The digital media industry juddered when Google said it would join Apple and Firefox in prohibiting third-party cookies on Chrome, its industry-leading browser.
The decision stoked uncertainty among investors in publicly listed ad-tech stocks. For example, investor confidence in retargeting stalwart Criteo crashed in the immediate aftermath of the announcement (Wall Street’s ad-tech sweetheart The Trade Desk had its own reaction.) In the aftermath, however, analysts specifically called out LiveRamp as a beneficiary.
This week, the data onboarder issued its first earnings call since Google’s cookie-killing announcement, reporting revenues of $102 million for the three months to Dec. 31, up 28% year-on-year.
Subscription revenue was $82 million, up 25% year-on-year, with the remainder of its revenue generated by “marketplace and other” activities, with company leadership reporting that its gross margin expanded to 69% during the period.
The company’s stock price rose as much as 10% in the early hours after the disclosure, as LiveRamp offered guidance that its full-year revenue for 2020 would be in the range of $376 million to $381 million, an increase of as much as 33% in 12 months.
Speaking on the company’s subsequent earnings call, analysts probed LiveRamp’s C-suite for insights on the impact of privacy legislation such as the California Consumer Privacy Act as well as Google’s seismic cookie prohibition in Chrome by 2022.
Scott Howe, CEO of LiveRamp, said his company is “flourishing in this environment of change” given that its identity solution, commonly referred to as IDL, is not cookie-based.
“We were prepared!” he said, referencing his company’s CCPA strategy, calling the privacy legislation “an opportunity.”
Part of the company’s preparations for CCPA included the purchase of Europe-based consent management platform Faktor, plus the divestiture of location-based data outfit Arbor, which it had purchased in 2016.
Presently, IDL is supported (in principle) by up to 30 demand-side platforms and 12 supply-side platforms. These numbers include both live and pending integrations, after the company started offering free integrations with the buy-side of the industry earlier this year.
Under questioning from analysts, LiveRamp leadership underlined how their lack of reliance on cookies due to the 2019 launch of its Authenticated Traffic Solution meant it was also poised to help publishers with the transition.
Helping clients navigate the “post-cookie world” will be at the core of the company’s activities in the next two years, with Howe remarking that given their vulnerability for data leakage, “the Wild West days of cookies are over!”
In particular, publishers and advertisers are asking questions about how to capture data while remaining compliant with laws such as CCPA and GDPR, plus how best to collaborate with data providers. “We see industry change as a euphemism for LiveRamp opportunity,” he added.
One Wall Street analyst, who requested anonymity because of his company’s communications policy, told Adweek that LiveRamp seemed to be a direct beneficiary of the decline of the cookie as the industry seeks an alternative method for streamlining automated advertising. “LiveRamp solutions are a viable and attractive alternative to third-party cookies,” he added.