LivePerson, Inc.

Good afternoon, ladies and gentlemen. Thank you for standing by. Welcome to LifePerson's third quarter 2025 earnings conference call. My name is Irene and I'll be your conference operator today. At this time, all participants are in a listen-only mode. After the prepared remarks, the management team from LifePerson will conduct a question and answer session and conference participants will be given instructions at the time. To give everyone the opportunity to participate, Please limit yourself to one question and one follow-up. As a reminder, this conference is being recorded. I would now like to turn the conference call over to Mr. John Perrocchio, Vice President, Investor Relations.

Thank you, Irene. Joining me on today's call is John Sabino, CEO and John Collins CFO and COO. Please note that during today's call, we will make forward-looking statements, which are predictions, projections, and other statements about future results. These statements are based on our current expectations and assumptions as of today, November 10th, 2025, and are subject to risk and uncertainties. Actual results may differ materially due to various factors, including those described in today's earnings press release and the comments made during this conference call, as well as in 10-Ks, 10-Qs, and other reports we filed with the SEC. We assume no obligation to update any forelooking statements. Also during this call, we'll discuss certain non-GAAP financial measures, A reconciliation of GAAP to non-GAAP financial measures is included in today's earnings press release. Both the press release and the supplemental slides, which include highlights for the quarter, are available on the Investor Relations section of LivePerson's website, ir.liveperson.com. With that, I'll turn the call over to LivePerson CEO, John Savino.

Thank you so much, John, and thank you all for joining us today. I will begin by briefly reiterating the decisive actions we took to stabilize the company this quarter. Then I will cover our results and key business updates. First, the debt refinancing agreement we discussed in our last call is now closed. This is a pivotal achievement, and most importantly, resolves a concern we heard from our customers and partners. Second, we executed a cost restructuring to reduce our cash burn. This ensures we can operate efficiently and allows live person to retain cash on the balance sheet. Together, these actions address a primary headwind of renewal hesitation and slower bookings, and indeed, the tone of our customer conversations has started to change. They recognize that our cost and capital structures have been stabilized and are looking to us for continued strategic partnership. Now turning to our operational performance for the third quarter, we delivered results that were above the high end of our guidance ranges for both revenue and adjusted EBITDA. Revenue came in at $60.2 million, exceeding the high end of our $60 million guidance. Adjusted EBITDA was $4.8 billion. This significantly exceeded our high end of our guidance range, demonstrating our continued financial discipline with the cost reductions made during the quarter. Turning to our product, we're seeing strong momentum and validation from both our customers and the market. Our customers' adoption of our generative AI suite continues to grow, with nearly 20% of all conversations on our platform now using generative AI. At the same time, Gartner recently recognized LivePerson as a niche player in their 2025 Gartner Magic Quadrant for conversational AI platforms, one of only 13 vendors. We were also recognized in the 2025 Gartner Report for digital customer service. Building on our previously announced partnership with Google, we were honored to join them on stage at their recent RCS event. LivePerson's integration with Google's RCS platform enables brands to deliver rich, interactive, and verified messaging experiences that drive higher engagement and customer trust. It also allows businesses to seamlessly transition from campaigns to two-way messaging, combining multimedia content with LivePerson's platform to create personalized, scalable customer conversations. It's an exciting development, and we expect to share more on this in the future. This partnership with Google extends even deeper. We just launched Copilot Translate, built on Google's Gemini 2.5. This capability is embedded directly within our agent workspace, eliminating language barriers by automatically translating all inbound and outbound messages. It allows our brands to effortlessly serve customers in many languages, boosting agent productivity and delivering a truly AI-native experience. Our innovation extends beyond these powerful partner integrations. We are applying our deep conversational expertise to solve customers' most fundamental challenges. We continue to hear consistent feedback from our customers and prospective customers about the challenges they face in deploying and scaling both AI and human agent workforces. These challenges range from the complexity of safely training and validating AI models before production to the long ramp times, high training costs, and quality assurance demands of their human teams. To address these needs in the market, We are leveraging our decades of conversational expertise and deep culture of innovation to introduce Conversation Simulator. This is a transformative product that enables brands to safely test, train, and validate AI agents in real-world conditions while simultaneously providing in-workflow training and quality management for human agents. Our fundamental differentiator is providing this dual capability in a single unified platform. It accelerates the time to value for AI deployments improves human agent performance, and positions our customers to scale more efficiently, driving stronger business outcomes across the enterprise. This will be a standalone product with its own revenue stream, and we believe it represents a significant new opportunity for LivePerson. It has a fundamentally open architecture designed to serve as the vendor-agnostic testing and insurance hub for a business's AI and human conversational ecosystem. This means that while it integrates seamlessly with our platform, it will also work with any CCaaS platform and any third-party AI. The core purpose of this product is to make AI agents more predictable, trainable, testable, and audible. This product allows businesses to simulate, analyze, and continuously improve performance across their conversational ecosystem. This is precisely where we bring AI and human training together. For AI bots, This product validates and optimizes performance against business-critical synthetic scenarios before they ever reach a live customer. This tests end-to-end conversational orchestration of care, sales, and commerce use cases across live agents and virtual agent experiences. For human agents, it provides a new style of training. We can inject synthetic scenarios and test agents directly in their workflow. This provides real-time feedback and training without ever taking them out of their day-to-day activities. The value this provides to our customers is significant. Early data points to a 30% decrease in agent ramp time and a 60% reduction in the time to test AI bots. Beyond these efficiencies is giving our customers the confidence to launch AI agents at scale for high-stakes, customer-facing use cases. Our product provides the visibility, risk management, continuous monitoring and training necessary to bring velocity and trust and scale to AI deployments. We believe these capabilities will remove key obstacles that has prevented further generative AI adoption. This proactive continuous approach marks a shift from recent failure analysis, excuse me, from reactive failure analysis. Customers can now identify and preempt errors. This is how we will deliver trust, value, and more predictable business outcomes, driven by a unified strategy for both AI and human agents. This capability unlocks a significant opportunity by extending live persons' reach beyond the traditional enterprise segment. Conversation Simulator has been designed to provide critical assurances to businesses of all sizes, allowing us to address an adjacent market for training, simulation, and compliance. This market represents a $10 billion TAM today and is projected to grow to $20 billion by 2030. Best of all, this is resonating with our customers. We have several early access customers actively using the product and seeing initial results. These customers include Telstra and Open University, amongst others. Additionally, we have a strong pipeline of customers expected to begin testing in the coming months. This early adoption is validation that Conversation Simulator provides a critical new layer of trust and predictability that the industry demands, and we are uniquely positioned to lead. We look forward to updating you on the growth and success of this new product. Now moving to go to market, we are seeing encouraging early signs of improvement in our commercial performance. Nowhere is this progress more evident than our renewal discussions, where the tone and confidence of our customers has shifted meaningfully. We successfully renewed several large accounts that had previously expressed hesitation, including a major U.S. telecom company and a leading amusement park and entertainment company. This renewed confidence extends beyond renewals and into new growth opportunities. For example, a leading travel brand, which had initially raised concerns about our financial stability, recently signed a new upsell contract. In addition, a large financial services organization, which had shared similar concerns is now expected to grow with us, including an upsell this quarter. These expansions from accounts that had previously expressed concern are powerful indicators of increasing confidence in our innovation and stability. This returning customer confidence is also beginning to appear in our numbers. We delivered a slight sequential increase in bookings this quarter, even as we continue to navigate the headwinds from renewal hesitation, longer deal cycles, and new AI-related approval processes across the industry. Our commercial momentum is being strengthened through our key technology partnerships as well. Notably, we're now officially live on Google Cloud Marketplace, a major milestone that makes it significantly easier for organizations already operating in the Google ecosystem to discover and purchase our platform using their committed Google Cloud spend. This opens a powerful new frictionless channel for growth, and it deepens our reach across enterprise markets. In fact, we already have a deal flowing through this new channel validating the strategy. At the beginning of this call, I laid out the decisive actions we took to stabilize this company, and we're beginning to see the benefits. The tone of our customer conversations is changing, and we're seeing better momentum in key enterprise accounts. We're also seeing continued strong adoption of our generative AI capabilities. Early traction on our new conversation simulator and a growing partnership with Google creating additional paths to market. With better than anticipated variable revenue performance in Q3 flowing through to the full year, we're raising our full year revenue guidance range to $235 million to $240 million, up $2.5 million at the midpoint. And our full year adjusted EBITDA guidance to a range of $7.5 million to $12.5 million, up $8 million at the midpoint. With our financial foundation stabilized and commercial traction building, we're well positioned to continue to execute our strategy. Now, let me hand our call over to John Collins. John?