Agora Inc. (NASDAQ: API) has provided revenue guidance for its third quarter, projecting sales between $41 million and $42 million. The company, traded on the NASDAQ exchange, outlined this financial outlook for the period.

Financial Outlook

The guidance indicates a narrow range for top-line performance in the quarter. No other financial metrics, such as net profit or EBITDA, were disclosed in the current filing.

Market Context

As a technology-focused entity, Agora’s revenue figures are critical for investors tracking its commercial traction. The absence of profit or margin data in this specific update limits immediate analysis of operational efficiency, focusing attention solely on the top-line trajectory.

Agora, Inc. (NASDAQ: API) reported second quarter 2026 earnings per share of $0.02, a 100% increase from $0.01 in the same period last year. The Santa Clara-based conversational AI and real-time engagement technology provider also posted total revenue of $40.4 million, an 18.0% increase from $34.3 million in Q2 2025. This marks the company's seventh consecutive quarter of GAAP profitability.

Total cash, cash equivalents, bank deposits, and financial products issued by banks stood at $361.7 million as of June 30, 2026.

Financial Performance

Revenue growth was primarily driven by the continued expansion of real-time engagement services in sectors such as live shopping and financial services. Cost of revenues increased 28.9% to $14.7 million from $11.4 million a year earlier, largely due to higher bandwidth, server costs, and expenses related to conversational AI products.

Gross profit rose 12.5% to $25.7 million, but gross margin contracted to 63.7% from 66.8% in Q2 2025. The company attributed the margin decline to product mix changes, noting that conversational AI products remain at a sub-scale stage.

Operating expenses increased modestly by 2.8% to $27.3 million. Research and development spending rose 10.2% to $15.4 million, reflecting increased investment in conversational AI products. Sales and marketing expenses decreased 1.5% to $6.4 million due to disciplined expense management, while general and administrative costs fell 9.5% to $5.5 million, aided by a decrease in allowance for current expected credit losses.

What the Numbers Show

Agora’s net income of $2.2 million was significantly supported by non-operating items. Interest income totaled $3.4 million, while the company recorded a loss from operations of $1.0 million. This indicates that interest income alone covered the operating deficit and constituted the primary driver of the bottom-line profit, rather than core operational efficiency. Additionally, investment loss widened to $0.4 million from an investment income of $0.8 million a year ago, driven by fair value changes in equity investments.

Operational Metrics & Outlook

Active customers reached 3,892 as of June 30, 2026, a marginal 0.4% increase from 3,877 in Q2 2025. However, the dollar-based net retention rate improved significantly to 104%, up from 94% in the prior-year period.

For the third quarter of 2026, Agora expects total revenues to be between $41 million and $42 million, representing year-over-year growth of 15.8% to 18.6%.

Share Repurchases

During the quarter, the company repurchased approximately 3.8 million Class A ordinary shares (equivalent to approximately 1.0 million ADSs) for approximately $3.7 million. As of June 30, 2026, total repurchases under the current program reached approximately 178.5 million Class A ordinary shares for $159.9 million. The program expires at the end of February 2027.