LivePerson, Inc. Beat Analyst Profit Forecasts, And Analysts Have New Estimates

It's been a good week for LivePerson, Inc. (NASDAQ:LPSN) shareholders, because the company has just released its latest quarterly results, and the shares gained 4.1% to US$6.08. LivePerson beat expectations by 5.3% with revenues of US$60m. It also surprised on the earnings front, with an unexpected statutory profit of US$0.98 per share a nice improvement on the losses that the analysts forecast. This is an important time for investors, as they can track a company's performance in its report, look at what experts are forecasting for next year, and see if there has been any change to expectations for the business. So we collected the latest post-earnings statutory consensus estimates to see what could be in store for next year.

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Taking into account the latest results, the current consensus, from the three analysts covering LivePerson, is for revenues of US$200.2m in 2026. This implies a substantial 22% reduction in LivePerson's revenue over the past 12 months. Losses are predicted to fall substantially, shrinking 32% to US$8.00. Yet prior to the latest earnings, the analysts had been forecasting revenues of US$216.4m and losses of US$10.25 per share in 2026. Although the revenue estimates have fallen somewhat, LivePerson'sfuture looks a little different to the past, with a very promising decrease in the loss per share forecasts in particular.

See our latest analysis for LivePerson

The consensus price target fell 19% to US$15.25, with the dip in revenue estimates clearly souring sentiment, despite the forecast reduction in losses. It could also be instructive to look at the range of analyst estimates, to evaluate how different the outlier opinions are from the mean. Currently, the most bullish analyst values LivePerson at US$22.50 per share, while the most bearish prices it at US$8.00. Note the wide gap in analyst price targets? This implies to us that there is a fairly broad range of possible scenarios for the underlying business.

These estimates are interesting, but it can be useful to paint some more broad strokes when seeing how forecasts compare, both to the LivePerson's past performance and to peers in the same industry. One more thing stood out to us about these estimates, and it's the idea that LivePerson's decline is expected to accelerate, with revenues forecast to fall at an annualised rate of 18% to the end of 2026. This tops off a historical decline of 7.1% a year over the past five years. Compare this against analyst estimates for companies in the broader industry, which suggest that revenues (in aggregate) are expected to grow 15% annually. So while a broad number of companies are forecast to grow, unfortunately LivePerson is expected to see its revenue affected worse than other companies in the industry.

The Bottom Line

The most obvious conclusion is that the analysts made no changes to their forecasts for a loss next year. Unfortunately, they also downgraded their revenue estimates, and our data indicates underperformance compared to the wider industry. Even so, earnings per share are more important to the intrinsic value of the business. Yet - earnings are more important to the intrinsic value of the business. Furthermore, the analysts also cut their price targets, suggesting that the latest news has led to greater pessimism about the intrinsic value of the business.

With that said, the long-term trajectory of the company's earnings is a lot more important than next year. We have forecasts for LivePerson going out to 2026, and you can see them free on our platform here.

We don't want to rain on the parade too much, but we did also find 6 warning signs for LivePerson (2 shouldn't be ignored!) that you need to be mindful of.

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This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.