Stockholders' Equity

9 Months Ended

Sep. 30, 2025

Share-Based Payment Arrangement [Abstract]

Stockholders’ Equity

Stock-Based Compensation

The Company’s stock-based compensation generally includes stock options, restricted stock units (“RSUs”), performance-vesting restricted stock units (“PRSUs”), and purchases under the Company’s 2019 Employee Stock Purchase Plan (the “ESPP”). Stock-based compensation expense related to RSUs is based on the market value of the underlying stock on the date of grant and the related expense is recognized ratably over the requisite service period. The stock-based compensation expense related to PRSUs is estimated at the grant date based on the expectation that performance goals will be achieved at the stated target level. The amount of compensation cost recognized depends on the relative satisfaction of the performance condition based on performance to date.

Stock Incentive Plans

The Company’s 2019 Stock Incentive Plan became effective on April 11, 2019. The 2019 Stock Incentive Plan, as amended and restated, allows the Company’s employees and directors to participate in the Company’s future performance through grants of stock-based awards of stock options and RSUs at the discretion of the board of directors. The number of shares authorized for issuance under the 2019 Stock Incentive Plan as of September 30, 2025 was 3,487,182, inclusive of 356,000 shares approved for issuance thereunder by stockholders of the Company at the Company’s annual meeting on June 25, 2025. Options to acquire common stock granted under the 2019 Stock Incentive Plan have four-year terms. As of September 30, 2025, 104,836 shares of common stock remained available for issuance (taking into account all stock option exercises and other equity award settlements through September 30, 2025).

Employee Stock Purchase Plan

The number of shares authorized for issuance under the ESPP as of September 30, 2025, was 300,000 shares. As of September 30, 2025, 162,658 shares of common stock remained available for issuance under the ESPP (taking into account all share purchases through September 30, 2025).

Inducement Plan

There are 1,027,489 shares of common stock authorized and reserved for issuance under the Inducement Plan. As of September 30, 2025, 69,364 shares of common stock remained available for issuance under the Inducement Plan (taking into account all option exercises and other equity award settlements through September 30, 2025).

CEO Inducement Award

As part of an equity compensation package negotiated to induce John Sabino, the Company’s Chief Executive Officer, to accept employment with the Company, pursuant to the terms of the employment agreement entered into between Mr. Sabino and the Company, the Company granted Mr. Sabino an option to purchase 66,666 shares of common stock (the “CEO Inducement Award”) that will vest upon the satisfaction of certain performance-based and time-based vesting conditions. On May 17, 2024, the Company’s board of directors authorized 66,666 shares for issuance under the CEO Inducement Award in compliance with and in reliance on Nasdaq Listing Rule 5635(c)(4). The CEO Inducement Award was a standalone award granted outside of the 2019 Stock Incentive Plan and 2018 Inducement Plan.

Stock Option Activity

The following table is a summary of the Company’s stock option activity and weighted average exercise prices for the nine months ended September 30, 2025:


	Stock Option Activity			Weighted Average Remaining Contractual Term (In years)	Aggregate Intrinsic Value (In thousands)
	Options (In thousands)	Weighted Average Exercise Price
Balance outstanding at December 31, 2024	178	$	343.95	3.95	$	7


Granted	27	16.20

Cancelled or expired	(16)	299.59
Balance outstanding at September 30, 2025	189	189.81		5.90	1
Options vested and expected to vest	160	221.32		5.33	1
Options exercisable at September 30, 2025	94	$	355.85	2.94	$	1

The total fair value of stock options exercised during the nine months ended September 30, 2025 and 2024 was immaterial. As of September 30, 2025, there was $0.5 million of total unrecognized compensation cost related to nonvested share-based compensation arrangements. That cost is expected to be recognized over a weighted average period of approximately 2.3 years.

Restricted Stock Unit and Performance-Vesting Restricted Stock Unit Activity

The following table is a summary of the Company’s RSU and PRSU activity and weighted average grant date fair value for the nine months ended September 30, 2025:


	Number of Shares	Weighted Average Grant Date Fair Value		Aggregate Fair Value

	(In thousands)	(Per share)		(In thousands)
Balance outstanding at December 31, 2024	835	$	30.45
Awarded	649	13.37
Vested	(474)	25.40
Forfeited	(152)	32.73
Non-vested and outstanding at September 30, 2025	858	19.00		7,508
Expected to vest	663	$	18.76	$	5,799

RSUs granted to employees generally vest over a one- to four-year period, or upon achievement of certain performance conditions. As of September 30, 2025, total unrecognized compensation cost, adjusted for estimated forfeitures, related to nonvested RSUs and PRSUs was $11.1 million and the weighted-average remaining vesting period was 1.17 years.

PRSUs granted are generally subject to both a service-based vesting condition and a performance-based vesting condition. PRSUs will vest upon the achievement of specified performance targets and subject to continued service through the applicable vesting dates. The associated compensation cost is recognized over the requisite service period when it is probable that the performance condition will be satisfied. There were no PRSUs granted during the three and nine months ended September 30, 2025 and 2024, respectively. During the three months ended September 30, 2025, the outstanding PRSUs vested but have not been distributed as of September 30, 2025.

Total stock-based compensation costs included in the condensed consolidated statements of operations for the three and nine months ended September 30, 2025 and 2024 are as follows:


	Three Months Ended September 30,				Nine Months Ended September 30,
	2025		2024		2025		2024

	(In thousands)				(In thousands)
Cost of revenue	$	77	$	251	$	466	$	882
Sales and marketing	507		2,182		2,944		6,491
General and administrative	1,283		1,725		4,811		5,841
Product development	768		1,217		3,383		5,619
Total	$	2,635	$	5,375	$	11,604	$	18,833

LIVEPERSON INC 10-Q