Agora, Inc. reported third‑quarter 2025 results that marked a return to profitability, with total revenue rising 12.0% year‑over‑year to $35.4 million and net income turning positive at $2.7 million. The core real‑time engagement platform generated $18.2 million, a 15.9% increase, while the China‑based Shengwang segment added $17.2 million, up 8.4%. Basic earnings per share reached $0.03, a turnaround from the $0.26 loss per share recorded in the same quarter a year earlier.
Gross profit climbed to $23.3 million, giving a gross margin of 66.0%, slightly below the 66.7% margin reported in Q3 2024. The modest compression is attributed to a mix shift toward higher‑cost services, which increased the proportion of revenue from segments with lower gross‑margin profiles. Despite the margin dip, the company’s overall profitability improved thanks to stronger revenue growth and disciplined cost management.
Operating expenses fell 44.8% to $25.3 million, driven by a 23% cut in research and development spend and a 27% reduction in general and administrative costs. These reductions were part of a broader effort to improve operating leverage as the company scales its platform and invests in new AI capabilities. The cost discipline helped offset the margin pressure from the service‑mix shift and contributed to the positive net income.
The company continued its share‑repurchase program, buying back approximately 5.2 million shares during the quarter. As of June 30, 2025, 63.6% of the $200 million authorized program had been repurchased, underscoring Agora’s commitment to returning value to shareholders while maintaining capital for growth initiatives.
Management guided for Q4 2025 revenue of $37 million to $38 million, a modest increase from the $35.4 million reported in Q3. CEO Tony Zhao highlighted the fourth consecutive quarter of GAAP profitability, double‑digit revenue growth, and expanding margins. He emphasized the core platform’s rebound and the company’s intensified investment in conversational AI, noting early adoption of new products such as Conversational AI Engine 2.0 and Conversational AI Studio.
No analyst consensus estimates for Q3 2025 EPS or revenue were available, and no market reaction data (price movements, analyst upgrades/downgrades, or price‑target changes) were found in the fact‑check sources. Consequently, the article does not speculate on market sentiment or valuation impacts.
The results reinforce Agora’s strategic pivot toward high‑margin conversational AI while maintaining a solid foundation in its core real‑time engagement platform. The company’s ability to turn a net loss into a modest profit, coupled with disciplined cost cuts and a growing AI portfolio, positions it for continued growth and shareholder value creation in the coming quarters.
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