Perfect Corp. reports revenue up 12 percent

AI/AR imaging software company Perfect Corp. announced its unaudited financial results for the three months ended June 30, 2023. Total revenues grew to $12.7 million, up 11.9% year over year, primarily due to strong growth momentum in AR/AI cloud solutions and subscription revenues. The gross profit was $10.2 million, compared to $9.7 million in the same period of 2022, and the net loss was $0.2 million, compared to a net income of $27.4 million in the same period of 2022.

The company had 163 key customers as of June 30, 2023, compared with 158 key customers as of March 31, 2023. As of June 30, 2023, the company’s customer base included 601 brand clients, with over 655,000 digital stock-keeping units (“SKUs”) for makeup, haircare, skincare, eyewear, and jewelry products, compared with 525 brand clients and over 590,000 digital SKUs as of March 31, 2023.

“Throughout the previous quarter, we persistently utilized the latest AI & AR technologies, including generative AI, to consistently support our three primary areas of growth, BeautyTech, FashionTech, and SkinTech, to brands and to end users,” said Alice H. Chang, the Founder, Chairwoman, and Chief Executive Officer Our objective is to enhance and expand our capabilities in these fields. As a result, we observed encouraging indications of increased product demand, indicating positive progress. Our mobile apps also continued to experience significant growth, maintaining their strong momentum in part thanks to new generative AI features. Furthermore, our AI skincare turnkey solution grew in popularity as we expanded our customer base. Our investments in generative AI, combined with our industry-leading experience and robust customer base, have positioned us for future success in the beauty and fashion tech space. We remain committed to delivering long-term, sustainable growth to our shareholders and providing our customers with the highest-quality services on the market.”

“In the second quarter, we saw sound momentum in our top-line growth, which was driven by continued demand for our online AR/AI cloud solutions and subscriptions, along with the rapid growth in our mobile beauty app subscribers,” said Pin-Jen (Louis) Chen, Executive Vice President and Chief Strategy Officer of Perfect. “While we grew our revenue, we also managed to control our spending to ensure profitability. With the stable renewal rate for existing subscriptions, dedicated cost control, and healthy cash position, we affirm our unwavering confidence in generating long-term revenue growth.”

Financial details

Total revenue was $12.7 million for the three months ended June 30, 2023, up by 11.9% from $$11.3 million in the same period of 2022.

• AR/AI cloud solutions and subscription revenue increased by 16.3% from $9.5 million in the same period of 2022 to $11.0 million, representing 86.7% of total revenue, mainly due to solid demand for the company’s online virtual product try-on solutions from brand customers and robust growth in its mobile beauty app subscriptions. The company’s mobile beauty app active subscribers grew by 63.3% year over year, reaching a historical high of over 777,000 active subscribers at the end of the second quarter of 2023.
• Licensing revenue, which is mostly generated from traditional offline services, increased by 6.2% from $1.3 million in the same period of 2022 to $1.4 million, representing 10.9% of our total revenue, compared with 11.5% of total revenue in the second quarter of 2022. This reflects relatively low demand for in-store services compared to online services from brands.
• Advertisement revenue was $0.3 million, compared to $0.5 million in the same period of 2022. This change is consistent with the Company’s strategic focus on delivering AR- and AI-SaaS solutions to customers while allocating fewer resources to advertisement services.

Net Loss

Net loss was $0.2 million for the three months ended June 30, 2023, compared to a net income of $27.4 million during the same period of 2022, mainly due to a $28.4 million adjustment in non-cash valuation gain on financial liabilities at fair value through profit or loss in the second quarter of 2022.

The company’s total revenue year-over-year growth rate is expected to range from 11.5% to 14.5% compared to 2022.