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    Little Excitement Around LivePerson, Inc.'s (NASDAQ:LPSN) Revenues As Shares Take 31% Pounding

    Simply Wall St·01/16/2026 10:05:06
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    Unfortunately for some shareholders, the LivePerson, Inc. (NASDAQ:LPSN) share price has dived 31% in the last thirty days, prolonging recent pain. For any long-term shareholders, the last month ends a year to forget by locking in a 84% share price decline.

    After such a large drop in price, LivePerson's price-to-sales (or "P/S") ratio of 0.2x might make it look like a strong buy right now compared to the wider Software industry in the United States, where around half of the companies have P/S ratios above 4.7x and even P/S above 10x are quite common. Although, it's not wise to just take the P/S at face value as there may be an explanation why it's so limited.

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    Check out our latest analysis for LivePerson

    ps-multiple-vs-industry
    NasdaqGS:LPSN Price to Sales Ratio vs Industry January 16th 2026

    How LivePerson Has Been Performing

    While the industry has experienced revenue growth lately, LivePerson's revenue has gone into reverse gear, which is not great. It seems that many are expecting the poor revenue performance to persist, which has repressed the P/S ratio. If this is the case, then existing shareholders will probably struggle to get excited about the future direction of the share price.

    Keen to find out how analysts think LivePerson's future stacks up against the industry? In that case, our free report is a great place to start.

    Is There Any Revenue Growth Forecasted For LivePerson?

    In order to justify its P/S ratio, LivePerson would need to produce anemic growth that's substantially trailing the industry.

    In reviewing the last year of financials, we were disheartened to see the company's revenues fell to the tune of 23%. The last three years don't look nice either as the company has shrunk revenue by 50% in aggregate. Therefore, it's fair to say the revenue growth recently has been undesirable for the company.

    Looking ahead now, revenue is anticipated to slump, contracting by 19% during the coming year according to the three analysts following the company. That's not great when the rest of the industry is expected to grow by 35%.

    With this in consideration, we find it intriguing that LivePerson's P/S is closely matching its industry peers. However, shrinking revenues are unlikely to lead to a stable P/S over the longer term. Even just maintaining these prices could be difficult to achieve as the weak outlook is weighing down the shares.

    The Final Word

    LivePerson's P/S looks about as weak as its stock price lately. We'd say the price-to-sales ratio's power isn't primarily as a valuation instrument but rather to gauge current investor sentiment and future expectations.

    As we suspected, our examination of LivePerson's analyst forecasts revealed that its outlook for shrinking revenue is contributing to its low P/S. As other companies in the industry are forecasting revenue growth, LivePerson's poor outlook justifies its low P/S ratio. Unless there's material change, it's hard to envision a situation where the stock price will rise drastically.

    Before you settle on your opinion, we've discovered 5 warning signs for LivePerson (2 don't sit too well with us!) that you should be aware of.

    If you're unsure about the strength of LivePerson's business, why not explore our interactive list of stocks with solid business fundamentals for some other companies you may have missed.