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LivePerson Raises Guidance for 2003
Dec 18, 2002
Company Expects Annual Revenue Growth of 35% and EBITDA Margin of 15% Next Year; Increases Restructuring Reserve

NEW YORK, NY - December 18, 2002 - LivePerson, Inc. (NASDAQ: LPSN), a leading Application Service Provider (ASP) of technology facilitating real-time sales, customer service and marketing solutions for companies doing business on the Internet, today announced improved financial guidance for 2003, and increased its allowance for expected legal settlements related to its 2001 restructuring efforts.

CEO Robert LoCascio stated, "We are experiencing strong preliminary results in the fourth quarter, and expect this trend to continue into 2003. As a result, we are increasing our 2003 revenue guidance to $11 million, an approximately 35% increase from our expected revenue in 2002. We also expect EBITDA margins to continue to improve to 15% for 2003. We are seeing growth from existing Service Edition customers, and we have had a positive reaction to the initial release of our Sales Edition product. We have also had better than expected client retention and growth related to the NewChannel transaction that closed in July of this year."

LivePerson's Service Edition enables customer support organizations to respond, in real time via text-based chat, to online end user inquiries more efficiently than traditional phone and email methods. The Sales Edition enables sales and marketing organizations to proactively communicate with select high value site visitors and shoppers based on preset behavioral rules and patterns, resulting in increased conversion rates and revenue per sales representative.

LivePerson recently announced that it had retained the services of Genesis Select Corp. to provide investor relations expertise. Genesis Select is an independent investment advisory and financial communications firm that specializes in micro- and mid-cap companies.

LivePerson also increased a reserve for potential legal settlements related to its 2001 restructuring by approximately $1.3 million. The company recently received an unfavorable ruling in a previously disclosed lawsuit involving a computer hardware vendor; as a result, the company has increased its reserve to the full amount recommended by the court referee. The company plans to appeal the ruling.

  Contact: Jennifer Regnault                     Stephen Laird
           LivePerson, Inc.                      Genesis Select Corp.
           (212) 609-4213                        (203) 341-0214

  About LivePerson

LivePerson ( is a leading Application Service Provider (ASP) of technology facilitating real-time sales, customer service and marketing solutions for companies doing business on the Internet. The LivePerson service enables online businesses to communicate with Internet users in real time, thereby enhancing the online experience. LivePerson offers clients the opportunity to increase sales, reduce customer service costs and increase responsiveness to customer needs. The company serves EarthLink, QVC, eBay, Ameritrade, American Airlines Credit Union and over 3,000 other clients. LivePerson is headquartered in New York City, with R&D facilities in Tel Aviv, Israel.

EBITDA Financial Disclosure

Investors are cautioned that the EBITDA, or earnings/(loss) before interest, taxes, depreciation and amortization, information contained in this press release is not a financial measure under generally accepted accounting principles. In addition, it should not be construed as an alternative to any other measures of performance determined in accordance with generally accepted accounting principles, or as an indicator of our operating performance, liquidity or cash flows generated by operating, investing and financing activities, as there may be significant factors or trends that it fails to address. We present this financial information because we believe that it is helpful to some investors as one measure of our operations. We caution investors that non-GAAP financial information such as EBITDA, by its very nature, departs from traditional accounting conventions; accordingly, its use can make it difficult to compare our results with our results from other reporting periods and with the results of other companies.

Forward Looking Statements

Statements in this press release regarding LivePerson, Inc. that are not historical facts are forward-looking statements and are subject to risks and uncertainties that could cause such statements to differ materially from actual future events or results. Any such forward-looking statements are made pursuant to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. It is routine for our internal projections and expectations to change as the quarter progresses, and therefore it should be clearly understood that the internal projections and beliefs upon which the Company bases its expectations may change prior to the end of the quarter. Although these expectations may change, we are under no obligation to inform you if they do. Our company policy is generally to provide our expectations only once per quarter, and not to update that information until the next quarter. Actual events or results may differ materially from those contained in the projections or forward-looking statements. The following factors, among others, could cause LivePerson's actual results to differ materially from those described in a forward-looking statement: our possible delisting from the Nasdaq Small Cap Market; the limited history of providing the LivePerson services; our limited historical annual revenue and history of losses; the possible unavailability of financing as and if needed; an unproven business model; our dependence on the success of the LivePerson chat service; continued use by our clients of the LivePerson services; potential fluctuations in our quarterly and annual results; risks related to adverse business conditions experienced by our clients; our dependence on key employees; risks related to our international operation, particularly our operations in Tel Aviv, Israel, and the current civil and political unrest in that region; potential legal liabilities related to our restructuring efforts; competition both for qualified personnel and in the market for real-time sales and customer service technology; building awareness of the LivePerson brand name; technology systems beyond LivePerson's control and technology-related defects that could disrupt the LivePerson services; our dependence on the growth of the Internet as a medium for commerce and the viability of the infrastructure of the Internet; and responding to rapid technological change. This list is intended to identify only certain of the principal factors that could cause actual results to differ from those discussed in the forward- looking statements. Readers are referred to the reports and documents filed from time to time by LivePerson with the Securities and Exchange Commission for a discussion of these and other important risk factors that could cause actual results to differ from those discussed in forward-looking statements.

SOURCE: LivePerson, Inc.

CONTACT: Younjee Kim, +1-212-609-4222,

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