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Perfect Corp.

Perfect Corp.PERF财报

NYSE · 信息技术 · 服务-预包装软件

Perfect World Co., Ltd. is a Chinese mass media company based in Beijing. It was founded in 2004 by Chi Yufeng. The company consists of two business segments: Perfect World Games, a video game publisher, and Perfect World Pictures, a film production company.

What changed in Perfect Corp.'s 20-F — 2024 vs 2025

Top changes in Perfect Corp.'s 2025 20-F

659 paragraphs added · 528 removed · 404 edited across 5 sections

Item 3. Legal Proceedings

Legal Proceedings — active lawsuits and investigations

153 edited+124 added−20 removed410 unchanged
In addition, we use open source software in our products and solutions, including various open source libraries in our product development, as well as many development tools or libraries from Apple and Google. We expect to incorporate open source software into other offerings or products in the future.
In addition, we use open source software in our solutions, including various open source libraries in our product development, as well as many development tools or libraries from Apple and Google. We expect to incorporate open source software into other offerings or products in the future.
These laws and regulations are subject to change and uncertain interpretation, which could result in claims, changes to our data and other business practices, regulatory investigations, monetary penalties, increased cost of operations, or declines in consumer growth or engagement, or otherwise harm our business.
These laws and regulations are subject to change and uncertain interpretation, which could result in claims, changes to our data and other business practices, regulatory investigations, monetary penalties, increased cost of operations or declines in consumer growth or engagement, and could otherwise harm our business.
For example, the Biometric Information Privacy Act in Illinois (the “BIPA”), the Capture or Use of Biometric Identifier Act in Texas (the “CUBI”) and the My Health My Data Act in Washington (the “MHMD”) restrict the collection and use of biometric identifiers and biometric information.
For example, the Biometric Information Privacy Act in Illinois (“BIPA”), the Capture or Use of Biometric Identifier Act in Texas (“CUBI”) and the My Health My Data Act in Washington (“MHMD”) restrict the collection and use of biometric identifiers and biometric information.
Failure to meet GDPR requirements could result in penalties of up to 4% of annual worldwide turnover from the preceding financial year or EUR 20 million (whichever is the greater). Additionally, the U.K. General Data Protection Regulation (the “U.K.
Failure to meet GDPR requirements could result in penalties of up to 4% of annual worldwide turnover from the preceding financial year or EUR 20 million (whichever is greater). Additionally, the U.K. General Data Protection Regulation (the “U.K.
For any failure to comply with the notification requirements, marketing restrictions, information security requirements, or obligations to respond to data subjects’ requests, the authority may order that correction be made by a certain deadline and impose an administrative fine if correction is not made within such deadline.
For any failure to comply with notification requirements, marketing restrictions, information security requirements or obligations to respond to data subjects’ requests, the authority may order that correction be made by a certain deadline and impose an administrative fine if correction is not made within such deadline.
Chang could be granted Awards (as defined below) under the Director Incentive Plan, and upon the vesting of these Awards (as defined below), she will be issued with Class A Ordinary Shares. See “Item 6. Directors, Senior Management and Employees — B. Compensation — Share Incentive Plan and — Director Equity Incentive Plan” for further details.
Chang could be granted Awards (as defined below) under the Director Equity Incentive Plan, and upon the vesting of these Awards (as defined below), she will be issued with Class A Ordinary Shares. See “Item 6. Directors, Senior Management and Employees — B. Compensation — Share Incentive Plan and — Director Equity Incentive Plan” for further details.
We expect to face particular challenges in global expansion and operations including: • increased costs associated with developing solutions and products and providing support in different languages; • increased costs in marketing and advertising to promote our products effectively in different markets; • localizing our products, services, content and features to ensure that they are culturally attuned to the different markets; • increased competition from competitors that have strong positions in particular markets; • increased costs associated with recruiting and retaining talented and capable employees in foreign countries and maintaining our Company culture across all of our offices; 15 Table of Contents • greater difficulty in receiving payments from different geographies, including difficulties associated with exchange rate fluctuations, transfer of funds, longer cycles for payment and collecting accounts receivable, especially in emerging markets; • compliance with applicable foreign laws and regulations, including laws and regulations with respect to economic sanctions and export controls, anti-corruption, anti-bribery and anti-kickback, data privacy, cybersecurity and consumer protection that may conflict with local customs and practices in some jurisdictions in which we operate, and the risk of penalties if our practices are deemed not to be in compliance; • more stringent regulations relating to privacy and data security and the unauthorized use of, or access to, commercial and personal information, particularly in Europe and other jurisdictions; • limited or insufficient intellectual property protection or difficulties enforcing our rights to intellectual property; • political, social and economic instability in some countries; and • exposure to different tax jurisdictions and potential adverse tax consequences.
We expect to face particular challenges in global expansion and operations including: • increased costs associated with developing solutions and products and providing support in different languages; • increased costs in marketing and advertising to promote our products effectively in different markets; • localizing our products, services, content and features to ensure that they are culturally attuned to the different markets; 16 Table of Contents • increased competition from competitors that have strong positions in particular markets; • increased costs associated with recruiting and retaining talented and capable employees in foreign countries and maintaining our Company culture across all of our offices; • greater difficulty in receiving payments from different geographies, including difficulties associated with exchange rate fluctuations, transfer of funds, longer cycles for payment and collecting accounts receivable, especially in emerging markets; • compliance with applicable foreign laws and regulations, including laws and regulations with respect to economic sanctions and export controls, anti-corruption, anti-bribery and anti-kickback, data privacy, cybersecurity and consumer protection that may conflict with local customs and practices in some jurisdictions in which we operate, and the risk of penalties if our practices are deemed not to be in compliance; • more stringent regulations relating to privacy and data security and the unauthorized use of, or access to, commercial and personal information, particularly in Europe and other jurisdictions; • limited or insufficient intellectual property protection or difficulties enforcing our rights to intellectual property; • political, social and economic instability in some countries; and • exposure to different tax jurisdictions and potential adverse tax consequences.
Violations of data protection laws may lead to administrative penalties, including warnings, orders for rectification, suspension or termination of related businesses issued by competent authorities, revocation of business permits or licenses, or monetary fines; civil liabilities including compensation for infringement upon legitimate rights and interests of individuals and public interests litigation by the People’s Procuratorate depending on the severity and impact of the case; and even criminal liabilities in more severe cases.
Violations of data protection laws may lead to administrative penalties, including warnings, orders for rectification, suspension or termination of related businesses issued by competent authorities, revocation of business permits or licenses, or monetary fines; civil liabilities including compensation for infringement upon legitimate rights and interests of individuals and public interest litigation by the People’s Procuratorate depending on the severity and impact of the case; and even criminal liabilities in more severe cases.
Our business brands may also be negatively affected by attacks from our competitors, by negative publicity about the actions of consumers that are deemed to be hostile, illegal or inappropriate to other consumers, by third-party content providers acting inappropriately, by any regulatory developments designed to address such risks, or due to legal proceedings or investigations.
Our brands may also be negatively affected by attacks from our competitors, by negative publicity about the actions of consumers that are deemed to be hostile, illegal or inappropriate to other consumers, by third-party content providers acting inappropriately, by any regulatory developments designed to address such risks, or due to legal proceedings or investigations.
GDPR include certain limitations and stringent obligations with respect to the transfer of personal data from the EU and the United Kingdom to third countries, and the mechanisms to comply with such obligations are also in considerable flux and may lead to greater operational burdens, costs and compliance risks. Laws and regulations governing AI, including Generative AI, are rapidly developing.
GDPR include certain limitations and stringent obligations with respect to the transfer of personal data from the EU and the United Kingdom to third countries, and the mechanisms to comply with such obligations are in flux and may lead to greater operational burdens, costs and compliance risks. Laws and regulations governing AI, including Generative AI, are also rapidly developing.
In addition, an administrative fine may be imposed for failure to comply with the requirements under the PDPA, such as the collecting or processing of personal data without a statutory ground, using personal data outside of the scope of the specified purpose under which the personal data was collected, or failure to comply with restrictions on the cross-border transfer of personal data.
In addition, an administrative fine may be imposed for failure to comply with the requirements under the PDPA, such as collecting or processing personal data without a statutory ground, using personal data outside of the scope of the specified purpose under which the personal data was collected, or failing to comply with restrictions on the cross-border transfer of personal data.
We may introduce new products or terms of service or policies that users do not like, which may negatively affect our business brands. Additionally, the actions of our developers or advertisers may affect our business brands if consumers do not have a positive experience interacting with third parties, including advertisers and platform distributors, through our products and services.
We may introduce new products or terms of service or policies that users do not like, which may negatively affect our brands. Additionally, the actions of our developers or advertisers may affect our brands if consumers do not have a positive experience interacting with third parties, including advertisers and platform distributors, through our products and services.
Many of the new users of our mobile apps or web services are referred by existing users. Maintaining and enhancing our business brands will depend largely on our ability to continue to provide useful, reliable, trustworthy and innovative products and technologies, which may not always be successful or timely.
Many of the new users of our mobile apps or web services are referred by existing users. Maintaining and enhancing our brands will depend largely on our ability to continue to provide useful, reliable, trustworthy and innovative products and technologies, which may not always be successful or timely.
If the demand for AI photo and AI video markets stops or slows down, our business will be materially and adversely affected. Our sustainable development of B2C business was benefited from the rapid growth of the demand and usage of mobile photo and video editing apps in recent years.
If the demand for AI photo and AI video markets stops or slows down, our business will be materially and adversely affected. Our sustainable development of B2C business benefited from the rapid growth of the demand and usage of mobile photo and video editing apps in recent years.
Security breaches, improper access to or disclosure of our data or consumer data, other hacking and phishing attacks on our systems, or other cyberattacks may cause our products and solutions to be perceived as not being secure, which could harm our reputation and adversely affect our business.
Security breaches, improper access to or disclosure of our data or consumer data, other hacking and phishing attacks on our systems, or other cyberattacks may cause our solutions to be perceived as not being secure, which could harm our reputation and adversely affect our business.
If we inappropriately use or incorporate open source software subject to certain types of open source licenses that challenge the proprietary nature of our software products, we may be required to re-engineer our products, discontinue the sale of our products and solutions or take other remedial actions.
If we inappropriately use or incorporate open source software subject to certain types of open source licenses that challenge the proprietary nature of our software products, we may be required to re-engineer our products, discontinue the sale of our solutions or take other remedial actions.
Many of our customers deploy our products and solutions globally and we could be held liable in some jurisdictions in which we operate for content posted by our consumers, which could expose us to damages or other legal liability. Our platform allows our consumers to post content globally.
Many of our customers deploy our solutions globally and we could be held liable in some jurisdictions in which we operate for content posted by our consumers, which could expose us to damages or other legal liability. Our platform allows our consumers to post content globally.
The process of integrating an acquired company, business, technology, or personnel into our Company, as well as the performance of an acquired company, business, technology or personnel, are subject to various risks and challenges, including: • diverting management time and attention from operating our business; • disrupting our existing business operations; • customer acceptance of the acquired company’s offerings; • establishing or remediating the controls, procedures, and policies of the acquired company; • integrating the acquired business onto our systems and ensuring the acquired business complies with our financial reporting requirements and timelines; • retaining and integrating acquired employees, including aligning incentives between acquired employees and existing employees, as well as managing costs associated with eliminating redundancies or transferring employees under mutually agreed terms with minimal business disruption; • maintaining important business relationships and contracts of the acquired business; • liability for pre-acquisition activities of the acquired company; 14 Table of Contents • litigation or other claims or liabilities arising in connection with the acquired company; • impairment charges associated with goodwill, investments, and other acquired intangible assets; and • other unforeseen operational difficulties and expenditures.
The process of integrating an acquired company, business, technology, or personnel into our Company, as well as the performance of an acquired company, business, technology or personnel, are subject to various risks and challenges, including: • diverting management time and attention from operating our business; • disrupting our existing business operations; • customer acceptance of the acquired company’s offerings; • establishing or remediating the controls, procedures, and policies of the acquired company; • integrating the acquired business onto our systems and ensuring the acquired business complies with our financial reporting requirements and timelines; • retaining and integrating acquired employees, including aligning incentives between acquired employees and existing employees, as well as managing costs associated with eliminating redundancies or transferring employees under mutually agreed terms with minimal business disruption; • maintaining important business relationships and contracts of the acquired business; • liability for pre-acquisition activities of the acquired company; • litigation or other claims or liabilities arising in connection with the acquired company; • impairment charges associated with goodwill, investments, and other acquired intangible assets; and • other unforeseen operational difficulties and expenditures.
Our financial results in any given period can be 27 Table of Contents influenced by numerous factors occurring in a particular period, many of which we are unable to predict or are outside of our control, including: • development and introduction of new products or services by us or our competitors and the market reaction to such new products or services; • our ability to renew our subscriptions with, and expand sales of our products and solutions to, our existing brand in our portfolio; • ability of our data service providers to scale effectively and timely to provide the necessary technical infrastructure to offer our services; • growth and diversification of our revenue sources; • increases in marketing, sales and other operating expenses that we may incur to grow and expand our operations and to remain competitive; • changes in budgets of brands and retailers and in the timing of their budget cycles and purchasing decisions, including cost-cutting measures; • seasonal fluctuations in spending by brands.
Our financial results in any given period can be influenced by numerous factors occurring in a particular period, many of which we are unable to predict or are outside of our control, including: • development and introduction of new products or services by us or our competitors and the market reaction to such new products or services; • our ability to renew our subscriptions with, and expand sales of our solutions to, our existing brand in our portfolio; • ability of our data service providers to scale effectively and timely to provide the necessary technical infrastructure to offer our services; • growth and diversification of our revenue sources; • increases in marketing, sales and other operating expenses that we may incur to grow and expand our operations and to remain competitive; • changes in budgets of brands and retailers and in the timing of their budget cycles and purchasing decisions, including cost-cutting measures; • seasonal fluctuations in spending by brands.
The obligations of the EU AI Act will apply to actors across the AI value chain, such as providers, importers, distributors and deployers, and providers of certain general purpose AI models with systemic risks may be subject to additional requirements.
The obligations of the EU AI Act apply to actors across the AI value chain, such as providers, importers, distributors and deployers, and providers of certain general purpose AI models with systemic risks may be subject to additional requirements.
We also do not intend to provide U.S. holders of the Class A Ordinary Shares with the information that is required to make an election to have us treated as a “qualified electing fund” for U.S. federal income tax purposes. 41 Table of Contents We may issue additional Class A Ordinary Shares upon the exercise of outstanding Warrants, which may increase the number of shares eligible for future resale in the public market and result in dilution to our shareholders.
We also do not intend to provide U.S. holders of the Class A Ordinary Shares with the information that is required to make an election to have us treated as a “qualified electing fund” for U.S. federal income tax purposes. 46 Table of Contents We may issue additional Class A Ordinary Shares upon the exercise of outstanding Warrants, which may increase the number of shares eligible for future resale in the public market and result in dilution to our shareholders.
Historically, the fourth quarter has typically been the quarter with the largest bookings from brands and retailers, which impacts revenue, unbilled revenue, deferred revenue, accounts receivable and amortized commissions in future periods; • system failures or breaches of security or privacy of our system; • amount and timing of non-cash expenses, including stock-based compensation, goodwill impairments and other non-cash charges; • impact of new accounting pronouncements; • unforeseen contingencies, such as adverse litigation judgments, settlements or other litigation-related costs; • fluctuations in currency exchange rates and changes in the proportion of our revenue and expenses denominated in foreign currencies; • changes in laws and regulations that affect our business; and • changes in business or macroeconomic conditions, including the impact of inflationary pressures and increases in interest rates, and global conflicts.
Historically, the fourth quarter has typically been the quarter with the largest bookings from brands and retailers, which impacts revenue, unbilled revenue, deferred revenue, accounts receivable and amortized commissions in future periods; • system failures or breaches of security or privacy of our system; • amount and timing of non-cash expenses, including stock-based compensation, goodwill impairments and other non-cash charges; • impact of new accounting pronouncements; • unforeseen contingencies, such as adverse litigation judgments, settlements or other litigation-related costs; 30 Table of Contents • fluctuations in currency exchange rates and changes in the proportion of our revenue and expenses denominated in foreign currencies; • changes in laws and regulations that affect our business; and • changes in business or macroeconomic conditions, including the impact of inflationary pressures and increases in interest rates, and global conflicts.
We are an “emerging growth company,” as defined in the JOBS Act, and we may take advantage of certain exemptions from various reporting requirements that are applicable to other public companies that are not “emerging growth companies,” including the auditor attestation requirements of Section 404, reduced disclosure obligations regarding executive compensation in our periodic reports and proxy statements, and exemptions from the requirements of holding a nonbinding advisory vote on executive compensation and shareholder approval of any golden parachute payments not previously approved. 38 Table of Contents We will remain an emerging growth company until the earliest of: (1) the last day of the fiscal year (a) following the fifth anniversary of October 28, 2022, the date on which our Class A Ordinary Shares were offered in connection with the Transactions, (b) in which we have total annual gross revenues of at least $1.235 billion, or (c) in which we are deemed to be a “large accelerated filer” as defined in Rule 12b-2 under the Exchange Act, which would occur if the market value of our Class A Ordinary Shares that are held by non-affiliates exceeds $700 million as of the end of the prior fiscal year’s second fiscal quarter; or (2) the date on which we have issued more than $1 billion in non-convertible debt during the prior three-year period.
We are an “emerging growth company,” as defined in the JOBS Act, and we may take advantage of certain exemptions from various reporting requirements that are applicable to other public companies that are not “emerging growth companies,” including the auditor attestation requirements of Section 404, reduced disclosure obligations regarding executive compensation in our periodic reports and proxy statements, and exemptions from the requirements of holding a nonbinding advisory vote on executive compensation and shareholder approval of any golden parachute payments not previously approved. 43 Table of Contents We will remain an emerging growth company until the earliest of: (1) the last day of the fiscal year (a) following the fifth anniversary of October 28, 2022, the date on which our Class A Ordinary Shares were offered in connection with the Business Combination, (b) in which we have total annual gross revenues of at least $1.235 billion, or (c) in which we are deemed to be a “large accelerated filer” as defined in Rule 12b-2 under the Exchange Act, which would occur if the market value of our Class A Ordinary Shares that are held by non-affiliates exceeds $700 million as of the end of the prior fiscal year’s second fiscal quarter; or (2) the date on which we have issued more than $1 billion in non-convertible debt during the prior three-year period.
Several factors could negatively impact brand retention and consumer engagement, including: • Inability to continuously develop products and services that align with evolving brand and consumer preferences. • Competitors launching superior or more cost-effective solutions, leading to reduced demand for our offerings. • Budget cuts or lower spending on AI- and AR-based solutions by brands, particularly amid economic downturns in China. • Insufficient customer service or weakened brand relationships, resulting in dissatisfaction or disengagement. • Failure to address consumer concerns about privacy, data security, and information-sharing. • Technical issues or service disruptions that diminish the reliability or performance of our products.
Several factors could negatively impact brand retention and consumer engagement, including: • Inability to continuously develop products and services that align with evolving brand and consumer preferences. • Competitors launching superior or more cost-effective solutions, leading to reduced demand for our offerings. 11 Table of Contents • Budget cuts or lower spending on AI- and AR-based solutions by brands, particularly amid economic downturns in China. • Insufficient customer service or weakened brand relationships, resulting in dissatisfaction or disengagement. • Failure to address consumer concerns about privacy, data security, and information-sharing. • Technical issues or service disruptions that diminish the reliability or performance of our products.
As a U.S.-listed public company that is not a foreign private issuer, we will incur significant additional legal, accounting and other expenses that we will not incur as a foreign private issuer. 39 Table of Contents As we are a “foreign private issuer” and intend to follow certain home country corporate governance practices, our shareholders may not have the same protections afforded to shareholders of companies that are subject to all NYSE corporate governance requirements.
As a U.S.-listed public company that is not a foreign private issuer, we will incur significant additional legal, accounting and other expenses that we will not incur as a foreign private issuer. 44 Table of Contents As we are a “foreign private issuer” and intend to follow certain home country corporate governance practices, our shareholders may not have the same protections afforded to shareholders of companies that are subject to all NYSE corporate governance requirements.
The PDPA applies in principle to all of data collection and processing activities taking place in Taiwan without regard to whether the data subjects are Taiwanese nationals or not.
The PDPA applies in principle to all data collection and processing activities taking place in Taiwan without regard to whether the data subjects are Taiwanese nationals or not.
Such unpredictability, including uncertainty as to the scope and effect of our contractual, property (including intellectual property) and procedural rights, could materially and adversely affect our business and impede our ability to continue our operations. 34 Table of Contents Changes and developments in the political and economic policies of the PRC government or the prolonged economic downturn of Chinese economy may materially and adversely affect our business, financial conditions and operating results.
Such unpredictability, including uncertainty as to the scope and effect of our contractual, property (including intellectual property) and procedural rights, could materially and adversely affect our business and impede our ability to continue our operations. 39 Table of Contents Changes and developments in the political and economic policies of the PRC government or the prolonged economic downturn of Chinese economy may materially and adversely affect our business, financial conditions and operating results.
Consequently, a portion of the revenue we report in each period is derived from the recognition of deferred revenue relating to subscriptions and contracts entered into during previous quarters. As a result, a decline in new or renewed subscriptions in any single reporting period may have a small impact on the revenue that we recognize for such quarter.
Consequently, a portion of the revenue we report in each period is derived from the recognition of deferred revenue relating to subscriptions and contracts entered into during previous quarters. As a result, if a possible decline in new or renewed subscriptions in any single reporting period may have a small impact on the revenue that we recognize for such quarter.
We are unable to predict the effect that such sales may have on the prevailing market price of our Class A Ordinary Shares and Warrants. 36 Table of Contents Class A Ordinary Shares held by certain of our shareholders are eligible for resale, subject to, in the case of certain shareholders, volume, manner of sale and other limitations under Rule 144.
We are unable to predict the effect that such sales may have on the prevailing market price of our Class A Ordinary Shares and Warrants. 41 Table of Contents Class A Ordinary Shares held by certain of our shareholders are eligible for resale, subject to, in the case of certain shareholders, volume, manner of sale and other limitations under Rule 144.
Our sustainable growth in our B2C business depends heavily on our ability to continue to evolve our existing product offerings and introduce market-competitive products that effectively address the shifting consumer preferences and demands, so as to grow or retain our existing mobile app and web service users and convert free users into paying subscribers.
Our steady growth in our B2C business depends heavily on our ability to continue to evolve our existing product offerings and introduce market-competitive products that effectively address the shifting consumer preferences and demands, so as to grow or retain our existing mobile app and web service users and convert free users into paying subscribers.
If our remediation of these material weaknesses is not effective, or if we experience additional material weaknesses or otherwise fail to maintain an effective system of internal controls in the future, we may not be able to report our financial results accurately, prevent fraud or file our periodic reports as a public company in a timely manner.
If our remediation of the material weakness is not effective, or if we experience additional material weaknesses or otherwise fail to maintain an effective system of internal controls in the future, we may not be able to report our financial results accurately, prevent fraud or file our periodic reports as a public company in a timely manner.
In 2024, persistent inflation, interest rate fluctuations, geopolitical instability, sustained military conflicts, and broader economic uncertainties have contributed to heightened volatility in international markets. A prolonged economic slowdown could weaken consumer spending power, reducing demand for our products and subscriptions to the premium features of our mobile apps.
In 2025, persistent inflation, interest rate fluctuations, geopolitical instability, sustained military conflicts, and broader economic uncertainties have contributed to heightened volatility in international markets. A prolonged economic slowdown could weaken consumer spending power, reducing demand for our products and subscriptions to the premium features of our mobile apps.
Additionally, there is no guarantee that we will be able to obtain additional capital in a timely manner, or on favorable or acceptable terms, or at all. We recorded net losses of $161.7 million in 2022, and recorded net income of $5.4 million and $5.0 million, respectively, in 2023 and 2024.
Additionally, there is no guarantee that we will be able to obtain additional capital in a timely manner, or on favorable or acceptable terms, or at all. We recorded net losses of $161.7 million in 2022, and recorded net income of $5.4 million, $5.0 million and $4.6 million, respectively, in 2023, 2024 and 2025.
Any unfavorable changes of tax laws and regulations in this jurisdiction could increase our effective tax rate and have an adverse effect on our operating results. 31 Table of Contents Foreign government initiatives to restrict or ban access to our products in their countries could seriously harm our business.
Any unfavorable changes of tax laws and regulations in this jurisdiction could increase our effective tax rate and have an adverse effect on our operating results. 36 Table of Contents Foreign government initiatives to restrict or ban access to our products in their countries could seriously harm our business.
Moreover, the concentration of voting 37 Table of Contents power could deter potential investors from acquiring Class A Ordinary Shares, which carry one vote per share, compared to Class B Ordinary Shares, which carry ten votes per share, potentially affecting the trading price of Class A Ordinary Shares. In addition, as our CEO, Ms.
Moreover, the concentration of voting 42 Table of Contents power could deter potential investors from acquiring Class A Ordinary Shares, which carry one vote per share, compared to Class B Ordinary Shares, which carry ten votes per share, potentially affecting the trading price of Class A Ordinary Shares. In addition, as our CEO, Ms.
We cannot predict or estimate the amount of additional costs we will incur as a public company, especially when we are no longer qualified as an “emerging growth company” or the specific timing of such costs. We have identified material weaknesses in our internal control over financial reporting.
We cannot predict or estimate the amount of additional costs we will incur as a public company, especially when we are no longer qualified as an “emerging growth company” or the specific timing of such costs. We have identified a material weakness in our internal control over financial reporting.
If the development of the markets stops or slows down, our B2B business will be materially and adversely affected. The AI- and AR- beauty and fashion technologies and markets are relatively new and rapidly evolving, which subjects our business to uncertainties and challenges relating to the growth and profitability of these markets as a whole.
If the development of the markets stops or slows down, our B2B business will be materially and adversely affected. The AI- and AR- beauty and fashion technologies and markets are rapidly evolving, which subjects our business to uncertainties and challenges relating to the growth and profitability of these markets as a whole.
Such administrative fines may range from NTD20,000 to NTD200,000 for each occurrence of a violation, with increased fines ranging from NTD150,000 to NTD15,000,000 available for certain violations of the PDPA. The PRC regulatory and enforcement regime with regard to privacy and data security is evolving.
Such administrative fines may range from NTD20,000 to NTD200,000 for each occurrence of a violation, with increased fines ranging from NTD150,000 to NTD15,000,000 available for certain violations of the PDPA. The PRC regulatory and enforcement regime with regard to privacy, data security and AI is also evolving.
Any such penalties, proceedings or actions may disrupt our business operations and materially and adversely affect our reputation, business, financial condition and results of operations. 35 Table of Contents Risks Related to the Class A Ordinary Shares and Warrants The price of Class A Ordinary Shares may be volatile, and the value of Class A Ordinary Shares may decline.
Any such penalties, proceedings or actions may disrupt our business operations and materially and adversely affect our reputation, business, financial condition and results of operations. 40 Table of Contents Risks Related to the Class A Ordinary Shares and Warrants The price of Class A Ordinary Shares may be volatile, and the value of Class A Ordinary Shares may decline.
We believe that our business brands, including the brands of our mobile apps such as YouCam, have significantly contributed to the success of our business. We also believe that maintaining and enhancing our business brands is critical to expanding our base of mobile app or web service users, brand partners and retailers.
We believe that our company brands, including the brands of our mobile apps such as YouCam, have significantly contributed to the success of our business. We also believe that maintaining and enhancing our brands is critical to expanding our base of mobile app or web service users, business partners and retailers.
Many jurisdictions have established data privacy and cybersecurity legal frameworks with which we may need to comply.
Many jurisdictions have established comprehensive data privacy and cybersecurity legal frameworks with which we may need to comply.
Business Overview — Regulation — Exchange Controls in Taiwan” for additional details. 33 Table of Contents We may be required to obtain approvals from Taiwan authority for investment in our Taiwan subsidiary if the shareholding of Perfect reaches the threshold for such approval.
Business Overview — Regulation — Exchange Controls in Taiwan” for additional details. 38 Table of Contents We may be required to obtain approvals from Taiwan authority for investment in our Taiwan subsidiary if the shareholding of Perfect reaches the threshold for such approval.
The determination of foreign private issuer status is made annually on the last business day of an issuer’s most recently completed second fiscal quarter, and, accordingly, the next determination will be made with respect to us on June 30, 2025.
The determination of foreign private issuer status is made annually on the last business day of an issuer’s most recently completed second fiscal quarter, and, accordingly, the next determination will be made with respect to us on June 30, 2026.
We believe that we were a “passive foreign investment company” for U.S. federal income tax purposes in fiscal year 2024. We believe that we were a “passive foreign investment company,” or a PFIC, for U.S. federal income tax purposes in fiscal year 2024 and we may be a PFIC in fiscal year 2025 and future years.
We believe that we were a “passive foreign investment company” for U.S. federal income tax purposes in fiscal year 2025. We believe that we were a “passive foreign investment company,” or a PFIC, for U.S. federal income tax purposes in fiscal year 2025 and we may be a PFIC in fiscal year 2026 and future years.
If advertisers, partners or investors do not perceive our consumer, geographic, or other demographic metrics to be accurate representations of our consumer base or consumer engagement, or if we discover material inaccuracies in our consumer, geographic or other demographic metrics, our reputation may be seriously harmed, and our advertisers and partners may also be less willing to allocate their budgets or resources to us, which could seriously harm our business.
If advertisers, partners or investors do not perceive our consumer, geographic, or other demographic metrics to be accurate representations of our consumer base or consumer engagement, or if we discover material inaccuracies in our consumer, 19 Table of Contents geographic or other demographic metrics, our reputation may be seriously harmed, and our advertisers and partners may also be less willing to allocate their budgets or resources to us, which could seriously harm our business.
In connection with the Business Combination, we entered into an Assignment, Assumption and Amendment Agreement on October 28, 2022, pursuant to which Provident assigned to us all of its rights, title, interests, and liabilities and obligations in and under the Warrant Agreement, dated as of January 7, 2021, by and between Provident and Continental.
In connection with the Business Combination, we entered into an Assignment, Assumption and Amendment Agreement on October 28, 2022, pursuant to which Provident assigned to us all of its rights, title, interests, and liabilities 47 Table of Contents and obligations in and under the Warrant Agreement, dated as of January 7, 2021, by and between Provident and Continental.
There is no assurance that any future outbreak of such diseases would not have a material adverse effect on our business, financial condition and results of operations. 44 Table of Contents Some of our customers have experienced, and may continue to experience, financial hardships that could result in delayed or even uncollectible payments in the future.
There is no assurance that any future outbreak of such diseases would not have a material adverse effect on our business, financial condition and results of operations. Some of our customers have experienced, and may continue to experience, financial hardships that could result in delayed or even uncollectible payments in the future.
Any disruption or failure in our infrastructure could hinder our ability to handle existing or increased traffic on our platform, which could significantly harm our business. 22 Table of Contents Our technical infrastructure is also vulnerable to the risk of damage from natural disasters, such as earthquakes and typhoons, as well as from acts of terrorism or other criminal acts.
Any disruption or failure in our infrastructure could hinder our ability to handle existing or increased traffic on our platform, which could significantly harm our business. Our technical infrastructure is also vulnerable to the risk of damage from natural disasters, such as earthquakes and typhoons, as well as from acts of terrorism or other criminal acts.
Based on the outcome of examinations by relevant tax authorities, or as a result of the expiration of statutes of limitations for specific jurisdictions, it is possible that the reserves for tax positions taken in previously filed tax returns will 28 Table of Contents materially change from those recorded in our financial statements.
Based on the outcome of examinations by relevant tax authorities, or as a result of the expiration of statutes of limitations for specific jurisdictions, it is possible that the reserves for tax positions taken in previously filed tax returns will materially change from those recorded in our financial statements.
As a public company in the United States, we are required, pursuant to Section 404, to furnish a report by management, among other things, on the effectiveness of our internal control over financial reporting beginning with our annual report for the fiscal year ended December 31, 2023.
As a public company in the United States, we have been required, pursuant to Section 404, to furnish a report by management, among other things, on the effectiveness of our internal control over financial reporting beginning with our annual report for the fiscal year ended December 31, 2023.
We may face claims relating to information that is published or made available on our products. Our mobile apps, in particular YouCam Makeup and YouCam Perfect, have the attributes of social media and may be misused by individuals 17 Table of Contents or groups of individuals to engage in inappropriate or illegal activities.
We may face claims relating to information that is published or made available on our products. Our mobile apps, in particular YouCam Makeup and YouCam Perfect, have the attributes of social media and may be misused by individuals or groups of individuals to engage in inappropriate or illegal activities.
In any of these cases, we may be required to expend significant time and expense to prevent infringement or to enforce our rights. We may be subject to intellectual property infringement claims or other allegations by third parties, which may cause substantial costs and materially and adversely affect our business operations.
In any of these cases, we may be required to expend significant time and expense to prevent infringement or to enforce our rights. 27 Table of Contents We may be subject to intellectual property infringement claims or other allegations by third parties, which may cause substantial costs and materially and adversely affect our business operations.
These investments, while increasing our expenses, may not result in an increase in revenues or growth in our business. If we are unable to achieve adequate revenue growth and to manage our expenses, we may incur significant losses in the future. We recognize revenue from recurring subscriptions to our products over the terms of these subscriptions.
These investments, while increasing our expenses, may not result in an increase in revenues or growth in our business. If we are unable to achieve adequate revenue growth and to manage our expenses, we may incur significant losses in the future. 29 Table of Contents We recognize revenue from recurring subscriptions to our products over the terms of these subscriptions.
If we do not maintain a current and effective prospectus relating to the Class A Ordinary Shares issuable upon exercise of the Perfect Public Warrants as part of the Transactions, at the time that holders wish to exercise such Perfect Public Warrants, they will only be able to exercise them on a “cashless basis”.
If we do not maintain a current and effective prospectus relating to the Class A Ordinary Shares issuable upon exercise of the Perfect Public Warrants, at the time that holders wish to exercise such Perfect Public Warrants, they will only be able to exercise them on a “cashless basis”.
As of December 31, 2024, we believe that we do not hold any investment securities. We intend to continue to conduct our operations so that we will not be deemed an investment company.
As of December 31, 2025, we believe that we do not hold any investment securities. We intend to continue to conduct our operations so that we will not be deemed an investment company.
Negative incidents or dissatisfaction in relation to our products and services regardless of all our efforts, could deter current and 21 Table of Contents potential consumers from using our products and services, which could have material adverse effects on our reputation, growth and consumer engagement, and could seriously harm our operational cost structure.
Negative incidents or dissatisfaction in relation to our products and services regardless of all our efforts, could deter current and potential consumers from using our products and services, which could have material adverse effects on our reputation, growth and consumer engagement, and could seriously harm our operational cost structure.
If our AWS, Alibaba Cloud or Google Cloud server code comes across some serious bugs that disrupt the service, many of our online services to clients will be affected. The Service-Level Agreement we have signed with most of our clients requires 99.7% to 99.99% service availability.
If our AWS, Alibaba Cloud or Google Cloud server code comes across some serious bugs that disrupt the service, many of our online services to clients will be affected. The Service-Level Agreement we have signed with most of our clients requires up to 99.5% service availability.
Our competitors that control the operating systems and related hardware that our mobile apps run on could make interoperability of our products with those mobile operating systems more difficult or display their competitive offerings more prominently than ours. Moreover, our products require high-bandwidth data capabilities.
Our competitors that control the operating systems and related hardware that our mobile apps run on could make interoperability of our products with those mobile operating systems more difficult or display their competitive offerings more prominently than ours. 26 Table of Contents Moreover, our products require high-bandwidth data capabilities.
If we fail to adequately address any of the challenges and manage our growth effectively, our financial performance, business and results of operations may be adversely impacted. Any businesses we will invest in or acquire may not perform as expected or be successfully integrated.
If we fail to adequately address any of the 13 Table of Contents challenges and manage our growth effectively, our financial performance, business and results of operations may be adversely impacted. Any businesses we will invest in or acquire may not perform as expected or be successfully integrated.
Employee departures or a shortage of skilled personnel could diminish the quality and value of our AI solutions, leading to reduced adoption by users and brand customers, ultimately harming our financial and business performance. 20 Table of Contents The information that our AI solutions learns may include confidential information.
Employee departures or a shortage of skilled personnel could diminish the quality and value of our AI solutions, leading to reduced adoption by users and brand customers, ultimately harming our financial and business performance. The information that our AI solutions learns may include confidential information.
Any such difficulties could have a material impact on our ability to deliver the products and services we intend to offer, reduce our reliability and harm our reputation. The successful operation of our business also depends upon the performance and reliability of the Internet infrastructure in China and the safety of our network and infrastructure.
Any such difficulties could have a material impact on our ability to deliver the products and services we intend to offer, reduce our reliability and harm our reputation. The successful operation of our business also depends upon the performance and reliability of the Internet infrastructure globally and the safety of our network and infrastructure.
We expect a substantial number of downloads of our mobile apps will continue to be derived from these distribution channels and we expect that we will continue to rely on Apple App Store for downloads of our mobile apps. Accordingly, we believe that maintaining successful partnerships with 23 Table of Contents Apple is critical to our success.
We expect a substantial number of downloads of our mobile apps will continue to be derived from these distribution channels and we expect that we will continue to rely on Apple App Store for downloads of our mobile apps. Accordingly, we believe that maintaining successful partnerships with Apple is critical to our success.
In recent years, the government authorities of mainland China have released a series of laws and regulations related to generative AI services, including the Administration Provisions on Algorithmic Recommendation of Internet Information Services, the Administrative Provisions on Deep Synthesis of Internet Information Services and the Interim Measures for the Administration of Generative Artificial Intelligence Services.
In recent years, PRC government authorities have released a series of laws and regulations related to AI and Generative AI services, including the Administration Provisions on Algorithmic Recommendation of Internet Information Services, the Administrative Provisions on Deep Synthesis of Internet Information Services and the Interim Measures for the Administration of Generative Artificial Intelligence Services.
Although the revenue concentration from those largest business partners has been diversifying over the past few years, we expect that a limited 16 Table of Contents number of our business partners will continue to contribute a notable portion of our revenues in the near future.
Although the revenue concentration from those largest business partners has been diversifying over the past few years, we expect that a limited number of our business partners will continue to contribute a notable portion of our revenues in the near future.
In order to address such technical difficulties, we may need to make fundamental changes to the configurations or of the underlying systems we use or expend a significant amount of time and resources to obtain the technical skills or expertise needed to adequately address such issues.
In order to address such technical 24 Table of Contents difficulties, we may need to make fundamental changes to the configurations or of the underlying systems we use or expend a significant amount of time and resources to obtain the technical skills or expertise needed to adequately address such issues.
Certain of our customers and we have been named parties in lawsuits that allege violations of the BIPA through deploying our product and technology, including virtual try-on solutions that may be perceived as subject to these laws and regulations.
Certain of our customers and we have been named parties in lawsuits that allege violations of BIPA through deploying our products and technology, including virtual try-on solutions that may be perceived as subject to these laws and regulations.
We may not be successful if we are not able to innovate, develop and provide new products and services or upgrade our existing products and services in a timely and cost-effective manner to address rapidly evolving consumer preferences, 12 Table of Contents industry trends and technological changes, and any new products and services we develop and provide may expose us to new risks and may not achieve expected returns.
We may not be successful if we are not able to innovate, develop and provide new products and services or upgrade our existing products and services in a timely and cost-effective manner to address rapidly evolving consumer preferences, industry trends and technological changes, and any new products and services we develop and provide may expose us to new risks and may not achieve expected returns.
The success of our broad range of AI- and AR- powered business and consumer solutions is reliant on technology. We currently primarily offer 31 SaaS technology solutions, six mobile apps and one web based editor. Our ability to attract and retain consumers largely depends on our ability to maintain and scale our technical infrastructure.
The success of our broad range of AI- and AR- powered business and consumer solutions is reliant on technology. We currently primarily offer seven mobile apps, one-web based editor and 47 SaaS technology solutions, . Our ability to attract and retain consumers largely depends on our ability to maintain and scale our technical infrastructure.
Nevertheless, depending on future developments of global trade tensions, such regulations, rules, or measures may have an adverse impact on our business and operations, and we may incur significant legal liability and financial losses as a result. 32 Table of Contents Risks Related to Doing Business in Taiwan Any lack of requisite approvals, licenses, permits or filings or failure to comply with any requirements of Taiwan laws, regulations and policies may materially and adversely affect our daily operations.
Nevertheless, depending on future developments of global trade tensions, such regulations, rules, or measures may have an adverse impact on our business and operations, and we may incur significant legal liability and financial losses as a result. 37 Table of Contents Risks Related to Doing Business in the Jurisdictions Where We Operate Any lack of requisite approvals, licenses, permits or filings or failure to comply with any requirements of Taiwan laws, regulations and policies may materially and adversely affect our daily operations.
If we fail to maintain good relationships with Apple, it may adversely impact our ability to continue to offer our products and services, which in turn could have a material adverse impact on our business. We rely on third-party proprietary and open source software for our products and services.
If we fail to maintain good relationships with Apple, it may adversely impact our ability to continue to offer our products and services, which in turn could have a material adverse impact on our business. 25 Table of Contents We rely on third-party proprietary and open source software for our products and services.
Therefore, the maintenance of strengths and leading position in AI-driven business and services depends largely on our ability to promptly adapt to the fast-paced technological changes in the development and implementation of AI products and services.
Therefore, the maintenance of strengths and leading position in AI-driven business and services depends largely on our ability to promptly adapt to the fast-paced 21 Table of Contents technological changes in the development and implementation of AI products and services.
For example, the European Union (the “EU”) has adopted the General Data Protection Regulation (the “GDPR”), which requires covered businesses to comply with rules regarding the processing of personal data, including its use, protection and the ability of persons whose personal data is processed to access, to correct or delete personal data about themselves.
For example, the EU has adopted the General Data Protection Regulation (the “GDPR”), which requires covered businesses to comply with rules regarding the processing of personal data, including its use, protection and the ability of persons whose personal data is processed to access, correct or delete personal data about themselves.
Our costs are growing rapidly and may increase faster than our revenue, which could seriously harm our business or increase our losses. As our business continues to grow, we expect our expenses to grow in the future.
Our costs are growing and may sometime increase faster than our revenue, which could harm our business or increase our losses. As our business continues to grow, we expect our expenses to grow in the future.
This exclusive forum 42 Table of Contents provision could limit the ability of holders of the Warrants to obtain what they believe to be a favorable judicial forum for disputes related to such agreement.
This exclusive forum provision could limit the ability of holders of the Warrants to obtain what they believe to be a favorable judicial forum for disputes related to such agreement.
It is possible that existing or newly introduced laws and regulations, or their interpretation, application or enforcement, could significantly affect the value of the data collected and generated by us during operation, force us to change our data and other business practices and cause us to incur significant compliance costs.
It is possible that existing or newly introduced laws and regulations, or their interpretation, application or enforcement, could significantly affect the value of the data collected and generated by us during operation, force us to change our data and other business practices, constrain the design and deployment of our AI systems and cause us to incur significant compliance costs.
In particular, we believe that the continued revenue growth depends on a number of factors, in particular, our ability to: • deepen our penetration into the top 20 beauty groups; • expand our reach among the indie brands, emerging new brands and retailers; • expand our market penetration into global top luxury and fashion brands; 13 Table of Contents • increase market share/awareness in med-spa, skincare clinics and aesthetic beauty clinics; • develop and launch market competitive products and premium features that effectively address brands and consumer demands; • enhance and optimize AI- and AR- technology solutions to advance product offerings; and • pursue strategic alliances, joint venture, investments and acquisition opportunities across categories and geographies.
In particular, we believe that sustained revenue growth will depend on a number of factors, including our ability to: • deepen our penetration into the top 20 beauty groups; • expand our services into top fashion groups; • expand our reach among the indie brands, emerging new brands and retailers; • expand our market penetration into global top luxury and fashion brands; • increase market share/awareness in med-spa, skincare clinics and aesthetic beauty clinics; • develop and launch market competitive products and premium features that effectively address brands and consumer demands; • enhance and optimize AI- and AR- technology solutions to advance product offerings; and • pursue strategic alliances, joint venture, investments and acquisition opportunities across categories and geographies.
Even though our revenues have grown over the years, from $47.3 million in 2022, to $53.5 million in 2023 and to $60.2 million in 2024, our revenue growth rate has slightly slowed in recent years and may continue to slow down in the future due to a variety of factors.
Even though our revenues have grown over the years, from $53.5 million in 2023, $60.2 million in 2024 to $69.2 million in 2025, our revenue growth rate has slightly slowed in recent years and may continue to slow down in the future due to a variety of factors.
Governmental authorities, including the Cyberspace Administration of China, the Ministry of Public Security and the State Administration for Market Regulation, are putting great focus on the enforcement of data privacy and protection laws and regulations with varying and evolving standards and interpretations.
Governmental authorities, including the Cyberspace Administration of China, the Ministry of Public Security and the State Administration for Market Regulation, are focusing on the enforcement of data privacy and protection laws and regulations with varying and evolving standards and interpretations.
If we fail to maintain good 10 Table of Contents relationships with Apple or Google, it may adversely impact our ability to continue to offer our products and services or effect payment processing, which in turn could have a material adverse impact on our business. We operate in relatively new and rapidly evolving markets in beauty and fashion.
If we fail to maintain good relationships with Apple or Google, it may adversely impact our ability to continue to offer our products and services or effect payment processing, which in turn could have a material adverse impact on our business. We operate in a rapidly evolving markets in beauty and fashion.
GDPR are substantially the same, going forward there is an increasing risk for divergence in application, interpretation and enforcement of the data privacy and cybersecurity laws and regulations as between the EU and the United Kingdom, which may result in greater operational 29 Table of Contents burdens, costs and compliance risks. Additionally, the GDPR and the U.K.
GDPR are substantially the same, there is an increasing risk of divergence in application, interpretation and enforcement of the data privacy and cybersecurity laws and regulations as between the EU and the United Kingdom, which may result in greater operational burdens, costs and compliance risks. Additionally, the GDPR and the U.K.

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For our B2B business, we empower beauty, skincare clinics, med spa, jewelry, watch, fashion, aesthetic skin beauty brands and retailers by providing subscription-based tech modules that enable them to offer beauty, skincare and fashion product virtual try-on experiences to their end consumers across multiple channels and product groups.
For our B2B business, we empower beauty, fashion, skincare clinics, med spa, jewelry, watch, fashion, aesthetic skin beauty brands and retailers by providing subscription-based tech modules that enable them to offer beauty, skincare and fashion product virtual try-on experiences to their end consumers across multiple channels and product groups.
We believe that as users are satisfied with the quality of our products, they will stick to our platforms and eventually our apps will become an integral part of users’ daily lives. Our YouCam family apps and web services, powered by AI-driven tools, are substantially lowering the barriers to content creation.
We believe that as users are satisfied with the quality of our products, they will stick to our platforms and eventually our apps and web services will become an integral part of users’ daily lives. Our YouCam family apps and web services, powered by AI-driven tools, are substantially lowering the barriers to content creation.
Perfect Console can also offer comprehensive product tryout insights, complete brand analysis and customer content management systems, enabling brands to effectively track, analyze, and manage consumer engagement. • Value Proposition to Developers Our comprehensive SaaS API business model offers developers a powerful toolkit to seamlessly integrate advanced AI technologies into their applications and platforms.
Perfect Console can also offer comprehensive product tryout insights, complete brand analysis and customer content management systems, enabling brands to effectively track, analyze, and manage consumer engagement. • Value Proposition to Developers Our comprehensive API business model offers developers a powerful toolkit to seamlessly integrate advanced AI technologies into their applications and platforms.
Our current offerings cover makeup, nail art, hairstyling, eyewear, watch, jewelry try-ons, advanced skin diagnostics and simulation, and foundation shade matching, all powered by a robust recommendation engine for ultra-personalized results.
Our current offerings cover makeup, nail art, hairstyling, eyewear, watch, jewelry try-ons, advanced skin diagnostics and simulation, and foundation shade matching, all powered by a robust AI recommendation engine for ultra-personalized results.
In 2024, we continue to follow the four pillars established in 2023 as our primary AI development strategies to serve our brand customers and mobile app users: (1) Beauty AI - a comprehensive suite of solutions focused on color cosmetics virtual applications providing beauty virtual try-ons with high fidelity in color and textures; (2) Skin AI - a complete line of over 15 skin concern diagnostics and simulations with high-definition capability, helping consumers to identify their skin needs; (3) Fashion AI - enabling watch and jewelry brands to offer hyper realistic 3D object virtual product try-on in real time; and (4) Generative AI - leveraging on the AI-diffusion technology to create new series of AI visual enhancement and creation toolkits, helping consumers improve their photos and videos. • Data-Enabled Product Development Strategy Based on consumers’ try-on behaviors across our multiple channels, we are able to gain valuable insights into consumers’ behaviors and preferences, as well as popular trends emerging in the industry, which in turn accelerates the product development process to create innovative products and services that cater to what the consumers want.
In 2025, we continue to follow the previously established four pillars as our primary AI development strategies to serve our brand customers and mobile app users: (1) Beauty AI - a comprehensive suite of solutions focused on color cosmetics virtual applications providing beauty virtual try-ons with high fidelity in color and textures; (2) Skin AI - a complete line of over 15 skin concern diagnostics and simulations with high-definition capability, helping consumers to identify their skin needs; (3) Fashion AI - enabling watch and jewelry brands to offer hyper realistic 3D object virtual product try-on in real time; and (4) Generative AI - leveraging on the AI-diffusion technology to create new series of AI visual enhancement and creation toolkits, helping consumers improve their photos and videos. • Data-Enabled Product Development Strategy Based on consumers’ try-on behaviors across our multiple channels, we are able to gain valuable insights into consumers’ behaviors and preferences, as well as popular trends emerging in the industry, which in turn accelerates the product development process to create innovative products and services that cater to what the consumers want.
We believe beauty and fashion brands naturally prefer a neutral platform such as us which has deployment capabilities across 68 Table of Contents all sales channels and social networks, as it provides brands with the peace of mind that the same set of SKUs only needs to be configured once and can then be flexibly deployed across sales channels for consistent consumer experience.
We believe beauty and fashion brands naturally prefer a neutral platform such as us which has deployment capabilities across 79 Table of Contents all sales channels and social networks, as it provides brands with the peace of mind that the same set of SKUs only needs to be configured once and can then be flexibly deployed across sales channels for consistent consumer experience.
In 2024 we enhanced the realism of the makeup textures for newer categories such as eyeliner. Our solution covers a wide range of virtual makeup products, including, but not limited to, foundations, lipsticks, blushes, eyeliners, mascaras, and eyeshadows. In 2024, our lipstick rendering effects now support over 8 types of lip pattern for even higher degree of personalization in beauty.
In 2024, we enhanced the realism of the makeup textures for newer categories such as eyeliner. Our solution covers a wide range of virtual makeup products, including, but not limited to, foundations, lipsticks, blushes, eyeliners, mascaras, and eyeshadows. In 2024, our lipstick rendering effects now support over eight types of lip pattern for even higher degree of personalization in beauty.
Capitalizing on the Generative AI technologies, it allows users to easily transform text descriptions into high-resolution digital images. This AI-based tool is capable of generating images in up to 20 artistic styles, including Van Gogh, Pop Art, Anime, Pixel Art, and Cartoon. Users can visualize their ideas without complex design skills.
Capitalizing on the Generative AI technologies, it allows users to easily transform text descriptions into high-resolution digital images. This AI-based tool is capable of generating images in up to 100 artistic styles, including Van Gogh, Pop Art, Anime, Pixel Art, and Cartoon. Users can visualize their ideas without complex design skills.
Through this approach, we position ourselves as a trusted, future-ready partner for developers who seek to build the next generation of AI-powered applications. 54 Table of Contents • Our Products and Services for Consumers and Enterprises We provide an AI- and AR-platform that provides true-to-life virtual try-ons across multiple platforms, including brand-owned websites, in-store kiosks, retailer websites, and official mobile applications, as well as major third-party platforms such as Alphabet (Google and YouTube), Snap, Alibaba (Taobao and Tmall), and Tencent (WeChat).
Through this approach, we position ourselves as a trusted, future-ready partner for developers who seek to build the next generation of AI-powered applications. • Our Products and Services for Consumers and Enterprises We provide an AI- and AR-platform that provides true-to-life virtual try-ons across multiple platforms, including brand-owned websites, in-store kiosks, retailer websites, and official mobile applications, as well as major third-party platforms such as Alphabet (Google and YouTube), Snap, Alibaba (Taobao and Tmall), and Tencent (WeChat).
We are also dedicated to nurturing young talent, with 19% of our team were hired fresh out of university. These talents bring energy, excitement and out-of-the-box ideas that help us keep innovating and staying on top of industry trends. We respect everyone equally and hire employees based on talent only.
We are also dedicated to nurturing young talent, with 16% of our team were hired fresh out of university. These talents bring energy, excitement and out-of-the-box ideas that help us keep innovating and staying on top of industry trends. We respect everyone equally and hire employees based on talent only.
Our team has designed patented and patent-pending technologies such as AgileHand® AR and foundation shade matching, AI-powered wrist mapping, physically based rendering, and 50 Table of Contents Generative AI applications to help consumer create and enhance their photos and videos in YouCam family apps and web-based editor. • Seasoned Management Team with Proven Track Record We are led by a seasoned yet innovative executive team, with an average of over 20 years of experience in the technology industry.
Our team has designed patented and patent-pending technologies such as AgileHand® AR and foundation shade matching, AI-powered wrist mapping, physically based rendering, and Generative AI applications to help consumer create and enhance their photos and videos in YouCam family apps and web-based editor. • Seasoned Management Team with Proven Track Record We are led by a seasoned yet innovative executive team, with an average of over 20 years of experience in the technology industry.
Specifically, we provide the following products and services through (i) our iOS and Android mobile apps and cloud platform, or (ii) licensing our customers offline SDK or AI- and AR- offline solutions or mobile apps designed based on customers’ specifications, the revenue of which is recognized in “AR/AI cloud solutions and subscription” and “licensing” components of our revenue, respectively.
Specifically, we provide the following products and services through (i) our iOS and Android mobile apps and cloud platform, or (ii) licensing our customers offline SDK or AI- and AR- offline mobile apps or solutions designed based on customers’ specifications, the revenue of which is recognized in “AI- and AR- cloud solutions and subscription” and “licensing” components of our revenue, respectively.
We run a hybrid business model of direct consumer business (B2C business) and enterprise business (B2B business). For B2C business, we offer six mobile apps under the “YouCam” suite, along with one online editing service tool, YouCam Online Editor, featuring AI- and AR- technologies. For B2B business, we offer AI- and AR-powered solutions tailored for the beauty and fashion industry.
We run a hybrid business model of direct consumer business (B2C business) and enterprise business (B2B business). For B2C business, we offer seven mobile apps under the “YouCam” suite, along with one online editing service tool, YouCam Online Editor, featuring AI- and AR- technologies. For B2B business, we offer AI- and AR-powered solutions tailored for the beauty and fashion industry.
Our in-house algorithms are created by a team of devoted engineers who prioritize inclusivity, ensuring our technologies are accessible and enjoyable for everyone, regardless of gender, age, or ethnicity. 46 Table of Contents Trust-worthy — We are committed to building trust, excellence and customer satisfaction for all our partners.
Our in-house algorithms are created by a team of devoted engineers who prioritize inclusivity, ensuring our technologies are accessible and enjoyable for everyone, regardless of gender, age, or ethnicity. 51 Table of Contents Trust-worthy — We are committed to building trust, excellence and customer satisfaction for all our partners.
Building on years of expertise in multimedia technology and AI development, our product offerings have expanded from makeup virtual try-ons and photo editing to more creative features powered by GenAI, as well as more advanced editing, beautification, and enhancement features for photos and videos.
Building on years of expertise in multimedia technology and AI development, our product offerings have expanded from makeup virtual try-ons and photo editing to more creative features powered by Generative AI, as well as more advanced editing, beautification, and enhancement features for photos and videos.
By innovating new AI technologies and nurturing our user base relentlessly, we believe our YouCam offerings will provide a variety of solutions that can facilitate and enhance users’ digital lifestyles and AI journeys. • Develop innovative Generative AI features for B2C apps subscriptions We are focused on harnessing the power of Generative AI to deliver engaging new features that is becoming an integral part of the premium subscription offerings for our B2C mobile apps.
By innovating new AI technologies and nurturing our user base relentlessly, we believe our YouCam offerings will provide a variety of solutions that can facilitate and enhance users’ digital lifestyles and AI journeys. 55 Table of Contents • Develop innovative Generative AI features for B2C apps subscriptions We are focused on harnessing the power of Generative AI to deliver engaging new features that is becoming an integral part of the premium subscription offerings for our B2C mobile apps.
AI Avatar offers a unique platform for users to upload their selfie images and create more than 25 styles of digital avatars for every occasion. These digital twins allow users to creatively express themselves and stand out on social media and online platforms.
AI Avatar offers a unique platform for users to upload their selfie images and create more than 71 styles of digital avatars for every occasion. These digital twins allow users to creatively express themselves and stand out on social media and online platforms.
With full-spectrum customization, such as 58 Table of Contents adjusting nose tip size, jaw shape, or the degree of a brow lift, it helps set clear expectations, reduce uncertainties, and boost confidence in final outcomes. By delivering true-to-life, adjustable simulations, clinics and med spas can enhance patient communication, streamline the consultation process, and supercharge their marketing efforts.
With full-spectrum customization, such as adjusting nose tip size, jaw shape, or the degree of a brow lift, it helps set clear expectations, reduce uncertainties, and boost confidence in final outcomes. By delivering true-to-life, adjustable simulations, clinics and med spas can enhance patient communication, streamline the consultation process, and supercharge their marketing efforts.
By combining user-friendly interfaces with advanced AI- and AR- capabilities, our apps serve both casual users and beauty enthusiasts, enabling everyone to transform their creative vision into high-quality outputs. From quick touch-ups and immersive beauty filters to sophisticated video enhancements and generative imaging, our solutions streamline the entire content production cycle within one cohesive ecosystem.
By combining user-friendly interfaces with advanced AI- and AR- capabilities, our mobile apps and web services serve both casual users and beauty enthusiasts, enabling everyone to transform their creative vision into high-quality outputs. From quick touch-ups and immersive beauty filters to sophisticated video enhancements and generative imaging, our solutions streamline the entire content production cycle within one cohesive ecosystem.
The special features from our apps can empower users to express themselves freely and creatively on social media or other platforms using high-quality and ultra-personalized photos/videos edited or generated by YouCam apps.
The special features from our apps and web services can empower users to express themselves freely and creatively on social media or other platforms using high-quality and ultra-personalized photos or videos edited or generated by YouCam apps or web services.
For each of the three years ended December 31, 2024, our revenue subject to foreign exchange controls in Taiwan represented less than 1.0% of our total revenue, and our revenue denominated in NTD was fully used for our Taiwan subsidiary’s operation.
For each of the three years ended December 31, 2025, our revenue subject to foreign exchange controls in Taiwan represented less than 1.0% of our total revenue, and our revenue denominated in NTD was fully used for our Taiwan subsidiary’s operation.
As a result, the democratization of AI-driven content creation is transforming social media aesthetics, amplifying the voice of everyday creators, and opening new avenues for personal expression. 53 Table of Contents • Value Proposition to Brands As consumers’ shopping behavior and expectations evolves rapidly, brands need to react and deliver solutions that enhance their consumers’ shopping experience and meet their new expectations.
As a result, the democratization of AI-driven content creation is transforming social media aesthetics, amplifying the voice of everyday creators and opening new avenues for personal expression. • Value Proposition to Brands As consumers’ shopping behavior and expectations evolves rapidly, brands need to react and deliver solutions that enhance their consumers’ shopping experience and meet their new expectations.
In addition to detecting skin concerns, our AI engine can also generate visual simulation that tracks gradual improvements directly on a consumer’s face, giving users simulations of the progress they can expect to see over time. It can also give recommendations to consumers that can be tailored to brands’ products and clinical tests.
In addition to detecting skin concerns, our AI engine can also generate visual simulation that tracks gradual improvements directly on a consumer’s face, giving users simulations of the progress they can expect to 63 Table of Contents see over time. It can also give recommendations to consumers that can be tailored to brands’ products and clinical tests.
As Generative AI becomes an integral tool for photo editing and beautification, these features allow users to unlock new possibilities for creative expression and artistry, aligning with the evolving trend for more personalized and expressive digital content. AI Text-to-Image AI Text-to-Image feature is the highlight of the newly launched mobile app YouCam AI Pro.
As Generative AI becomes an integral tool for photo editing and beautification, these 69 Table of Contents features allow users to unlock new possibilities for creative expression and artistry, aligning with the evolving trend for more personalized and expressive digital content. AI Text-to-Image AI Text-to-Image feature is the highlight of the newly launched mobile app YouCam AI Pro.
The AI Hair Length Detection feature categorizes hair into five distinct lengths, from above-the-ear to mid-back, enabling brands to deliver precise product and styling recommendations. By analyzing vast datasets, the solution ensures accurate identification of each user’s hair length for a more personalized recommendation in style and product selection.
The AI Hair Length Detection feature categorizes hair into five distinct lengths, 65 Table of Contents from above-the-ear to mid-back, enabling brands to deliver precise product and styling recommendations. By analyzing vast datasets, the solution ensures accurate identification of each user’s hair length for a more personalized recommendation in style and product selection.
Our current solutions include virtual try-ons for makeup, nail art, hairstyles, watches, eyewear, jewelry, advanced skin diagnostic and simulation, and foundation shade finder. Brands and retailers can deploy these solutions through various channels, including mobile apps, websites, in-store kiosks, and third-party e-commerce platforms.
Our current solutions include virtual try-ons for makeup, shoes, bags, scarves, nail art, hairstyles, watches, eyewear, jewelry, advanced skin diagnostic and simulation, and foundation shade finder. Brands and retailers can deploy these solutions through various channels, including mobile apps, websites, in-store kiosks, and third-party e-commerce platforms.
Furthermore, on December 8, 2022, the Ministry of Industry and Information Technology of the PRC released the Administrative Measures for Data Security in Industry and Information Technology Sectors (Trial), effective from January l, 2023, which, among other things, impose specific data security 72 Table of Contents management requirements and certain filing and reporting obligations on processors of important data and core data in industry and information technology sectors.
Furthermore, on December 8, 2022, the Ministry of Industry and Information Technology of the PRC released the Administrative Measures for Data Security in Industry and Information Technology Sectors (Trial), effective from January l, 2023, which, among other things, impose specific data security management requirements and certain filing and reporting obligations on processors of important data and core data in industry and information technology sectors.
By offering a user-friendly platform combining real-time AR capabilities with cutting-edge Generative AI technologies, our YouCam suite of mobile apps and web services address evolving consumer demands in a 52 Table of Contents prompt manner, fueling a surge in global adoption and bolstering our B2C growth trajectory.
By offering a user-friendly platform combining real-time AR capabilities with cutting-edge Generative AI technologies, our YouCam suite of mobile apps and web services address evolving consumer demands in a prompt manner, fueling a surge in global adoption and bolstering our B2C growth trajectory.
It also supports various types of foundation textures such as matte and glow, and the intensities can also be adjusted to closely mimic the real-life coverage levels. Thus, with our AI foundation shade finder and matcher, consumers can find the perfect foundation shade in a matter of seconds and with high precision.
It also supports various types of foundation textures such as matte and glow, and the intensities can also 61 Table of Contents be adjusted to closely mimic the real-life coverage levels. Thus, with our AI foundation shade finder and matcher, consumers can find the perfect foundation shade in a matter of seconds and with high precision.
This approach provides the ability to track changes over time, enabling users to monitor the effectiveness of skincare routines with ease. By integrating the latest advances in AI-driven personalization, we provide an immersive, data-backed experience that stands at the forefront of modern beauty technology.
This approach provides the ability to track changes over time, enabling users to monitor the 81 Table of Contents effectiveness of skincare routines with ease. By integrating the latest advances in AI-driven personalization, we provide an immersive, data-backed experience that stands at the forefront of modern beauty technology.
(Shanghai), a company incorporated in the PRC • Perfect Corp., a company incorporated in Japan • Perfect Mobile Corp., a company incorporated in Taiwan • Perfect Mobile Corp., a company incorporated in the British Virgin Islands • Perfect Corp., a company incorporated in the State of California, the United States In addition, Perfect Taiwan directly owns (i) 100% equity interest in Perfect Corp., a company incorporated in France, and (ii) 100% equity interests in Wannaby, a corporation incorporated in the State of Delaware, the United States which directly owns 100% equity interests in Wannaby UAB, a private limited liability company incorporated in Republic of Lithuania.
(Shanghai), a company incorporated in the PRC • Perfect Corp., a company incorporated in Japan • Perfect Mobile Corp., a company incorporated in Taiwan • Perfect Mobile Corp., a company incorporated in the British Virgin Islands • Perfect Corp., a company incorporated in the State of California, the United States In addition, Perfect Taiwan directly owns (i) 100% equity interest in Perfect Corp., a company incorporated in France, and (ii) 100% equity interests in Wannaby, a corporation incorporated in the State of Delaware, the United States 88 Table of Contents which directly owns 100% equity interests in Wannaby UAB, a private limited liability company incorporated in Republic of Lithuania.
For our B2C business, we operate a family of YouCam mobile apps and web-based online editor designed for photo and video beautification, enhancement, and editing, including but not limited to real-time AR makeup application, skin diagnosis, AI photo background removal, AI selfie, AI avatar, and AI text-to-image.
For our B2C business, we operate a family of YouCam mobile apps and web-based editing services designed for photo and video beautification, enhancement, and editing, including but not limited to real-time AR makeup application, skin diagnosis, AI photo background removal, AI selfie, AI avatar, AI text-to-image and AI image-to-video.
Our AI Skin Tech and AI Hair Tech solutions have been honored with the prestigious Biohackers’ Choice Beauty Awards in the Best Skincare Diagnostic and Best Haircare Diagnostic categories. These awards recognize the products and technologies that are pushing the boundaries of innovation, sustainability, and effectiveness in the beauty and wellness industries.
Our AI Skin Tech and AI Hair Tech solutions have been honored with the prestigious Biohackers’ Choice Beauty Awards in the Best Skincare Diagnostic and Best Haircare Diagnostic categories. 58 Table of Contents These awards recognize the products and technologies that are pushing the boundaries of innovation, sustainability, and effectiveness in the beauty and wellness industries.
We have powerful AI technology that taps into deep and machine learning algorithms built on data from over 10 billion real-life try-ons every year around the world. We are also able to leverage these data collected from virtual try-ons to provide highly accurate and realistic AR makeover experiences, as well as personalized recommendations.
We have powerful AI technology that taps into deep and machine learning algorithms built on data from over 10 billion real-life try-ons every year around the world. We are also able to leverage these data 54 Table of Contents collected from virtual try-ons to provide highly accurate and realistic AR makeover experiences, as well as personalized recommendations.
The DSA entered into force on November 16, 2022, which 71 Table of Contents seeks to update the rules concerning e-commerce, for instance, by providing for enforceable obligations and increased accountability rules for all digital services that connect consumers to goods, services, or content, in relation to, for example, users’ safety and trust, harmful/illegal online content, content moderation and removal, and advertisement targeting.
The DSA entered into force on November 16, 2022, which seeks to update the rules concerning e-commerce, for instance, by providing for enforceable obligations and increased accountability rules for all digital services that connect consumers to goods, services, or content, in relation to, for example, users’ safety and trust, harmful/illegal online content, content moderation and removal, and advertisement targeting.
We maintain offices in Taiwan, Japan, the United States, France and China to serve our geographically diverse customer base. We lease all of our offices. For additional information about the lease, see “Item 7. Major Shareholders and Related Party Transactions — B.
We maintain offices in Taiwan, Japan, the United States, France and China to serve our geographically diverse customer base. 87 Table of Contents We lease all of our offices. For additional information about the lease, see “Item 7. Major Shareholders and Related Party Transactions — B.
We believe we are well-positioned to capture the significant opportunities ahead to expand our reach within these beauty groups. 51 Table of Contents • Penetration into Global Top Luxury, Fashion Brands and Retailers We are executing a targeted expansion strategy aimed at increasing our penetration among the world’s leading luxury and fashion brands by leveraging our cutting-edge AI- and AR- technologies.
We believe we are well-positioned to capture the significant opportunities ahead to expand our reach within these beauty groups. • Penetration into Global Top Luxury, Fashion Brands and Retailers We are executing a targeted expansion strategy aimed at increasing our penetration among the world’s leading luxury and fashion brands by leveraging our cutting-edge AI- and AR- technologies.
AI Object Removal employs advanced algorithms to provide users with an easy way to erase objects and remove unwanted people, text, and watermarks in just a few clicks. With AI Image Extender, users can expand their photos beyond their original borders, with our advanced AI technology ensuring the expanded areas blend seamlessly with the original photos.
AI Object Removal employs advanced algorithms to provide users with an easy way to erase objects and remove unwanted people, text, and watermarks in just a few clicks. With AI Image Extender, users can expand their photos beyond their original borders, with our 70 Table of Contents advanced AI technology ensuring the expanded areas blend seamlessly with the original photos.
The new face ratio assessment, the AI Face Analyzer calculates key proportions inspired by the golden ratio, taking into account eye placement, eyebrow arch, nose aspect, lip 67 Table of Contents balance, and more. These insights help professionals offer personalized styling tips and product suggestions that harmonize a customer’s natural features.
The new face ratio assessment, the AI Face Analyzer calculates key proportions inspired by the golden ratio, taking into account eye placement, eyebrow arch, nose aspect, lip balance, and more. These insights help professionals offer personalized styling tips and product suggestions that harmonize a customer’s natural features.
Our marketing team closely monitors the latest market trends on the Internet and captivating blogs or posts that are shared on our website and social media. By refining keywords, optimizing titles, and regularly updating metadata, we ensure that our apps stand out in both Apple App Store and Google Play Store.
Our marketing team closely monitors the latest market trends on the Internet and captivating blogs or posts that are shared on 85 Table of Contents our website and social media. By refining keywords, optimizing titles, and regularly updating metadata, we ensure that our apps stand out in both Apple App Store and Google Play Store.
Our B2C offerings revolve around advanced AI-driven technologies, delivering a seamless user experience for photo and video editing. We offer six mobile apps under the “YouCam” suite,YouCam Makeup, YouCam Perfect, YouCam Video, YouCam Enhance, YouCam AI Pro, and YouCam Nails, along with one web-based editing tool, YouCam Online Editor.
Our B2C offerings revolve around advanced AI-driven technologies, delivering a seamless user experience for photo and video editing. We offer seven mobile apps under the “YouCam” suite, including YouCam Makeup, YouCam Perfect, YouCam AI Pro, YouCam Enhance, YouCam Video, YouCam Nails and YouCam AI Chat, along with one web-based editing tool, YouCam Online Editor.
In 2024, our AI- and AR- Hair solutions were upgraded with new Generative AI capabilities, allowing users to create new hair styles, extend hair length, create hair bangs, adjust hair volume and experiment with various wavy hair effects. 59 Table of Contents Our comprehensive AI hair analysis suite combines hair length detection and hair frizz assessment to provide unparalleled personalization in haircare.
In 2024, our AI- and AR- Hair solutions were upgraded with new Generative AI capabilities, allowing users to create new hair styles, extend hair length, create hair bangs, adjust hair volume and experiment with various wavy hair effects. Our comprehensive AI hair analysis suite combines hair length detection and hair frizz assessment to provide unparalleled personalization in haircare.
The AI deep learning algorithm detects 56 Table of Contents the full spectrum of skin tones based on around 89,970 shades with unlimited grades from light to dark and true undertones from warm to cool.
The AI deep learning algorithm detects the full spectrum of skin tones based on around 89,970 shades with unlimited grades from light to dark and true undertones from warm to cool.
We intend to consider potential opportunities throughout the AI, beauty and fashion value chains that will enable us to consolidate and extend market leadership, accelerate our expansion into new verticals and geographies, create synergies from our technology integration, and drive revenue growth and margin expansion.
We intend to consider potential opportunities throughout the AI, beauty 56 Table of Contents and fashion value chains that will enable us to consolidate and extend market leadership, accelerate our expansion into new verticals and geographies, create synergies from our technology integration, and drive revenue growth and margin expansion.
Harnessing AI- and AR- technologies, our products provide real-time virtual try-ons, beauty camera or portrait retouching, photo or video enhancement, as well as state-of-the-art Generative AI capabilities such as text-to-photo, avatar creation, and intelligent editing. These innovative features empower users to transform selfies and text prompts into striking personal contents.
Harnessing AI- and AR- technologies, our products provide real-time virtual try-ons, beauty camera or portrait retouching, photo or video enhancement, as well as state-of-the-art Generative AI capabilities such as text-to-photo, photo-to-photo, photo-to-video, and smart AI editing agent. These innovative features empower users to transform selfies and text prompts into striking personal contents.
These competing websites focus on Generative AI, photo-editing and video-editing features, similar to our YouCam Online Editor. With regards to the SaaS services that we offer, Modiface Inc., Revieve, Holition, and Banuba can be considered our closest competitors, though they are limited with regards to their product offerings.
These competing websites focus on Generative AI, photo-editing and video-editing features, similar to our YouCam Online Editor. 86 Table of Contents With regards to the SaaS services that we offer, Modiface Inc., Revieve, Holition, Banuba and Haut.ai can be considered our closest competitors, though they are limited with regards to their product offerings.
YouCam suite of Mobile Apps and Web Services The suite of YouCam apps and web services primarily consists of six mobile apps and one web-based editor, as described below.
YouCam suite of Mobile Apps and Web Services The suite of YouCam apps and web services primarily consists of seven mobile apps and one web-based editor, as described below.
Brands can effortlessly generate hyper-realistic virtual rings, watches, and accessories using simple 2D product images, bypassing costly and time-consuming 3D modeling. Our advanced algorithms create lifelike accessories and timepieces 61 Table of Contents with intricate lighting effects and accurate motions.
Brands can effortlessly generate hyper-realistic virtual rings, watches, and accessories using simple 2D product images, bypassing costly and time-consuming 3D modeling. Our advanced algorithms create lifelike accessories and timepieces with intricate lighting effects and accurate motions.
Our family of YouCam apps and web-based editor are able to offer unique and superior digital experiences with the help of our advanced technologies, such as Generative AI technologies.
Our family of YouCam apps and web-based editing services are able to offer unique and superior digital experiences with the help of our advanced technologies, such as Generative AI technologies.
Our technology now supports over 89,969 skin tones and 14 makeup textures, covering facial attributes across all ethnicities and ages, and offering a fully inclusive virtual try-on experience, being the most comprehensive in the industry. As of December 31, 2024, we had 35 registered patents and 25 pending patent applications in the beauty tech domain.
Our technology now supports over 89,969 skin tones and 25 makeup textures, covering facial attributes across all ethnicities and ages, and offering a fully inclusive virtual try-on experience, being the most comprehensive in the industry. As of December 31, 2025, we had 43 registered patents and 22 pending patent applications in the beauty tech domain.
Our technology highlights include: • Generating around 3,900 real-time facial 3D live meshes backed by visual computing; • Supporting over 20 different makeup textures (e.g., matte and metallic); 69 Table of Contents • Supporting over 20 common skin concerns diagnosis; • Recognizing nearly 90,000 skin tones; • Employing over 10 million data sets to train AI deep-learning algorithms for the excellent performance across all ethnicities and skin tones; and • Protecting our intellectual property with 35 patents and 25 pending patent applications as of December 31, 2024.
Our technology highlights include: • Generating around 3,900 real-time facial 3D live meshes backed by visual computing; • Supporting over 25 different makeup textures (e.g., matte and metallic); 80 Table of Contents • Supporting over 36 common skin concerns diagnosis; • Recognizing nearly 90,000 skin tones; • Employing over 10 million data sets to train AI deep-learning algorithms for the excellent performance across all ethnicities and skin tones; and • Protecting our intellectual property with 43 patents and 22 pending patent applications as of December 31, 2025.
Our Company Founded in 2015, we are a leading AI technology company focused on delivering self-developed AI- and AR-powered solutions to make your virtual world beautiful. Operating with a hybrid model that spans both B2C and B2B segments, we leverage our cutting-edge expertise to transform how users and brands interact with digital experiences.
Our Company Founded in 2015, we are a leading AI technology company focused on delivering self-developed AI- and AR-powered solutions to make your virtual world beautiful. Through a hybrid business model spanning both B2C and B2B segments, we leverage our cutting-edge expertise to transform how users and brands interact with digital experiences.
We employ a wide range of marketing activities to engage with existing and potential business and consumer partners. These include regular press releases, social media campaigns across all major channels, including Facebook, 73 Table of Contents Instagram, X (formerly Twitter), YouTube, and LinkedIn, targeted email marketing, online and offline advertising, and industry event participation.
We employ a wide range of marketing activities to engage with existing and potential enterprise partners. These include regular press releases, social media campaigns across all major channels, including Facebook, Instagram, X (formerly Twitter), YouTube, and LinkedIn, targeted email marketing, online and offline advertising, and industry event participation.
In particular, the GDPR and the U.K. GDPR include obligations and restrictions concerning the consent and rights of individuals to whom the personal data relates, the transfer of personal data out of the European Economic Area or the United Kingdom, security breach notifications, and the security and confidentiality of personal data.
GDPR include obligations and restrictions concerning the consent and rights of individuals to whom the personal data relates, the transfer of personal data out of the European Economic Area or the United Kingdom, security breach notifications, and the security and confidentiality of personal data.
These competing mobile apps focus on Generative AI, photo-editing, beautifying, and retouching features, similar to our YouCam Makeup, YouCam Perfect, YouCam Video, YouCam Enhance, and YouCam AI Pro apps. With regards to online website that we offer, we directly compete with several market players, including Fotor, Picwish, Cutout, Media.io, Photoroom, Myedit, PromeAI, Pixlr.
These competing mobile apps focus on Generative AI, photo-editing, beautifying, and retouching features, similar to our YouCam Makeup, YouCam Perfect, YouCam AI Pro, YouCam Video and YouCam Enhance apps. With regards to online website services that we offer, we directly compete with several market players, including Fotor, Picwish, Cutout.pro, Photoroom, PicsArt, Myedit, Leonardo.ai and Pixlr.
Since early 2019, we introduced beauty tech AI and formed numerous partnerships with e-commerce and social media leaders, including Alphabet (Google and YouTube), Meta (Instagram), and Snap, as well as with Asia tech platforms such as Alibaba (Taobao and Tmall) and Tencent (WeChat). Such partnerships have been critical to our growth as an omni-channel AI/AR service provider.
Since early 2019, we introduced beauty tech AI and formed numerous partnerships with e-commerce and social media leaders, including Alphabet (Google and YouTube), Alibaba (Taobao and Tmall) and Tencent (WeChat). Such partnerships have been critical to our growth as an omni-channel AI/AR service provider.
We also bring positive impact to the environment by helping brands reduce waste of beauty sampling and overconsumption. Many brands have testified the positive experiences we brought to them and have become our active endorsers. We have a diverse customer base, with Key Customers accounting for approximately 35.2% of our 2024 revenue.
We also bring positive impact to the environment by helping brands reduce waste of beauty sampling and overconsumption. Many brands have testified the positive experiences we brought to them and have become our active endorsers. We have a diverse customer base, with Key Customers accounting for approximately 27.6% of our 2025 revenue.
We have 186 AI- and AR-specialists who drive the development of our technology.
We have 221 AI- and AR-specialists who drive the development of our technology.
YouCam Online Editor: a cloud-based photo editing platform that offers a variety of AI-powered tools to enhance and transform images and videos. 55 Table of Contents AI- and AR-Makeup Virtual Try-On and Foundation Finder AI- and AR-makeup virtual try-on solution is our first SaaS tech solution for the beauty brands, launched in 2015.
YouCam Online Editor: a cloud-based photo and video creation/enhancement platform that offers a variety of AI-powered tools to enhance, create and transform images and videos. 60 Table of Contents AI- and AR-Makeup Virtual Try-On and Foundation Finder AI- and AR-makeup virtual try-on solution is our first SaaS tech solution for the beauty brands, launched in 2015.
We rely on a combination of patent, trademark, copyright, unfair competition, and trade secret laws, as well as confidentiality procedures and contractual restrictions to establish, maintain and protect our proprietary rights. As of December 31, 2024, we have 35 patents registered and 25 applications pending.
We rely on a combination of patent, trademark, copyright, unfair competition, and trade secret laws, as well as confidentiality procedures and contractual restrictions to establish, maintain and protect our proprietary rights. As of December 31, 2025, we have 43 patents registered and 22 applications pending.
Brands show recurring demand and high loyalty for our platform and are less likely to switch to other platforms as we provide products and services that are aligned with their value proposition. • Superior and Proven Technology and Product Capabilities Our technological capabilities offer highly accuracy, scalability and performance in our AI- and AR- powered business and consumer solutions.
Brands are less likely to switch to other platforms as we provide products and services that are aligned with their value proposition. • Superior and Proven Technology and Product Capabilities Our technological capabilities offer highly accuracy, scalability and performance in our AI- and AR- powered business and consumer solutions.
As of December 31, 2024, we cover 90% (18 out of 20) of the top 20 beauty groups worldwide, and serve global beauty brands, including Estée Lauder, MAC and e.l.f., covering the broad spectrum of brands and products from luxury to mass markets.
As of December 31, 2025, we cover 90% (18 out of 20) of the top 20 beauty groups worldwide, and serve global beauty brands, including Estée Lauder, MAC, COTY and Shiseido, covering the broad spectrum of brands and products from luxury to mass markets.
Our unique tech capabilities and extensive collection of training data sets help us solidify our product leadership in the beauty AI- and AR- industry. As of December 31, 2024, our team of 169 technology staff, representing 49.4% of our employees, are dedicated to the constant improvement of our platform, development of new features, as well as creation of new apps.
Our unique tech capabilities and extensive collection of training data sets help us solidify our product leadership in the beauty AI- and AR- industry. As of December 31, 2025, our team of 180 technology staff, representing 51.0% of our employees, are dedicated to the constant improvement of our platform, development of new features, as well as creation of new apps.
Our skincare solution is proven to be highly accurate against dermatological tests. AI Aesthetic and Skin Simulator In 2024, we introduced an advanced, AI-driven facial reshaping solution that enables aesthetics professionals to offer realistic, accurate previews of potential enhancements directly on each patient’s own face.
Our skincare solution is proven to be highly accurate against dermatological tests. AI Aesthetic and Skin and Body Simulator Our advance AI-driven facial reshaping solution that enables aesthetics professionals to offer realistic, accurate previews of potential enhancements directly on each patient’s own face.
Our diverse global team is composed of talented individuals of various ethnic groups and LGBTQ+ identities, of which 54% are men and 46% are women, with 43% of our managers and executives being female, including the CEO.
Our diverse global team is composed of talented individuals of various ethnic groups and LGBTQ+ identities, of which 58% are men and 42% are women, with 28% of our managers and executives being female, including the CEO.
As of December 31, 2024, we covered 90% of the top 20 global beauty groups and had a cumulative brand portfolio of 732 brands, offering over 822,000 digital SKUs and enabling more than 10 billion virtual product try-ons annually.
As of December 31, 2025, we covered 90% of the top 20 global beauty groups and had a cumulative brand portfolio of 859 brands, offering over 982 thousand digital SKUs and enabling more than 10 billion virtual product try-ons annually.
Within our customer base, we had 151 Key Customers, which accounted for approximately 32.5% of our revenue in 2024. We also have a well-diversified portfolio. Aside of cooperating with top 20 beauty groups, we also engage with indie brands, emerging new brands and beauty retailers around the world.
Within our customer base, we had 135 Key Customers, which accounted for approximately 27.6% of our revenue in 2025. We also have a well-diversified portfolio. Aside of cooperating with top 20 beauty groups, we also engage with fashion brands, indie brands, emerging new brands and beauty retailers around the world.
European Union and the United Kingdom The GDPR, together with national legislation, regulations and guidelines, including the U.K. GDPR and the Data Protection Act 2018, govern the processing of personal data and impose strict obligations and restrictions on the ability to collect, use, retain, protect, disclose, transfer and otherwise process personal data in the European Union and the United Kingdom.
GDPR and the Data Protection Act 2018, govern the processing of personal data and impose strict obligations and restrictions on the ability to collect, use, retain, protect, disclose, transfer and otherwise process personal data in the European Union and the United Kingdom. In particular, the GDPR and the U.K.
Innovation is part of our core values, and we are continuously pushing the frontiers of technology to develop AI- and AR-technology and provide new beauty, skincare, fashion tech products integrated with Generative AI solutions. As of December 31, 2024, we primarily offered 31 SaaS technology solutions, six mobile apps and one online editing tool.
Innovation is part of our core values, and we are continuously pushing the frontiers of technology to develop AI- and AR-technology and provide new beauty, skincare, fashion tech products integrated with Generative AI solutions. As of December 31, 2025, we primarily offered seven mobile apps, one web-based editing service and 47 AI/SaaS technology solutions.
YouCam Makeup: an award-winning virtual beauty app that offers a full suite of virtual makeover tools, including real-time AR makeup application, selfie retouch, hair color and style retouch, skin diagnosis, and live selfie backgrounds. YouCam Perfect: a leading AI-powered photo-editing and beauty camera app.
YouCam Makeup: an award-winning virtual beauty app that offers a full suite of virtual makeover tools, including All-in-One AI beauty agent capable of real-time AR makeup applications, selfie retouch, hair color and style retouch, skin diagnosis, and live selfie backgrounds. 59 Table of Contents YouCam Perfect: a leading AI-powered photo-editing and beauty camera app.
The following table sets forth a geographic breakdown of our revenue for the periods indicated: Year ended December 31, 2022 2023 2024 (million) % of Total (million) % of Total (million) % of Total Americas $ 27.6 58.3 $ 29.9 55.9 $ 31.8 52.8 Europe 9.2 19.4 13.8 25.8 16.6 27.6 Asia-Pacific 9.2 19.4 8.6 16.0 10.1 16.8 Others 1.3 2.9 1.2 2.3 1.7 2.8 Total $ 47.3 100 $ 53.5 100 $ 60.2 100 For the years ended December 31, 2022, December 31, 2023 and December 31, 2024, our revenue generated from the PRC represented less than 3% of our total revenue for the respective periods.
The following table sets forth a geographic breakdown of our revenue for the periods indicated: Year ended December 31, 2023 2024 2025 (million) % of Total (million) % of Total (million) % of Total Americas $ 29.9 55.9 $ 31.8 52.8 $ 34.3 49.6 Europe 13.8 25.8 16.6 27.6 20.3 29.3 Asia-Pacific (1) 8.6 16.0 10.1 16.8 12.0 17.4 Others 1.2 2.3 1.7 2.8 2.6 3.7 Total $ 53.5 100 $ 60.2 100 $ 69.2 100 —————— (1) For the years ended December 31, 2023, 2024 and 2025, revenue generated from the PRC accounted for less than 3% of our total revenue in each respective period.
As of December 31, 2024, we cover 90% (18 out of 20) of the top 20 global beauty groups. The number of cumulative brands within our brand portfolio increased from 509 brands as of December 31, 2022 to 645 and 732 brands as of December 31, 2023 and 2024, respectively, at a CAGR of 19.9% from 2022 to 2024.
As of December 31, 2025, we cover 90% (18 out of 20) of the top 20 global beauty groups. The number of cumulative brands within our brand portfolio increased from 645 brands as of December 31, 2023 to 732 to 859 brands as of December 31, 2025, respectively, at a CAGR of 15.4% from 2023 to 2025.
Our Strengths We believe we have the following competitive strengths that have been instrumental to our leading position as a leading AI company and will continue to fuel our success in the fast-growing AI- and AR-market and beyond, for both B2C and B2B customers. • Comprehensive Full Range of Photo and Video Consumer Apps 48 Table of Contents We position our strength in offering a comprehensive suite of mobile apps that span the entire spectrum of photo and video creation, editing, and enhancement.
For a discussion of risks related to our operations in the PRC, see “Risk Factors — Risks Related to Doing Business in the PRC.” Our Strengths We believe we have the following competitive strengths that have been instrumental to our leading position as a leading AI company and will continue to fuel our success in the fast-growing AI- and AR-market and beyond, for both B2C and B2B businesses. • Comprehensive Full Range of Photo and Video Consumer Apps We position our strength in offering a comprehensive suite of mobile apps that span the entire spectrum of photo and video creation, editing, and enhancement.
As of December 31, 2024, we cover 90% of the top 20 beauty groups. We have over 822,000 SKUs in our database, among which approximately 567,000 SKUs are for the top 20 beauty groups.
As of December 31, 2025, we cover 90% of the top 20 beauty groups. We have over 982 thousand SKUs in our database, among which approximately 632 thousand SKUs are for the top 20 beauty groups.
In 2024, the Generative AI technologies and AI editing features for photos and videos, integrated into our product offerings, have proven to play a pivotal role in converting our free users into paying subscribers. • Beauty AI- and AR-SaaS Leadership We are the leader in the nascent beauty AI- and AR-SaaS industry.
In 2024, the Generative AI technologies and AI editing features for photos and videos, integrated into our offerings, have proven to play a pivotal role in converting our free users into paying subscribers.
This allows brands to create the new, seamless, and cohesive shopping experiences that modern shoppers have grown to expect. As of December 31, 2024, 100% of the top 20 beauty groups have incorporated the AI- and AR-technologies into their business model, while 18 of them are our customers.
This allows brands to create the new, seamless, and cohesive shopping experiences that modern shoppers have grown to expect. As of December 31, 2025, 90% of the top 20 beauty groups have incorporated the AI- and AR-technologies from Perfect Corp. into their business.
On October 31, 2022, our Class A Ordinary Shares and Warrants commenced trading on the NYSE under the symbols “PERF” and “PERF WS”, respectively.
On October 28, 2022, we consummated the previously announced Business Combination with Provident. On October 31, 2022, our Class A Ordinary Shares and Warrants commenced trading on the NYSE under the symbols “PERF” and “PERF WS”, respectively.
For AR watches, we leverage our proprietary AgileHand® technology with up to seven types of material maps effects within our PBR technologies to provide an ultra-realistic AR try-on experience.
AI- and AR- Glasses, Watches and Accessories Our AI- and AR-accessories technology provides AR effects for watches, eyewear, headbands, hats and other accessory virtual try-ons. For AR watches, we leverage our proprietary AgileHand® technology with up to seven types of material maps effects within our PBR technologies to provide an ultra-realistic AR try-on experience.
See “Risk Factors — Risks Related to Our Technology, Data Privacy and Intellectual Property — We may be subject to intellectual property infringement claims or other allegations by third parties, which may cause substantial costs and materially and adversely affect our business operations” and “Risk Factors — Risks Related to Our Technology, Data Privacy and Intellectual Property — From time to time, we may become involved in litigation, regulatory investigations, administrative proceedings, or other legal disputes that could have a material and adverse impact on our business.” C.
See “Risk Factors — Risks Related to Our Technology, Data Privacy and Intellectual Property — We may be subject to intellectual property infringement claims or other allegations by third parties, which may cause substantial costs and materially and adversely affect our business operations” and “Risk Factors — Risks Related to Our Technology, Data Privacy and Intellectual Property — From time to time, we may become involved in litigation, regulatory investigations, administrative proceedings, or other legal disputes that could have a material and adverse impact on our business.” Corporate Social Responsibility The Perfect CyberLink Education Foundation (the “Foundation”) is an independent non-profit organization jointly established by Perfect Corp. and CyberLink to support educational outreach and charitable initiatives.
The Generative AI technologies and AI editing features for photos and videos, integrated into our product offerings, play a pivotal role in converting our mobile app or web service users into paid users, underscoring the critical importance of our AI roadmap to the success of our B2C business. 45 Table of Contents For details of our principal capital expenditures for the previous three years ended December 31, 2024, see “Item 5.
The Generative AI technologies and AI editing features for photos and videos, integrated into our product offerings, play a pivotal role in converting our mobile app or web service users into paid users, underscoring the critical importance of our AI roadmap to the success of our B2C business.

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Market for Common Equity — stock, dividends, buybacks

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One-time fees are made up of service setup fee, customization fee, and console base fee, which allow brands to create a brand console account on our platform for uploading and managing SKUs. Recurring fees are related to granting customers access to the modules throughout the contract period.
One-time fees are made up of service setup fee, customization fee, and console base fee, which allow brands to create a brand console account on our platform for uploading and managing SKUs. Recurring fees are related to granting brand customers access to the modules throughout the contract period.
If the financing is not available, or if the terms of financing are less desirable than we expect, we may be forced to decrease our level of investment in product development or delay, scale back or abandon all or part of our growth strategy, which could have an adverse impact on our business and financial prospects.
If the financing is not available, or if the terms of financing are less desirable than we expect, we may be forced to decrease our level of investment in product development or we may delay, scale back or abandon all or part of our growth strategy, which could have an adverse impact on our business and financial prospects.
Other than as disclosed above and elsewhere in this annual report, we are not aware of any trends, uncertainties, demands, commitments or events for the period from January 1, 2024 to December 31, 2024, that are reasonably likely to have a material effect on our net sales or revenue, income from continuing operations, profitability, liquidity or capital resources, or that caused the disclosed financial information to be not necessarily indicative of future operating results or financial conditions.
Other than as disclosed above and elsewhere in this annual report, we are not aware of any trends, uncertainties, demands, commitments, or events for the period from January 1, 2025 to December 31, 2025, that are reasonably likely to have a material effect on our net sales or revenue, income from continuing operations, profitability, liquidity or capital resources, or that caused the disclosed financial information to be not necessarily indicative of future operating results or financial conditions.
We plan to continue to invest in sales and marketing to grow our customer base and increase our brand awareness. As such, we expect sales and marketing expenses to increase in absolute dollars.
We plan to continue to invest in sales and marketing to grow our user and brand customer base and increase our brand awareness. As such, we expect sales and marketing expenses to increase in absolute dollars.
As of the date of this annual report, there has been no material change to our liquidity position since December 31, 2024. To the extent that our current resources are insufficient to satisfy our cash requirements in the future, we may need to seek additional equity or debt financing.
As of the date of this annual report, there has been no material change to our liquidity position since December 31, 2025. To the extent that our current resources are insufficient to satisfy our cash requirements in the future, we may need to seek additional equity or debt financing.
This collaboration offers us unique opportunities to access innovative ideas and latest technology developments at an early stage, allowing us for proactive planning. Additionally, we are committed to continually improving and upgrading our technologies to ensure the highest quality to our customers.
This collaboration offers us unique opportunities to access innovative ideas and the latest technology developments at an early stage, allowing us for proactive planning. Additionally, we are committed to continually improving and upgrading our technologies to ensure the highest quality to our users and brand customers.
E. Critical Accounting Estimates Our consolidated financial statements have been prepared in accordance with IFRS. The preparation of our consolidated financial statements requires us to make judgements, estimates and assumptions that affect the application of accounting policies and the reported amounts of assets, liabilities, revenue, expenses and related disclosures.
E. Critical Accounting Estimates Our consolidated financial statements have been prepared in accordance with IFRS. The preparation of our consolidated financial statements requires us to make judgments, estimates and assumptions that affect the application of accounting policies and the reported amounts of assets, liabilities, revenue, expenses and related disclosures.
In the near term, we anticipate fluctuations in sales and marketing expenses as a percentage of revenue due to our investments in accelerating market adoption of our AI- and AR-technologies. General and Administrative Expenses Our general and administrative expenses primarily consist of personnel-related expenses for employees involved in general corporate operations, including administration, legal, human resources, accounting and finance.
In the near term, we anticipate fluctuations in sales and marketing expenses as a percentage of revenue due to our investments in accelerating market adoption of our AI- and AR-technologies. 93 Table of Contents General and Administrative Expenses Our general and administrative expenses primarily consist of personnel-related expenses for employees involved in general corporate operations, including administration, legal, human resources, accounting and finance.
(2) Licensing We collect licensing fees from (1) licensing self-developed technologies, which include offline SDK and AI- and AR- offline solutions to brand customers, and (2) licensing customized mobile apps designed and created based on customers’ specifications that do not require continuous support from our backend cloud computing infrastructure.
(2) Licensing We collect licensing fees from (i) licensing self-developed technologies, which include offline SDK and AI- and AR- offline solutions to brand customers, and (ii) licensing customized mobile apps designed and created based on customers’ specifications that do not require continuous support from our backend cloud computing infrastructure.
Income and expense items are translated at the average exchange rates for the period. Exchange differences arising, if any, are recognized in other comprehensive income and accumulated in equity. 80 Table of Contents Components of Results of Operations Revenue Our revenue sources include two major components: AI- and AR- cloud solutions and subscription and licensing.
Income and expense items are translated at the average exchange rates for the period. Exchange differences arising, if any, are recognized in other comprehensive income and accumulated in equity. Components of Results of Operations Revenue Our revenue sources include two major components: AI- and AR- cloud solutions and subscription and licensing.
Comparison of Year Ended December 31, 2022 to Year Ended December 31, 2023 For the discussion covering items for the fiscal year ended December 31, 2023 and a comparison between the fiscal year ended December 31, 2023 and 2022, please refer to “Item 5. — Operating and Financial Review and Prospects — A.
Comparison of Year Ended December 31, 2023 to Year Ended December 31, 2024 For the discussion covering items for the fiscal year ended December 31, 2024 and a comparison between the fiscal year ended December 31, 2024 and 2023, please refer to “Item 5. — Operating and Financial Review and Prospects — A.
Furthermore, we have incurred and expect to further incur expenses as a result of becoming a public company since October 2022, including costs for complying with the rules and regulations applicable to companies listed on a national securities exchange, costs related to compliance and reporting obligations, and increased expenses for insurance, investor relations, and professional services.
Furthermore, we have incurred and expect to continue incurring expenses as a result of becoming a public company since October 2022, including costs for complying with the rules and regulations applicable to companies listed on a national securities exchange, costs related to compliance and reporting obligations, and increased expenses for insurance, investor relations, and professional services.
Accordingly, our effective tax rate will vary depending on the relative proportion of income derived in each jurisdiction, 82 Table of Contents use of tax credits, changes in the valuation of our deferred tax assets and liabilities as well as changes in tax laws.
Accordingly, our effective tax rate will vary depending on the relative proportion of income derived in each jurisdiction, use of tax credits, changes in the valuation of our deferred tax assets and liabilities as well as changes in tax laws.
We expect the licensing revenue and advertisement revenue will become increasingly immaterial, as we continue to focus on strengthening our market leadership in the consumer beauty and AI mobile apps as well as in the beauty and fashion AI- and AR- industry.
We expect the licensing revenue will become increasingly insignificant, as we continue to focus on strengthening our market leadership in the consumer beauty and AI mobile apps as well as in the beauty and fashion AI- and AR- industry.
The slight decrease in gross margin was primarily due to the sustained increase in third-party payment processing fees paid to digital distribution partners such as Google and Apple, due to the steady growth in our mobile app subscription revenue.
The slight decrease in gross margin was primarily due to the increase in third-party payment processing fees paid to digital distribution partners, such as Google and Apple, driven by the steady growth in our YouCam mobile app subscription revenue.
Cash Flows Generated from (Used in) Financing Activities Net cash used in financing activities was $0.5 million for the year ended December 31, 2024, consisting of $0.5 million in the repayment of the principal portion of lease liabilities.
Net cash used in financing activities was $0.5 million for the year ended December 31, 2024, consisting of $0.5 million in the repayment of the principal portion of lease liabilities.
Our continued investment in technology also contributes to the increase of operational efficiency, enabling the same number of employees to deliver higher productivity over time. In addition, we believe that we will continue to benefit from economies of scale as we continue to actively manage the level of our general and administrative expenses.
Our continued investment in technology is also expected to drive operational efficiency, enabling the same number of employees to deliver higher productivity over time. In addition, we believe that we will continue to benefit from economies of scale as we continue to actively manage the level of our general and administrative expenses.
These sales, or the possibility that these sales may occur, and any related volatility or decrease in market price of our Class A Ordinary Shares and Warrants, might make it more difficult for us to sell equity securities in the future at a time and at a price that we deem appropriate. See “Item 3. Key Information — D.
These sales, or the possibility that these sales may occur, and any related volatility or decrease in market price of our Class A Ordinary Shares and Warrants, might make it more difficult for us to sell equity securities in the future at a time and at a price that we deem appropriate.
In addition, our total operating expenses as a percentage of our revenue decreased from 91.1% in 2023 to 83.2% in 2024, highlighting the continued improvement of our operational efficiency, as the scale of our business grows. Completion of Business Combination On October 28, 2022, we completed the Business Combination.
In addition, our total operating expenses as a percentage of our revenue decreased from 83.2% in 2024 to 79.9% in 2025, highlighting the continued improvement of our operational efficiency, as the scale of our business grows. Completion of Business Combination On October 28, 2022, we completed the Business Combination.
As of December 31, 2024, we had cash and cash equivalents of $127.1 million, which primarily consisted of checking accounts, demand deposits and time deposits. Our cash and cash equivalents are primarily denominated in U.S. dollars, and we do not currently enter into any hedging arrangements.
As of December 31, 2025, we had cash and cash equivalents of $126.0 million, which primarily consisted of checking accounts, demand deposits and time deposits. Our cash and cash equivalents are primarily denominated in U.S. dollars, and we do not currently enter into any hedging arrangements.
As the closing price of our Class A Ordinary Shares was $1.68 as of March 27, 2025, we believe that holders of the Warrants are currently unlikely to exercise their Warrants. Accordingly, we do not expect to rely on the cash exercise of Warrants to fund our operations.
As the closing price of our Class A Ordinary Shares was $1.39 as of March 12, 2026, we believe that holders of the Warrants are currently unlikely to exercise their Warrants. Accordingly, we do not expect to rely on the cash exercise of Warrants to fund our operations.
We have invested considerable resources in our people. We recruit talents from renowned universities and academic institutions across various regions. We have built up a comprehensive talent development program that includes diverse training programs featuring lectures, senior experience sharing, study groups, and participation in conferences and external forums.
We have invested significant resources in our people, recruiting talents from renowned universities and academic institutions across various regions. We have developed a comprehensive talent development program that includes diverse training programs featuring lectures, senior experience sharing, study groups, and participation in conferences and external forums.
See Note 5 “Critical Accounting Judgements, Estimates and Key Sources of Assumption Uncertainty” to our consolidated financial statements elsewhere in this annual report for additional information on our critical accounting estimates. 89 Table of Contents
See Note 5 “Critical Accounting Judgments, Estimates and Key Sources of Assumption Uncertainty” to our consolidated financial statements elsewhere in this annual report for additional information on our critical accounting estimates.
We believe that our cash and cash equivalents, including the cash we obtained from the Business Combination, and our credit facilities will be sufficient to meet our working capital and capital expenditure requirements for at least the next 12 months from the date of this annual report and sufficient to fund our operations.
We believe that our cash and cash equivalents will be sufficient to meet our working capital and capital expenditure requirements for at least the next 12 months from the date of this annual report and sufficient to fund our operations.
(1) AI- and AR- cloud solutions and subscription For AI- and AR- cloud solutions and subscription, we provide online cloud-based solutions to our customers, primarily including premium feature subscriptions for our individual customers and virtual try-on solutions for our brand customers.
(1) AI- and AR- cloud solutions and subscription For AI- and AR- cloud solutions and subscription, we provide online cloud-based solutions to our customers, primarily including premium feature subscriptions for our app and web service users and virtual try-on solutions for our brand customers.
Our net income slightly decreased from $5.4 million for the year ended December 31, 2023 to $5.0 million for the year ended December 31, 2024.
Our net income decreased from $5.0 million for the year ended December 31, 2024 to $4.6 million for the year ended December 31, 2025.
Our business primarily operates in a prepaid service subscription model, enabling us to collect cash in advance upon the signing of contract and then deliver services pursuant to terms of contract.
Our business primarily operates in a prepaid service subscription model, enabling us to collect cash in advance upon the subscription of product plans or signing of contract and then deliver services pursuant to terms and conditions of subscriptions or relevant contracts.
Despite the continuous increase in gross profit, our gross margin slightly decreased by 2.6% from 80.6% for the year ended December 31, 2023 to 78.0% for the year ended December 31, 2024.
Despite the continuous increase in gross profit, our gross margin slightly decreased by 0.6% from 78.0% for the year ended December 31, 2024 to 77.4% for the year ended December 31, 2025.
With respect to geographical contribution, revenue from the Americas has increased 6.3% from $29.9 million for the year ended December 31, 2023 to $31.8 million for the same period in 2024, revenue from Europe has increased by 20.4% from $13.8 million for the year ended December 31, 2023 to $ 16.6 million for the same period in 2024, and revenue from Asia-Pacific has increased by 18.2% from $8.6 million for the year ended December 31, 2023 to $10.1 million for the same period in 2024.
With respect to geographical contribution, revenue from the Americas has increased by 7.7% from $31.8 million for the year ended December 31, 2024 to $34.3 million for the same period in 2025, revenue from Europe has increased by 22.3% from $16.6 million for the year ended December 31, 2024 to $20.3 million for the same period in 2025, and revenue from Asia-Pacific has increased by 18.9% from $10.1 million for the year ended December 31, 2024 to $12.0 million for the same period in 2025.
Investments in research and development fuel our steady innovation and product relevance. Expanding our total addressable market by identifying and engaging new target user groups also plays a significant role in maintaining our sustained growth in B2C business and enhancing our market competitiveness.
Our continued investment in research and development underpins our ability to drive innovation and maintain product relevance. Expanding our total addressable market by identifying and engaging new target user groups also plays a significant role in maintaining our steady growth in B2C business and enhancing our market competitiveness.
The double-digit revenue growth is primarily driven by the robust momentum in the growth of YouCam mobile app subscriptions, the growing popularity among consumers of Generative AI technologies and AI editing features for photos and videos, the stable demand for the Company’s online virtual product try-on solutions from brand customers.
This increase is primarily driven by the robust momentum in the revenue growth of YouCam mobile app and web service subscriptions, increasing consumer interest in Generative AI technologies and AI editing features for photos and videos, and the stable demand for the Company’s online virtual product try-on solutions from brand customers.
In addition, we have 6-month time deposits of $36.0 million classified as current financial assets at amortized cost according to IFRS as of December 31, 2024 and we do not have any loan and bank borrowings as of the same date.
In addition, we have 6-month time deposits of $36.3 million classified as current financial assets at amortized cost according to IFRS as of December 31, 2025. Furthermore, we had U.S. Treasuries of $10.2 million, classified as non-current financial assets at amortized cost under IFRS and we do not have any loan and bank borrowings as of the same date.
We recorded net losses of $161.7 million in 2022, and recorded a net income of $5.4 million in 2023 and $5.0 million in 2024. Our sustained improvement of operating income in 2023 and 2024 demonstrated the steady growth of our business and the improvement of our overall financial and business situation.
We recorded a net income of $5.0 million in 2024 and $4.6 million in 2025. Our sustained reduction of operating loss from 2023 through 2025 demonstrated the steady growth of our business and the improvement of our overall financial and business situation.
We have observed that as consumers increasingly rely on mobile technology for content creation and self-expression, the demand for advanced, feature-rich apps and web services continues to rise.
As consumers increasingly rely on mobile technology for digital content creation and personal expression, we have observed growing demand for advanced, feature-rich mobile apps and web services.
We generate recurring revenue from renewals of these licensing agreements by customers. For further details on our revenue recognition, see Note 4 “Summary of Significant Accounting Policies” to our consolidated financial statements included in this annual report.
For further details on our revenue recognition, see Note 4 “Summary of Significant Accounting Policies” to our consolidated financial statements included in this annual report.
In terms of the premium features on our mobile apps and web services to which individual customers subscribe through Apple App Store and Google Play and our web-based editor, we currently offer monthly and annual subscription plans, with subscription price varying by countries and regions. We recognize revenue from such services based on the fulfilled contract obligations for each month.
In terms of the premium features on our mobile apps and web services to which users subscribe through Apple App Store and Google Play and our website, we currently offer monthly and annual subscription plans, with subscription price varying by countries and regions.
In managing our B2B business, our management vigilantly monitors the revenue contribution from our Key Customers, as these metric provide reliable insights into the growth of our B2B business, due to the following reasons: (i) revenue from Key Customers accounted for approximately 43.5%, 45.4% and 32.5% of our total revenue in 2022, 2023 and 2024, respectively; and (ii) revenue from Key Customers represented 70.4%, 94.1% and 87.2% of our total revenue from our total brand portfolio in 2022, 2023 and 2024, respectively.
In managing our B2B business, our management vigilantly monitors the revenue contribution from our Key Customers, as these metric provide reliable insights into the growth of our B2B business, for the reasons that: (i) revenue from Key Customers accounted for approximately 32.5% and 27.6% of our total revenue in 2024 and 2025, respectively; and (ii) revenue from Key Customers represented 87.2% and 86.2% of our total revenue from our total B2B business in 2024 and 2025, respectively.
We intend to continue to fund our future material cash requirements with net proceeds in connection with our Business Combination, equity contributions from our shareholders and payments received from our customers. We will continue to make cash commitments, including capital expenditures, to support the growth of our business. On October 28, 2022, we completed the Business Combination.
We intend to continue to fund 97 Table of Contents our future material cash requirements with net proceeds in connection with equity contributions from our shareholders and revenue generated from our business operations. We will continue to make cash commitments, including capital expenditures, to support the growth of our business.
Results of Operations Our results of operations for the years ended December 31, 2022, 2023 and 2024 are presented below: Years ended December 31, ($ in thousands, unless otherwise stated) 2022 2023 2024 2023 % Change 2024 % Change Revenue $ 47,300 $ 53,505 $ 60,202 13.1 % 12.5 % Cost of sales and services (7,130) (10,400) (13,258) 45.9 % 27.5 % Gross profit 40,170 43,105 46,944 7.3 % 8.9 % Operating expenses Sales and marketing expenses (24,544) (25,725) (28,213) 4.8 % 9.7 % General and administrative expenses (76,219) (11,582) (8,501) (84.8) % (26.6) % Research and development expenses (10,481) (11,458) (12,000) 9.3 % 4.7 % Expected credit losses — — (1,373) — % (100.0) % Total operating expenses (111,244) (48,765) (50,087) (56.2) % 2.7 % Operating loss (71,074) (5,660) (3,143) (92.0) % (44.5) % Non-operating income and expenses Interest income 2,029 9,498 7,708 368.1 % (18.8) % Other income 75 33 55 (56.0) % 66.7 % Other gains and losses (92,474) 1,675 (316) (101.8) % (118.9) % Finance costs (8) (15) (18) 87.5 % 20.0 % Total non-operating income and expenses (90,378) 11,191 7,429 (112.4) % (33.6) % Income (loss) before income tax (161,452) 5,531 4,286 (103.4) % (22.5) % Income tax benefit (expense) (292) (115) 735 (60.6) % (739.1) % Net income (loss) $ (161,744) $ 5,416 $ 5,021 (103.3) % (7.3) % Comparison of Year Ended December 31, 2023 to Year Ended December 31, 2024 Revenue Total revenue increased by $6.7 million, or 12.5%, from $53.5 million for the year ended December 31, 2023 to $60.2 million for the year ended December 31, 2024.
Currently, the applicable tax rate in our headquarters in Taiwan is 20% while the tax rate for unappropriated earnings is 5%. 94 Table of Contents Results of Operations Our results of operations for the years ended December 31, 2023, 2024 and 2025 are presented below: Years ended December 31, ($ in thousands, unless otherwise stated) 2023 2024 2025 2024 % Change 2025 % Change Revenue $ 53,505 $ 60,202 $ 69,154 12.5 % 14.9 % Cost of sales and services (10,400) (13,258) (15,630) 27.5 % 17.9 % Gross profit 43,105 46,944 53,524 8.9 % 14.0 % Operating expenses Sales and marketing expenses (25,725) (28,213) (30,811) 9.7 % 9.2 % General and administrative expenses (11,582) (8,501) (6,996) (26.6) % (17.7) % Research and development expenses (11,458) (12,000) (15,405) 4.7 % 28.4 % Expected credit losses — (1,373) (75) (100.0) % (94.5) % Impairment loss on goodwill — — (1,965) — % (100.0) % Total operating expenses (48,765) (50,087) (55,252) 2.7 % 10.3 % Operating loss (5,660) (3,143) (1,728) (44.5) % (45.0) % Non-operating income and expenses Interest income 9,498 7,708 6,134 (18.8) % (20.4) % Other income 33 55 28 66.7 % (49.1) % Other gains and losses 1,675 (316) 1,319 (118.9) % 517.4 % Finance costs (15) (18) (16) 20.0 % (11.1) % Total non-operating income and expenses 11,191 7,429 7,465 (33.6) % 0.5 % Income before income tax 5,531 4,286 5,737 (22.5) % 33.9 % Income tax benefit (expense) (115) 735 (1,094) (739.1) % 248.8 % Net income $ 5,416 $ 5,021 $ 4,643 (7.3) % (7.5) % Comparison of December 31, 2024 to December 31, 2025 Revenue Total revenue increased by $9.0 million, or 14.9%, from $60.2 million for the year ended December 31, 2024 to $69.2 million for the year ended December 31, 2025.
Risk Factors — Risks Related to the Class A Ordinary Shares and Warrants — Sales of a substantial number of our securities in the public market by our existing securityholders could cause the price of our Class A Ordinary Shares and Warrants to fall.” 87 Table of Contents Cash Flows Summary Presented below is a summary of cash flows from or used in our operating, investing, and financing activities: Year ended December 31, ($ in thousands, unless otherwise stated) 2022 2023 2024 Cash flows from (used in) operating activities $ (3,305) $ 13,578 $ 13,003 Cash flows from (used in) investing activities (30,258) (637) (8,879) Cash flows from (used in) financing activities 118,028 (51,499) (525) Effects of exchange rates changes on cash and cash equivalents (2,302) (187) (349) Net increase (decrease) in cash and cash equivalents $ 82,163 $ (38,745) $ 3,250 Cash Flows Generated from (Used in) Operating Activities Cash flows generated from or used in operating activities primarily relate to the collection of accounts receivables, payment of provision and payables, net interest received and income tax paid.
Cash Flows Summary Presented below is a summary of our operating, investing, and financing cash flows: Year ended December 31, ($ in thousands, unless otherwise stated) 2023 2024 2025 Cash flows from (used in) operating activities $ 13,578 $ 13,003 $ 13,305 Cash flows from (used in) investing activities (637) (8,879) (14,063) Cash flows from (used in) financing activities (51,499) (525) (562) Effects of exchange rates changes on cash and cash equivalents (187) (349) 175 Net increase (decrease) in cash and cash equivalents $ (38,745) $ 3,250 $ (1,145) Cash Flows Generated from (Used in) Operating Activities Cash flows generated from or used in operating activities primarily relate to the collection of accounts receivables, payment of provision and payables, net interest received and income tax paid.
We have achieved significant scale and steady growth since our inception in 2015. Our total revenue grew from $22.9 million in 2019 to $60.2 million in 2024, at a CAGR of 21.3%.
We have achieved significant scale and steady growth since our inception in 2015. We have achieved a double-digit revenue growth of 14.9% in total revenue, reaching $69.2 million in 2025, up from $60.2 million in 2024.
Our lease obligations consist of the commitments under the rental agreements for our office premises. Our contractual obligations primarily consist of minimum commitments for marketing activities. From a dollar amount perspective, both lease obligations and contractual obligations have been immaterial.
From January 1, 2025 through December 31, 2025, we incurred capital expenditure of less than $0.5 million. Our lease obligations consist of the commitments under the rental agreements for our office premises. Our contractual obligations primarily consist of minimum commitments for marketing activities. From a dollar amount perspective, both lease obligations and contractual obligations are immaterial.
Research and Development Expenses Our research and development expenses primarily consist of salaries and benefits, including share-based compensation, for our technology and product development personnel, and depreciation and other associated corporate costs.
In 2025, our general and administrative expenses have decreased primarily due to reduction in corporate insurance premium and reduced external professional service fee. Research and Development Expenses Our research and development expenses primarily consist of salaries and benefits, including share-based compensation, for our technology and product development personnel, and depreciation and other associated corporate costs.
The increase was primarily due to the increase in payment processing fees paid to third-party digital distribution platforms such as Apple App Store and Google Play resulting from the increase in our mobile app subscription revenue.
The increase was primarily attributable to higher third-party 95 Table of Contents payment processing fees paid to digital distribution partners-such as the Apple App Store and Google Play-driven by the continued growth in mobile app and web service subscription revenue.
Revenue outside of these three major regions has grown by 36.1% from $1.2 million for the year ended December 31, 2023 to $1.7 million for the same period in 2024. 83 Table of Contents Cost of Sales and Services Cost of sales and services increased by $2.9 million, or 27.5%, from $10.4 million for the year ended December 31, 2023 to $13.3 million for the year ended December 31, 2024.
Revenue outside of these three major regions has grown by 52.5% from $1.7 million for the year ended December 31, 2024 to $2.6 million for the same period in 2025.
We have already made inroads into luxury and fashion industries, including jewelry, eyewear, watches, and accessories, and now are exploring opportunities into new segments, such as solutions for hair salons, med-spa, skin clinics and aesthetic non-surgical beauty treatments. We are uniquely positioned to integrate our industry-leading facial and hand solutions into these new segments.
We have already extended our presence into luxury categories such as jewelry, eyewear, watches, and accessories, and are exploring new segments including hair salons, med-spa, skin clinics, and aesthetic non-surgical treatments.
Our typical contract terms with brand customers range from three months to multiple years, with one-year term being the most common.
We recognize revenue from such services based on the fulfilled contract obligations for each month. 92 Table of Contents Our typical contract terms with brand customers range from three months to multiple years, with one-year term being the most common.
Certain expenses, such as the professional advisors’ fees in connection with our ongoing reporting obligations as a public company, however, may negatively affect our profitability in the next few years. • Our people and technology We are committed to investing in our people and technology, as these are essential for delivering innovative solutions and services that meet our customer needs, expanding our customer base, and maintaining our market leadership in the consumer beauty and AI mobile apps as well as in the beauty and fashion AI- and AR- industry.
Our people and technology We are committed to investing in our people and technology, as these are essential for delivering innovative solutions and services that meet the evolving needs of users and brands, expanding our active subscriber and brand customer base, and maintaining our market leadership in the consumer beauty and AI mobile apps as well as in the beauty and fashion AI- and AR- industry.
Total Non-Operating Income and Expenses Total non-operating income and expenses decreased by $3.8 million, or 33.6%, from $11.2 million for the year ended December 31, 2023 to $7.4 million for the year ended December 31, 2024.
Total Non-operating income and expenses Total non-operating income and expenses increased by $0.04 million, or 0.5%, from $7.4 million for the year ended December 31, 2024 to $7.5 million for the same period in 2025.
Net cash generated from operating activities decreased by $0.6 million, or 4.2%, from $13.6 million for the year ended December 31, 2023 to $13.0 million for the year ended December 31, 2024. This change was primarily due to less interests received compared to 2023.
Net cash generated from operating activities increased by $0.3 million, or 2.3%, from $13.0 million for the year ended December 31, 2024 to $13.3 million for the year ended December 31, 2025.
Cash Flows Generated from (Used in) Investing Activities Cash flows generated from or used in investing activities primarily relates to acquisition of financial assets, proceeds from disposal of financial assets, acquisition of property, plant and equipment, acquisition of intangible assets, and changes in guarantee deposits paid.
The Company continues to invest in growth while maintaining a healthy cash flow to support business operations underscoring the Company’s operational health and sustainability. 98 Table of Contents Cash Flows Generated from (Used in) Investing Activities Cash flows generated from or used in investing activities primarily relates to acquisition of financial assets, proceeds from disposal of financial assets, acquisition of businesses, acquisition of property, plant and equipment, acquisition of intangible assets, and changes in guarantee deposits paid.
We expect that our cost of sales and services will increase in absolute dollars in tandem with the growth of our businesses in the foreseeable future, as we continue to invest and broaden our product offerings and scale up our business operations. 81 Table of Contents Sales and Marketing Expenses Our sales and marketing expenses consist of personnel-related expenses for salaries, employee benefits, and stock-based compensation for employees engaged in sales and marketing, advertising and promotional fees, cloud-hosting fees as well as allocated facilities and information technology costs.
We expect that our cost of sales and services will increase in absolute dollars in tandem with the growth of our businesses in the foreseeable future, as we continue to invest and broaden our product offerings and scale up our business operations.
General and Administrative Expenses General and administrative expenses significantly decreased by $3.1 million, or 26.6%, from $11.6 million for the year ended December 31, 2023 to $8.5 million for the year ended December 31, 2024. The significant decrease was primarily due to reduced corporate insurance premium and external professional service fees.
The decrease was primarily due to reduced corporate insurance premium and external professional service fees. Research and Development Expenses Research and development expenses increased by $3.4 million, or 28.4%, from $12.0 million for the year ended December 31, 2024 to $15.4 million for the same period in 2025.
Sales and Marketing Expenses Sales and marketing expenses increased by $2.5 million, or 9.7%, from $25.7 million for the year ended December 31, 2023 to $28.2 million for the year ended December 31, 2024. This increase was primarily due to an increase in marketing events and advertising expenses related to our mobile apps and cloud computing.
The increase was primarily due to the increase in marketing events and advertising costs related to our mobile apps and web service subscriptions. General and Administrative Expenses General and administrative expenses decreased by $1.5 million, or 17.7%, from $8.5 million for the year ended December 31, 2024 to $7.0 million for the same period in 2025.
Operating Results Company Overview Founded in 2015, we are a leading AI technology company offering self-developed AI- and AR- powered solutions dedicated to making your virtual world beautiful. We operate a hybrid business model of B2B business and B2C business.
Operating Results Company Overview Founded in 2015, we are a leading AI technology company focused on delivering self-developed AI- and AR- powered solutions to make your virtual world beautiful. Operating with a hybrid model that spans both B2C and B2B segments, we leverage our cutting-edge expertise to transform how users and brands interact with digital experiences.
The increase was primarily associated with the increased sales and marketing expenses and research and development expenses, which were partially offset by a decline in general and administrative expenses.
Total Operating Expenses Total operating expenses increased by $5.2 million, or 10.3%, from $50.1 million for the year ended December 31, 2024 to $55.3 million for the same period in 2025. The increase was primarily associated with higher research and development expenses and sales and marketing expenses, which were partially offset by a decline in general and administrative expenses.
Operating Results — Results of Operations” of our annual report on Form 20-F for the fiscal year ended December 31, 2023 filed with SEC on March 29, 2024.
Operating Results — Results of Operations” of our annual report on Form 20-F for the fiscal year ended December 31, 2024 filed with SEC on March 28, 2025. B. Liquidity and Capital Resources Since our inception, we have financed our operations primarily through equity contributions from our shareholders and revenue generated from our business operations.
(3) Average monthly active subscribers is calculated by taking the total number of active subscribers at the end of each calendar month within a given year, summing these values, and dividing the total by 12. • Our ability to continuously introduce market competitive offerings that drive user interest Our results of operations rely heavily on our ability to consistently develop and periodically launch new premium features and mobile apps that resonate with users and adapt to evolving market demands.
Our ability to continuously introduce market competitive offerings that drive user interest Our results of operations rely heavily on our ability to consistently develop and periodically launch new premium features and product offerings that resonate with our app and web service users and adapt to evolving market dynamics.
Our capital expenditures are 86 Table of Contents primarily related to purchase of certain servers in our ordinary course of business and ERP system upgrade, which has been immaterial from a dollar amount perspective. From January 1, 2022 through December 31, 2024, we incurred capital expenditure of less than $0.4 million annually.
Our cash requirements as of December 31, 2025 and any subsequent interim period primarily include our capital expenditure, lease obligations, contractual obligations and other commitments. Our capital expenditures are primarily related to purchase of certain servers in our ordinary course of business and ERP system upgrade, which are immaterial from a dollar amount perspective.
Key Factors Affecting Our Results of Operations Our results of operations are affected by the following factors: • Overall adoption rate and our ability to monetize our premium features Our results of operations are significantly driven by our ability to continuously grow and retain existing subscriptions of our premium features within our YouCam suite of mobile apps and web services.
Key Factors Affecting Our Results of Operations Our results of operations are affected by the following factors: Our ability to effectively monetize our premium features and expand our B2C business Our results of operations are significantly driven by our ability to sustain a steady growth in our B2C business, which in turn, depends on our success in expanding and retaining subscriptions to the premium features offered through our YouCam suite of mobile applications and web-based services.
Net cash used in investing activities was $8,879 thousand for the year ended December 31, 2024 and net cash used in investing activities was $637 thousand for the year ended December 31, 2023. Net cash used in investing activities was $30.3 million for the year ended December 31, 2022.
Net cash used in investing activities was $14.1 million for the year ended December 31, 2025 and net cash used in investing activities was $8.9 million for the year ended December 31, 2024. The increase in net cash used in investing activities was primarily attributable to the Company’s acquisition of Wannaby.
Material Contractual Obligations and Commitments During the periods presented, we did not have any material contractual obligations and commitments other than two office leases entered into by and between Perfect Taiwan and CyberLink for two years starting from June 1, 2023 and December 1, 2023 respectively, and an office lease entered into by and between Perfect Taiwan and ClinJeff Corp., a related party, for two years starting from May 15, 2024. 88 Table of Contents Off-Balance Sheet Arrangements During the periods presented, we did not have any relationships with unconsolidated organizations or financial partnerships, such as structured finance or special purpose entities, which were established for the purpose of facilitating off-balance sheet arrangements.
Material Contractual Obligations and Commitments During the periods presented, we did not have any material contractual obligations and commitments other than two office leases entered into by and between Perfect Taiwan and CyberLink for two years starting from June 1, 2025 and December 1, 2025, respectively.
We believe the high consumer engagement and scalability of our platform positions us well to capitalize on this monetization opportunity. In addition to the Key Customers, which are major brand customers, we also generate revenue from other long-tail brand customers which is the non-Key Customer brands.
In addition to the Key Customers, which are major brand customers, we also generate revenue from other long-tail brand customers which is the non-Key Customer brands. The total non-Key Customer brands revenue represented 12.8% and 13.8% of our total brand business for the years ended December 31, 2024 and 2025, respectively.
We achieved a double-digit revenue growth of 12.5% in 2024, compared to 2023, driven by the robust momentum in the growth of YouCam mobile app and web service subscriptions, stable demand for the Company’s online virtual product try-on solutions from brand customers, and the growing popularity among consumers of Generative AI technologies and AI editing features for photos and videos.
This growth was fueled by continued revenue growth in YouCam mobile app and web services subscriptions, increasing consumer interest in Generative AI technologies and AI-powered photo and video editing features, and sustained demand from brand customers for the Company’s online virtual product try-on solutions.
Nevertheless, we raised $105 million from PIPE Investors and FPA Investors, which, together with the proceeds from non-redeeming Provident shareholders, amounted to $119 million in gross proceeds, and added $113 million in net proceeds to our balance sheet. We would receive the proceeds from any exercise of any outstanding Warrants that are exercised for cash pursuant to their terms.
We would receive the proceeds from any exercise of any outstanding Warrants that are exercised in cash pursuant to their terms.
Furthermore, as part of our growth strategy, we have plans to further invest in research and development, develop new AI- and AR-solutions, broaden our customer bases in the beauty and fashion industry, and expand into aesthetic skin beauty segment with a particular focus on med-spa applications. These new developments and expansions may generate long-term cash requirements.
Furthermore, as part of our growth strategy, we plan to increase investment in research and development, upgrade AI- and AR- technologies, expand the suite of product offerings and premium features, broaden our user and brand customer base, and expand into synergistic segments such as the luxury sector. These new developments and expansions may generate long-term cash requirements.
The decrease was primarily due to the decrease of interest income and other gains and losses. 84 Table of Contents Interest Income Interest income decreased by $1.8 million, or 18.8%, from $9.5 million for the year ended December 31, 2023 to $7.7 million for the year ended December 31, 2024.
The increase was primarily attributable to a decrease in the fair value of warrant liabilities, which resulted in gains recognized on financial liabilities, which was partially offset by a decline in interest income. 96 Table of Contents Interest Income Interest income decreased by $1.6 million, or 20.4%, from $7.7 million for the year ended December 31, 2024 to $6.1 million for the same period in 2025.
Net cash from financing activities was $118.0 million in 2022, primarily consisting of gross proceeds of $112.9 million from the Transactions, and $5.6 million from the proceeds of the exercise of employee stock options, partially offset by $0.5 million in the repayment of the principal portion of lease liabilities.
Cash Flows Generated from (Used in) Financing Activities Net cash used in financing activities was $0.6 million for the year ended December 31, 2025, consisting of $0.6 million in the repayment of the principal portion of lease liabilities.
We observed a robust growth momentum in the number of our active subscribers from approximately 604,000, 879,000 as of December 31, 2022 and 2023, respectively, to over one million as of December 31, 2024, primarily driven by the sustained and robust demand for our YouCam family apps and web-based editor from our users.
Our active subscriber base demonstrated strong growth momentum, increasing from approximately 604,000 as of December 31, 2022 to 879,000 as of December 31, 2023, and surpassing one million as of December 31, 2024.
Gross Profit Gross profit increased by $3.8 million, or 8.9%, from $43.1 million for the year ended December 31, 2023 to $46.9 million for the year ended December 31, 2024.
Cost of Sales and Services Cost of sales and services increased by $2.4 million, or 17.9%, from $13.3 million for the year ended December 31, 2024, to $15.6 million for the same period in 2025.
We manage the monetization of our YouCam suite of mobile apps and web services by closely monitoring metrics such as active subscribers as of year-end and average monthly active subscribers, and benchmark against the product ratings and functionalities of the primary competitors of our mobile apps and web services, so as to enabling us to identify which features are key drivers for converting free users into paying subscribers.
In managing our B2C business, we continuously monitor key performance indicators, such as the number of active subscribers. We also benchmark product ratings and functionalities against primary competitors to identify and prioritize features that serve as core drivers in converting free users to paying subscribers.
Other Gains and Losses Other gains and losses, primarily consisting of adjustment in non-cash valuation gains (losses) on financial liabilities at fair value through profit or loss, were recorded as losses of $0.2 million for the year ended December 31, 2024, as compared to gains of $1.6 million for the year ended December 31, 2023.
The change was primarily attributable to a decrease in the fair value of warrant liabilities, which resulted in gains recognized on financial liabilities. Net Income As a result of the foregoing, our net income for the year ended December 31, 2025 was $4.6 million, compared to $5.0 million for the same period in 2024.
Removed
Our B2C family of YouCam mobile apps and web-based editing services empower users to create and enhance their personal photo and video with user-friendly interfaces, while driving powerful high quality outputs through 76 Table of Contents Generative AI technologies. Our B2B platform transforms how brands and consumers interact and create opportunities to connect that were previously unimaginable.
Added
Our B2C offerings revolve around advanced AI-driven technologies, delivering a seamless user experience for photo and video editing and creation. We offer seven mobile apps under the “YouCam” suite, YouCam Makeup, YouCam Perfect, YouCam AI Pro, YouCam Video, YouCam Enhance, YouCam Nails and YouCam AI Chat, along with one web-based editing tool, YouCam Online Editor.
Removed
With our cutting-edge, hyper-realistic virtual try-on solutions, we are transforming the traditional online and in-store shopping journey by creating instant, seamless and engaging omni-channel shopping experiences from product discovery to personalized recommendation in multiple categories. For our B2C business, we primarily offer six mobile apps under the “YouCam” suite and one web-based editor, featuring AI- and AR- technologies.
Added
Harnessing AI- and AR- technologies, our products enable real-time virtual try-ons, beauty camera or portrait retouching, photo or video enhancement, editing and creation, as well as state-of-the-art Generative AI capabilities such as image-to-image, image-to-video, text-to-video, text-to-photo, avatar creation, and intelligent editing. These innovative features empower users to transform selfies images and text prompts into striking personal contents.
Removed
The flagship mobile apps, YouCam Makeup, YouCam Perfect, YouCam Video, YouCam Enhance, YouCam AI Pro and YouCam Nails, along with online editing tool, YouCam Online Editor, provide users with virtual try-ons, beauty camera and portrait retouching, photo and video enhancement and editing features and Generative AI features for selfies, avatars, generative imaging, text-to-photo, and AI-driven editing.
Added
While the number of active subscribers declined modestly year over year to 908,239 as of December 31, 2025, this reflected a deliberate strategic shift toward higher-value generative AI features and premium creative tools, which drove a meaningful increase in average selling price and fueled our sustained revenue growth.
Removed
These apps and online services, powered by our AI- and AR- technologies, have attracted a growing number of active subscribers, reaching a record high of over one million active subscribers as of December 31, 2024, up from 879,000 active subscribers as of December 31, 2023.
Added
Our B2C segment also functions as a dynamic platform for new AI- and AR- functionalities, enabling us to fine-tune cutting-edge solutions that can later be integrated into our B2B offerings. Capitalizing on our success in B2C business, we deliver hyper-realistic AI-driven virtual try-on solutions for enterprise clients, transforming both online and in-store shopping experiences from product discovery to personalized recommendations.

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Item 6. [Reserved]

Selected Financial Data — reserved (removed by SEC in 2021)

36 edited+3 added−2 removed89 unchanged
Plan Administration. Our Board, the CEO or any other executive officer(s) designated by our Board from time to time (the “administrator”) will have authority to administer the Director Equity Incentive Plan, and the administrator’s decision (save as otherwise provided herein) shall be final and binding on all parties.
Our Board, the CEO or any other executive officer(s) designated by our Board from time to time (the “administrator”) will have authority to administer the Director Equity Incentive Plan, and the administrator’s decision (save as otherwise provided herein) shall be final and binding on all parties.
Lee currently serves as the CEO at First Elite CAPs & Co, a Taiwan-based accounting company, and is a Professor-level Part-time Technical Expert of National Taipei University of Business and Vice-Chairman of the Board at Taipei CPA Association. Mr.
Lee currently serves as the CEO at First Elite CAPs & Co., a Taiwan-based accounting company, and is a Professor-level Part-time Technical Expert of National Taipei University of Business and Vice-Chairman of the Board at Taiwan Province CPA Association. Mr.
The above information is based on the Schedule 13D filed by CyberLink, among others, on February 13, 2023. 98 Table of Contents (4) Represents (i) 4,891,467 Class A Ordinary Shares issued as entitlement shares for the cancellation of 5,327,500 Provident Class B Ordinary Shares previously held by the Sponsor, (ii) 3,000,000 Class A Ordinary Shares consisting of (a) 2,000,000 Class A Ordinary Shares converted from 2,000,000 Provident Class A Ordinary Shares acquired by an affiliate of the Sponsor in connection with the FPA Investment, and (b) 1,000,000 Class A Ordinary Shares issuable upon the exercise of 1,000,000 Perfect Forward Purchase Warrants acquired by an affiliate of the Sponsor in connection with the FPA Investment, and (iii) 6,600,000 Class A Ordinary Shares issuable upon the exercise of 6,600,000 Warrants converted from 6,600,000 Private Placement Warrants previously held by the Sponsor.
(3) The above information is based on the Schedule 13D filed by CyberLink, among others, on February 13, 2023. 108 Table of Contents (4) Represents (i) 4,891,467 Class A Ordinary Shares issued as entitlement shares for the cancellation of 5,327,500 Provident Class B Ordinary Shares previously held by the Sponsor, (ii) 3,000,000 Class A Ordinary Shares consisting of (a) 2,000,000 Class A Ordinary Shares converted from 2,000,000 Provident Class A Ordinary Shares acquired by an affiliate of the Sponsor in connection with the FPA Investment, and (b) 1,000,000 Class A Ordinary Shares issuable upon the exercise of 1,000,000 Perfect Forward Purchase Warrants acquired by an affiliate of the Sponsor in connection with the FPA Investment, and (iii) 6,600,000 Class A Ordinary Shares issuable upon the exercise of 6,600,000 Warrants converted from 6,600,000 Private Placement Warrants previously held by the Sponsor.
We are not aware of any arrangement that may, at a subsequent date, result in a change of control of the Company. F. Disclosure of a Registrant’s Action to Recover Erroneously Awarded Compensation There was no erroneously awarded compensation that was required to be recovered pursuant to the Company’s clawback policy during the fiscal year ended December 31, 2024.
We are not aware of any arrangement that may, at a subsequent date, result in a change of control of the Company. F. Disclosure of a Registrant’s Action to Recover Erroneously Awarded Compensation There was no erroneously awarded compensation that was required to be recovered pursuant to the Company’s clawback policy during the fiscal year ended December 31, 2025.
In general, in identifying and evaluating nominees for directors, our Board considers educational background, diversity of professional experience, knowledge of our business, integrity, professional reputation, independence, character, and the ability to exercise sound judgement, and relevant skills and experience, including financial literacy, and experience in the context of the needs of our Board. D. Employees See “Item 4.
In general, in identifying and evaluating nominees for directors, our Board considers educational background, diversity of professional experience, knowledge of our business, integrity, professional reputation, independence, character, and the ability to exercise sound judgment, and relevant skills and experience, including financial literacy, and experience in the context of the needs of our Board. D. Employees See “Item 4.
Chang (1) 597,256 *% 16,788,718 100 % 66.6 % Wei-Hsin Tsen (Johnny Tseng) 762,330 *% — — *% Weichuan (Wayne) Liu 353,471 *% — — *% Pin-Jen (Louis) Chen 118,062 *% — — *% Jau-Hsiung Huang 148,274 *% — — *% Hsiao-Chuan (Iris) Chen 69,932 *% — — *% Michael Aw — — — — — Meng-Shiou (Frank) Lee — — — — — Philip Tsao 5,311 (2) *% — — *% Chung-Hui (Christine) Jih — — — — — All directors and executive officers as a group 2,054,636 2.4 % 16,788,718 100 % 67.2 % Five Percent or More Shareholders: GOLDEN EDGE CO., LTD. — — 10,622,620 (1) 63.3 % 42.0 % DVDonet.com.
Chang (1) 597,256 0.7 % 16,788,718 100 % 66.6 % Wei-Hsin Tsen (Johnny Tseng) 762,330 0.9 % — — 0.3 % Weichuan (Wayne) Liu 353,471 0.4 % — — 0.1 % Pin-Jen (Louis) Chen 118,062 0.1 % — — 0.1 % Jau-Hsiung Huang 148,274 0.2 % — — 0.01 % Hsiao-Chuan (Iris) Chen 69,932 0.1 % — — 0.03 % Michael Aw — — — — — Meng-Shiou (Frank) Lee — — — — — Philip Tsao 5,311 (2) 0.01 % — — 0.00 % Chung-Hui (Christine) Jih — — — — — All directors and executive officers as a group 2,054,636 2.4 % 16,788,718 100 % 67.2 % Five Percent or More Shareholders: GOLDEN EDGE CO., LTD. — — 10,622,620 (1) 63.3 % 42.0 % DVDonet.com.
Subject to exceptions in the event of retirement, death, or permanent injury due to occupational hazards during the employment as provided in the Share Incentive Plan, no options will be vested in the first two years from the grant date; following the end of such two-year period, 50% of the options will be vested; following the end of the third anniversary of the grant date, 75% of the options cumulatively will be vested; and on the date of the fourth anniversary of the grant date, 100% of the options cumulatively will be vested.
Subject to exceptions in the event of retirement, death, or permanent injury due to occupational hazards during the employment as provided in the Share Incentive Plan, no options will be vested in the first two years 103 Table of Contents from the grant date; following the end of such two-year period, 50% of the options will be vested; following the end of the third anniversary of the grant date, 75% of the options cumulatively will be vested; and on the date of the fourth anniversary of the grant date, 100% of the options cumulatively will be vested.
Subject to the adjustment provisions in the Share Incentive Plan, the maximum aggregate number of the Ordinary Shares that may be issued upon exercise of all options to be granted under the Share Incentive Plan shall be 5,311,310 Ordinary Shares; up to 5,311,310 Ordinary Shares may be issued under the Share Incentive Plan to 92 Table of Contents participants who are citizens of the U.S., residents of the U.S. or are otherwise subject to the federal income tax laws of the U.S.
Subject to the adjustment provisions in the Share Incentive Plan, the maximum aggregate number of the Ordinary Shares that may be issued upon exercise of all options to be granted under the Share Incentive Plan shall be 5,311,310 Ordinary Shares; up to 5,311,310 Ordinary Shares may be issued under the Share Incentive Plan to participants who are citizens of the U.S., residents of the U.S. or are otherwise subject to the federal income tax laws of the U.S.
Insofar as indemnification of liabilities arising under the Securities Act may be permitted to the Board, executive officers or persons controlling us pursuant to the foregoing provisions, we have been informed that, in the opinion of the SEC, such indemnification is against public policy as expressed in the Securities Act and is therefore unenforceable. C.
Insofar as indemnification of liabilities arising under the Securities Act may be permitted to the Board, executive officers or persons controlling us pursuant to the foregoing provisions, we have been informed that, in the opinion of the SEC, such indemnification is against public policy as expressed in the Securities Act and is therefore unenforceable. 105 Table of Contents C.
The audit committee is responsible for, among other things: • the quality and integrity of our financial statements, • internal control over financial reporting and disclosure controls and procedures, • our compliance with legal and regulatory requirements, • our independent registered public accounting firm’s qualifications and independence, 96 Table of Contents • the performance of our internal audit function, and • the performance of our independent registered public accounting firm.
The audit committee is responsible for, among other things: • the quality and integrity of our financial statements, • internal control over financial reporting and disclosure controls and procedures, • our compliance with legal and regulatory requirements, • our independent registered public accounting firm’s qualifications and independence, • the performance of our internal audit function, and • the performance of our independent registered public accounting firm.
Huang was a professor in the computer science department at National Taiwan University and was the co-founder of the Communications and Multimedia Lab at National Taiwan University, from which he subsequently received a series of awards, including the Distinguished Alumni Award and the Electronic Research and Service Organization (“ERSO”) Award. Dr.
Huang was a professor in the computer science department at National Taiwan University and was the co-founder of the Communications and Multimedia Lab at National Taiwan University, from which he subsequently received a series of awards, including the Distinguished Alumni Award and the Electronic Research and Service 101 Table of Contents Organization (“ERSO”) Award. Dr.
Prior to that, Mr. Tsao also worked at Citibank for nine years across various functions. Mr. 91 Table of Contents Tsao holds an MBA from National Taiwan University and a B.Sc. from Tsinghua University. He is also a Chartered Financial Analyst Charterholder. Chung-Hui (Christine) Jih has served as our non-executive director since October 28, 2022. Ms.
Prior to that, Mr. Tsao also worked at Citibank for nine years across various functions. Mr. Tsao holds an MBA from National Taiwan University and a B.Sc. from Tsinghua University. He is also a Chartered Financial Analyst Charterholder. Chung-Hui (Christine) Jih has served as our non-executive director since October 28, 2022. Ms.
For the year ended December 31, 2024, no options to purchase Class A Ordinary Shares were granted to our directors under the Director Equity Incentive Plan.
For the year ended December 31, 2025, no options to purchase Class A Ordinary Shares were granted to our directors under the Director Equity Incentive Plan.
Each Award will be evidenced by an award agreement that will specify the period of restriction (if any), the number of shares granted, and such other terms and conditions as the administrator, in its sole discretion, will determine. 94 Table of Contents Term of the Plan.
Each Award will be evidenced by an award agreement that will specify the period of restriction (if any), the number of shares granted, and such other terms and conditions as the administrator, in its sole discretion, will determine. Term of the Plan.
Share Ownership Except as specifically noted, the following table sets forth information regarding the beneficial ownership of Ordinary Shares to the extent known to us as of March 20, 2025 by: • each person who beneficially owns 5.0% or more of the outstanding Ordinary Shares; • each person who is our executive officer or director; and • all of our executive officers and directors as a group.
Share Ownership Except as specifically noted, the following table sets forth information regarding the beneficial ownership of Ordinary Shares to the extent known to us as of March 6, 2026 by: • each person who beneficially owns 5.0% or more of the outstanding Ordinary Shares; • each person who is our executive officer or director; and • all of our executive officers and directors as a group.
In computing the number of shares beneficially owned by a person and the percentage ownership of that person, shares that the person has the right to acquire within 60 days are included, including through the exercise of any option or other right or the conversion of any other security.
In computing the 107 Table of Contents number of shares beneficially owned by a person and the percentage ownership of that person, shares that the person has the right to acquire within 60 days are included, including through the exercise of any option or other right or the conversion of any other security.
Inc — — 4,669,346 (1) 27.8 % 18.5 % CyberLink International 36,960,961 (3) 43.5 % — — 14.6 % Provident Acquisition Holdings Ltd. 14,491,467 (4) 17.0 % — — 5.7 % Yi-Chen Huang 4,567,425 (5) 5.4 % — — 1.8 % ________________________________ * Less than 1%. † For each person or group, percentage of class is calculated by dividing the number of Class A Ordinary Shares or Class B Ordinary Shares beneficially owned by such person or group by the total Class A Ordinary Shares or Class B Ordinary Shares, respectively.
Inc — — 4,669,346 (1) 27.8 % 18.5 % CyberLink International 36,960,961 (3) 43.5 % — — 14.6 % Provident Acquisition Holdings Ltd. 14,491,467 (4) 15.6 % — — 5.7 % Yi-Chen Huang 4,567,425 (5) 5.4 % — — 1.8 % ________________________________ † For each person or group, percentage of class is calculated by dividing the number of Class A Ordinary Shares or Class B Ordinary Shares beneficially owned by such person or group by the total Class A Ordinary Shares or Class B Ordinary Shares, respectively.
Dissolution or Liquidation . In the event of our dissolution or liquidation, each award will terminate immediately prior to the consummation of such action, unless otherwise determined by the CEO or other senior officer(s) designated by the Board. 93 Table of Contents Change in Control .
Dissolution or Liquidation . In the event of our dissolution or liquidation, each award will terminate immediately prior to the consummation of such action, unless otherwise determined by the CEO or other senior officer(s) designated by the Board. Change in Control .
Compensation For the year ended December 31, 2024, we paid an aggregate of $3.1 million in cash and benefits to our executive officers and directors, including $0.5 million in share-based compensation related to previously granted stock options that remain unvested and/or vested stock options that remain unexercised.
Compensation For the year ended December 31, 2025, we paid an aggregate of $3.1 million in cash and benefits to our executive officers and directors, including $0.3 million in share-based compensation related to previously granted stock options that remain unvested and vested stock options that remain unexercised.
Liu holds an MBA from Santa 90 Table of Contents Clara University, an M.Sc. from Case Western Reserve University, a B.Sc. from National Tsing Hua University, and a Ph.D. degree in electrical engineering from University of Southern California.
Liu holds an MBA from Santa Clara University, an M.Sc. from Case Western Reserve University, a B.Sc. from National Tsing Hua University, and a Ph.D. degree in electrical engineering from University of Southern California.
In fulfilling their duty of care to us, our directors must ensure 95 Table of Contents compliance with our Articles, as amended and restated from time to time, and the class rights vested thereunder in the holders of the shares.
In fulfilling their duty of care to us, our directors must ensure compliance with our Articles, as amended and restated from time to time, and the class rights vested thereunder in the holders of the shares.
Chang 63 CEO and Chairwoman of the Board Michael Aw 49 Non-executive Director Jau-Hsiung Huang 65 Non-executive Director Meng-Shiou (Frank) Lee 63 Independent Non-executive Director Philip Tsao 64 Independent Non-executive Director Chung-Hui (Christine) Jih 63 Independent Non-executive Director Pin-Jen (Louis) Chen 46 Executive Vice President and Chief Strategy Officer Wei-Hsin Tsen (Johnny Tseng) 57 Senior Vice President and Chief Technology Officer Weichuan (Wayne) Liu 55 Chief Growth Officer and President of Americas Hsiao-Chuan (Iris) Chen 56 Vice President and Head of Finance and Accounting The business address of each director and executive officer is 14F, No. 98 Minquan Road, Xindian District, New Taipei City 231, Taiwan.
Chang 64 CEO and Chairwoman of the Board Michael Aw 50 Non-executive Director Jau-Hsiung Huang 66 Non-executive Director Meng-Shiou (Frank) Lee 64 Independent Non-executive Director Philip Tsao 65 Independent Non-executive Director Chung-Hui (Christine) Jih 64 Independent Non-executive Director Pin-Jen (Louis) Chen 47 Executive Vice President and Chief Strategy Officer Wei-Hsin Tsen (Johnny Tseng) 58 Senior Vice President and Chief Technology Officer Weichuan (Wayne) Liu 56 Chief Growth Officer and President of Americas Hsiao-Chuan (Iris) Chen 57 Vice President and Head of Finance and Accounting The business address of each director and executive officer is 14F, No. 98 Minquan Road, Xindian District, New Taipei City 231, Taiwan.
To our knowledge, as of March 20, 2025, 41,405,708 Class A Ordinary Shares, or 48.67% of the total outstanding Class A Ordinary Shares, were held by three record holders in the United States (including Cede & Co., the nominee of the Depository Trust Company).
To our knowledge, as of March 6, 2026, 41,405,708 Class A Ordinary Shares, or 48.67% of the total outstanding Class A ,Ordinary Shares, were held by three record holders in the United States (including Cede & Co., the nominee of the Depository Trust Company).
Because a portion of these shares are held by brokers or other nominees, we cannot ascertain the exact number of Class A Ordinary Shares ultimately held by holders in the United States. As of March 20, 2025, none of our Class B Ordinary Shares was held by record holders in the United States.
Because a portion of these shares are held by brokers or other nominees, we cannot ascertain the exact number of Class A Ordinary Shares ultimately held by holders in the United States. As of March 6, 2026, none of our Class B Ordinary Shares was held by record holders in the United States.
His accounting experience includes working as a Certified Public Accountant at Deloitte Touche Tohmatsu Limited in its Taiwan office from July 1988 to July 1997 and at First Elite CAPs & Co since July 1997. Mr. Lee holds an M.A. in accounting from National Chengchi University and a B.A. in accounting from National Taiwan University.
His accounting experience includes working as a Certified Public Accountant at Deloitte CPA firm in its Taiwan office from July 1988 to July 1997 and at First Elite CAPs & Co since July 1997. Mr. Lee holds an M.A. in accounting from National Chengchi University and a B.A. in accounting from National Taiwan University.
Chang holds an MBA from the University of California, Los Angeles, and a B.Sc. from National Taiwan University. We believe that Ms.
Chang holds an MBA from the University of California, Los Angeles, and a B.Sc. from National Taiwan University. 100 Table of Contents We believe that Ms.
If no replacement directors are appointed, the existing directors shall be automatically re-appointed for a further term of office to expire at the third succeeding annual general meeting after their re-appointment. Our officers are elected by and serve at the discretion of the Board. Their terms shall be decided by the Board. Board Committees Our Board has an audit committee.
If no replacement directors are appointed, the existing directors shall be automatically re-appointed for a further term of office to expire at the third succeeding annual general meeting after their re-appointment. 106 Table of Contents Our officers are elected by and serve at the discretion of the Board. Their terms shall be decided by the Board.
If an Award is forfeited, repurchased, expired, or settled in cash, the related Class A Ordinary Shares will be available for future grants or sales under the Director Equity Incentive Plan (unless it has terminated). However, Class A Ordinary Shares that have already been issued will not be returned to the Director Equity Incentive Plan or available for future distribution.
If an Award is forfeited, repurchased, expired, or settled in cash, the related Class A Ordinary Shares will be available for future grants or sales under the Director Equity Incentive Plan (unless it has terminated).
Each of the audit committee members satisfies the requirements for an “independent director” within the meaning of the NYSE listing rules and the criteria for independence set forth in Rule 10A-3 of the Exchange Act. The audit committee oversees our accounting and financial reporting processes.
Meng-Shiou (Frank) Lee satisfies the criteria of an audit committee financial expert as set forth under the applicable rules of the SEC. Each of the audit committee members satisfies the requirements for an “independent director” within the meaning of the NYSE listing rules and the criteria for independence set forth in Rule 10A-3 of the Exchange Act.
The audit committee’s members and functions are described below. Audit Committee The audit committee consists of three directors, Meng-Shiou (Frank) Lee, Philip Tsao and Chung-Hui (Christine) Jih. Philip Tsao is the chairperson of the audit committee. Mr. Meng-Shiou (Frank) Lee satisfies the criteria of an audit committee financial expert as set forth under the applicable rules of the SEC.
Board Committees Our Board has an audit committee. The audit committee’s members and functions are described below. Audit Committee The audit committee consists of three directors, Meng-Shiou (Frank) Lee, Philip Tsao and Chung-Hui (Christine) Jih. Philip Tsao is the chairperson of the audit committee. Mr.
Share Incentive Plan Our Share Incentive Plan was first approved and adopted by our Board on December 13, 2021, and was amended by our Board on October 25, 2022, to make equitable adjustments to the number and class of shares to be issued thereunder for the purposes of reflecting the Recapitalization in connection with the Business Combination.
Share Incentive Plan Our Share Incentive Plan was first approved and adopted by our Board on December 13, 2021, and was amended by our Board on October 25, 2022 in connection with the Business Combination.
For the year ended December 31, 2024, (i) no option has been granted to our directors and executive officers under the Share Incentive Plan, and (ii) no Award (as defined below) has been granted under the Director Equity Incentive Plan to our directors.
For the year ended December 31, 2025, (i) options to purchase 35,000 Class A Ordinary Shares were granted to our directors and executive officers under the Share Incentive Plan at an exercise price of $1.84 per Class A Ordinary Share, and (ii) no Award (as defined below) has been granted under the Director Equity Incentive Plan to our directors.
For the year ended December 31, 2024, options to purchase an aggregate of 50,045 Class A Ordinary Shares were granted to our employees and other eligible grantees under the Share Incentive Plan at exercise prices of $2.13 to $2.22 per Class A Ordinary Share.
For the year ended December 31, 2025, options to purchase 35,000 Class A Ordinary Shares were granted to our directors and executive officers under the Share Incentive Plan at an exercise price of $1.84 per Class A Ordinary Share.
Chang agreed to serve as our CEO, until her appointment is terminated by Ms. Chang’s death, disability or a termination by a decision of the Board. The service agreement also includes certain restrictive covenants, which include confidentiality and non-disclosure restrictions and non-competition restrictions that apply during the term and for certain periods following specified terminations of service.
The service agreement also includes certain restrictive covenants, which include confidentiality and non-disclosure restrictions and non-competition restrictions that apply during the term and for certain periods following specified terminations of service.
Each holder of Class A Ordinary Shares is entitled to one vote per share, and each holder of Class B Ordinary Shares is entitled to ten (10) votes per share. 97 Table of Contents The total number of Ordinary Shares outstanding as of March 20, 2025 is 101,848,671 shares, consisting of 85,059,953 Class A Ordinary Shares and 16,788,718 Class B Ordinary Shares.
The total number of Ordinary Shares outstanding as of March 6, 2026 is 101,848,671 shares, consisting of 85,059,953 Class A Ordinary Shares and 16,788,718 Class B Ordinary Shares. Beneficial Owners Class A Ordinary Shares % of Class† Class B Ordinary Shares % of Class† % of voting power†† Directors and Executive Officers: Alice H.
However, these shares are not included in the computation of the percentage ownership of any other person.
However, these shares are not included in the computation of the percentage ownership of any other person. Each holder of Class A Ordinary Shares is entitled to one vote per share, and each holder of Class B Ordinary Shares is entitled to ten (10) votes per share.
Removed
Beneficial Owners Class A Ordinary Shares % of Class† Class B Ordinary Shares % of Class† % of voting power†† Directors and Executive Officers: Alice H.
Added
Chang agreed to serve as our CEO, until her appointment is terminated by Ms. 102 Table of Contents Chang’s death, disability or a termination by a decision of the Board.
Removed
(3) Represents (a) 36,660,961 Class A Ordinary Shares issued to CyberLink International in connection with the Recapitalization before the Closing, and (b) 300,000 Class A Ordinary Shares held by CyberLink International in connection with its PIPE Investment.
Added
However, Class A 104 Table of Contents Ordinary Shares that have already been issued will not be returned to the Director Equity Incentive Plan or available for future distribution. Plan Administration.
Added
The audit committee oversees our accounting and financial reporting processes.

Item 7. Management's Discussion & Analysis

Management's Discussion & Analysis (MD&A) — revenue / margin commentary

10 edited+1 added−13 removed25 unchanged
On January 1, 2018, Perfect Corp., Perfect Taiwan, a wholly-owned subsidiary of Perfect, and CyberLink entered into an assignment agreement, pursuant to which, Perfect agreed to assign all its rights and obligations under the PerfectCam Cross License Agreement to Perfect Taiwan, and as a result, Perfect Corp. was released of all liabilities accrued thereunder, and Perfect Taiwan succeeded Perfect Corp. and undertook all the rights and obligations under the PerfectCam Cross License Agreement. 101 Table of Contents License Agreement — YouCam On November 30, 2019, Perfect Taiwan entered into a license agreement with CyberLink (the “YouCam License Agreement”), pursuant to which, Perfect Taiwan grants to CyberLink a non-exclusive, non-transferable and non-sublicensable worldwide license to use its AR technology to be embedded into CyberLink’s YouCam software and the SDK thereof.
On January 1, 2018, Perfect Corp., Perfect Taiwan, a wholly-owned subsidiary of Perfect, and CyberLink entered into an assignment agreement, pursuant to which, Perfect agreed to assign all its rights and obligations under the PerfectCam Cross License Agreement to Perfect Taiwan, and as a result, Perfect Corp. was released of all liabilities accrued thereunder, and Perfect Taiwan succeeded Perfect Corp. and undertook all the rights and obligations under the PerfectCam Cross License Agreement. 110 Table of Contents License Agreement — YouCam On November 30, 2019, Perfect Taiwan entered into a license agreement with CyberLink (the “YouCam License Agreement”), pursuant to which, Perfect Taiwan grants to CyberLink a non-exclusive, non-transferable and non-sublicensable worldwide license to use its AR technology to be embedded into CyberLink’s YouCam software and the SDK thereof.
The initial lease term was for two years, commencing from June 1, 2017, with rent paid to CyberLink on a monthly basis. In 2019, 2021 and 2023, Perfect Taiwan renewed this agreement under the same terms as the original agreement.
The initial lease term was for two years, commencing from June 1, 2017, with rent paid to CyberLink on a monthly basis. In 2019, 2021,2023 and 2025, Perfect Taiwan renewed this agreement under the same terms as the original agreement, respectively.
Compensation.” 102 Table of Contents Share Incentive Plan See “Item 6. Directors, Senior Management and Employees — B. Compensation — Share Incentive Plan.” Director Equity Incentive Plan See “Item 6. Directors, Senior Management and Employees — B. Compensation — Director Equity Incentive Plan.” Shareholders Agreement Perfect Corp., certain of its shareholders and Alice H.
Compensation.” 111 Table of Contents Share Incentive Plan See “Item 6. Directors, Senior Management and Employees — B. Compensation — Share Incentive Plan.” Director Equity Incentive Plan See “Item 6. Directors, Senior Management and Employees — B. Compensation — Director Equity Incentive Plan.” Shareholders Agreement Perfect Corp., certain of its shareholders and Alice H.
Cross License Agreement and Assignment Agreement — PerfectCam On August 8, 2017, Perfect Corp. entered into a cross license agreement with CyberLink (the “PerfectCam Cross License Agreement”), pursuant to which, (i) Perfect grants to CyberLink a non-exclusive and non-transferable worldwide license to use its AR technology of facial feature detection and makeup generation to be embedded into CyberLink’s PerfectCam software, and CyberLink may sublicense its own developed SDK of PerfectCam software derived from Perfect’s AR technology to its customers and other third parties; and (ii) CyberLink grants to Perfect a non-exclusive and non-transferable worldwide license to use, reproduce, distribute and sell PerfectCam software and the derivative work created and developed by or on behalf of CyberLink based on the AR technology provided by us under the PerfectCam Cross License Agreement.
Related Party Transactions with CyberLink and Its Affiliates Licensing Agreements Cross License Agreement and Assignment Agreement — PerfectCam On August 8, 2017, Perfect Corp. entered into a cross license agreement with CyberLink (the “PerfectCam Cross License Agreement”), pursuant to which, (i) Perfect grants to CyberLink a non-exclusive and non-transferable worldwide license to use its AR technology of facial feature detection and makeup generation to be embedded into CyberLink’s PerfectCam software, and CyberLink may sublicense its own developed SDK of PerfectCam software derived from Perfect’s AR technology to its customers and other third parties; and (ii) CyberLink grants to Perfect a non-exclusive and non-transferable worldwide license to use, reproduce, distribute and sell PerfectCam software and the derivative work created and developed by or on behalf of CyberLink based on the AR technology provided by us under the PerfectCam Cross License Agreement.
The initial lease term was for two years, commencing from December 1, 2021, with rent paid to CyberLink on a monthly basis. In 2023, Perfect Taiwan renewed this agreement under the same terms as the original agreement.
The initial lease term was for two years, commencing from December 1, 2021, with rent paid to CyberLink on a monthly basis. In 2023 and 2025, Perfect Taiwan renewed this agreement under the same terms as the original agreement, respectively.
Forward Purchase Agreements — FPA Investment In connection with the Provident Initial Public Offering, Provident entered into a Forward Purchase Agreements and a joinder agreement with the FPA Investors, pursuant to which, the FPA Investors purchased from Provident an aggregate of 5,500,000 Provident Class A Ordinary Shares and an aggregate of 2,750,000 Forward Purchase Warrants for an aggregate purchase price of $55,000,000 prior to the Closing.
Forward Purchase Agreements — FPA Investment In connection with the Provident Initial Public Offering, Provident entered into a Forward Purchase Agreements and a joinder agreement with the FPA Investors, pursuant to which, the FPA Investors purchased from Provident an aggregate of 5,500,000 Provident Class A Ordinary Shares and an aggregate of 2,750,000 Forward Purchase Warrants for an aggregate purchase price of $55,000,000 on October 27, 2022.
Subject to the terms and conditions contemplated by the Sponsor Letter Agreement, upon the occurrence of a Sponsor Earnout Event (as defined below) during the period from and after the Closing Date until the fifth anniversary of the Closing Date (the “Earnout Period”), Perfect will issue up to 1,175,624 Class A Ordinary Shares (the “Sponsor Earnout Shares”) to Sponsor, with (i) 50% of the Sponsor Earnout Shares issuable if over 99 Table of Contents any twenty (20) trading days within any 30-trading-day period during the Earnout Period the daily volume-weighted average price of the Class A Ordinary Shares is greater than or equal to $11.50, and (ii) 50% of the Sponsor Earnout Shares issuable if over any 20 trading days within any 30-trading-day period during the Earnout Period the daily volume-weighted average price of the Class A Ordinary Shares is greater than or equal to $13.00 (each, a “Sponsor Earnout Event”).
Subject to the terms and conditions contemplated by the Sponsor Letter Agreement, upon the occurrence of a Sponsor Earnout Event (as defined below) during the period from October 28, 2022 to October 28, 2027 (the “Earnout Period”), Perfect will issue up to 1,175,624 Class A Ordinary Shares (the “Sponsor Earnout Shares”) to Sponsor, with (i) 50% of the Sponsor Earnout Shares issuable if over any twenty (20) trading days within any 30-trading-day period during the Earnout Period the daily volume-weighted average price of the Class A Ordinary Shares is greater than or equal to $11.50, and (ii) 50% of the Sponsor Earnout Shares issuable if over any 20 trading days within any 30-trading-day period during the Earnout Period 109 Table of Contents the daily volume-weighted average price of the Class A Ordinary Shares is greater than or equal to $13.00 (each, a “Sponsor Earnout Event”).
At the First Merger Effective Time, each Provident Class A Ordinary Share and Forward Purchase Warrant issued in the FPA Investment was cancelled in exchange for one Class A Ordinary Share and one Warrant, respectively.
In connection with the Business Combination, each Provident Class A Ordinary Share and Forward Purchase Warrant issued in the FPA Investment was cancelled in exchange for one Class A Ordinary Share and one Warrant, respectively.
Item 7. Major Shareholders and Related Party Transactions A. Major Shareholders Please refer to “Item 6. Directors, Senior Management and Employees — E. Share Ownership.” B.
Item 7. Major Shareholders and Related Party Transactions A. Major Shareholders Please refer to “Item 6. Directors, Senior Management and Employees — E. Share Ownership.” B. Related Party Transactions Agreements Related to the Business Combination In connection with the Business Combination, certain agreements were entered into between Perfect, Provident and certain related parties following the Business Combination.
The YouCam License Agreement was automatically renewed for an addition one-year term on December 1, 2022, December 1, 2023 and December 1, 2024, respectively.
The YouCam License Agreement was automatically renewed for an addition one-year term each year from 2022 and remains in effect for the 2025-2026 term.
Removed
Related Party Transactions Agreements Related to the Business Combination In connection with, and pursuant to, the Business Combination Agreement, certain agreements were entered into between Perfect, Provident and certain related parties following the Business Combination.
Added
These agreements include: Sponsor Letter Agreement On March 3, 2022, Perfect, Provident and the Sponsor entered into the Sponsor Letter Agreement.
Removed
These agreements include: Sponsor Letter Agreement Concurrently with the execution of the Business Combination Agreement on March 3, 2022, Perfect, Provident and the Sponsor entered into the Sponsor Letter Agreement, pursuant to which 1,710,000 Class A Ordinary Shares held by Sponsor as of immediately after the First Merger Effective Time (the “Forfeited Shares”) were forfeited and cancelled for no consideration immediately after the Closing.
Removed
Pursuant to the Sponsor Letter Agreement, the Sponsor also agreed not to transfer, during a period of 12 months from and after October 28, 2022, any Class A Ordinary Shares and Warrants held by it immediately after the First Merger Effective Time, any Class A Ordinary Shares acquired by the Sponsor upon the exercise of such Warrants, or any Sponsor Earnout Shares issued pursuant to the Sponsor Letter Agreement subject to customary exceptions.
Removed
The lock-up requirements expired on October 28, 2022.
Removed
Perfect Shareholder Lock-Up Agreement On October 28, 2022, Perfect, Provident and certain Perfect’s shareholders (the “Perfect Lock-Up Shareholders”) entered into a Perfect Shareholder Lock-Up Agreement, pursuant to which, each Perfect Lock-Up Shareholder agreed not to transfer (i) any Ordinary Shares held by such Perfect Lock-Up Shareholder immediately after the Second Merger Effective Time, (ii) any Ordinary Shares issuable upon the exercise of options or warrants to purchase Ordinary Shares held by such Perfect Lock-Up Shareholder immediately after the Second Merger Effective Time (along with such options or warrants themselves), (iii) any Ordinary Shares acquirable upon the conversion, exercise or exchange of any securities convertible into or exercisable or exchangeable for Ordinary Shares held by such Perfect Lock-Up Shareholder immediately after the Second Merger Effective Time (along with such securities themselves), and (iv) any Shareholder Earnout Shares to the extent issued pursuant to the Business Combination Agreement during the applicable lock-up period, subject to customary exceptions.
Removed
For each Perfect Lock-Up Shareholder who is not CyberLink International, Founder Parties, Pin-Jen (Louis) Chen or Wei-Hsin Tsen (Johnny Tseng), the applicable lock-up period will be six months from and after October 28, 2022.
Removed
For each of CyberLink International, Founder Parties, Pin-Jen (Louis) Chen and Wei-Hsin Tsen (Johnny Tseng), the applicable lock-up period will be 12 months from and after October 28, 2022.
Removed
Perfect Shareholder Voting Agreement Concurrently with the execution of the Business Combination Agreement on March 3, 2022, Perfect, Provident and certain shareholders of Perfect (the “Perfect Voting Shareholders”) entered into a Perfect Shareholder Voting Agreement, pursuant to which, each Perfect Voting Shareholder agreed to, among other things, (i) attend any shareholder meeting of Perfect to establish a quorum for the purpose of approving the Business Combination, and (ii) vote the Pre-Recapitalization Shares and any other Perfect securities acquired by such Perfect Voting Shareholders in favor of approving the transactions contemplated by the Business Combination Agreement.
Removed
Subscription Agreements — PIPE Investment Concurrently with the execution of the Business Combination Agreement on March 3, 2022, Provident, Perfect and the PIPE Investors entered into Subscription Agreements and certain assignment, assumption and consent agreements, pursuant to which, the PIPE Investors subscribed for and purchased Provident Class A Ordinary Shares at $10.00 per share for an aggregate purchase price of $50,000,000 prior to the Closing. 100 Table of Contents At the First Merger Effective Time, each Provident Class A Ordinary Share issued in the PIPE Investment was cancelled in exchange for one Class A Ordinary Share.
Removed
Related Party Transactions with CyberLink and Its Affiliates Licensing Agreements Cross License Agreement — MakeupDirector On July 1, 2016, Perfect Corp. entered into a cross license agreement with CyberLink (the “MakeupDirector Cross License Agreement”), pursuant to which, (i) Perfect grants to (a) CyberLink a non-exclusive and non-transferable license to use Perfect’s digital makeover technology, and (b) CyberLink and CyberLink MakeupDirector users non-exclusive access to the contents and features of Beauty Circle, a beauty social platform owned by Perfect; and (ii) CyberLink grants to Perfect a non-exclusive and non-transferable worldwide license to (a) distribute CyberLink’s MakeupDirector software to users of Perfect’s mobile apps, and (b) advertize for certain software applications of Perfect within certain CyberLink’s software and websites as specified under the MakeupDirector Cross License Agreement.
Removed
No cash consideration is payable under the MakeupDirector Cross License Agreement. Each of Perfect and CyberLink receives its consideration for its license to the other party from the license that the other party grants to it.
Removed
The term of the MakeupDirector Cross License Agreement is three years, commencing from July 1, 2016 and will automatically renew for an additional three years, unless either party provides written notice of termination to the other party at least one year prior to the expiration of relevant term.
Removed
The MakeupDirector Cross License Agreement was automatically renewed for an additional three-year term on July 1, 2019 and July 1, 2022, respectively.

Other PERF 10-K year-over-year comparisons