Agora, Inc.

Good day and thank you for standing by. Welcome to the Agora, Inc. First Quarter 2023 Financial Results Conference Call. At this time, all participants are in the listen-only mode. After the speaker's presentation, there will be question and answer session. To ask a question during the session, you will need to press star 1 1 on your telephone. You will then hear an automated message advising your hand is raised. To withdraw your question, please press star 11 again. Please be advised that today's conference is being recorded. And I'd like to hand the conference over to the IR Director, Ms. Fiona Chen. Please go ahead, ma'am.

Thank you, operator. Good morning and evening, everyone. Thank you for joining us for Agarwal Inc.' 's first quarter 2023 earnings conference call. Our earnings results press release earnings presentation and an explanatory note on certain reporting and disclosure adjustments, SEC filings, and a replay of today's call can be found on our IO website at investor.agora.io. Joining me today are Tony Zhao, founder, chairman, and the CEO, Jim Bowen, our CFO. Reconciliations between our GAAP and non-GAAP results can be found in our earnings press release. During this call, we will make forward-looking statements about our future financial performance and other future events and the trends. These statements are only predictions that are based on what we believe today, and the actual results may differ materially. These forward-looking statements are subject to risks, uncertainty, assumptions, and other factors that could affect our financial results and the performance of our business, and which we discuss in detail in our filings with the SEC, including today's earnings press release and the risk factors and other information contained in the final prospectus relating to our initial public offering. Agora Inc. remains no obligation to update any forward-looking statements we may make on today's call. With that, let me turn it over to Tony. Hi, Tony.

Thanks, Fiona. And welcome, everyone, to our earnings call. Before diving into our operational results for the quarter, I would first like to make a few remarks regarding recent changes in the organizational structure of our company. Since our inception nine years ago, we have mostly operated under the Agora brand globally. To better meet the requirements of our customers and compete more effectively in the unique markets we serve, we will now operate two independent divisions under the same holding company. Our Agora division will focus on our business in the US and international markets, and our Shenwang division will focus on our business in the China market. Agora and Shenwang will each be run by a local management team and adopt local standards and best practices. We have appointed Stanley Wei as Chief Operating Officer of Agora and Robin Liu as Chief Operating Officer of Shonwa. We believe this strategic reorganization will allow us to optimally focus our resources on the specific needs and priorities of each business. Agora will focus on acceleration of growth and on gaining market share in the US and international markets, leveraging our leading technology and comprehensive product offerings. Shenwang will focus on enhancing our quality of experience advantage and improving the ease of adoption of our products, further strengthening our competitive position in the China market. By empowering the local management team of each division, we will be able to respond more quickly to the needs of our customers and become more agile as new opportunities emerge. From this quarter onwards, we will report our revenue and operating metrics separately for Agora and Shenwang to help investors better understand the dynamics and our operational results in each of these markets. Our revenue for the first quarter was $15.1 million for Agora, up 10% year-over-year, and $21.3 million for Shenwang, down 14% year-over-year. Agora's revenue growth was primarily due to business extension and usage growth in US and international markets. Shenwang's decrease in revenue was primarily due to the appreciation of US dollar over disposal of E-Small's customer engagement cloud business, and decrease in usage from K-12 academic tutoring customers. After adjusting for these factors, Shengwang's revenue would have increased by 3% compared to the same quarter last year. As of the end of this quarter, We have nearly 1,500 active customers for Agora and nearly 4,000 for Shonla, an increase of 31% and 2%, respectively, compared to one year ago. Now, moving on to our product and technology updates. First, starting with Agora, the flexible classroom of our local ACOS solution designed for building scalable and customizable online classroom has continued to gain momentum in the US and the global market, as the demand for online learning continues to grow. Recently, the flexible classroom was named a finalist by 2023, the EdTech Award in the e-learning blended solution or remote solution category. Previously, we mentioned our partnership with HTC to accelerate the adoption of real-time engagement in VR applications. In HTC's wide ecosystem, developers use our video SDK to power real-time collaboration between end users within virtual environments. Recently, we were recognized as a Webby Award Honorary under the category of Metaverse, immersive and virtual best real-time experience for how our technology is used in HTC's wide SyncVR ecosystem. To further increase the value of our premium and enterprise support package for our customers, we have added integrations with Okta and Datadog. The Okta integration enables customers to manage the team members and access to Aurora console through Okta identity management tools. The DeepDock integration with Agora Analytics enables customers to push analytics data covering usage, quality, and performance directly to the DeepDock platform for analysis and visualization. Moving on to Shonwa, we recently upgraded our real-time karaoke product When this solution was first launched in 2021, it could accommodate two users singing together at the same time. If a third user wanted to join, one of the two current users would have to give up the microphone. This limitation was mainly due to the technology challenge at the time of mixing multiple real-time soundtracks in a highly synchronous manner and delivers output to all users with low latency. With our latest version, up to eight users can now sing together, which unlocks a wide range of new features for our customers' applications. For example, all users in the virtual karaoke room can now participate in a singing battle or take random turns singing part of songs together. empowered by our upgraded product our customers can now replicate in-person priority experience within their application next i would like to discuss the combination of generative ai and real-time engagement and enormous opportunity this combined this combination holds for the future since the end of last year the world has been captivated by the latest advance in large language model and generative AI. People widely believe that generative AI, despite being in its early stage, will drive significant paradigm shifts in many industries. And real-time engagement is no exception. Generative AI can empower to dramatically enhance end-user experience in their applications or create new use cases that were previously impossible. Let's look at some examples. The advent of powerful large language model has significantly improved the performance of chatbots in text format, as can be seen in the growing popularity of chat GPT and AI-powered search engines. However, this is only the beginning. As AI models continue to evolve and gain more powerful multimodal capabilities, they will become more adept at processing voice and video feeds and generating response in real time. Using IoT hardware as input-output devices, people will have an all-powerful human-like AI body that can provide information. carry on tasks, or engage in casual chats all through voice and video. Education is another industry where people have strong hopes that generating AI can help revolutionize experiences. By analyzing student data, AI-powered tutors can generate personalized learning plans and deliver learning content in an interactive manner with everything tailored to best match a student's learning progress, pattern, and real-time feedback. In addition, AI tutoring can also provide affordable and tailored education opportunity to those who previously did not have access to a quality education. There is also huge potential for generative AI to disrupt the social entertainment and gaming industry. A virtual matchmaker can do the job of making initial introduction and facilitating conversations just as well as a real person in a dating application. If you need to leave an interactive session for a short while or being disrupted by network connection, your digital twin can take over and continue the conversation. When you come back, a summary can be immediately available for you to catch up. For online social gaming, it will become almost impossible to tell if your teammates or opponents are real players or AI-controlled non-player characters. Looking at the examples above and many others, we see something in common. Generative AI can significantly expand the scope and opportunity of real-time engagement. Previously, real-time engagement largely took place among groups of people. With the help of large language model, RTE can now occur among people, digital trends of people, and fully virtual AI-based characters. opening the door to a much broader range of possible use cases. In addition, with greatly enhanced user experience, RTE will become more intelligent, immersive, and enjoyable. This trend will likely increase the overall usage of real-time engagement solutions multiple times and bring more business opportunities. We have been working closely with our customers to create pilot applications in certain verticals, and we will continue to monitor the latest developments while assisting our customers in utilizing generative AI in their real-time engagement use cases. Before concluding my prepared remarks, I want to thank both Agora and Shenglong team for their hard work during this transitional period. I believe this strategic reorganization will sharpen our identity and strengthen our position in both the global and China markets. And most importantly, allow us to serve developers and customers in a more agile and efficient way. With that, let me turn things over to Jingbo, who will reveal our financial results.