 SANTA CLARA, Calif., Aug. 17, 2020 GLOBE NEWSWIRE -- Agora, Inc. NASDAQ: API Agora, a pioneer and leading platform for real-time engagement APIs, today announced its financial results for the second quarter ended June 30, 2020. We delivered strong results in our first quarter as a public company, with total revenues up 128 year-over-year. Our efficient and scalable business model focused on developers also contributed to positive GAAP profitability and free cash flow in the quarter, said Tony Zhao, founder, chairman and CEO of Agora. Developers around the world continue to use Agoras real-time engagement APIs to build immersive experiences for their end users and enable meaningful human connections. The successful completion of our IPO in June will provide additional brand visibility and capital to drive our growth as we strive to fulfill our mission of making real-time engagement ubiquitous.Second Quarter 2020 Highlights Total revenues for the quarter were 33.9 million, an increase of 127.5 from 14.9 million in the second quarter of 2019. Active Customers as of June 30, 2020 were 1,486, an increase of 85.5 from 801 as of June 30, 2019. Constant Currency Dollar-Based Net Expansion Rate was 183.2 for the trailing 12-month period ended June 30, 2020. Net income for the quarter was 3.0 million, compared to net loss of 2.0 million in the second quarter of 2019. After excluding share-based compensation expense, non-GAAP net income for the quarter was 4.7 million, compared to the non-GAAP net loss of 0.3 million in the second quarter of 2019. Adjusted EBITDA for the quarter was 5.7 million, compared to 0.1 million in the second quarter of 2019. Cash and cash equivalents as of June 30, 2020 was 640.9 million, including 485.6 million in net proceeds from the IPO and the concurrent private placement, after deducting underwriting discounts and commissions and other offering expenses payable by Agora. Net cash generated from operating activities for the quarter was 7.5 million, compared to net cash used in operating activities of 4.9 million in the second quarter of 2019. Free cash flow for the quarter was positive 3.6 million, compared to negative 6.6 million in the second quarter of 2019.Second Quarter 2020 Financial ResultsRevenues Total revenues were 33.9 million in the second quarter of 2020, an increase of 127.5 from 14.9 million in the same period last year, primarily due to increased usage of our video and voice products as result of our business expansion.Cost of Revenues Cost of revenues was 11.4 million in the second quarter of 2020, an increase of 148.2 from 4.6 million in the same period last year, primarily due to increase in bandwidth and co-location costs as we continued to scale our business.Gross Profit and Gross Margin Gross profit was 22.5 million in the second quarter of 2020, an increase of 118.3 from 10.3 million in the same period last year. Gross margin was 66.4 in the second quarter of 2020, a decrease of 2.8 from 69.2 in the same period last year, primarily due to international expansion to regions with higher infrastructure costs.Operating Expenses Operating expenses were 20.2 million in the second quarter of 2020, an increase of 64.3 from 12.3 million in the same period last year. Research and development expenses were 10.9 million in the second quarter of 2020, an increase of 91.3 from 5.7 million in the same period last year, primarily due to increased personnel costs as we continue to build our research and development team. Sales and marketing expenses were 5.9 million in the second quarter of 2020, an increase of 16.7 from 5.1 million in the same period last year, primarily due to increased personnel costs as we continue to build our team and advertising expenses. General and administrative expenses were 3.4 million in the second quarter of 2020, an increase of 121.2 from 1.5 million in the same period last year, primarily due to increased personnel costs as we continue to build our team and professional services expenses.Other Operating Income Other operating income was 770 thousand in the second quarter of 2020, compared to 14 thousand in the same period last year, primarily due to additional value added tax deductions and income tax refund.IncomeLoss from Operations Income from operations was 3.1 million in the second quarter of 2020, compared to loss from operations of 2.0 million in the same period last year.Interest Income Interest income was 120 thousand in the second quarter of 2020, an increase of 48.1 from 81 thousand in the same period last year, primarily due to an increase in the average balance of cash and cash equivalents.Income Taxes Income taxes were 0.2 million in the second quarter of 2020, an increase of 39.7 from 0.1 million in the same period last year, primarily due to increase in pre-tax income generated by our subsidiaries.Net IncomeLoss Net income was 3.0 million in the second quarter of 2020, compared to net loss of 2.0 million in the same period last year.Net loss attributable to ordinary shareholders Net loss attributable to ordinary shareholders for the quarter was 157.8 million, compared to net loss attributable to ordinary shareholders of 13.0 million in the same period last year, primarily due to accretion of preferred shares to redemption value.Net loss per American Depositary Share Net loss per American Depositary Share ADS1 was 4.60, compared to net loss of 0.45 per ADS in the same period last year.Financial OutlookBased on currently available information, Agora expects total revenues for the full fiscal year ending December 31, 2020 to be between 125 million and 130 million. This forecast reflects the Companys current and preliminary views on the market and operational conditions, and the outlook ranges for full year 2020 reflect a number of assumptions that are subject to change based on uncertainties related to the impact of the COVID-19 pandemic.Earnings CallAgora will host a conference call to discuss its financial results and outlook at 6 p.m. Pacific Time 9 p.m. Eastern Time on the same day. Details for the conference call are as follows: Event title: Agora, Inc. 2Q 2020 Financial Results Conference ID: 3363465 Direct Event online registration: Please register in advance of the conference using the link provided above. Upon registering, you will be provided with participant dial-in numbers, a Direct Event passcode and a unique registrant ID. Please visit Agoras investor relations website at on August 17, 2020 to view the earnings release and accompanying slides prior to the conference call. A digital recording of the conference call will be available for replay approximately two hours after the calls completion dial-in number: US 18554525696, International 61 2 81990299; same conference ID as shown above and remain up for approximately one week.Use of Non-GAAP Financial MeasuresAgora has provided in this press release financial information that has not been prepared in accordance with generally accepted accounting principles in the United States GAAP. Agora uses these non-GAAP financial measures internally in analyzing its financial results and believes that use of these non-GAAP financial measures is useful to investors as an additional tool to evaluate ongoing operating results and trends and in comparing Agoras financial results with other companies in its industry, many of which present similar non-GAAP financial measures. Besides free cash flow as defined below, each of these non-GAAP financial measures represents the corresponding GAAP financial measure before share-based compensation expenses. We believe that such non-GAAP financial measures help identify underlying trends in our business that could otherwise be distorted by the effect of such share-based compensation expenses that we include in cost of revenues, total operating expenses and net income loss. We believe that all such non-GAAP financial measures also provide useful information about our operating results, enhance the overall understanding of our past performance and future prospects and allow for greater visibility with respect to key metrics used by our management in its financial and operational decision-making.Non-GAAP financial measures are not meant to be considered in isolation or as a substitute for comparable GAAP financial measures and should be read only in conjunction with Agoras consolidated financial statements prepared in accordance with GAAP. A reconciliation of Agoras historical non-GAAP financial measures to the most directly comparable GAAP measures has been provided in the tables captioned Reconciliation of GAAP to Non-GAAP Measures included at the end of this press release, and investors are encouraged to review the reconciliation.Definitions of Agoras non-GAAP financial measures included in this press release are presented below.Non-GAAP Net Income LossAgora defines non-GAAP net income loss as net income loss adjusted to exclude share-based compensation expense.Adjusted EBITDAAgora defines Adjusted EBITDA as net income loss before exchange gain loss, interest income, income taxes, depreciation and amortization, and adjusted to exclude the effects of share-based compensation expense.Free Cash FlowAgora defines free cash flow as net cash provided by operating activities less purchases of property and equipment. Agora considers free cash flow to be a liquidity measure that provides useful information to management and investors regarding net cash provided by operating activities and cash used for investments in property and equipment required to maintain and grow the business. 