Perfect Corp. (NYSE:PERF) shares rose 1.55% in pre-market trading after the artificial intelligence and augmented reality software provider reported second-quarter earnings that matched Wall Street forecasts, despite revenue coming in below expectations.
For the quarter ended June 30, 2026, the company posted adjusted earnings per share of $0.01, in line with analyst estimates. Revenue totalled $16.3 million, missing the consensus forecast of $18.13 million, although sales were broadly unchanged from the same period a year earlier.
Licensing weakness offsets subscription growth
The revenue miss was largely driven by a sharp decline in licensing income, which fell 25.3% year over year to $0.7 million.
That weakness outweighed continued growth in subscriptions across the company’s YouCam mobile applications and web-based services.
Profitability improves on stronger margins
Perfect Corp. reported net income of $1.3 million, compared with $0.2 million in the second quarter of 2025, as higher margins and tighter cost controls supported profitability.
Gross margin improved to 80.9% from 75.3% a year earlier, reflecting greater operating efficiency as the company continued shifting toward standardized AI-powered products.
“Perfect Corp. continues to prioritize the advancement of our consumer (B2C) and enterprise (B2B) businesses through AI-driven innovation,” said Alice H. Chang, Founder, Chairwoman, and Chief Executive Officer.
Operating loss narrowed to $0.1 million from $1.5 million in the prior-year quarter, while operating expenses declined 3.2% to $13.3 million. Research and development spending also fell 11.0% to $3.6 million.
Subscriber numbers decline amid tougher competition
The company ended the quarter with 820,000 active subscribers across its YouCam applications, down from 960,000 a year earlier, as competition in the AI-powered app market intensified.
Perfect Corp. also reported a decline in key enterprise customers, with the total falling to 113 from 139 during the same period last year.
Despite softer revenue and lower subscriber numbers, the company maintained a strong balance sheet, finishing the quarter with cash and cash equivalents of $125.6 million.