Shares of LivePerson (NASDAQ:LPSN) soared 35% on Tuesday after Citron Research published a bullish note highlighting the company’s better-than-expected earnings and emerging strength in its AI-driven business model.
The customer engagement software provider reported revenue of $60.2 million, topping analyst forecasts of $57.4 million, while also delivering stronger-than-anticipated EBITDA results. Citron attributed part of this performance to LivePerson’s growing partnership with Google (NASDAQ:GOOG), calling it a key factor in the company’s turnaround.
In its report, Citron spotlighted LivePerson’s Conversation Simulator, an AI testing tool that is already generating revenue from large enterprise customers such as Telstra. The firm said clients using the simulator are achieving efficiency gains of 30% to 60%, and noted a rapidly expanding pipeline of interested buyers.
The Conversation Simulator provides a sandbox environment for AI agents, allowing companies to refine and validate customer interaction models before deployment. Citron said this solution meets a critical industry need and positions LivePerson as a cross-platform provider capable of addressing a $10–20 billion total addressable market in conversational AI.
LivePerson also raised its full-year guidance, though Citron described management’s fourth-quarter outlook as conservative. The research firm said the market continues to undervalue the company, noting that investors still see LivePerson as “a dying SaaS company” even though evidence points to renewed stability and growth potential driven by its new AI products.
The rally follows a period of significant volatility for LivePerson, which has been reshaping its business model to leverage AI-powered customer engagement technologies amid accelerating demand for intelligent automation tools.