Agora, Inc. (API)
NASDAQ:API
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Agora
(NASDAQ:API)
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Rating:67Neutral
Price Target:
$4.50
▲(8.43% Upside)
Action:Reiterated
Date:06/03/26
The score is driven primarily by improving financial performance (profitability recovery and a strong balance sheet) and constructive technical momentum (price above key moving averages with positive MACD). These positives are tempered by a high valuation (P/E ~44.6 with no dividend) and ongoing fundamental risks highlighted in the earnings call, including near-term margin pressure from conversational AI and uneven cash-flow conversion.
Positive Factors
Usage-based SaaS model
Agora’s core business—cloud-delivered, usage-based APIs/SDKs for real-time voice, video, streaming and messaging—creates durable revenue linkage to customer scale and engagement. Usage pricing aligns vendor and customer incentives, supports high gross margins on core services, and fits diverse verticals, aiding long-term customer stickiness and predictable revenue expansion as apps scale.
Negative Factors
AI-related gross margin pressure
Conversational AI product-mix is currently exerting a material negative impact on gross margins as offerings remain subscale and costly. Until AI usage reaches meaningful scale with improved unit economics, margin dilution could persist and compress reported profitability even if top-line growth continues, creating a multi-quarter headwind to margin sustainability.
Read all positive and negative factors
Positive Factors
Negative Factors
Usage-based SaaS model
Agora’s core business—cloud-delivered, usage-based APIs/SDKs for real-time voice, video, streaming and messaging—creates durable revenue linkage to customer scale and engagement. Usage pricing aligns vendor and customer incentives, supports high gross margins on core services, and fits diverse verticals, aiding long-term customer stickiness and predictable revenue expansion as apps scale.
Read all positive factors
Agora (API) vs. SPDR S&P 500 ETF (SPY)
Market Cap
$403.97M
Dividend YieldN/A
Average Volume (3M)554.31K
Price to Earnings (P/E)35.9
Beta (1Y)2.20
Revenue Growth9.23%
EPS GrowthN/A
CountryUS
Employees608
SectorTechnology
Sector Strength88
IndustrySoftware - Application
Share Statistics
EPS (TTM)0.11
Shares Outstanding65,504,800
10 Day Avg. Volume678,482
30 Day Avg. Volume554,314
Financial Highlights & Ratios
PEG Ratio-0.32
Price to Book (P/B)0.67
Price to Sales (P/S)2.65
P/FCF Ratio-79.97
Enterprise Value/Market Cap0.66
Enterprise Value/Revenue1.82
Enterprise Value/Gross Profit2.80
Enterprise Value/Ebitda15.01
Forecast
1Y Price Target
$6.60Price Target Upside59.04% Upside
Rating ConsensusModerate Buy
Number of Analyst Covering1
EPS Forecast (FY)0.18
Revenue Forecast (FY)$155.49M
Agora Business Overview & Revenue Model
Company Description
Agora, Inc. operates globally, with a presence in China, the U.S., and other international markets, by delivering a Real-Time Engagement Platform-as-a-Service (RTE-PaaS). Through this platform, the company furnishes software development tools that...
How the Company Makes Money
Agora primarily generates revenue by selling access to its real-time engagement platform (APIs/SDKs) under usage-based and/or subscription-style commercial arrangements, where customers pay based on consumption of services (e.g., real-time audio/v...
Agora Earnings Call Summary
Earnings Call Date:May 26, 2026
(Q1-2026)
| % Change Since: |
Next Earnings Date:Aug 24, 2026
Earnings Call Sentiment Positive
The call conveyed a generally positive operational and financial trajectory: revenue growth accelerated and beat guidance, GAAP profitability continues (six consecutive quarters), customer retention improved, new AI and collaboration products and meaningful partnerships (including Google and NetEase) indicate significant strategic progress, and management provided an optimistic Q2 outlook. Offsetting these positives are meaningful near-term margin pressure from conversational AI product-mix (gross margin declined ~4.6 percentage points), negative operating cash flow in the quarter driven by lower interest income and share buybacks, and the conversational AI business remaining subscale with execution and competitive risks. Overall, the company appears to be balancing disciplined cost management and capital return with continued investment in AI; the positives (growth, profitability, product momentum, partnerships, and buybacks) outweigh the near-term AI-related margin and cash-flow challenges.Positive Updates
Sustained Profitability
6th consecutive quarter of GAAP profitability with GAAP net income of $1.1M in Q1 2026, more than double Q1 2025, representing a 2.9% GAAP net income margin.
Negative Updates
Gross Margin Pressure from Conversational AI Mix
Gross margin declined to 63.4% in Q1 2026 from 68.0% in Q1 2025 (down 4.6 percentage points). Management attributes the decline primarily to product-mix changes as conversational AI offerings are still at subscale and carry initial negative margin impact.
Read all updates
Q1-2026 Updates
Positive
Negative
Sustained Profitability
6th consecutive quarter of GAAP profitability with GAAP net income of $1.1M in Q1 2026, more than double Q1 2025, representing a 2.9% GAAP net income margin.
Read all positive updates
Company Guidance
Guidance for Q2 2026 calls for total revenue of $39.0–$40.0 million (vs. $34.3M in Q2 2025), implying 13.7%–16.6% year‑over‑year growth and, the company noted, faster growth than Q1 even at the low end; Q1 results were $37.7M revenue (+13.5% YoY), beating prior guidance of $36–$37M, GAAP net income $1.1M (2.9% margin) and the sixth consecutive profitable quarter. Management also highlighted key operating metrics from Q1—DBNER 99% (vs. 95% a year ago), gross profit $23.9M and gross margin 63.4% (down from 68% due mainly to early-stage conversational AI), R&D $14.4M (38.1% of revenue), sales & marketing $5.9M (15.6%), G&A $6.0M (15.9%), cash/Cash equivalents and deposits of $166M, and active share repurchases of ~12.5M Class B shares (3.1M ADS) for ~$13.1M in the quarter (total repurchases to date ~174.7M Class A / 43.7M ADS for ~$156.2M, ~78.1% of a $200M program). Looking ahead, management expects operating income and net income to grow sequentially Q1→Q4, targets GAAP operating profitability in H2 2026, and sees conversational AI ramping to roughly ~5% of revenue by year‑end amid >150% sequential usage growth per quarter since its launch.Agora Financial Statement Overview
Summary
Income Statement
68
Positive
Balance Sheet
82
Very Positive
Cash Flow
49
Neutral
| Breakdown | TTM | Dec 2025 | Dec 2024 | Dec 2023 | Dec 2022 | Dec 2021 |
|---|---|---|---|---|---|---|
Income Statement | ||||||
| Total Revenue | 145.65M | 141.06M | 133.26M | 141.54M | 160.67M | 167.98M |
| Gross Profit | 95.03M | 93.66M | 85.45M | 89.47M | 99.42M | 104.01M |
| EBITDA | 17.70M | 17.91M | -28.62M | -72.17M | -104.08M | -57.91M |
| Net Income | 10.26M | 9.55M | -42.73M | -87.22M | -120.62M | -72.69M |
Balance Sheet | ||||||
| Total Assets | 724.20M | 721.10M | 699.65M | 674.60M | 800.72M | 945.00M |
| Cash, Cash Equivalents and Short-Term Investments | 339.90M | 219.69M | 269.66M | 216.65M | 427.71M | 755.30M |
| Total Debt | 92.67M | 82.34M | 50.14M | 15.20M | 2.27M | 7.41M |
| Total Liabilities | 169.62M | 158.25M | 126.99M | 69.85M | 72.45M | 78.74M |
| Stockholders Equity | 554.59M | 562.85M | 572.66M | 604.75M | 728.26M | 866.26M |
Cash Flow | ||||||
| Free Cash Flow | -16.77M | -4.68M | -49.38M | -30.46M | -254.25M | -32.47M |
| Operating Cash Flow | 15.51M | 27.23M | -14.13M | -13.61M | -44.38M | -20.00M |
| Investing Cash Flow | 56.93M | 13.31M | -38.05M | 56.64M | -151.06M | -57.69M |
| Financing Cash Flow | -10.14M | 5.01M | 45.99M | -52.37M | -42.15M | 251.94M |
Agora Technical Analysis
Positive
4.15
Price Trends
4.01
Positive
4.10
Positive
3.93
Positive
Market Momentum
0.14
Positive
48.78
Neutral
9.33
Positive
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For API, the sentiment is Positive. The current price of 4.15 is below the 20-day moving average (MA) of 4.32, above the 50-day MA of 4.01, and above the 200-day MA of 3.93, indicating a neutral trend. The MACD of 0.14 indicates Positive momentum. The RSI at 48.78 is Neutral, neither overbought nor oversold. The STOCH value of 9.33 is Positive, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for API.
Agora Risk Analysis
Agora disclosed 86 risk factors in its most recent earnings report. Agora reported the most risks in the "Finance & Corporate" category.
Finance & Corporate - Financial and accounting risks. Risks related to the execution of corporate activity and strategy
Latest Risks Added 0 New Risks
Agora Peers Comparison
UnderperformOutperform
Sector (61)
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
75 Outperform | $171.01M | 24.18 | 0.06% | 0.57% | 6.55% | 11.41% | |
67 Neutral | $403.97M | 35.92 | 1.82% | ― | 9.23% | ― | |
63 Neutral | $527.13M | -30.91 | -6.98% | ― | -2.33% | -425.96% | |
61 Neutral | $37.18B | 12.37 | -10.20% | 1.83% | 8.50% | -7.62% | |
60 Neutral | $251.32M | 147.86 | 1.20% | ― | 2.89% | ― | |
48 Neutral | $219.84M | -8.72 | -10.61% | ― | -9.70% | 61.30% |
* Technology Sector Average
API
Agora
4.24
0.52
13.98%
EGHT
8X8
1.77
-0.07
-3.80%
TRAK
ReposiTrak
9.68
-10.15
-51.19%
PUBM
PubMatic
11.47
0.37
3.33%
SMRT
SmartRent
1.13
0.23
25.56%
Agora Corporate Events
Agora CEO Tony Zhao Unveils $20 Million Personal Share Purchase Plan
Jun 1, 2026
On June 1, 2026, Agora, Inc. announced that founder, chairman and CEO Tony Zhao plans to use his personal funds to purchase up to US$20 million of the company’s American depositary shares or Class A ordinary shares over the next 12 months. T...
Agora Posts Sixth Straight Profitable Quarter as Revenue and AI Usage Climb
May 28, 2026
Agora, Inc. reported unaudited first-quarter 2026 results on May 26, 2026, posting total revenue of $37.7 million, up 13.5% year over year, with active customers rising to 3,946 and dollar-based net retention improving to 99%. Despite higher bandw...
Glossary
BuyA stock rated as a "Buy" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock is likely to deliver higher returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
HoldA stock rated as a "Hold" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly compelling nor unfavorable for investment. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
SellA stock rated as a "Sell" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock may deliver lower returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
Disclaimer
This AI Analyst Stock Report is automatically generated by our AI systems using advanced algorithms and publicly available financial, technical, and market data. While the information provided aims to be accurate and insightful, it is intended for informational purposes only and should not be considered financial advice. Any content created by an AI (Artificial Intelligence) system may contain inaccuracies and/or contain errors. Investing in stocks carries inherent risks, and past performance is not indicative of future results. This report does not account for your personal financial circumstances, objectives, or risk tolerance. Always conduct your own research or consult with a qualified financial advisor before making investment decisions. The analysis and recommendations provided are based on historical and current data and may not fully reflect future market conditions or unexpected developments. Neither the creators of this report nor its affiliated entities guarantee the accuracy, completeness, or reliability of the information presented. Use this report at your own discretion and risk.