Good morning, everyone, and welcome to San Diego. We're excited to have you all here, and we're ready to get started with our first presentation. Let's please give a warm welcome to the Investor Relations Director of Perfect Corp., Jimmy Xia. Morning, good morning. Thank you. It's always great to be at LD Micro. Of course, San Diego, the weather is great too. Let me take a few minutes to give you a quick introduction to Perfect Corp., who we are, what we do on a more macro level, and later on, Q&A, we can discuss any specific questions that anyone may have. Who are we? We're a software company. We're based in Taiwan with the vast majority of our headcount in Taipei, about 400 in total, and about half our R&D professionals, with the vast majority, again, in Taiwan. We also have locations around the world, like in the U.S., like in Japan, in mainland China, and in EU countries. We're a software company from day one for the beauty and fashion space, which makes it a little more unique because many times you see the software companies like Salesforce, Workday, and such that are enterprise, but for beauty and fashion, it's a very niche market. We have a B2B and B2C component, which makes it even more special. Again, looking at this slide, we have countries around the world in terms of representation. Just to give you a little more background, why we have these offices. In terms of revenue distribution, roughly 50% stem from North America, which is mainly U.S., about 25% from EU, and about 20% from the rest of the world, with the majority focus in Japan. This also explains why we have all these locations around the world. Who do we serve? As I mentioned before, we have a B2B and B2C component. The B2C component is very straightforward. It's apps, iOS, Android Play. We have a suite of apps under the YouCam brand, Y-O-U-C-A-M. These apps are about six apps today and one online editor through PC. Each one has its own unique features. I'll go through some of them in later slides, but really, for me, it's a fun way for people to entertain themselves for pleasure. On the B2B side, it's more specific to brand clients as the latter: Dior, Shiseido, Chanel, Burberry, Cartier. We have clients from large to small. We also have clients such as Sephora, Amazon, Walmart, and such. Big or small, within the beauty and fashion space. Now, specifically, what we do from an R&D perspective, we don't separate our R&D process for the B2B and B2C side. I'll show you some examples later that many functions on our apps and for our B2B clients are very, very similar because they have the same heart, the same engine, which runs the software that operates behind both. Some of the more interesting things that are more specific to these services that we provide, both on the B2B and B2C side, is virtual reality, AI, in terms of beauty and fashion. Again, I'll show you some examples later. More specific to the B2C side, six mobile apps, one web service online, GenAI-powered for photo and video editing. That is going to be and will continue to be the growth driver for the company, the generative AI technology with photo and video editing and creation. There's AI, AR solutions, which is, again, direct to consumers. B2C is a freemium subscription model. As in, you download for free, you have a seven-day free trial with all the premium access. At the end of seven days, you have two choices. Technically three. One is on a monthly basis, is anywhere from $5 to $7 a month. Then there are two separate annual tiers. One is a $39 plan and one is a $79 plan. Each tier has its own services that you can access on these apps. On the B2B side, software model, annual contracts, annual renewals, looking for up and cross-sell, omnichannel deployment either on clients' websites, their apps, or through third parties like Google search results. The journey, we started a decade ago in 2015. From an AI perspective, we have been in the game since day one. This is not something that we caught on all of a sudden because the OpenAIs of the world came up a few years ago. This is what we've started to do from 2015 all the way till today, and we'll continue to invest and reinvest. I'll talk more about the financials later in the company when we move forward into the AI space with specifics on beauty and fashion. Jumping back to the B2C, here are the apps that you can see. One is YouCam Makeup, one is YouCam Perfect. Those two are our quote-unquote "flagship" apps. They generate the most revenue, the most paying subscribers, and there are a bunch of other apps that are behind them that are still gaining a lot of steam. The newest app is the YouCam AI Chat, which is an AI chat assistant. There are elements of these apps that are cross-pollinated in terms of services, but each app has its own unique focus. For example, YouCam Makeup is your own personal AI Makeup Virtual Try-On or artist selfie editor. You can change your skin tone. You can virtual try-on hair, makeup, change the color of your hair, facial or body tuner, facial reshape. YouCam Perfect, which is actually what I use and my daughter, my young daughter, loves this very much, is to photo edit. She's too young for makeup, but I'm more than OK with her playing with the app to put on makeup for herself as an elementary school student. You can edit your photos. If you're at a site, Taj Mahal, for example, tons of people in the background, you can edit people out to have you in the background solo. YouCam Video, it's very straightforward, generative AI video. You can use one photo to generate a few seconds of video interaction between you and an object. You can be running, you can be on a treadmill, for example. These are all AI image to video or video face swap enhancement of videos. YouCam Online Editor is for image and video enhancement and creation. This is actually more higher power versus some of the things we've seen in apps. Coming back to the B2B, AI Makeup Virtual Try-On is the flagship of our B2B service. As we progress, there's many more services we've introduced. For example, face, hair, body, all these things that moved forward as we gained more client base. You can see from this slide, it started in 2015, and today we have over 800 brand clients. It might be a little hard to see and hard to put all the brand clients' logos here, but you can name basically every single one of the big players and small players is here. The only one that's not here is L'Oréal. That's mainly because in 2018, L'Oréal took private, our largest competitor, as an internal software. From 2018 on, we slowly lost L'Oréal as a client, but we gained the rest of the market because the competitor now is the internal software for L'Oréal. Throughout the history, we've had over 10 billion virtual AR try-ons per year. Again, over 800 brand clients, over 900,000 SKUs that's running off of our software, again, with some of these largest clients around the world. The growth over the past many years, you see CAGR over 20% in terms of the number of brand clients and the number of SKUs that we service them. As virtual try-on for makeup has become more mature, we've expanded into AI-powered skincare diagnostics. This is the fastest growing portion of our B2B business, but it's still relatively small as a total pie of B2B revenue. This has been growing at a much faster pace. Now, the audience are, instead of the large brand clients like Estée Lauder or Dior, these are more one-off or a few locations for dermatology office, for med spas. Here's an example of a consumer using our software that's running off of Walmart. You find a product of your choice. You allow front-facing camera access to the product. One click, one color on your lips. Every single time, you can, within seconds, try on different styles or different colors for lipstick, for makeup, for eyelash. Here's an example of, as I mentioned, the AI-powered skincare diagnostics. This is off of Sephora. You can do this today on Sephora's app. Within a quick few seconds, you can analyze the skin conditions or concerns. It'll give you a report of things that you should be aware of. Through that, it'll recommend products on which of the Sephora products best suit your concerns. Another example here is from MAC, Estée Lauder companies. It's a tutorial of how to set your whole makeup style from beginning to end. Each step of the way, it'll teach you on if I use something for my eyes, something for my lips, something for my skin, what do I need to buy, and the brush associated with it. Each step of the way, it'll teach you exactly what you need. This is actually very, very helpful for young professionals that come into the workforce that have little experience with makeup. Another example here is Amazon. This is your back-facing camera. You're pointing to your finger for nail styles. One click and one try-on for different styles. As you can imagine, especially during the pandemic, this was very, very prevalent because people were not willing to go inside to stores to do virtual try-on for makeup or different things. Here's some examples from Google Search with regards to makeup, with regards to watch virtual try-on. In the first month of this year, in 2025, we've actually done a small acquisition with WANNA. WANNA was a company that's mainly focused in AR/AI virtual try-on technology for luxury brands such as Gucci, Dolce & Gabbana, Balenciaga, IWC, and so on. There was a great cross-pollination of the services that they provide in terms of virtual try-on and our core business on the B2B side. If you look at this slide, Perfect Corp. for AR makeup and jewelry, skin analyzer, eyewear, watch, jewelry, necklace, and nails, and WANNA with shoes, clothing, scarf, bags, and so on and so forth. There's a great complementary service to what WANNA had versus what Perfect Corp. had. That's why we did the acquisition in the first quarter of the year. Some quick financial highlights. Quick disclaimer, this information is as of June 30th because next week we'll have our third quarter earnings. It only ends at the half-year mark. Our guidance for the year is actually 13% - 14.5%. By the half point mark, we're exceeding our expectation. Last year we grew about 12.5%. This year, at the first half mark, we're just under 15%. Last quarter, the second quarter, it was over 17%. You'll see a slight decrease in terms of gross margin. This is mainly because as the percentage of revenue grows from the B2C business, our gross margin has come down because our B2B business, from a software perspective, has higher margin. B2C, because of Google and Apple tax, we have to have a lower margin profile. As the percentage grows from the B2C side, from roughly in 2023, when we first listed, it was about 25% of revenue on the B2C side. In 2024, it was 50%. If this pattern continues, it will probably be 65% - 70% of overall revenue on a B2C versus B2B, which is why gross margin has seen a decline. We are operating cash flow positive. In the first half of the year, it's just around $8 million versus $5.5 million last year. We had just over $167 million in cash and cash equivalent at the midpoint mark of the year. This is a very strong, obviously strong cash position and allows the board and management to act accordingly should M&A or buyback or even dividend come to play. From a net income and margin perspective, we've seen some fluctuations downwards. We've explained that some of the major impact for this first half of the year was due to currency. For example, the Taiwanese dollar versus U.S. dollar has been fluctuating at no less than 12% - 14% because we have the vast majority of our R&D professionals headquartered in Taiwan. When we exchange USD into Taiwan dollars to pay staff, we've seen, unfortunately, the currency exchange rate had a negative impact. Throughout M&A with WANNA, there were added costs from an R&D perspective that's seen a downshift in margins. This year, we're guiding 13% -14.5% top line. At this rate, we should be able to meet that, if hopefully beat that. We'll talk more about that when this third quarter and, of course, fourth quarter earnings come out. The growth for the future, as I mentioned before, the B2C element is the bigger portion of our overall revenue this year. It will continue to be the growth driver. The GenAI technology with video and photo editing will be a crucial element to how our B2C business grows and overall our whole company. Our B2B element, because of the overall headwinds that we've seen amongst, for those of you that follow, let's say, the Coty, Estée Lauder, LVMH businesses, you'll see that a lot of these businesses, our clients, have seen pressure over the past 2+ years for many reasons. One is their slowdown. Number two is a lot of their China business has seen a vast slowdown. As a result, they've been under pressure from top, middle, and bottom line and squeezed software updates, which negatively impact our B2B business. For our B2B business, the future still will continue to grow in terms of the number of brand clients for makeup, for skincare, for hopefully shoes and luxury and apparel down the road, as well as to continue to grow within these large segments. If you imagine all the umbrella corporations under an Estée Lauder brand, there's more than the Estée Lauder headquarters themselves. There are many brands underneath them. As I mentioned, the skincare will also be a fast growth driver. The only difference here is that instead of targeting large brand clients, we're targeting towards long-tail clients that are smaller in terms of contracts. It could be only a few hundred per month or a few thousand per year to tens, if not hundreds of thousands, for the skincare. It'll take time from a sales and marketing perspective to really reach all these potential clients. We'll also continue to penetrate into fashion and jewelry AI technology. Finally, as I mentioned before, because we have this $167+ million cash on hand, it'll allow the management team to pursue strategic M&A, such as we've done in the first half of this year. By the way, historically, we've used, so in 2023, the company spent just over $51 million on buyback and tender. I believe, if I'm not wrong, it was a $10 million buyback. Because we had float limitation, we were only able to buy back about $1 million change. The company decided to do a tender offer at $50 million at $3.10. Together, we spent about $51 million tender plus buyback in 2023. Of course, 2025, we spent about $6+ million on the M&A. OK, that concludes my presentation. Questions? Yes, sir. Can you speak to about your competitors? I know you mentioned the one from L'Oréal that they acquired. Does L'Oréal intend to provide that service to be a competitor to you to others? Or Or they want to just keep it internal? There were two questions there. Can you speak to your competitors overall and specifically the L'Oréal? OK, so competition on the B2B side. Right now, besides the company that L'Oréal purchased, there's really no large competitor out there in the space. There are many smaller competitors, a few dozen people or a few clients that may or may not be positive in terms of a profit. When we look at the overall market, mainly because everything that our small competitors are doing, we're able to do. It creates a, there's no need for us to do additional M&A, at least right now, based on everything that's out there in the landscape, in terms of the B2B competition. What L'Oréal and their software are doing in the future, it's hard to, we can't speak for them. We've seen some of their products and offerings, it's all public, right? When you do virtual try-on on their products, the technology, for example, as a consumer, you will be able to do virtual try-on yourself, and you'll be the judge which one is more accurate. For example, some of the examples I showed you are true to life, as in when you buy something off your phone for, let's say, a certain makeup color. If it shows up and it's not the color you're looking for, you're going to return it, right? That's obviously not what we want. We actually spend time, energy, and money on each new release of, let's say, iPhone. It's very straightforward. There's dozens of Android brands. We cover all the large Android brands too that there's, let's say, color saturation would be different. We have to adjust the software to make sure that it shows exactly what the product is. That's why our services and our products are very popular amongst our B2B clients. Thank you. I didn't have a follow-up. Market share, what percentage of the market do you think you guys have on the B2B and B2C side? In terms of the market, for B2C, number one, we're very small. Together, we're about under $70 million this year, the projected. There are companies on the B2C side that make hundreds of million dollars, right? For B2B, because this is a very niche market, it is still a little early because there are a lot of companies right now that do not use software at all. You'll probably see some of the companies out there that have, but still not every single product line. There's going to be a lot of runway here organically for the industry to grow. Here's the caveat. Because of all the headwinds that the B2B industry, our clients have faced, as I mentioned before, many are pausing either because they don't want to get a sense of what really AI is to them or will do for them, or because they're having such big financial headwinds that they can't, they're not able to, they don't have the budget to do the software updates that they want to do. We've seen quite a lot of that, by the way. Got it. Last follow-up, please. Sorry, you're next. Exclusivity, I assume there's no exclusivity between you and the makeup companies. Right. They can Perfect, and they can go to you. Right. We've had clients that use us and others at the same time. They'll basically do a trial, basically which one's better, and we've won many, many times. We've actually had clients that left but came back after they decided, you know what, this is not working out. There's really no exclusivity. You can do it yourself if you want to, but it might not be worth your time. Please. You showed a lot of B2B customers. Is there any one that's of primary importance, any customer concentration within the B2B market? On the B2B side, I think the top three clients make up under 15% of revenue, if I remember correctly. I'll have to look at the filings. There's really no large concentration. Of course, we have something called key customers. A key customer is anyone that pays us over $50,000 a year. That makes up a significant portion of our B2B revenue. That's, I think, just under 140 right now, key customers. On the B2C side, are you working with any influencers to try to promote the product? Yes, actually, on the B2C side, we do work with the smaller or macro influencer, anyone like 50,000 or such, sorry, 50,000 subscribers and such. We have had little, I guess, results that are great if we use bigger influencers on the B2C side. $167.8 million in cash, $194 million market cap. Yes. $25 million in net cash. Yes. What's the market missing? The question is, because the market cap is just under $200 million and cash is under $170 million, what's the market missing? Here's the thing. When we first listed, we were at $10 a share, a $1 billion market cap. We were talking to. Was it a SPAC? Yes, it was a D-SPAC in 2023, Halloween, actually. I'm not saying that. No, also because, as I mentioned, because our management is in Taiwan, we have seen a slowdown in our B2B business because of all the macro headwinds, as I mentioned. There are a lot of investors that still do not know who we are, what we do. That's why we're here at the LD Micro Conference, to introduce many investors to something that's new and something that is real and tangible. Yeah. With the 13% or 13% - 14.5% growth projected and already operating cash flow. Yes. You said two years ago, post-D-SPAC, it sounds like you did an offer and you bought back your own shares? Yes, two years ago, we did. Was it an adoption of some sort? It was a tender offer. Tender, OK. Sorry, last question. How many consumers do you have? On the B2C side, we have just under $1 million paying subscribers that pay us on average like under $40 a year, sorry. $40 a year? Yes. How do you anticipate that will grow? We expect that to still continue to grow. By the way, the vast majority of our growth has been B2C in the first half of this year. It should be healthy growth. Sorry, and our time's up. Thank you so much for your. Thank you.