Perfect Corp. (NYSE: PERF) (“Perfect” or the “Company”), a
global leader in providing artificial intelligence (“AI”) and
augmented reality (“AR”) Software-as-a-Service (“SaaS”) solutions
to beauty and fashion industries, today announced its unaudited
financial results for the three months ended September 30, 2024 and
the nine months ended September 30, 2024.
Highlights for the Three Months Ended
September 30, 2024
- Total revenue was $16.1 million for the three months
ended September 30, 2024, compared to $14.5 million in the same
period of 2023, an increase of 10.8%. The increase was primarily
due to growth momentum in the revenue of AI- and AR- cloud
solutions and mobile app subscriptions.
- Gross profit was $13.0 million for the three months
ended September 30, 2024, compared with $11.8 million in the same
period of 2023, an increase of 9.6%.
- Net income was $2.5 million for the three months ended
September 30, 2024, compared to a net income of $3.5 million during
the same period of 2023.
- Adjusted net income (non-IFRS)1 was $3.2 million for the
three months ended September 30, 2024, compared to adjusted net
income (non-IFRS) of $2.7 million in the same period of 2023, an
increase of 20.6%.
- Operating cash flow was $4.2 million in the third
quarter of 2024, compared to $4.0 million in the same period of
2023, an increase of 6.3%.
- The Company’s YouCam mobile beauty app active subscribers grew
by 17.0% year-over-year, reaching a record high of over 977,000
active subscribers as of end of the third quarter of 2024.
- The Company had 151 Key Customers2 as of September 30, 2024,
compared to 151 Key Customers as of June 30, 2024. The number of
key customers remained the same due to the stability of our
enterprise business.
- As of September 30, 2024, the Company’s cumulative customer
base included 708 brand clients, with over 806,000 digital stock
keeping units (“SKUs”) for makeup, haircare, skincare, eyewear,
watches and jewelry products, compared to 686 brand clients and
over 774,000 digital SKUs as of June 30, 2024.
Highlights for the Nine Months Ended
September 30, 2024
- Total revenue was $44.3 million for the nine months
ended September 30, 2024, compared to $39.4 million in the same
period of 2023, an increase of 12.5%.
- Gross profit was $35.2 million for the nine months ended
September 30, 2024, compared with $31.6 million in the same period
of 2023, an increase of 11.2%.
- Net income was $3.9 million for the nine months ended
September 30, 2024, compared to a net income of $4.0 million during
the same period of 2023, a decrease of 2.2%.
- Adjusted net income (non-IFRS) was $6.0 million for the
nine months ended September 30, 2024, compared to adjusted net
income (non-IFRS) of $4.9 million in the same period of 2023, an
increase of 23.2%.
- Operating cash flow was $9.8 million in the first nine
months of 2024, compared to $10.4 million in the same period of
2023, a decrease of 6.5%.
Ms. Alice H. Chang, the Founder, Chairwoman, and Chief Executive
Officer of Perfect, commented, “The Company has managed to maintain
a positive trajectory, demonstrating resilience in the face of
market challenges. This is bolstered by the strong performance of
our consumer suite of apps, and improved operating efficiencies,
which positioned the Company for sustainable success. As a result,
we are confident in both the Company's ability to navigate the
current landscape and the long-term industry outlook. The
combination of steady growth and operational improvements suggests
a promising future, underscoring Perfect Corp.'s commitment to
long-term value creation and innovation. Our advanced Generative AI
technologies will continue to deliver value to customers and
shareholders.”
Financial Results for the Three Months
Ended September 30, 2024
Revenue
Total revenue was $16.1 million for the three months ended
September 30, 2024, compared to $14.5 million in the same period of
2023, an increase of 10.8%.
- AI- and AR- cloud solutions and subscription revenue was $13.4
million for the three months ended September 30, 2024, compared to
$11.4 million in the same period of 2023, an increase of 17.9%. The
double digit growth was driven by robust demand for the Company’s
online virtual product try-on solutions from brand customers, the
healthy momentum in the growth of YouCam mobile beauty app
subscriptions, and the consumer preference for Generative AI
technologies and AI editing features for photos and videos. The
Company’s YouCam mobile beauty app active subscribers grew by 17.0%
year-over-year, once again reaching a record high of over 977,000
active subscribers as of the end of the third quarter of 2024. This
increase reflected the sustained demand in the Company’s YouCam
mobile beauty app services from subscribers and users.
- Licensing revenue was $2.4 million for the three months ended
September 30, 2024, compared to $2.8 million in the same period of
2023, a decrease of 14.5%. The Company anticipates that this legacy
non-recurring revenue will diminish in significance as it continues
to prioritize enhancing its market leadership in offering AI- and
AR-based SaaS subscription solutions for brands and customers.
Gross Profit
Gross profit was $13.0 million for the three months ended
September 30, 2024, compared with $11.8 million in the same period
of 2023, an increase of 9.6%. Despite the increase in gross profit,
our gross margin slightly decreased to 80.3% for the three months
ended September 30, 2024, from 81.2% in the same period of 2023,
primarily due to the increase in third-party payment processing
fees paid to digital distribution partners such as Google and Apple
related to the growth in our mobile app subscription revenue.
Total Operating Expenses
Total operating expenses were $13.0 million for the three months
ended September 30, 2024, compared with $12.7 million in the same
period of 2023, an increase of 3.0%. The increase was primarily due
to higher sales and marketing expenses and research and development
("R&D") expenses, while mainly offset by declines in general
and administrative expenses in the third quarter of 2024.
- Sales and marketing expenses were $7.1 million for the
three months ended September 30, 2024, compared to $6.4 million
during the same period of 2023, an increase of 10.0%. This increase
was largely due to an increase in marketing events and advertising
costs related to our mobile apps and cloud computing.
- Research and development expenses were $3.2 million for
the three months ended September 30, 2024, compared to $3.0 million
during the same period of 2023, an increase of 5.9%. The increase
primarily resulted from the increase in R&D headcount as we
further lean into the development of Generative AI
technologies.
- General and administrative expenses were $2.1 million
for the three months ended September 30, 2024, compared to $3.2
million during the same period of 2023, a decrease of 32.9%. The
decrease was primarily due to enhanced operational efficiencies in
the third quarter of 2024.
Net Income
Net income was $2.5 million for the three months ended September
30, 2024, compared to a $3.5 million during the same period of
2023. The positive net income in the third quarter of 2024 was
supported by continued revenue growth and effective cost
control.
Adjusted Net Income (Non-IFRS)
Adjusted net income was $3.2 million for the three months ended
September 30, 2024, compared to $2.7 million in the same period of
2023, an increase of 20.6%.
Liquidity
As of September 30, 2024, the Company held $127.2 million in
cash and cash equivalents (or $163.2 million when including 6-month
time deposits of $36.0 million, which are classified as current
financial assets at amortized cost under IFRS), compared to $120.8
million as of June 30, 2024 (or $158.8 million when including time
deposits). The total increase in cash, cash equivalents and 6-month
time deposits, resulted from the positive operating cash flow and
the interest income received from the Company’s bank deposits.
The Company had a positive operating cash flow of $4.2 million
in the third quarter of 2024, compared to positive $4.0 million in
the same period of 2023. The Company continues to invest in growth
while maintaining healthy cash reserve to support business
operations signifying the Company's operational health and
sustainability.
Business Outlook for 2024
Based on the growth momentum in both enterprise SaaS solution
demands and YouCam mobile apps subscriptions, the Company
anticipates a year-over-year total revenue growth rate of 12% to
14% for 2024, compared to 2023.
Note that this forecast is based on the Company’s current
assessment of the market and operational conditions, and that these
factors are subject to change.
Conference Call
Information
The Company’s management will hold an earnings conference call
at 8:00 p.m. Eastern Time on October 29, 2024 (8:00 a.m. Taipei
Time on October 30, 2024) to discuss the financial results. For
participants who wish to join the call, please complete online
registration using the link provided below in advance of the
conference call. Upon registering, each participant will receive a
participant dial-in number and a unique access PIN, which can be
used to join the conference call.
Registration Link:
https://registrations.events/direct/Q4I516305131
A live and archived webcast of the conference call will also be
available at the Company's investor relations website at
https://ir.perfectcorp.com.
About Perfect Corp.
Founded in 2015, Perfect Corp. is a beautiful AI Company and
global leader in enterprise SaaS solutions. As an innovative
powerhouse in using artificial intelligence (AI) to transform the
beauty and fashion industries, Perfect empowers major beauty,
skincare, fashion, jewelry brands and retailers by providing
consumers with omnichannel shopping experiences through augmented
reality (AR) product try-ons and AI-powered skin diagnostics. With
cutting-edge technologies such as Generative AI, real-time facial
and hand 3D AR rendering and cloud solutions, Perfect enables
personalized, enjoyable, and engaging shopping journey. In
addition, Perfect also operates a family of YouCam consumer apps
for photo, video and camera users, centered on unleashing
creativity with AI-driven features for creation, beautification and
enhancement. With the help of technologies, Perfect helps brands
elevate customer engagement, increase conversion rates, and propel
sales growth. Throughout this journey, Perfect maintains its
unwavering commitment to environmental sustainability and
fulfilling social responsibilities. For more information, visit
https://ir.perfectcorp.com/.
Forward-Looking Statements
This communication contains forward-looking statements within
the meaning of Section 27A of the U.S. Securities Act of 1933, as
amended, or the Securities Act, and Section 21E of the U.S.
Securities Exchange Act of 1934, as amended, or the Exchange Act,
that are based on beliefs and assumptions and on information
currently available to Perfect. In some cases, you can identify
forward-looking statements by the following words: “may,” “will,”
“could,” “would,” “should,” “expect,” “intend,” “plan,”
“anticipate,” “believe,” “estimate,” “predict,” “project,”
“potential,” “continue,” “ongoing,” “target,” “seek” or the
negative or plural of these words, or other similar expressions
that are predictions or indicate future events or prospects,
although not all forward-looking statements contain these words.
Any statements that refer to expectations, projections or other
characterizations of future events or circumstances, including
strategies or plans, are also forward-looking statements. These
statements involve risks, uncertainties and other factors that may
cause actual results, levels of activity, performance or
achievements to be materially different from those expressed or
implied by these forward-looking statements. These statements are
based on Perfect’s reasonable expectations and beliefs concerning
future events and involve risks and uncertainties that may cause
actual results to differ materially from current expectations.
These factors are difficult to predict accurately and may be beyond
Perfect’s control. Forward-looking statements in this communication
or elsewhere speak only as of the date made. New uncertainties and
risks arise from time to time, and it is impossible for Perfect to
predict these events or how they may affect Perfect. In addition,
risks and uncertainties are described in Perfect’s filings with the
Securities and Exchange Commission. These filings may identify and
address other important risks and uncertainties that could cause
actual events and results to differ materially from those contained
in the forward-looking statements. Perfect cannot assure you that
the forward-looking statements in this communication will prove to
be accurate. There may be additional risks that Perfect presently
does not know or that Perfect currently does not believe are
immaterial that could also cause actual results to differ from
those contained in the forward-looking statements. In light of the
significant uncertainties in these forward-looking statements, you
should not regard these statements as a representation or warranty
by Perfect, its directors, officers or employees or any other
person that Perfect will achieve its objectives and plans in any
specified time frame, or at all. Except as required by applicable
law, Perfect does not have any duty to, and does not intend to,
update or revise the forward-looking statements in this
communication or elsewhere after the date of this communication.
You should, therefore, not rely on these forward-looking statements
as representing the views of Perfect as of any date subsequent to
the date of this communication.
Use of Non-IFRS Financial Measures
This press release and accompanying tables contain certain
non-IFRS financial measures, including adjusted net income, as
supplemental metrics in reviewing and assessing Perfect’s operating
performance and formulating its business plan. Perfect defined
these non-IFRS financial measures as follows:
Adjusted net income (loss) is
defined as net income (loss) excluding one-off transaction costs3,
non-cash equity-based compensation, and non-cash valuation
(gain)/loss of financial liabilities. Starting from the first
quarter of 2024, we no longer exclude foreign exchange gain (loss)
from adjusted net income (loss). As we transitioned to using the
U.S. dollar as the functional currency for certain subsidiaries in
2023, our foreign exchange gains (losses), which historically have
predominantly been unrealized, have not been material since 2023.
For a reconciliation of adjusted net income (loss) to net income
(loss), see the reconciliation table included elsewhere in this
press release.
Non-IFRS financial measures are not defined under IFRS and are
not presented in accordance with IFRS. Non-IFRS financial measures
have limitations as analytical tools, which possibly do not reflect
all items of expense that affect our operations. Share-based
compensation expenses have been and may continue to be incurred in
our business and are not reflected in the presentation of the
non-IFRS financial measures. In addition, the non-IFRS financial
measures Perfect uses may differ from the non-IFRS measures used by
other companies, including peer companies, and therefore their
comparability may be limited. The presentation of these non-IFRS
financial measures is not intended to be considered in isolation
from or as a substitute for the financial information prepared and
presented in accordance with IFRS. The items excluded from our
adjusted net income are not driven by core results of operations
and render comparison of IFRS financial measures with prior periods
less meaningful. We believe adjusted net income provides useful
information to investors and others in understanding and evaluating
our results of operations, as well as providing a useful measure
for period-to-period comparisons of our business performance.
Moreover, such non-IFRS measures are used by our management
internally to make operating decisions, including those related to
operating expenses, evaluate performance, and perform strategic
planning and annual budgeting.
_________________ 1 Adjusted net income (loss) is a non-IFRS
financial measure. See the “Use of Non-IFRS Financial Measures”
section of this communication for the definition of such non-IFRS
measure. 2 “Key Customers” refers to the Company’s brand customers
who contributed revenue of more than $50,000 in the trailing 12
months ended on the measurement date. 3 The one-off transaction
cost in the first quarter of 2023 included professional services
expenditures that the Company incurred in connection with the
de-SPAC transaction. No such cost incurred in the same period of
2024.
PERFECT CORP. AND
SUBSIDIARIES
UNAUDITED CONSOLIDATED BALANCE
SHEETS
DECEMBER 31, 2023 AND
SEPTEMBER 30, 2024
(Expressed in thousands of
United States dollars)
December 31,
2023
September 30,
2024
Assets
Amount
Amount
Current assets
Cash and cash equivalents
$
123,871
$
127,177
Current financial assets at amortized
cost
30,300
36,000
Current contract assets
2,770
2,022
Accounts receivable
6,992
8,036
Other receivables
343
786
Current income tax assets
311
281
Inventories
33
21
Other current assets
4,042
2,311
Total current assets
168,662
176,634
Non-current assets
Property, plant and equipment
380
617
Right-of-use assets
847
626
Intangible assets
77
44
Deferred income tax assets
257
1,563
Guarantee deposits paid
140
148
Total non-current assets
1,701
2,998
Total assets
$
170,363
$
179,632
PERFECT CORP. AND
SUBSIDIARIES
UNAUDITED CONSOLIDATED BALANCE
SHEETS (continued)
DECEMBER 31, 2023 AND
SEPTEMBER 30, 2024
(Expressed in thousands of
United States dollars)
December 31,
2023
September 30,
2024
Liabilities and Equity
Amount
Amount
Current liabilities
Current contract liabilities
$
15,346
$
17,923
Other payables
10,331
11,393
Other payables – related parties
50
55
Current tax liabilities
21
390
Current provisions
2,394
1,822
Current lease liabilities
481
484
Other current liabilities
277
310
Total current liabilities
28,900
32,377
Non-current liabilities
Non-current financial liabilities at fair
value through profit or loss
1,566
1,459
Non-current lease liabilities
387
171
Net defined benefit liability,
non-current
79
81
Guarantee deposits received
25
25
Total non-current liabilities
2,057
1,736
Total liabilities
30,957
34,113
Equity
Capital stock
Perfect Class A Ordinary Shares, $0.1 (in
dollars) par value
8,513
8,506
Perfect Class B Ordinary Shares, $0.1 (in
dollars) par value
1,679
1,679
Capital surplus
Capital surplus
510,399
512,397
Retained earnings
Accumulated deficit
(380,472
)
(376,546
)
Other equity interest
Other equity interest
(523
)
(517
)
Treasury shares
(190
)
—
Total equity
139,406
145,519
Total liabilities and equity
$
170,363
$
179,632
PERFECT CORP. AND
SUBSIDIARIES
UNAUDITED CONSOLIDATED
STATEMENTS OF COMPREHENSIVE INCOME
FOR THE THREE MONTHS AND NINE
MONTHS ENDED SEPTEMBER 30, 2023 AND 2024
(Expressed in thousands of
United States dollars)
Three months ended September
30
Nine months ended September
30
2023
2024
2023
2024
Items
Amount
Amount
Amount
Amount
Revenue
$
14,549
$
16,127
$
39,381
$
44,321
Cost of sales and services
(2,729
)
(3,171
)
(7,753
)
(9,142
)
Gross profit
11,820
12,956
31,628
35,179
Operating expenses
Sales and marketing expenses
(6,444
)
(7,090
)
(19,029
)
(21,274
)
General and administrative expenses
(3,172
)
(2,128
)
(8,599
)
(6,742
)
Research and development expenses
(3,035
)
(3,213
)
(8,431
)
(9,223
)
Expected credit losses
—
(602
)
—
(602
)
Total operating expenses
(12,651
)
(13,033
)
(36,059
)
(37,841
)
Operating loss
(831
)
(77
)
(4,431
)
(2,662
)
Non-operating income and expenses
Interest income
2,335
1,923
6,944
5,875
Other income
11
5
18
19
Other gains and losses
2,034
422
1,575
131
Finance costs
(5
)
(4
)
(10
)
(14
)
Total non-operating income and
expenses
4,375
2,346
8,527
6,011
Income before income tax
3,544
2,269
4,096
3,349
Income tax benefit (expense)
(17
)
263
(80
)
577
Net income
$
3,527
$
2,532
$
4,016
$
3,926
Other comprehensive income
(loss)
Components of other comprehensive
income (loss) that will be reclassified to profit or loss
Exchange differences arising on
translation of foreign operations
$
(56
)
$
257
$
(224
)
$
6
Other comprehensive income (loss),
net
$
(56
)
$
257
$
(224
)
$
6
Total comprehensive income
$
3,471
$
2,789
$
3,792
$
3,932
Net income, attributable to:
Shareholders of the parent
$
3,527
$
2,532
$
4,016
$
3,926
Total comprehensive income attributable
to:
Shareholders of the parent
$
3,471
$
2,789
$
3,792
$
3,932
Earnings per share (in dollars)
Basic earnings per share of Class A and
Class B Ordinary Shares
$
0.030
$
0.025
$
0.034
$
0.039
Diluted earnings per share of Class A and
Class B Ordinary Shares
$
0.030
$
0.025
$
0.034
$
0.039
PERFECT CORP. AND
SUBSIDIARIES
UNAUDITED CONSOLIDATED
STATEMENTS OF CASH FLOWS
FOR THE THREE MONTHS AND NINE
MONTHS ENDED SEPTEMBER 30, 2023 AND 2024
(Expressed in thousands of
United States dollars)
Three months ended September
30
Nine months ended September
30
2023
2024
2023
2024
Items
Amount
Amount
Amount
Amount
CASH FLOWS FROM
OPERATING ACTIVITIES
Profit before tax
$
3,544
$
2,269
$
4,096
$
3,349
Adjustments to reconcile profit (loss)
Depreciation expense
156
197
482
541
Amortization expense
19
13
56
39
Expected credit losses
—
602
—
602
Interest income
(2,335
)
(1,923
)
(6,944
)
(5,875
)
Interest expense
5
4
10
14
Net (gains) losses on financial
liabilities at fair value through profit or loss
(2,096
)
(61
)
(1,852
)
(107
)
Share-based payment transactions
1,234
744
2,675
2,181
Changes in operating assets and
liabilities
Accounts receivable
974
(1,501
)
1,061
(1,635
)
Current contract assets
(1,603
)
(462
)
527
752
Other receivables
—
—
3
—
Inventories
1
—
12
12
Other current assets
791
523
838
1,733
Current contract liabilities
(1
)
919
3,034
2,541
Other payables
1,625
1,106
442
1,055
Other payables – related parties
1
2
(11
)
5
Current provisions
181
(15
)
501
(578
)
Other current liabilities
(15
)
101
(122
)
34
Net defined benefit liability,
non-current
1
1
2
2
Cash inflow generated from operations
2,482
2,519
4,810
4,665
Interest received
1,648
1,875
5,979
5,433
Interest paid
(5
)
(4
)
(10
)
(14
)
Income tax paid
(142
)
(158
)
(347
)
(334
)
Net cash flows from operating
activities
3,983
4,232
10,432
9,750
CASH FLOWS FROM
INVESTING ACTIVITIES
Acquisition of financial assets at
amortized cost
(11,000
)
(11,104
)
(171,800
)
(55,574
)
Proceeds from disposal of financial assets
at amortized cost
85,500
13,074
115,500
49,874
Acquisition of property, plant and
equipment
(13
)
(130
)
(183
)
(389
)
Acquisition of intangible assets
—
—
(33
)
(6
)
Increase in guarantee deposits paid
(15
)
—
(15
)
(8
)
Net cash flows from (used in) investing
activities
74,472
1,840
(56,531
)
(6,103
)
CASH FLOWS FROM
FINANCING ACTIVITIES
Repayment of principal portion of lease
liabilities
(107
)
(142
)
(310
)
(381
)
Payments to acquire treasury shares
(446
)
—
(875
)
—
Net cash flows used in financing
activities
(553
)
(142
)
(1,185
)
(381
)
Effects of exchange rates changes on cash
and cash equivalents
(101
)
451
(363
)
40
Net increase (decrease) in cash and
cash equivalents
77,801
6,381
(47,647
)
3,306
Cash and cash equivalents at beginning
of period
37,168
120,796
162,616
123,871
Cash and cash equivalents at end of
period
$
114,969
$
127,177
$
114,969
$
127,177
PERFECT CORP. AND
SUBSIDIARIES
UNAUDITED RECONCILIATION OF
NON-IFRS FINANCIAL MEASURES – ADJUSTED NET INCOME
CALCULATION
FOR THE THREE MONTHS AND NINE
MONTHS ENDED SEPTEMBER 30, 2023 AND 2024
(Expressed in thousands of
United States dollars)
Three months ended September
30
Nine months ended September
30
2023
2024
2023
2024
Items
Amount
Amount
Amount
Amount
Net Income (Loss)
$
3,527
$
2,532
$
4,016
$
3,926
One-off Transaction Costs
—
—
33
—
Non-Cash Equity-Based Compensation
1,234
744
2,675
2,181
Non-Cash Valuation Gain of financial
liabilities
(2,096
)
(61
)
(1,852
)
(107
)
Adjusted Net Income (Loss)1
$
2,665
$
3,215
$
4,872
$
6,000
Note (1): In accordance with the changed definition of “adjusted
net income (loss)” that is detailed in the “Use of Non-IFRS
Financial Measures” section above, we have made a retrospective
adjustment to our adjusted net income for the nine months ended
September 30, 2023 not adjusting for “foreign exchange gain (loss)”
(which amounted to a loss of $277 thousand for the period, as
previously disclosed in our Form 6-K furnished to the SEC on
October 24, 2023).
Category: Investor Relations
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version on businesswire.com: https://www.businesswire.com/news/home/20241029854226/en/
Investor Relations Contact Investor Relations, Perfect
Corp. Email: Investor_Relations@PerfectCorp.com
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