Agora (API) Q3 2025 earnings summary

Executive summary

• Achieved fourth consecutive quarter of GAAP profitability in Q3 2025, with double-digit revenue growth and expanding margins.

• Total Q3 revenue was $35.4 million, up 12% year-over-year, and GAAP net profit reached $2.7 million with a 7.8% net margin.

• Core real-time engagement business rebounded, with first full-year revenue growth since the pandemic and significant investments in conversational AI, including the launch of AI Engine 2.0 and a zero/no-code AI Studio.

• Strong customer adoption in call centers, education, and AI companionship toys, with global infrastructure expansion supporting growth.

• Active customer base grew to 1,968 for Agora and 1,976 for Shengwang, with net retention rates of 108% and 90% respectively.

Financial highlights

• Q3 total revenue: $35.4 million, up 12% year-over-year; Agora division revenue: $18.2 million, up 15.9%; Shenghua/Shengwang revenue: RMB 122.4 million ($17.2 million), up 8.4%.

• Gross margin: 66%, down 0.7% year-over-year and 0.8% sequentially.

• R&D expenses: $13.8 million, down 52.8% year-over-year; sales and marketing: $6.5 million, down 5.6%; G&A: $5 million, down 48.4%.

• Operating cash flow: $0.7 million in Q3, compared to negative $4.6 million last year.

• Net income was $2.7 million, compared to a net loss of $24.2 million in Q3 2024.

Outlook and guidance

• Q4 2025 revenue expected between $37 million and $38 million, up 7.2%-10.1% year-over-year.

• Net income projected to grow sequentially in Q4; target for full-year 2026 is GAAP operating profit and net profit improvement over 2025.

• Anticipates meaningful conversational AI revenue in the first half of next year, with broader adoption by year-end.

• Guidance reflects current market and operational conditions, subject to change.