Agora (API) Q2 2025 earnings summary

Executive summary

• Achieved third consecutive quarter of GAAP profitability in Q2 2025, with net income of $1.5 million and a net margin of 4.3%, more than tripling the previous quarter's profit.

• Recognized as a global leader in RTE technology, with balanced revenue from the US, China, and other regions.

• Conversational AI Engine launched in March is now in production with customers in call centers and AI-powered toys.

• Leadership changes include CTO resignation and new board appointments.

• Endorsed by major partners such as OpenAI for audio infrastructure capabilities.

Financial highlights

• Total revenue reached $34.3 million, up 11% year-over-year, driven by both Agora and Zhengwang/Shengwang divisions.

• Agora revenues were $18.2 million, up 16.7% YoY; Shengwang revenues were $16.1 million, down 12.4% YoY.

• Gross margin for Q2 was 66.8%, improving from 62.0% YoY; gross profit was $22.9M.

• Operating expenses for Q2 2025 were $26.5M, or 77.4% of total revenues, down 18.7% YoY.

• Net cash used in operating activities was $0.4M, with $377M in cash and equivalents at quarter end.

Outlook and guidance

• Q3 2025 revenue guidance: $34–36 million, representing 7.6%–13.9% YoY growth.

• Net income expected to grow sequentially through 2025; medium- to long-term operating margin target of 15–20%.

• Committed to maintaining GAAP profitability for the full year 2025.

• Gross margin for RTC business expected to remain stable (66–68%); conversational AI margins may initially be lower but are expected to match or exceed RTC margins as the business matures.