Financial Data and Key Metrics Changes - In the first half of 2024, revenue grew by 13.5% year-over-year to 1.4 million [7][8] - For Q2 2024, total revenue increased to 12.7 million in Q2 2023, representing a year-over-year growth rate of 9.6% [18] - Adjusted net income for Q2 2024 was 0.9 million in Q2 2023 [23] Business Line Data and Key Metrics Changes - The AI and AR cloud solution and subscription revenue reached 0.7 million, as the company transitions from legacy contracts to subscription models [21] - Active subscribers for mobile beauty apps increased by 18.3% year-over-year, reaching over 919,000 [9][20] Market Data and Key Metrics Changes - The company noted strong momentum in Latin America, particularly Brazil, for B2C mobile app subscriptions, while facing challenges in China due to fierce competition [39] - The Japanese Yen's weakness in Q2 affected revenue by approximately 0.3% to 0.4% against the U.S. dollar [39] Company Strategy and Development Direction - The company is focused on enhancing market penetration in the B2B sector and expanding its AI-powered solutions across various verticals [11][12] - The introduction of the Generative AI framework, PerfectGPT, aims to connect various beauty services and assist brands in developing personalized AI solutions [12][13] - The company is committed to investing in Gen AI technology innovation to strengthen its core capabilities and maintain a competitive edge [26][27] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in maintaining revenue growth within the guidance range of 12% to 16% for the full year 2024, despite macroeconomic concerns [16][31] - The company anticipates that brands will allocate more funds to AI initiatives, with many establishing AI committees to explore new possibilities [34][35] Other Important Information - The company held $158.8 million in cash and equivalents as of June 30, 2024, reflecting positive operating cash flow [24] - The total customer base increased by 20 brand clients, achieving a total of 686 brand clients with over 774,000 SKUs [24][25] Q&A Session Summary Question: Outlook for the second half and pipeline shape - Management indicated that the pipeline remains robust, with strong renewal rates from brand customers, and reiterated annual guidance [31][32] Question: AI spending trends among brands - Brands are showing interest in AI initiatives, with many setting up AI budgets for pilot projects [34][35] Question: Customer churn and profile - Churn is primarily among smaller brands, with larger enterprises remaining stable [36][37] Question: Geographic trends and momentum - Strong growth is noted in Latin America, while challenges persist in China due to competition [39] Question: AI assistant rollout - The initial rollout of AI assistants is expected to start with prestige beauty groups before expanding to mass markets [42][43] Question: Licensing revenue future - Licensing revenue is expected to remain flat and gradually become immaterial, contributing around 5% to 10% of total revenue [45][46] Question: Gross margin fluctuations - Gross margin fluctuations are attributed to the mix of B2C and B2B revenue, with B2B typically having higher margins [48][49] Question: Advertising for mobile apps - The company continues to explore advertising as a user acquisition strategy, but organic growth remains the primary focus [50][52] Question: Impact of AI on e-commerce - The company believes its AI technology will enhance personalized recommendations, complementing e-commerce platforms [54][55]
Perfect(PERF) - 2024 Q2 - Earnings Call Transcript