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Agora, Inc. (API)
NASDAQ:API
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Agora
(NASDAQ:API)
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Rating:54Neutral
Price Target:
$5.00
▲(20.48% Upside)
Action:ReiteratedDate:01/13/26
Overall score is held back primarily by weak financial-statement profitability/cash-flow signals and a very high P/E valuation. These are partially offset by a positive price trend and a strong, upbeat earnings update showing profitability, improving operating cash flow, and constructive forward guidance.
Positive Factors
Revenue Growth
Consistent double-digit revenue growth indicates strong market penetration and adoption, enhancing Agora's competitive position and long-term growth potential.
Profitability
Achieving profitability for four consecutive quarters reflects operational improvements and financial stability, supporting sustainable business growth.
Conversational AI Innovations
Innovations in conversational AI can drive future revenue streams and strengthen Agora's technological edge, positioning it well in emerging markets.
Negative Factors
Cash Flow Challenges
Persistent negative cash flow highlights liquidity challenges, potentially limiting Agora's ability to invest in growth and manage financial obligations effectively.
Profitability Issues
Continued net losses and negative profit margins indicate operational inefficiencies, which could hinder long-term financial health and shareholder value.
Gross Margin Decline
A declining gross margin suggests rising costs or pricing pressures, which may impact profitability and require strategic cost management to maintain margins.
Agora (API) vs. SPDR S&P 500 ETF (SPY)
Market Cap
$437.63M
Dividend YieldN/A
Average Volume (3M)385.27K
Price to Earnings (P/E)97.1
Beta (1Y)2.28
Revenue Growth1.62%
EPS GrowthN/A
CountryUS
Employees608
SectorTechnology
Sector Strength88
IndustrySoftware - Application
Share Statistics
EPS (TTM)0.05
Shares Outstanding74,465,760
10 Day Avg. Volume325,288
30 Day Avg. Volume385,266
Financial Highlights & Ratios
PEG Ratio0.18
Price to Book (P/B)0.68
Price to Sales (P/S)2.91
P/FCF Ratio-7.86
Enterprise Value/Market Cap0.99
Enterprise Value/Revenue3.16
Enterprise Value/Gross Profit4.73
Enterprise Value/Ebitda35.22
Forecast
1Y Price TargetN/A
Price Target UpsideN/A
Rating ConsensusN/A
Number of Analyst Covering0
EPS Forecast (FY)0.2
Revenue Forecast (FY)$153.29M
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 primarily generates revenue through a usage-based pricing model, charging customers based on the volume of audio or video minutes consumed, as well as data transmitted over its network. This model allows for scalability as clients pay for what they use. Key revenue streams include subscriptions for premium features, pay-as-you-go services, and enterprise solutions tailored to large organizations. Additionally, partnerships with technology companies and integrations with popular platforms enhance Agora's market reach and contribute to its earnings.
Agora Earnings Call Summary
Earnings Call Date:Mar 02, 2026
(Q4-2025)
| % Change Since: |
Next Earnings Date:May 25, 2026
Earnings Call Sentiment Positive
The call highlighted solid operational and financial momentum — double-digit YoY revenue growth, restored GAAP profitability, strong operating cash flow, a large-scale product win (600k peak viewers), expanding conversational AI usage and product adoption, and continued capital returns via buybacks. Headwinds are largely transitional and tied to ramping conversational AI (subscale infrastructure, pilot monetization lag) and a slight YoY gross margin decline driven by that mix; Shengwang's DBNR below 100 and near-term margin items (SBC and amortization) are additional cautions. Overall, positives (growth, profitability, cash, product validation and AI momentum) outweigh near-term AI-related margin and scale challenges.Q4-2025 Updates
Positive Updates
Revenue Growth and Beat
Total Q4 revenue of $38.2M, up 10.7% year-over-year and above the high end of guidance; company reports fourth consecutive quarter of double-digit organic growth.
GAAP Profitability Restored and Improving
GAAP net income of $4.9M in Q4 with a 12.9% net margin; fifth consecutive quarter of GAAP profitability and first full year of GAAP profitability since 2018; management expects net income to grow vs. 2025 and targets GAAP operating profit in Q4 2026.
Business Segment Performance
Agora segment: $19.9M in Q4 revenue (+14.4% YoY, +9.3% QoQ). Shengwang: RMB129.2M in Q4 (+5.7% YoY, +5.6% sequentially). Dollar-based net retention: 109% for Agora and 89% for Shengwang.
Strong Cash Generation and Capital Return
Operating cash flow of $9.3M in Q4 (vs. $4.5M year-ago); cash, equivalents and bank deposits of $374.9M at quarter-end. Repurchased $10.9M of shares in the quarter and $143.1M since program inception (71.6% of the $200M program); Board extended the repurchase program through Feb 28, 2027.
Product and Market Validation at Scale
Delivered full HD, sub-second latency video to nearly 600,000 peak concurrent viewers during a Super Bowl-weekend live shopping event (MrBeast on Whatnot), cited as likely the largest U.S. live video shopping event and a demonstration of platform scalability and reliability.
Conversational AI Momentum and Product Traction
Conversational AI engine usage has more than doubled each quarter since launch in March 2025; early deployments across customer service, smart devices, education and AI consumer apps; management aims for conversational AI to approach ~5% of ARR by year-end.
New Product Introductions and Ecosystem Interest
Launched upgraded conversational AI device kit with multimodal capabilities showcased at CES 2026; multiple customers and OEMs (including a leading consumer hardware giant) adopting the kit and launching products, indicating expanding partner and OEM traction.
Expense Discipline and Improved Operating Leverage
R&D down 7.7% YoY to $13.6M (35.8% of revenue vs. 42.9% prior year); Sales & Marketing down 2.1% YoY to $7.1M (18.7% of revenue vs. 21.1% prior year); G&A down 16.5% YoY to $5.4M (14.1% of revenue vs. 18.7% prior year), reflecting cost discipline and improved margins.
Forward Guidance
Q1 2026 revenue guidance of $36M–$37M (implying +8.1% to +11.1% YoY vs. $33.3M in Q1 2025), signaling continued top-line growth visibility.
Negative Updates
Gross Margin Pressure from Early-Stage AI Products
Quarter gross margin of 65.1%, down 1.5 percentage points YoY and 0.9pp sequentially; decline primarily attributed to conversational AI products running at subscale levels and POC pilots (often uncharged), dragging overall margin.
Conversational AI Revenue Lags Usage
Although conversational AI usage has doubled each quarter, revenue contribution remains small because many customers remain in POC stage; management expects revenue ramp but timing could take multiple quarters.
Lower DBNR at Shengwang
Shengwang's dollar-based net retention rate is 89%, below 100%, indicating potential churn or downgrades and weaker account expansion relative to the Agora segment (109%).
Near-Term Margin Outlook Conservative
Management expects flat gross margins versus Q4 2025 in their 2026 internal forecast due to AI ramp; also anticipates ~ $6M of share-based compensation and nearly $4M of headquarters amortization in 2026 that will offset some operating income improvement.
Subscale AI Infrastructure Costs and Free Pilots
Conversational AI infrastructure currently operates at suboptimal utilization with low margins while many pilots are provided at low or no charge, creating short-term cost and margin headwinds until scale and monetization accelerate.
Company Guidance
For Q1 2026 the company guided total revenues of $36.0–$37.0 million (versus $33.3M in Q1 2025), implying year‑over‑year growth of 8.1%–11.1%; management expects gross margin to be roughly flat versus Q4 2025, sees net income growing versus 2025, and anticipates significant operating income improvement with a goal of achieving GAAP operating profit in Q4 2026 (2026 outlook assumes about $6.0M of share‑based compensation and ~ $4.0M of headquarters‑project amortization). They also expect conversational AI revenue to ramp through 2026 toward roughly 5% of ARR by year‑end, and noted quarter‑end liquidity of $374.9M plus a Board‑approved share repurchase program extended through Feb 28, 2027 ( ~$143.1M repurchased to date, 71.6% of a $200M authorization).Agora Financial Statement Overview
Summary
Mixed fundamentals: strong gross margin (67%) and low leverage (debt-to-equity 0.11) support stability, but profitability remains weak in the provided financial-statement view (negative net/EBITDA margins, negative ROE) and cash-flow quality is a concern given inconsistent history and negative free-cash-flow trends.Income Statement
Agora's income statement shows a mixed performance. The TTM (Trailing-Twelve-Months) gross profit margin is strong at 67%, indicating efficient cost management. However, the net profit margin is negative, reflecting ongoing losses. Revenue growth is modest at 2.88% TTM, but historical data shows volatility with periods of decline. The EBIT and EBITDA margins are negative, highlighting profitability challenges.45
Neutral
Balance Sheet
The balance sheet is relatively stable with a low debt-to-equity ratio of 0.11 TTM, suggesting limited leverage risk. However, the return on equity is negative, indicating that the company is not generating profits from its equity base. The equity ratio is healthy, showing a strong equity position relative to total assets.60
Neutral
Cash Flow
Cash flow analysis reveals concerns, with negative free cash flow growth and a negative free cash flow to net income ratio. Operating cash flow is positive TTM, but historical data shows inconsistency. The company needs to improve cash generation to support operations and growth.40
Negative
| Breakdown | TTM | Dec 2024 | Dec 2023 | Dec 2022 | Dec 2021 | Dec 2020 |
|---|---|---|---|---|---|---|
Income Statement | ||||||
| Total Revenue | 137.40M | 133.26M | 141.54M | 160.67M | 167.98M | 133.56M |
| Gross Profit | 91.81M | 85.45M | 89.47M | 99.42M | 104.01M | 86.36M |
| EBITDA | 12.34M | -31.19M | -78.27M | -104.08M | -61.63M | -731.00K |
| Net Income | 4.77M | -42.73M | -87.22M | -120.62M | -72.69M | -3.11M |
Balance Sheet | ||||||
| Total Assets | 710.10M | 699.65M | 674.60M | 800.72M | 945.00M | 692.90M |
| Cash, Cash Equivalents and Short-Term Investments | 170.11M | 269.66M | 216.65M | 427.71M | 755.30M | 635.44M |
| Total Debt | 76.26M | 50.14M | 15.20M | 2.27M | 7.41M | 0.00 |
| Total Liabilities | 143.46M | 126.99M | 69.85M | 72.45M | 78.74M | 36.44M |
| Stockholders Equity | 566.65M | 572.66M | 604.75M | 728.26M | 866.26M | 656.46M |
Cash Flow | ||||||
| Free Cash Flow | -18.47M | -49.38M | -30.46M | -254.25M | -32.47M | -6.31M |
| Operating Cash Flow | 22.48M | -14.13M | -13.61M | -44.38M | -20.00M | 6.56M |
| Investing Cash Flow | 2.43M | -38.05M | 56.64M | -151.06M | -57.69M | -535.05M |
| Financing Cash Flow | 23.86M | 45.99M | -52.37M | -42.15M | 251.94M | 533.64M |
Agora Technical Analysis
Positive
4.15
Price Trends
4.34
Positive
3.97
Positive
3.87
Positive
Market Momentum
0.12
Negative
57.29
Neutral
45.28
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 4.15 is below the 20-day moving average (MA) of 4.50, below the 50-day MA of 4.34, and above the 200-day MA of 3.87, indicating a bullish trend. The MACD of 0.12 indicates Negative momentum. The RSI at 57.29 is Neutral, neither overbought nor oversold. The STOCH value of 45.28 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
UnderperformOutperform
Sector (61)
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
67 Neutral | $157.46M | 23.47 | 14.60% | 0.57% | 11.05% | 18.55% | |
66 Neutral | $341.66M | -11.78 | -20.20% | ― | -6.23% | 28.57% | |
64 Neutral | $379.67M | -26.26 | -5.36% | ― | -0.68% | -146.14% | |
61 Neutral | $37.18B | 12.37 | -10.20% | 1.83% | 8.50% | -7.62% | |
60 Neutral | $309.29M | -70.25 | -3.02% | ― | 0.25% | 92.10% | |
54 Neutral | $437.63M | 97.10 | 0.84% | ― | 1.62% | ― | |
51 Neutral | $297.05M | -4.40 | -25.48% | ― | -24.30% | -181.62% |
* Technology Sector Average
API
Agora
4.68
-0.56
-10.69%
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Agora Corporate Events
Agora, Inc. Achieves Fourth Consecutive Profitable Quarter in Q3 2025
Nov 20, 2025
Agora, Inc. reported its financial results for the third quarter of 2025, marking its fourth consecutive quarter of GAAP profitability with a 12% increase in total revenues to $35.4 million. The company achieved a net income of $2.7 million, a significant turnaround from a net loss of $24.2 million in the same quarter last year. This growth is attributed to the strong performance of its core real-time engagement business and increased investment in conversational AI. Agora also reported a reduction in operating expenses by 44.8% due to workforce optimization, contributing to improved financial health. The company repurchased 5.2 million Class A ordinary shares during the quarter, reflecting its ongoing commitment to its share repurchase program.
The most recent analyst rating on (API) stock is a Hold with a $3.50 price target. To see the full list of analyst forecasts on Agora stock, see the API Stock Forecast page.
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.