STOCKHOLDERS' EQUITY: | STOCKHOLDERS’ EQUITY: The Company has authorized 200 million shares of $0.10 par value common stock and 1 million shares of $1.00 par value preferred stock. The board of directors of the Company may designate the relative rights and preferences of the preferred stock when and if issued. Such rights and preferences could include liquidation preferences, redemption rights, voting rights and dividends, and the shares could be issued in multiple series with different rights and preferences. The Company currently has no plans for the issuance of any shares of preferred stock. On August 29, 2011, the board of directors adopted a common stock repurchase program. That program was subsequently modified and expanded, most recently on October 25, 2018. On that date, the board of directors authorized a $500 million increase to the existing common stock repurchase program. Under the modified common stock repurchase program, the Company may purchase up to $1.0 billion of its common stock through the period ending December 31, 2020. During the fiscal year ended March 31, 2019, the Company repurchased 2.4 million shares of its common stock for $74.4 million under the stock repurchase program. During the fiscal year ended March 31, 2018, the Company repurchased 3.3 million shares of its common stock for $88.9 million. During the fiscal year ended March 31, 2017, the Company repurchased 1.3 million shares of its common stock for $30.5 million. Through March 31, 2019, the Company has repurchased 22.6 million shares of its stock for $449.1 million, leaving remaining capacity of $550.9 million under the stock repurchase program. On October 25, 2018, the board of directors authorized a Dutch auction tender offer to purchase shares of its outstanding common stock at an initial aggregate purchase price not to exceed $500 million, plus up to 2% of the Company's outstanding shares of common stock in accordance with the rules and regulations of the SEC. On December 13, 2018, the Company accepted for purchase 11.2 million shares of its common stock at a price of $44.50 per share, for an aggregate cost of $503.4 million, including fees and expenses. These shares represented approximately 14.2% of the shares outstanding. The Company paid no dividends on its common stock for any of the years reported. Stock-based Compensation Plans The Company has stock option and equity compensation plans for which a total of 42.3 million shares of the Company’s common stock have been reserved for issuance since the inception of the plans. At March 31, 2019, there were a total of 12.1 million shares available for future grants under the plans. During the fiscal year ended March 31, 2019, the Board voted to amend the Amended and Restated 2005 Equity Compensation Plan to increase the number of shares available under the plan from 32.9 million shares at March 31, 2018 to 37.9 million shares at March 31, 2019, bringing the total number of shares reserved for issuance since inception of all plans from 34.5 million shares at March 31, 2018 to 42.3 million shares beginning in the quarter ended September 30, 2018. The amendment received shareholder approval at the September 20, 2018 annual shareholders' meeting. Stock-based Compensation Expense The Company's stock-based compensation activity for the fiscal years ended March 31, 2019, 2018 and 2017, by award type, was (dollars in millions): 2019 2018 2017 Stock options $ 3.3 $ 5.0 $ 6.9 Performance stock options — 0.5 1.4 Restricted stock units 67.0 29.1 24.7 Arbor acquisition consideration holdback 15.3 15.3 5.1 PDP assumed performance plan 15.8 2.0 — Other non-employee stock-based compensation 1.3 1.0 1.3 Total non-cash stock-based compensation included in the consolidated statements of operations 102.7 52.9 39.4 Less expense related to liability-based equity awards (14.2) (1.7) — Stock-based compensation of discontinued operations 62.8 10.3 9.7 Total non-cash stock-based compensation included in the consolidated statements of equity $ 151.3 $ 61.5 $ 49.1 In March 2019, the Company accelerated the vesting of certain time-vesting restricted stock units that would have otherwise vested over the next six months to take advantage of significant cash tax savings opportunities. This resulted in the release of restricted stock units covering approximately 0.5 million shares of common stock. The Company recognized $19.8 million of compensation costs related to the accelerated vesting and release of these units, which is included in loss from operations in the consolidated statement of operations. Of the $19.8 million compensation costs, $14.3 million represented incremental compensation cost and $5.5 million represented accelerated original grant date fair value compensation cost. Future expense for all of the Company's outstanding equity awards at March 31, 2019, by award type, is expected to be (dollars in millions): During the year ended: 2020 2021 2022 2023 Total Stock options $ 2.2 $ 0.5 $ — $ — $ 2.7 Restricted stock units 40.7 28.3 16.8 6.1 91.9 Arbor acquisition consideration holdback 2.6 — — — 2.6 PDP assumed performance plan 15.8 15.8 15.7 — 47.3 $ 61.3 $ 44.6 $ 32.5 $ 6.1 $ 144.5 Stock Option Activity of Continuing Operations Stock option activity during the year ended March 31, 2019 was: Weighted-average Weighted-average remaining Aggregate Number of exercise price contractual term Intrinsic value shares per share (in years) (in thousands) Outstanding at Outstanding at March 31, 2018 2,456,184 $ 13.30 Exercised (1,056,163) $ 11.20 $ 35,337 Forfeited or cancelled (25,591) $ 18.64 Outstanding at Outstanding at March 31, 2019 1,374,430 $ 14.81 4.5 $ 54,950 Exercisable at Exercisable at March 31, 2019 1,213,177 $ 15.67 4.2 $ 47,462 The aggregate intrinsic value for options exercised in fiscal 2019, 2018, and 2017 was $35.3 million, $6.5 million, and $7.7 million, respectively. The aggregate intrinsic value at period end represents total pre-tax intrinsic value (the difference between LiveRamp's closing stock price on the last trading day of the period and the exercise price for each in-the-money option) that would have been received by the option holders had option holders exercised their options on March 31, 2019. This amount changes based upon changes in the fair market value of LiveRamp’s stock. A summary of stock options outstanding and exercisable as of March 31, 2019 was: Options outstanding Options exercisable Range of Weighted-average Weighted-average Weighted-average exercise price Options remaining exercise price Options exercise price per share outstanding contractual life per share exercisable per share $ 0.61 — $ 9.99 214,347 5.5 years $ 1.52 122,502 $ 1.59 $ 10.00 — $ 19.99 709,672 3.6 years $ 14.69 640,264 $ 14.39 $ 20.00 — $ 24.99 450,411 5.5 years $ 21.32 450,411 $ 21.32 1,374,430 4.5 years $ 14.81 1,213,177 $ 15.67 Performance Stock Option Unit Activity of Continuing Operations Performance stock option unit activity during the year ended March 31, 2019 was: Weighted-average Weighted-average remaining Aggregate Number exercise price contractual term intrinsic value of shares per share (in years) (in thousands) Outstanding at March 31, 2018 328,806 $ 21.38 Forfeited or cancelled (198,652) $ 21.40 Outstanding at March 31, 2019 130,154 $ 21.44 1.1 $ 4,340 Exercisable at March 31, 2019 — $ — — $ — Of the performance stock option units outstanding at March 31, 2019, 130,154 reached maturity of the relevant performance period at March 31, 2019. The units are expected to vest at an approximate 0% attainment level during the subsequent service period, resulting in cancellation of the units. Restricted Stock Unit Activity Related to Disposition of AMS Performance-based Restricted Stock Unit Conversions In conjunction with the disposition of AMS, the Company converted its outstanding TSR-based performance restricted stock units ("PSUs") to time-vesting restricted stock units ("RSUs"). On the conversion date, the performance period was truncated and attainment measured, resulting in conversion of the PSUs to RSUs at a 200% conversion rate. Each converted RSU held by an AMS associate was vested immediately. The remaining converted RSUs will cliff vest on the same date as the original PSU performance period maturity date. Share activity related to these conversions was: Continuing Operations Discontinued Operations Total Continuing and Discontinued Operations TSR-based performance restricted stock units converted to time-based restricted stock units, by fiscal year granted: Original Performance Maturity Date: Fiscal 2017 PSU 3/31/2019 (168,378) (46,218) (214,596) Fiscal 2018 PSU 3/31/2020 (148,963) (36,815) (185,778) Fiscal 2019 PSU 3/31/2021 (186,539) (30,188) (216,727) Totals (503,880) (113,221) (617,101) Time-based restricted stock units converted from TSR-based performance restricted stock units RSU Cliff Vest Date (Continuing Ops Only): Fiscal 2017 PSU 3/31/2019 336,756 92,436 429,192 Fiscal 2018 PSU 3/31/2020 297,926 73,630 371,556 Fiscal 2019 PSU 3/31/2021 373,078 60,376 433,454 Totals 1,007,760 226,442 1,234,202 The Company recognized both incremental and accelerated compensation costs in the consolidated statement of operations related to the PSU conversions. The impact on compensation costs was (dollars in thousands): Continuing Operations Discontinued Operations Total Continuing and Discontinued Operations Incremental compensation costs $ 7,179 $ 1,599 $ 8,778 Accelerated compensation costs of original grant date fair value related to immediate vesting of converted PSUs of AMS associates $ — $ 1,607 $ 1,607 AMS Restricted Stock Unit Accelerations In conjunction with the disposition of AMS, the Company accelerated the vesting of substantially all outstanding time-vesting restricted stock units of AMS associates to the date of disposition, including converted PSU shares, resulting in the release of restricted stock units covering 1,187,344 shares of common stock. The Company recognized $54.0 million of compensation costs related to the accelerated vesting and release of these units, which is included in net earnings from discontinued operations, net of tax in the consolidated statement of operations. Of the $54.0 million compensation costs, $27.0 million represented incremental compensation cost and $27.0 million represented accelerated original grant date fair value compensation cost. Restricted Stock Unit Activity of Continuing Operations During fiscal 2019, the Company granted time-vesting restricted stock units covering 1,939,746 shares of common stock with a fair value at the date of grant of $69.5 million. Of the restricted stock units granted in the current period, 1,856,444 vest over four years and 83,302 vest over one year. During fiscal 2018, the Company granted time-vesting restricted stock units covering 1,386,448 shares of common stock with a fair value at the date of grant of $36.2 million. Of the restricted stock units granted in fiscal 2018, 1,089,379 vest over four years, 106,571 vest over three years, 174,368 vest over two years, and 16,130 vest over one year. During fiscal 2017, the Company granted time-vesting restricted stock units covering 1,716,357 shares of common stock with a fair value at the date of grant of $42.2 million, of which units covering 768,710 shares, with a fair value at grant date of $20.4 million, were granted to former Arbor and Circulate employees subsequent to the acquisitions (see Note 4 - Acquisitions). Of the restricted stock units granted in fiscal 2017, 898,646 vest over four years, 398,079 vest over three years, 407,413 vest over two years, and 12,219 vest in one year. Non-vested time-vesting restricted stock units activity during the year ended March 31, 2019 was: Weighted-average Weighted-average fair value per remaining Number share at grant contractual of shares date term (in years) Outstanding at Outstanding at March 31, 2018 2,517,488 $ 24.73 2.38 Granted 1,939,746 $ 35.85 Vested (2,014,518) $ 24.04 Forfeited or cancelled (395,726) $ 26.09 Outstanding at PSUs converted to RSUs in conjunction with AMS disposition 1,007,760 $ 21.21 Outstanding at Outstanding at March 31, 2019 3,054,750 $ 30.91 2.47 Valuation of time-vesting restricted stock units for all periods presented is equal to the quoted market price for the shares on the date of grant. The total fair value of time-vesting restricted stock units vested in fiscal 2019, 2018, and 2017 was $93.1 million, $24.1 million, and $17.0 million, respectively and is measured as the quoted market price of the Company’s common stock on the vesting date for the number of shares vested. Non-vested performance-based restricted stock units activity during the year ended March 31, 2019 was: Weighted-average Weighted-average fair value per remaining Number share at contractual of shares grant date term (in years) Outstanding at March 31, 2018 557,801 $ 25.65 1.67 Granted 534,438 $ 41.08 Additional earned performance shares 176 $ 23.89 Vested (61,330) $ 24.22 Forfeited or cancelled (133,017) $ 25.16 PSUs converted to RSUs in conjunction with AMS disposition (503,880) $ 28.06 Outstanding at March 31, 2019 394,188 $ 43.88 3.23 During fiscal 2019, the Company granted performance-based restricted stock units, in two separate plans, covering 534,438 shares of common stock having a fair value at the date of grant of $22.0 million. Under the first performance plan, units covering 186,539 shares of common stock were granted having a fair value at the date of grant of $5.8 million, determined using a Monte Carlo simulation model. The units vest subject to attainment of market conditions established by the compensation committee and continuous employment through the vesting date. The 186,539 units may vest in a number of shares from 25% to 200% of the award, based on the total shareholder return of LiveRamp common stock compared to total shareholder return of a group of peer companies established by the compensation committee for the period from April 1, 2018 to March 31, 2021. All of these awards were converted to RSUs at the time of the AMS disposition. Under the second performance plan, units covering 347,899 shares of common stock were granted having a fair value at the date of grant of $16.2 million equal to the quoted market price for the shares on the date of grant. The units vest subject to attainment of performance criteria established by the compensation committee. The units may vest in a number of shares from zero to 200% of the award, based on the attainment of revenue growth and margin targets. During fiscal 2018, the Company granted performance-based restricted stock units covering 389,065 shares of common stock having a fair value at the date of grant of $10.1 million. Of the performance-based restricted stock units granted in fiscal 2018, 184,931 units - having a fair value at the date of grant of $5.1 million, determined using a Monte Carlo simulation model - vest subject to attainment of performance criteria established by the compensation committee and continuous employment through the vesting date. The 184,931 units may vest in a number of shares from zero to 200% of the award, based on the total shareholder return of LiveRamp common stock compared to TSR established by the compensation committee for the period from April 1, 2017 to March 31, 2020. All of these awards were converted to RSUs at the time of the AMS disposition. Of the performance-based restricted stock units granted in fiscal 2018, 87,184 units - having a fair value at the date of grant of $2.1 million, based on the quoted market price for the shares on the date of grant - vest over two periods, each being subject to attainment of performance criteria established by the compensation committee and continuous employment through the vesting date. These units vested at 50.2% attainment in fiscal 2019 resulting in release of 43,768 shares of stock and cancellation of remaining units. The remaining 116,950 performance-based restricted stock units granted in fiscal 2018 - having a fair value at the date of grant of $2.9 million, based on the quoted market price for the shares on the date of grant - vest in three equal tranches, each being subject to attainment of performance criteria established by the compensation committee and continuous employment through the vesting date. Each of the three tranches may vest in a number of shares, from zero to 300% of the initial award, based on the attainment of certain revenue growth and operating margin targets for the years ending March 31, 2018, 2019, and 2020, respectively. The first tranche vested at 53.3% attainment in fiscal 2019 resulting in release of 17,562 shares of stock. Of the 46,289 units outstanding at March 31, 2019, 23,142 reached maturity of the relevant performance period at March 31, 2019. Those units are expected to vest at an approximate 0% attainment level, resulting in cancellation of the units. During fiscal 2017, the Company granted performance-based restricted stock units covering 212,083 shares of common stock with a fair value at the date of grant of $5.3 million, determined using a Monte Carlo simulation model. Of the performance-based restricted stock units granted in fiscal 2017, 3,882 units represent award modifications that included 5,231 corresponding canceled units. The remaining 208,201 performance-based restricted stock units, having a fair value at the date of grant of $5.1 million, vest subject to attainment of performance criteria established by the compensation committee. Those units may vest in a number of shares from zero to 200% of the award, based on TSR established by the compensation committee for the period from April 1, 2016 to March 31, 2019. All of these awards were converted to RSUs at the time of the AMS disposition. During fiscal 2019, 61,330 performance-based restricted stock units vested. Of the units vested, 43,768 relate to 50.2% attainment on a fiscal 2018 plan, and 17,562 relate to 53.3% attainment on a fiscal 2018 plan. During fiscal 2018, 580,133 performance-based restricted stock units vested. There were no performance-based restricted stock units vested in fiscal 2017. The total fair value of performance-based restricted stock units vested in fiscal 2019 and 2018 was $2.20 million and $14.1 million, respectively and is measured as the quoted market price of the Company’s common stock on the vesting date for the number of shares vested. Other Performance Unit Activity Other performance unit activity during the year ended March 31, 2019 was: Weighted average Weighted-average fair value per remaining Number share at contractual of shares grant date term (in years) Outstanding at Outstanding at March 31, 2018 111,111 $ 5.33 0 Vested (45,364) $ 5.33 Forfeited or canceled (65,747) $ 5.33 Outstanding at Outstanding at March 31, 2019 — $ — — The 111,111 performance-based units outstanding at March 31, 2018 reached maturity of the relevant performance period on March 31, 2018. The units achieved a 100% performance attainment level. However, application of the share price adjustment factor resulted in a 59% reduction in shares vested in fiscal 2019. Stock-based Compensation Expense Related to Discontinued Operations Total stock-based compensation expense related to discontinued operations for fiscal 2019, 2018 and 2017 was $62.8 million, $10.3 million and $9.7 million, respectively and is included in non-cash stock-based compensation in the consolidated statements of equity. Consideration Holdback As part of the Company’s acquisition of Arbor in fiscal 2017, $38.3 million of the acquisition consideration otherwise payable with respect to shares of restricted Arbor common stock held by certain key employees was subject to holdback by the Company pursuant to agreements with those employees (each, a “Holdback Agreement”). As a result, 382,462, 578,071 and 184,214 shares were issued to the Arbor key employees in fiscal 2019, 2018 and 2017, respectively. PDP Assumed Performance Plan In connection with the fiscal 2018 acquisition of PDP, the Company assumed the outstanding performance compensation plan under the 2018 Equity Compensation Plan of PDP ("PDP PSU plan"). Through March 31, 2019, the Company recognized a total of $17.8 million in non-cash stock-based compensation expense in the consolidated statements of operations related to the PDP PSU plan. Future expense shown in tables above for the PDP PSU plan is based on a current expectation of full attainment. At March 31, 2019, the recognized, but unpaid, balance in other liabilities in the consolidated balance sheet was $16.0 million. Qualified Employee Stock Purchase Plan In addition to the stock-based plans, the Company maintains a qualified employee stock purchase plan (“ESPP”) that permits substantially all employees to purchase shares of common stock at a discount from the market price. At March 31, 2019, there were approximately 0.6 million shares available for issuance under the ESPP. During the combined fiscal years of 2019, 2018, and 2017, 276,475 shares were purchased under the plan. The total expense to the Company, representing the discount to the market price, for fiscal 2019, 2018 and 2017 was approximately $0.4 million, $0.2 million, and $0.3 million, respectively. Accumulated Other Comprehensive Income Accumulated other comprehensive income accumulated balances of $7.8 million and $10.8 million at March 31, 2019 and March 31, 2018, respectively, reflect accumulated foreign currency translation adjustments. |