Perfect Corp. Reports Unaudited Financial Results for the Three Months Ended September 30, 2023
- Perfect Corp. reports strong financial performance in Q3 2023, with total revenues growing by 13.2% YoY to $14.5 million. Gross profit increases to $11.8 million. Net income shows a significant increase to $3.5 million, compared to $1.6 million in the same period last year. The company's customer base expands to 627 brand clients, with over 678,000 digital SKUs. Mobile beauty app active subscribers reach a record high of over 835,000. Perfect Corp. reiterates its 2023 full-year revenue outlook with a growth rate of 11.5% to 14.5% compared to 2022.
- None.
Highlights for the Three Months Ended September 30, 2023
-
Total revenues grew to
, up$14.5 million 13.2% year over year, primarily due to strong growth momentum in AR/AI cloud solutions and subscription revenues. -
Gross profit grew from
in the third quarter of 2022 to$11.0 million in the same period of 2023.$11.8 million -
Net Income was
, compared to a net income of$3.5 million in the same period of 2022.$1.6 million -
Adjusted net income (non-IFRS)1 was
, compared to adjusted net income (non-IFRS) of$2.7 million in the same period of 2022.$2.3 million - The Company had 169 Key Customers2 as of September 30, 2023, compared with 163 Key Customers as of June 30, 2023.
- As of September 30, 2023, the Company's customer base included 627 brand clients, with over 678,000 digital stock keeping units (“SKUs”) for makeup, haircare, skincare, eyewear, and jewelry products, compared with 601 brand clients and over 655,000 digital SKUs as of June 30, 2023.
Ms. Alice H. Chang, the Founder, Chairwoman, and Chief Executive Officer of Perfect, commented, “In the third quarter, our robust performance continued, underscoring the continuous top line revenue growth momentum of
Financial Results for the Three Months Ended September 30, 2023
Revenue
Total revenue was
-
AR/AI cloud solutions and subscription revenue increased to
, representing$11.4 million 78.3% of total revenue, compared to in the same period of 2022. The$9.1 million 24.8% year-over-year increase was mainly due to robust demand for the Company’s online virtual product try-on and skincare solutions from brand customers and strong growth momentum in its mobile beauty app subscriptions. The Company’s mobile beauty app active subscribers grew by62.5% year over year, reaching a record high of over 835,000 active subscribers at the end of the third quarter of 2023. This increase reflected elevated interests in the Company’s mobile beauty app services from customers. -
Licensing revenue, which is mostly generated from traditional offline services, decreased by
13.6% from in the same period of 2022 to$3.3 million , representing$2.8 million 19.5% of our total revenue, compared with25.5% of total revenue in the second quarter of 2022. This indicates a comparatively lower demand for in-store services in contrast to online services from brands. -
Advertisement revenue was
, compared to$0.3 million in the same period of 2022. This change aligns with the Company's strategic emphasis on providing AR- and AI-SaaS solutions to customers, and allocating less resources to advertising services.$0.4 million
Gross Profit
Gross profit increased by
Total Operating Expenses
Total operating expenses increased by
-
Sales and marketing (“S&M”) expenses were
, representing$6.4 million 44.3% of our total revenue, compared to and$6.1 million 47.8% of total revenue during the same period last year. The4.9% year-over-year change was primarily due to increases in marketing and user acquisition costs. -
Research and development (“R&D”) expenses were
, representing$3.0 million 20.9% of total revenue, compared to and$2.6 million 19.9% of total revenue during the same period last year. The18.9% year-over-year change was resulted from an increase in R&D talent acquisition expenses. -
General and administrative (“G&A”) expenses were
, representing$3.2 million 21.8% of total revenue, compared to and$2.5 million 19.3% of total revenue during the same period last year. The28.1% year-over-year change was primarily due to an increase in public company-related costs.
Net Income
Net Income was
Adjusted Net Income (Non-IFRS)
Adjusted net income was
Liquidity
As of September 30, 2023, the Company held
Business Outlook
Taking into account the recent advancements of products powered by AI and AR technology, the growing demand for the Company’s enterprise SaaS solutions, and the strong momentum in the Company’s mobile beauty app subscriptions, Perfect Corp. reiterates its 2023 full-year revenue outlook:
-
The Company's total revenue year-over-year growth rate is expected to range from
11.5% to14.5% compared to 2022.
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 7 a.m. Eastern Time on October 25, 2023 (7 p.m. Taipei Time on October 25, 2023) 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/Q4E61441
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 for beauty, fashion, and skincare brands. Leveraging cutting-edge technologies such as Generative AI, realtime facial and hand 3D augmented reality (AR) rendering and cloud solutions. Perfect empowers beauty, skincare, fashion brands and retailers by providing consumers with an enjoyable, personalized, and convenient omnichannel shopping experience through product try-ons and skin diagnostics. 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
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, non-cash valuation (gain)/loss of financial liabilities, and foreign exchange (gain)/loss. 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.
PERFECT CORP. AND SUBSIDIARIES |
||||||
UNAUDITED CONSOLIDATED BALANCE SHEETS |
||||||
DECEMBER 31, 2022 AND SEPTEMBER 30, 2023 |
||||||
(Expressed in thousands of |
||||||
|
|
December 31,
|
|
September 30,
|
||
Assets |
|
Amount |
|
Amount |
||
Current assets |
|
|
|
|
||
Cash and cash equivalents |
|
$ |
162,616 |
|
$ |
114,969 |
Current financial assets at amortized cost |
|
|
30,000 |
|
|
86,300 |
Current contract assets |
|
|
3,660 |
|
|
3,116 |
Accounts receivable |
|
|
7,756 |
|
|
6,641 |
Other receivables |
|
|
314 |
|
|
1,274 |
Current income tax assets |
|
|
77 |
|
|
193 |
Inventories |
|
|
45 |
|
|
33 |
Other current assets |
|
|
4,705 |
|
|
3,863 |
Total current assets |
|
|
209,173 |
|
|
216,389 |
Non-current assets |
|
|
|
|
||
Property, plant and equipment |
|
|
289 |
|
|
312 |
Right-of-use assets |
|
|
323 |
|
|
739 |
Intangible assets |
|
|
119 |
|
|
96 |
Deferred income tax assets |
|
|
244 |
|
|
216 |
Guarantee deposits paid |
|
|
125 |
|
|
139 |
Total non-current assets |
|
|
1,100 |
|
|
1,502 |
Total assets |
|
$ |
210,273 |
|
$ |
217,891 |
PERFECT CORP. AND SUBSIDIARIES |
||||||||
UNAUDITED CONSOLIDATED BALANCE SHEETS (continued) |
||||||||
DECEMBER 31, 2022 AND SEPTEMBER 30, 2023 |
||||||||
(Expressed in thousands of |
||||||||
|
|
December 31,
|
|
September 30,
|
||||
Liabilities and Equity |
|
Amount |
|
Amount |
||||
Current liabilities |
|
|
|
|
||||
Current contract liabilities |
|
$ |
13,024 |
|
|
$ |
15,926 |
|
Other payables |
|
|
9,308 |
|
|
|
9,703 |
|
Other payables – related parties |
|
|
63 |
|
|
|
49 |
|
Current tax liabilities |
|
|
155 |
|
|
|
— |
|
Current provisions |
|
|
1,855 |
|
|
|
2,304 |
|
Current lease liabilities |
|
|
251 |
|
|
|
406 |
|
Other current liabilities |
|
|
261 |
|
|
|
131 |
|
Total current liabilities |
|
|
24,917 |
|
|
|
28,519 |
|
Non-current liabilities |
|
|
|
|
||||
Non-current financial liabilities at fair value through profit or loss |
|
|
3,207 |
|
|
|
1,355 |
|
Non-current lease liabilities |
|
|
87 |
|
|
|
361 |
|
Net defined benefit liability, non-current |
|
|
73 |
|
|
|
75 |
|
Guarantee deposits received |
|
|
25 |
|
|
|
25 |
|
Total non-current liabilities |
|
|
3,392 |
|
|
|
1,816 |
|
Total liabilities |
|
|
28,309 |
|
|
|
30,335 |
|
|
|
|
|
|
||||
Equity |
|
|
|
|
||||
Capital stock |
|
|
|
|
||||
Perfect Class A Ordinary Shares, |
|
|
10,147 |
|
|
|
10,147 |
|
Perfect Class B Ordinary Shares, |
|
|
1,679 |
|
|
|
1,679 |
|
Capital surplus |
|
|
|
|
||||
Capital surplus |
|
|
556,429 |
|
|
|
559,104 |
|
Retained earnings |
|
|
|
|
||||
Accumulated deficit |
|
|
(385,884 |
) |
|
|
(381,868 |
) |
Other equity interest |
|
|
|
|
||||
Other equity interest |
|
|
(407 |
) |
|
|
(631 |
) |
Treasury shares |
|
|
— |
|
|
|
(875 |
) |
Total equity |
|
|
181,964 |
|
|
|
187,556 |
|
Total liabilities and equity |
|
$ |
210,273 |
|
|
$ |
217,891 |
|
PERFECT CORP. AND SUBSIDIARIES |
||||||||||||||||
UNAUDITED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME |
||||||||||||||||
FOR THE THREE MONTHS AND NINE MONTHS ENDED SEPTEMBER 30, 2022 AND 2023 |
||||||||||||||||
(Expressed in thousands of |
||||||||||||||||
|
|
Three months ended September 30 |
|
Nine months ended September 30 |
||||||||||||
|
|
|
2022 |
|
|
|
2023 |
|
|
|
2022 |
|
|
|
2023 |
|
Items |
|
Amount |
|
Amount |
|
Amount |
|
Amount |
||||||||
Revenue |
|
$ |
12,850 |
|
|
$ |
14,549 |
|
|
$ |
36,229 |
|
|
$ |
39,381 |
|
Cost of sales and services |
|
|
(1,886 |
) |
|
|
(2,729 |
) |
|
|
(5,168 |
) |
|
|
(7,753 |
) |
Gross profit |
|
|
10,964 |
|
|
|
11,820 |
|
|
|
31,061 |
|
|
|
31,628 |
|
Operating expenses |
|
|
|
|
|
|
|
|
||||||||
Sales and marketing expenses |
|
|
(6,141 |
) |
|
|
(6,444 |
) |
|
|
(18,228 |
) |
|
|
(19,029 |
) |
General and administrative expenses |
|
|
(2,477 |
) |
|
|
(3,172 |
) |
|
|
(7,177 |
) |
|
|
(8,599 |
) |
Research and development expenses |
|
|
(2,552 |
) |
|
|
(3,035 |
) |
|
|
(7,910 |
) |
|
|
(8,431 |
) |
Total operating expenses |
|
|
(11,170 |
) |
|
|
(12,651 |
) |
|
|
(33,315 |
) |
|
|
(36,059 |
) |
Operating loss |
|
|
(206 |
) |
|
|
(831 |
) |
|
|
(2,254 |
) |
|
|
(4,431 |
) |
Non-operating income and expenses |
|
|
|
|
|
|
|
|
||||||||
Interest income |
|
|
442 |
|
|
|
2,335 |
|
|
|
620 |
|
|
|
6,944 |
|
Other income |
|
|
1 |
|
|
|
11 |
|
|
|
12 |
|
|
|
18 |
|
Other gains and losses |
|
|
1,360 |
|
|
|
2,034 |
|
|
|
30,337 |
|
|
|
1,575 |
|
Finance costs |
|
|
(1 |
) |
|
|
(5 |
) |
|
|
(6 |
) |
|
|
(10 |
) |
Total non-operating income and expenses |
|
|
1,802 |
|
|
|
4,375 |
|
|
|
30,963 |
|
|
|
8,527 |
|
Income before income tax |
|
|
1,596 |
|
|
|
3,544 |
|
|
|
28,709 |
|
|
|
4,096 |
|
Income tax expense |
|
|
(40 |
) |
|
|
(17 |
) |
|
|
(201 |
) |
|
|
(80 |
) |
Net income |
|
$ |
1,556 |
|
|
$ |
3,527 |
|
|
$ |
28,508 |
|
|
$ |
4,016 |
|
|
|
|
|
|
|
|
|
|
||||||||
Other comprehensive loss |
|
|
|
|
|
|
|
|
||||||||
Components of other comprehensive loss that will not be reclassified to profit or loss |
|
|
|
|
|
|
|
|
||||||||
Credit risk changes in financial instrument - Preferred shares |
|
$ |
— |
|
|
$ |
— |
|
|
$ |
(7 |
) |
|
$ |
— |
|
Components of other comprehensive loss that will be reclassified to profit or loss |
|
|
|
|
|
|
|
|
||||||||
Exchange differences arising on translation of foreign operations |
|
|
(952 |
) |
|
|
(56 |
) |
|
|
(1,953 |
) |
|
|
(224 |
) |
Other comprehensive loss, net |
|
$ |
(952 |
) |
|
$ |
(56 |
) |
|
$ |
(1,960 |
) |
|
$ |
(224 |
) |
Total comprehensive income |
|
$ |
604 |
|
|
$ |
3,471 |
|
|
$ |
26,548 |
|
|
$ |
3,792 |
|
Net income, attributable to: |
|
|
|
|
|
|
|
|
||||||||
Shareholders of the parent |
|
$ |
1,556 |
|
|
$ |
3,527 |
|
|
$ |
28,508 |
|
|
$ |
4,016 |
|
Total comprehensive income attributable to: |
|
|
|
|
|
|
|
|
||||||||
Shareholders of the parent |
|
$ |
604 |
|
|
$ |
3,471 |
|
|
$ |
26,548 |
|
|
$ |
3,792 |
|
Earnings per share (in dollars) |
|
|
|
|
|
|
|
|
||||||||
Basic earnings per share of Class A and Class B Ordinary Shares |
|
$ |
0.025 |
|
|
$ |
0.030 |
|
|
$ |
0.494 |
|
|
$ |
0.034 |
|
Diluted earnings per share of Class A and Class B Ordinary Shares |
|
$ |
0.015 |
|
|
$ |
0.030 |
|
|
$ |
0.001 |
|
|
$ |
0.034 |
|
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, 2022 AND 2023 |
||||||||||||||||
(Expressed in thousands of |
||||||||||||||||
|
|
Three months ended September 30 |
|
Nine months ended September 30 |
||||||||||||
|
|
|
2022 |
|
|
|
2023 |
|
|
|
2022 |
|
|
|
2023 |
|
Items |
|
Amount |
|
Amount |
|
Amount |
|
Amount |
||||||||
Net Income |
|
$ |
1,556 |
|
|
$ |
3,527 |
|
|
$ |
28,508 |
|
|
$ |
4,016 |
|
One-off Transaction Costs |
|
|
1,491 |
|
|
|
— |
|
|
|
4,316 |
|
|
|
33 |
|
Non-Cash Equity-Based Compensation |
|
|
574 |
|
|
|
1,234 |
|
|
|
1,580 |
|
|
|
2,675 |
|
Non-Cash Valuation Gain of financial liabilities |
|
|
— |
|
|
|
(2,096 |
) |
|
|
(28,374 |
) |
|
|
(1,852 |
) |
Foreign Exchange (Gain)/Loss |
|
|
(1,360 |
) |
|
|
62 |
|
|
|
(1,963 |
) |
|
|
277 |
|
Adjusted Net Income |
|
$ |
2,261 |
|
|
$ |
2,727 |
|
|
$ |
4,067 |
|
|
$ |
5,149 |
|
Category: Investor Relations
__________________________
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
3 The one-off transaction cost in the third quarter of 2022 included professional services expenditures that the Company incurred in connection with the de-SPAC transaction. No such cost incurred in the same period of 2023.
View source version on businesswire.com: https://www.businesswire.com/news/home/20231024695384/en/
Investor Relations
Rick Lee
VP of Investor Relations & Finance
Email: Rick_lee@PerfectCorp.com
Source: Perfect Corp.
FAQ
What are Perfect Corp.'s financial results for Q3 2023?
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What is the growth rate of Perfect Corp.'s mobile beauty app active subscribers?