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Perfect(PERF) - 2025 Q1 - Earnings Call Transcript
PERFPerfect(PERF)2025-04-29 04:57

Financial Data and Key Metrics Changes - Total revenue grew by 12.1% year over year to 16,000,000,withnetincomeincreasingby26416,000,000, with net income increasing by 264% to 2,300,000 [7][21] - Adjusted net income rose by 33.3% to 2,000,000comparedtothefirstquarterof2024[8][21]−Operatingcashflowgeneratedanetinflowof2,000,000 compared to the first quarter of 2024 [8][21] - Operating cash flow generated a net inflow of 4,300,000, with a strong balance sheet holding over 164,600,000incashandcashequivalents[8][22]BusinessLineDataandKeyMetricsChanges−Themobileappsubscriptionbusinessmaintainedstronggrowth,endingthequarterwith973,000activepayingsubscribers,a7.9164,600,000 in cash and cash equivalents [8][22] Business Line Data and Key Metrics Changes - The mobile app subscription business maintained strong growth, ending the quarter with 973,000 active paying subscribers, a 7.9% increase from 902,000 in the previous year [9][22] - AI and AR cloud solutions and subscription revenue grew by 13.3% to 14,100,000, representing 88% of total revenue [18] - Licensing revenue increased by 1.5% to 1,600,000,althoughitisexpectedtobecomeimmaterialasitisphasedout[18]MarketDataandKeyMetricsChanges−Theenterprisecustomerbaseincreasedby59brandclients,totaling801brandclientswithover891,000SKUs[23]−Thenumberofkeycustomersdecreasedfrom151to148duetounexpectedcontractchurnsintheU.S.market[23][24]CompanyStrategyandDevelopmentDirection−ThecompanyaimstoexpandB2CrevenuethroughnewgenerativeAIfunctionsandhigherpremiumsubscriptionplans[14]−FocusonfullyintegratingtheWalmartteamandproductsintothebusiness,expandingpresenceinbeauty,skincare,andfashionmarkets[14][24]−Thecompanyispositionedtobenefitfromevolvingclientneedswithastrongtrackrecordandexpertiseinthebeautyandfashionindustry[15]Management′sCommentsonOperatingEnvironmentandFutureOutlook−Managementexpressedoptimismaboutgrowthopportunitiesdespitemacroeconomicuncertainties,witharevenuegrowthforecastof131,600,000, although it is expected to become immaterial as it is phased out [18] Market Data and Key Metrics Changes - The enterprise customer base increased by 59 brand clients, totaling 801 brand clients with over 891,000 SKUs [23] - The number of key customers decreased from 151 to 148 due to unexpected contract churns in the U.S. market [23][24] Company Strategy and Development Direction - The company aims to expand B2C revenue through new generative AI functions and higher premium subscription plans [14] - Focus on fully integrating the Walmart team and products into the business, expanding presence in beauty, skincare, and fashion markets [14][24] - The company is positioned to benefit from evolving client needs with a strong track record and expertise in the beauty and fashion industry [15] Management's Comments on Operating Environment and Future Outlook - Management expressed optimism about growth opportunities despite macroeconomic uncertainties, with a revenue growth forecast of 13% to 14.5% for 2025 [25][26] - The integration of Wana is progressing smoothly, enhancing market position and growth opportunities [11][24] - Management noted that client churn was primarily due to financial pressures rather than competition, indicating a cautious approach from clients in the current economic climate [53] Other Important Information - The company is focusing on optimizing pricing strategies, introducing a higher premium subscription plan at 79 per year, which has shown positive early results [45] - The company plans to remain selective in acquisitions, prioritizing organic growth and investment in R&D [56] Q&A Session Summary Question: Can you talk about the launch of the new AI chat app? - The app was launched last month on both Apple and Google Play stores, integrating various AI tools into one platform [28][29] Question: How did the Wana acquisition impact customer numbers? - The acquisition added over a dozen key customers, but there were also losses due to financial pressures in the beauty business [33] Question: What are the future acquisition plans? - The focus is on expanding market penetration in core business areas rather than acquiring competitors, with potential interest in new verticals [34][36] Question: How does the Wana acquisition affect the sales process? - The acquisition has received positive feedback, allowing for a more complete solution for clients and enhancing the sales process [39][41] Question: What are the monetization strategies for B2C? - The company is optimizing pricing, introducing a higher subscription price, and early results indicate consumer willingness to upgrade [44][45] Question: What is the competitive landscape in the shoe and handbag markets? - There are few competitors in the handbag space, while the shoe market has leading brands, and the company is ready to support clients as market conditions improve [49][51] Question: What is the plan for the cash on hand? - The company plans to hold cash for growth support, focusing on organic growth and selective acquisitions in the current environment [56]