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Agora, Inc. (API)
NASDAQ:API
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Agora
(NASDAQ:API)
Rating:66Neutral
Price Target:
$4.50
▲(13.07%Upside)
Positive Factors
Demand and market potential
Management noted strong interest in conversational AI, which could lead to significant demand growth.
International business expansion
Agora's international revenue increased by 18%, driven by growth in live shopping and entertainment.
Profitability and earnings
Agora achieved a net profit of US$0.4 million in 1Q25 and is expected to continue being profitable through the year.
Negative Factors
Financial guidance
Agora's 2Q25E revenue guidance suggests potential challenges in exceeding current growth expectations.
Agora (API) vs. SPDR S&P 500 ETF (SPY)
Market Cap
$373.11M
Dividend YieldN/A
Average Volume (3M)391.23K
Price to Earnings (P/E)―
Beta (1Y)1.99
Revenue Growth-3.34%
EPS Growth56.44%
CountryUS
Employees608
SectorTechnology
Sector Strength93
IndustrySoftware - Application
Share Statistics
EPS (TTM)<0.01
Shares Outstanding74,465,760
10 Day Avg. Volume544,732
30 Day Avg. Volume391,231
Financial Highlights & Ratios
PEG Ratio-0.13
Price to Book (P/B)0.17
Price to Sales (P/S)0.00
P/FCF Ratio-3.13
Enterprise Value/Market Cap0.31
Enterprise Value/Revenue0.21
Enterprise Value/Gross Profit1.31
Enterprise Value/Ebitda-0.63
Forecast
1Y Price Target
$7.10Price Target Upside78.39% Upside
Rating ConsensusModerate Buy
Number of Analyst Covering1
Agora Business Overview & Revenue Model
Company DescriptionAgora, Inc. provides Real-Time Engagement Platform-as-a-Service (RTE-PaaS) in the People's Republic of China, the United States, and internationally. The company RTE-PaaS offers developers with software tools to embed real-time video, voice, and messaging functionalities into applications. Its products include video calling, voice calling, interactive live streaming, chat, signaling. Acceleration products; and extensions, which comprise interactive whiteboard, recording, analytics, and extensions marketplace products to enable developers to launch RTE in specific use cases and verticals. The company also provides Flexible Classroom that offers a low-code application Platform as a Service; and App Builder, no-code application platform. Its real-time engagement products are delivered through its Software-Defined Real-Time Network, which is a virtual network overlay on top of the public internet. The company serves social, entertainment, gaming, education, enterprise solutions, e-commerce, financial services, healthcare, and IoT industries. Agora, Inc. was incorporated in 2013 and is headquartered in Shanghai, the People's Republic of China.
How the Company Makes MoneyAgora generates revenue primarily through a usage-based pricing model. Developers and businesses are charged based on the volume of voice and video minutes used within their applications. This model allows for scalable pricing, aligning costs with the level of engagement achieved by their customers' end-users. Additionally, Agora may benefit from strategic partnerships with technology firms and platform providers that expand its market reach and integration possibilities. Other factors contributing to its earnings include the continuous innovation and enhancement of its API offerings, which attract a diverse clientele seeking reliable and high-performance real-time engagement solutions.
Agora Earnings Call Summary
Earnings Call Date:May 27, 2025
(Q1-2025)
| % Change Since: 5.01%|
Next Earnings Date:Aug 25, 2025
Earnings Call Sentiment Positive
The earnings call highlighted Agora Inc.'s strong financial performance, including sustained profitability and revenue growth, alongside significant advancements in AI and IoT. However, challenges in the Shengwang segment and competitive pressures in China were noted.Q1-2025 Updates
Positive Updates
Second Consecutive Quarter of GAAP Profitability
Agora Inc. reported GAAP profitability for the second consecutive quarter in Q1 2025, driven by double-digit revenue growth and disciplined cost management.
Revenue Growth
Total revenue in Q1 2025 was $33.3 million, up 12% year-over-year, excluding revenues from certain end-of-sale, low-margin products.
Strong Performance in AI and IoT
Launched conversational AI engine and device kit, enabling developers to create interactive voice experiences and IoT devices, unlocking innovation across multiple verticals.
Improved Net Retention Rates
Dollar-based net retention rates improved to 96% for Agora and 85% for Shengwang compared to previous quarters.
Operating Cash Flow Improvement
Operating cash flow was $17.6 million in Q1 2025, a significant improvement from negative $6.5 million last year.
Negative Updates
Sequential Revenue Decline in Shengwang
Shengwang revenues declined 13.7% sequentially, primarily due to seasonality and reduced activity from social and education customers.
Competitive Market in China
China remains a highly competitive market, impacting pricing and margins, though the company focuses on high-value use cases to maintain stability.
Company Guidance
During the Agora Inc.'s first quarter 2025 financial results call, the company reported a second consecutive quarter of GAAP profitability, with total revenue reaching $33.3 million, a 12% year-over-year increase. The company highlighted significant achievements, including a net profit more than doubling from the previous quarter and an operating cash flow of $17.6 million. Agora's revenue grew by 17.7% year-over-year, while Shengwang's revenue increased by 6.7%. The company maintained a strong gross margin of 68% and reduced operating expenses to $26.5 million, down from $32.6 million in Q2 2024. For Q2 2025, Agora anticipates revenues between $33 million and $35 million, representing a year-over-year growth rate of 6.8% to 13.3%. The company also emphasized its robust financial position, with a net income margin of 1.2% and continued commitment to shareholder value through its share repurchase program.Agora Financial Statement Overview
Summary
Agora's financial performance is mixed, with persistent net losses and negative cash flows indicating operational challenges. Despite a strong equity position, the need for improved profitability and cash management is evident.Income Statement
Agora's income statement shows considerable challenges, with consistent net losses and negative EBIT margins over the periods analyzed. The TTM (Trailing-Twelve-Months) data shows a slight gross profit margin improvement, indicating some operational efficiency, but the net profit margin remains negative. Revenue growth has been inconsistent, with a decline in recent years, highlighting the need for strategic adjustments to regain growth momentum.55
Neutral
Balance Sheet
The balance sheet reflects a strong equity position, with stockholders' equity significantly outweighing total liabilities, resulting in a low debt-to-equity ratio. However, the declining cash reserves and consistent net losses pose a potential risk to long-term financial stability. The equity ratio remains robust, indicating financial resilience despite operating challenges.60
Neutral
Cash Flow
Cash flow analysis reveals challenges with negative free cash flow and a fluctuating operating cash flow. The operating cash flow to net income ratio shows some improvement in TTM data, indicating better cash management. However, the persistent negative free cash flow suggests ongoing difficulties in generating sufficient cash from operations to cover capital expenditures.50
Neutral
| Breakdown | Dec 2024 | Dec 2023 | Dec 2022 | Dec 2021 | Dec 2020 |
|---|---|---|---|---|---|
Income Statement | |||||
| Total Revenue | 133.26M | 141.54M | 160.67M | 167.98M | 133.56M |
| Gross Profit | 85.45M | 89.47M | 99.42M | 104.01M | 86.36M |
| EBITDA | -31.19M | -78.27M | -104.08M | -61.63M | -731.00K |
| Net Income | -42.73M | -87.22M | -120.62M | -72.69M | -3.11M |
Balance Sheet | |||||
| Total Assets | 699.65M | 674.60M | 800.72M | 945.00M | 692.90M |
| Cash, Cash Equivalents and Short-Term Investments | 269.66M | 216.65M | 427.71M | 755.30M | 635.44M |
| Total Debt | 50.14M | 15.20M | 2.27M | 7.41M | 0.00 |
| Total Liabilities | 126.99M | 69.85M | 72.45M | 78.74M | 36.44M |
| Stockholders Equity | 572.66M | 604.75M | 728.26M | 866.26M | 656.46M |
Cash Flow | |||||
| Free Cash Flow | -49.38M | -30.46M | -254.25M | -32.47M | -6.31M |
| Operating Cash Flow | -14.13M | -13.61M | -44.38M | -20.00M | 6.56M |
| Investing Cash Flow | -38.05M | 56.64M | -151.06M | -57.69M | -535.05M |
| Financing Cash Flow | 45.99M | -52.37M | -42.15M | 251.94M | 533.64M |
Agora Technical Analysis
Positive
3.98
Price Trends
3.75
Positive
3.95
Positive
4.23
Negative
Market Momentum
0.08
Negative
54.61
Neutral
42.29
Neutral
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 3.98 is above the 20-day moving average (MA) of 3.86, above the 50-day MA of 3.75, and below the 200-day MA of 4.23, indicating a neutral trend. The MACD of 0.08 indicates Negative momentum. The RSI at 54.61 is Neutral, neither overbought nor oversold. The STOCH value of 42.29 is Neutral, 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
Overall Rating
UnderperformOutperform
Sector (63)
Financial Indicators
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
67 Neutral | $296.48M | 1.65 | -10.56% | 2.25% | -11.07% | 953.01% | |
66 Neutral | $260.73M | ― | -24.28% | ― | -1.87% | 61.90% | |
66 Neutral | $373.11M | ― | -5.62% | ― | -3.34% | 56.44% | |
63 Neutral | $34.61B | 5.36 | -11.67% | 1.95% | 5.33% | -20.62% | |
60 Neutral | $161.71M | ― | -10.44% | ― | 7.65% | -96.35% | |
58 Neutral | $254.31M | 3.01 | 35.11% | 5.31% | 3828.94% | 129.01% | |
52 Neutral | $579.73M | ― | -50.07% | ― | -9.91% | 78.56% |
* Technology Sector Average
Performance Comparison
API
Agora
4.00
1.51
60.64%
EGHT
8X8
2.04
-0.98
-32.45%
IMMR
Immersion
7.32
-5.47
-42.77%
APPS
Digital Turbine
5.39
3.21
147.25%
SSTI
SoundThinking Inc
12.75
-0.82
-6.04%
MKTW
MarketWise
19.21
-0.73
-3.66%
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.