Perfect Corp. (NYSE: PERF) reported first‑quarter 2026 revenue of $18.1 million, a 14.2% year‑over‑year increase driven by strong demand in its mobile‑app and web‑service subscription business. The growth was supported by a 24.1% rise in gross profit to $14.6 million, lifting the gross margin to 80.5% from 74.1% in the same period a year earlier. The margin expansion reflects the company’s shift toward standardized AI solutions and lower customization costs, which have reduced variable expenses and improved pricing power.
Operating expenses rose 24.1% to $15.2 million, resulting in an operating loss of $0.6 million. The loss was largely attributable to a $2.0 million goodwill impairment related to the 2025 acquisition of Wannaby. Net income for the quarter was $0.1 million, a 94.2% decline from $1.1 million in the same period a year earlier. The operating loss was slightly larger than the $0.5 million loss reported for the fourth quarter of 2025, underscoring the impact of the one‑time impairment.
For the full year ended December 31 2025, Perfect Corp. generated revenue of $69.2 million, up 14.9% year‑over‑year, and a gross margin of 77.4%. The company guided 2026 total revenue to $74.736 million–$77.504 million, a 10% increase from 2025, but the range sits below analyst estimates of $78.862 million. The guidance signals a cautious outlook, reflecting management’s focus on sustaining margin gains while navigating competitive pressures in the AI and AR solutions market.
Management highlighted that “results exceeded full‑year guidance” and added that “the integration of both teams is progressing smoothly with our operations, cultures, and the strategic goals aligned seamlessly.” These comments underscore confidence in the post‑acquisition integration and the company’s strategic pivot toward higher‑margin subscription and enterprise SaaS offerings.
Investors responded cautiously but with a slight positive tilt, reflecting confidence in the company’s margin improvement and guidance. The market’s muted reaction suggests that while the quarter missed revenue and EPS estimates, the underlying operational discipline and strategic focus on AI‑driven subscription growth are viewed favorably.
The earnings report indicates that Perfect Corp. is successfully scaling its AI and AR platform while managing one‑time charges. The improved gross margin and steady revenue growth support a positive long‑term outlook, though the company’s guidance below analyst expectations highlights a conservative stance amid competitive headwinds. Management’s emphasis on smooth integration and continued focus on subscription and enterprise SaaS signals a strategic path toward higher‑margin recurring revenue streams.
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