Agora(US:API)2023-02-28 06:15Financial Data and Key Metrics Changes - Revenue for Q4 2022 was $40.1 million, a decrease of 0.7% year-over-year and a decrease of 2.1% quarter-over-quarter [15][16] - Full year revenue for 2022 was $160.7 million, representing a 4.4% decrease from 2021, primarily due to a $37.8 million drop in revenue from the K12 academic tutoring sector in China [9][16] - Non-GAAP gross margin for Q4 was 61.2%, which was 1.4% higher than the previous quarter but 2.8% lower than Q4 2021 [18] - Non-GAAP operating loss was $10.7 million, translating to a 26.7% non-GAAP operating loss margin for Q4, an improvement from 38.2% in Q4 2021 [19] Business Line Data and Key Metrics Changes - The number of active customers increased to 3,066, adding close to 400 compared to the previous year [5] - Revenue from the K12 academic tutoring sector in China decreased significantly from $40 million to $3 million [9] - New use cases such as live video shopping are expanding rapidly, contributing to revenue growth in other sectors [8] Market Data and Key Metrics Changes - The trailing 12-month constant currency dollar-based net expansion rate was 81%, with 118% for U.S. and international business and approximately 100% for China business [17] - Pricing pressure was noted in the U.S. and international markets, particularly affecting startup companies due to high inflation and interest rate hikes [30] Company Strategy and Development Direction - The company plans to focus on customer value, enhance competitive advantage, and gain market share in 2023 [12][13] - A reorganization of the global R&D team and workforce reduction was implemented to improve efficiency and focus on strategic priorities [10] - The sale of Easemob's Customer Engagement Cloud business was completed to concentrate resources on core products and markets [11] Management Comments on Operating Environment and Future Outlook - Management expressed caution regarding the macro environment but sees new opportunities in the global RTE market [12] - The company expects total revenues for 2023 to be in the range of $155 million to $157 million, reflecting a flat outlook compared to 2022 [22] Other Important Information - The company ended Q4 with $428 million in cash and short-term investments, down from $483 million at the end of Q3 [21] - A share repurchase program was extended to February 28, 2024, reflecting the Board's confidence in the company's fundamentals [21] Q&A Session Summary Question: When could we see the inflection point in the domestic and overseas markets? - Management noted that the recent slowdown in revenue growth is due to macroeconomic challenges and does not reflect a fundamental change in demand for real-time engagement technology [25] Question: Is the target of breakeven by Q4 2023 still valid? - Management indicated that while they expect revenue to increase quarter-by-quarter, they do not have a fixed revenue and operating expense target at this point [26] Question: Can management provide insights on client numbers and ASP trends? - Management confirmed a steady increase in the number of customers but noted pricing pressure in the U.S. and international markets due to economic conditions [30] Question: What applications or industry verticals might accelerate or slow down in 2023? - Management highlighted emerging use cases like speech-to-text and live shopping, with potential growth in digital transformation in China and other regions [34] Question: What is the revenue breakdown by key categories in 2022? - In the U.S. and international markets, social is the largest vertical, followed by education and live video shopping, while in China, social dominates with growing contributions from digital transformation and IoT [42]