This quarter marks the highest Q2 QoQ growth rate since IPO amidst seasonality, demonstrating stronger business momentum for 2023

Highlight and achievements of Q2 FY23

• Revenue increased by 42% YoY to reach a historically high quarterly revenue of JPY 6.2 billion
• Highest QoQ revenue growth rate (11.1%) for the second quarter since its IPO in 2021, driven by stronger market expansion and deeper vertical penetration 
• Gross profit reached a historical high of JPY 3.2 billion with a 45% YoY growth rate, while gross margin improved to 51.3%
• Operating income and net income surpass projections to turn positive with an operating margin of 1.3% and net profit achieved 1.9%
• EBITDA increased by 158% YoY with an 8.9% margin

Exceeding forecast in first-half revenue performance, charting the course to fulfill year-end guidance

Appier Group Inc (TSE: 4180), henceforth referred to as Appier, today announced its earnings results for the second quarter of the fiscal year 2023. This quarter, Appier accomplished its best-performing Q2 in terms of QoQ growth versus Q1. This achievement positions the company firmly on a trajectory to achieve its full-year 2023 guidance. The company's headway in the E-commerce and Digital Content verticals, as well as its strong customer traction in the US, EMEA, and Northeast Asia Markets, stand as a testament to its exceptional performance in the first half of 2023.

Appier reported an accelerated revenue YoY growth of 42% to reach a historical high of JPY 6.2 billion. This figure was paralleled by a YoY gross profit growth of 45%, reaching a historical high of JPY 3.2 billion. Appier’s operating income and net income surpassed projections to turn positive from last quarter, reflecting a notable operating margin of 1.3% and a net profit margin of 1.9%. The company's financial health was underscored by the 158% YoY growth in EBITDA, achieving a record-high JPY 550 million with an 8.9% margin.

These achievements underscore Appier's steadfast commitment to sustainable and profitable growth, underpinned by its core principles of transforming AI into predictable returns. The rising demand for ROI-driven solutions, coupled with the growing acceptance of AI trends, has played a pivotal role in enhancing customer adoption and embracing key differentiators, culminating in its accelerated second-quarter results that have surpassed initial budget projections.

Embracing diverse verticals and strengthening relationships for AI-driven customer growth 

Appier achieved a 22% YoY growth in its overall customer base, with the majority of new customers originating from the Digital Content (39%), E-commerce (22%), and Consumer Brands & BFSI (22%) verticals. This expansion has also spurred a 16.5% YoY increase in the Average Revenue per Customer (ARPC), driven by the expansion of existing customer relationships and heightened activity within the Digital Content vertical, boosted by seasonal factors. This aligns with the company's ongoing strategic focus on large enterprise customer acquisition, driven by growing confidence in AI-powered solutions among major brands.

Appier also maintained a low overall customer churn rate of 0.619% this quarter, underscoring its success in nurturing lasting customer partnerships. The company's financial strength and growth trajectory are further accentuated by the fact that its annual recurring revenue is showcasing a YoY expansion of 35%.

Strong growth momentum fueled by expanding market reach

The vertical expansion and the deeper engagement of existing customers, especially in the E-commerce vertical, fueled impressive growth in Northeast Asia (66%). Meanwhile, the US and EMEA markets (15%) displayed robust revenue growth of 78% YoY, with an overall contribution up 15% from 12% a year ago.

"Our first-half revenue performance has surpassed our projections, laying a strong foundation for our growth trajectory in the coming quarters. Our strength in cutting-edge AI capabilities helps us push the boundaries of businesses and establishes new benchmarks within the realm of digital marketing. Our years of R&D in both predictive AI and generative AI allow us to provide differentiated products to boost our customers’ ROI,” said Dr. Chih-Han Yu, CEO and Co-Founder, Appier. “Our ongoing pursuit of vertical expansion, combined with heightened vertical awareness and strategic market penetration, fuels our confidence in achieving our year-end guidance and sustaining strong growth well into the future."

Pioneering Generative AI synergy to transform business-customer dynamics

Leveraging Appier’s core essence of AI, combined with the augmented capabilities of predictive AI and generative AI synergy, Appier is poised to revolutionize business-customer interactions and bring fresh ideas for industry-leading applications. These insights derived from predictive AI act as a guiding compass for generative AI, facilitating the creation of content that yields exceptional outcomes. Simultaneously, the influx of data from generative AI empowers predictive AI to continuously refine its model training, thus enhancing campaign performance. One accelerates output generation, while the other ensures heightened efficacy. This initiative epitomizes Appier's commitment to delivering personalized marketing experiences and positions itself at the forefront of the generative AI era.

Looking ahead, Appier remains poised for continued success in the latter half of the fiscal year. The momentum generated by exceptional performance is anticipated to propel even more substantial growth in the Digital Content and E-commerce verticals. Bolstered by these prospects and the ongoing alignment with its core values, Appier is well-positioned to not only sustain its trajectory of remarkable financial growth but to also further elevate its impact in the dynamic landscape of AI-driven business solutions.

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About Appier

Appier (TSE: 4180) is a software-as-a-service (SaaS) company that uses artificial intelligence to power business decision-making. Founded in 2012 with a vision of democratizing AI, Appier now has 17 offices across APAC, Europe and US, and is listed on the Tokyo Stock Exchange.