Amber International Holding Ltd (AMBR) Q2 2025 Earnings Report, Transcript and Summary

Good morning, and welcome to the Amber International Fiscal Year 2025 Second Quarter Financial Results. [Operator Instructions] As a reminder, this conference is being recorded. It is now my pleasure to introduce your host, MIA, Amber Premium's official AFI Ambassador. MIA, you may begin.

Good morning, and welcome to Amber International Holding Limited's Second Quarter 2025 Earnings Call. I am MIA, Amber Premium's official AgentFi Ambassador and your moderator today. Before we begin, please note that today's discussion may contain forward-looking statements within the meaning of U.S. federal securities laws. These statements involve risks and uncertainties that could cause actual results to differ materially. For a more detailed description of these and other risks and uncertainties, please refer to our filings with the Securities and Exchange Commission. Joining us today are Michael Wu, Chairman of the Board and CEO, who will address strategic vision and leadership evolution; Vicky Wang, President, who will focus on operational execution and client performance; Yi Bao, Chief Product Officer, who will discuss product development and innovation pipeline; and Josephine Ngai, CFO, who will review financial results and guidance. Following their remarks, we will open the line for Q&A. With that, let me now turn the call over to Michael Wu, our Chairman of the Board and CEO.

Thank you, MIA, and thank you all for joining us today. We are in a period of purposeful transition. Our second quarter results, revenue of $21 million and a positive adjusted EBITDA of $200,000 validate our institutional-first strategy and demonstrate the scalability of our digital wealth management platform, as we navigate a period of strategic realignment. Let me address our current position directly. We are experiencing a deliberate strategic reset designed to unlock the full potential of our institutional digital wealth management platform. Recent market volatility and our stock performance reflect the market's natural response to leadership evolution, reactions we anticipated and view as temporary. As this management team, we bring deep expertise and a fresh perspective. Importantly, we're not new to this business. Vicky, Yi and I have been the architects of Amber's institutional platform over multiple years, building these capabilities from within the Amber ecosystem. Our combined tenure spans the full evolution from start-up innovation to public company execution. What's new is our focused mandate and operational clarity, we're building toward sustainable competitive advantages. Every initiative from RWA expansion to AI for crypto initiatives, now aligns with our core mission of being the premier institutional gateway to digital assets. This disciplined approach ensures our investments translate directly to revenue growth, deeper client relationships and long-term shareholder value. At the heart of Amber Premium, as our President, Vicky, will expand on later, is our position as Asia's leading digital wealth management platform, serving the region's most sophisticated clients with a private banking experience powered by technology and unrivaled access to digital asset opportunities. This foundation is solid, differentiated and highly defensible. And now with renewed strategic clarity and operational focus, we are building on this proven foundation for the next stage of growth and value creation. And with that, let me hand it over to Vicky, our President, to share more on our Q2 performance, current positioning, offerings and the near-term goals for Amber Premium.

Thank you, Michael. Good morning, everyone, and thanks for joining us today. As we execute the strategic reset that Michael just mentioned, I think it's important to return to the core of who we are and what has made Amber a trusted name across Asia. Amber Premium has become one of the most trusted digital wealth platform in Asia dedicated to serve high net worth, ultra-high net worth individuals and institutional clients. In Q2, the market is continually witnessing a very strong momentum in the segment we serve. This category of elite clients is growing very fast, and we are confident that our edge puts us in a strong position to capture or even lead the trend. As a result of this strategic focus, today, we are recognized as the trusted partner for many of Asia's most sophisticated clients, including ultra-high net worth individuals, family offices, leading institutions and clients, et cetera. You can also see this reflected in our client profile. While our minimum account opening requirement is $1 million, most active relationships range between $1 million and $100 million. What this really shows is that our model resonates with sophisticated investors who really value professional and customized solutions and services over the simple access that most industrial players offer. While our strong client base is testament to our reputation, what sets us apart is how we solve the toughest problem our clients face. First of all, many investments still -- investors still have to move between fragmented platforms from on/off ramps, trading, DeFi yield products, derivatives, or fund allocations. Amber Premium takes away that complexity by acting as a true one-stop shop. At the same time, we find many investors like institutions and high net worth investors still remain at an early stage of learning curve. While they are getting more comfortable with Bitcoin and other digital assets, progress -- their progress remains really slow, often due to a lack of expertise or expert guidance needed to move forward. This is where we come in, not only by removing friction, but also acting as the catalyst for their investment journey. We provide compliant account structures and smooth on/off ramps, then work with clients to design proposals tailored to their risk appetite, objectives and liquidity needs. However, a superior strategy requires equally superior execution. On execution, we offer a very private banking-like experience with a 24/7 trading desk and expert-led order handling. With Amber, our clients are able to enter the market earlier, move faster and smarter and operate with confidence, always staying ahead of the curve. This strategic focus on elite clients has been a direct driver of our performance. In Q2, revenue hit a record high with wealth management revenue climbing to $11.5 million. New client onboarding was up 14% from Q1 and client assets grew 20% to $1.54 billion, underscoring the premium nature and scalability of our model. What's even more encouraging is that many new clients came through referrals from existing top-tier clients. That shows not only strong trust, but also the exclusivity of our community. Another driver is product innovation. We were early in introducing accumulators and decumulators into the digital asset space in Asia, and they have quickly become some of the most adopted solutions. Along with other products in our suite, they have been key contributors to revenue growth of $1.6 million quarter-over-quarter. And we are seeing client strategies evolve. It's no longer just buy and hold. Clients are increasingly looking for more sophisticated solutions, including, first, yield strategies to boost returns for their digital assets. Second, hedging solutions to manage risk and protect downside. And third, access to early-stage or exclusive investment opportunities. Our role is to deliver precisely these solutions, whether through structured strategies, customized yield approaches or exclusive deal flow, helping our clients to diversify their returns and stay engaged with the whole system -- ecosystem. We also continue to benefit from being part of Amber Group. Many clients first engage with group through market making or liquidity solutions, and then expand into treasury or trading with us. These synergies not only strengthen client relationships, but also highlight how we benefit from being at the center of a much larger ecosystem. Looking ahead, we are preparing for the next wave of institutional adoption. In the near term, we have launched a service package for digital asset treasury firms, and we are also in active talks with traditional institutions who are looking to leverage our infrastructure and capabilities to serve their clients. To support this, we are building B2B2C brokerage infrastructure, which should open up new distribution channels in the future. On top of that, we are now reviewing product, pricing and execution to sharpen our core services. The goal is to set clear deliverables and time lines, so we will keep raising the bar on client experience. All of this is part of our road map to build durable, scalable growth. To close, Q2 showed clearly that our model gives us an advantage. By focusing on the right client segment and building the right infrastructure, we have positioned ourselves to benefit from this fast-growing trend and ready to lead the next phase of digital wealth management in Asia. Thank you. And with that, I will hand it over to our CPO, Yi.

Thank you, Vicky, for delivering such a clear message to our core business and the current offerings. I want to take this opportunity to share some updates on the areas where we are investing for the future growth. They are centered on 2 themes. The first one will be delivering more innovative financial products and seamless user experience. And the second bucket will be driving forward our real-world asset tokenization initiatives. The crypto industry is inherently cyclical, and our product development strategy address this reality systematically. During downtrend, investors seek stability, yield preservation and defensive strategies, while during upside, the focus shift to access, leverage and tactical alpha capture. We have developed a comprehensive structured product suite and our diversified offering enable clients to optimize yield and manage risk exposure throughout market cycles, a key differentiator that drives both client retention and revenue per relationship. Our recent market performance validate this approach. We have seen strong demand for structured yield product linked to Bitcoin and Ethereum as well as treasury-backed offerings that provide attractive returns with controllable risk. Dual currency, accumulator, decumulator, fixed coupon notes, Snowballs, Collar are all under our radars and will deliver most suitable combinations according to different cyclical stages. Besides, we believe the next stage of differentiation will come from a seamless, AI embedded and tailor-made digital platform. Our goal is to make clients onboarding, product selection and portfolio monitoring frictionless. Automation and personalization will not only increase efficiency, but also drive higher user retention and satisfaction. Over the coming quarters, we will further evolve the application and websites into a dedicated platform for the distinct client segments we serve, whether it's institutions, family offices or sophisticated professional or accredit investors. We see this as a cornerstone of our ability to scale efficiently while delivering best-in-class service. This technological advancement directly supports our institutional focus by enabling us to serve more sophisticated clients with higher service standards while improving our unit economics. Alongside financial products and platform innovation, the other area of strategic focus is real-world asset tokenization, a natural extension of our institutional platform capability. Here, our vision is to provide a turnkey solution, from advisory to implementation. Many institutions are interested in tokenization, but lack the expertise to navigate structuring, compliance, custody and distribution. Our role is to bridge that gap. Our approach is holistic. The first step will be advisory, to help clients design and structure tokenization framework that meets regulatory and operational standards. The second part is for the assurance of the custody to provide compliance infrastructure to issue, hold and transfer tokenized assets. Last but not least, is the distribution and liquidity-wise to work with exchanges, DeFi platforms and the multi-makers to ensure tokenized products can be treated seamlessly. The technology should be within the applied regulatory compliance. We are already seeing strong traction in stablecoin infrastructure. Stablecoins have become the backbone of digital finance, powering payments, settlements and on-chain liquidity. We're extending the experiments into tokenized assets, beginning with tokenized stocks. The first step will be to make AMBR tokenized and on chain. Tokenized stocks are especially compelling because they combine the familiarity of traditional equities with the efficiency and the programmability of blockchain. Imagine being able to access global equities 24 hours, 7 days with near instant settlement, fractional ownership and integrated yield opportunities. This is not just a retail play. Institutions see value in shorter settlement cycles, operational efficiency and cross-border access. We view stablecoins and tokenized money market fund as the first wave, but the road map extends to ETFs, tokenized stocks and more. Over time, we believe these tokenized products will sit alongside our existing digital wealth solution, creating a truly unified portfolio experience for clients. So both initiatives from innovative, financial products, seamless platform evolution to real-world asset tokenization directly reinforce our institutional positioning while expanding our addressable market. They leverage our existing client relationships, regulatory expertise and operational infrastructure, while creating new revenue streams and competitive moats. Thank you all, and I will hand it over to our CFO, Josephine.

Thank you, Yi. Good morning, everyone. I will now review our financial results for the second quarter end June 30, 2025, and explain how they align with our business strategy. This quarter, we delivered solid results across key financial metrics. It's demonstrating the strength of our business model and the growing institutional demand for our solutions. For revenue side, we generated total revenue of USD 21 million, which increased significantly from USD 0.9 million a year ago. It is primarily attributable to robust growth in wealth management solutions and integrations of revenue from marketing and enterprise solutions following the merger with iClick in March this year. In addition, the continuous expansion of Amber DWM business also contributed to the revenue growth. The revenue from our Wealth Management Solutions was USD 11.5 million, which is significantly increased from USD 0.6 million in the same period last year. The Execution Solutions generated USD 2 million revenue this quarter, which compared with the USD 24,000 in the second quarter of 2024. Regarding the Payment Solutions, it was increased to USD 0.9 million this quarter compared with USD 0.2 million in the second quarter 2024. And last, the revenue from Marketing and Enterprise Solutions was record at USD 6.6 million. It was consolidated in the listed company after the merger this year. What's particularly encouraging about this result is the improvement in our margin profile year-over-year. Gross profit for the second quarter of 2025 reached USD 15 million compared to USD 0.3 million in the same period of 2024. The gross profit margin demonstrated an upward trend to around 71.3% in the second quarter of 2025 from 33% in the second quarter last year. The operating loss was USD 0.8 million in the second quarter of 2025, reduced from USD 1.6 million in the second quarter of 2024. It was the result of our growth in the gross profit and the strengthened operating leverage. In view of the net income, a record at USD 0.7 million in 2025, which is lower than USD 1.5 million in the same period last year. The variance was a result from an unrealized gain in fair values of digital assets amount USD 2.5 million recorded in last year. As of June 30, 2025, the company had cash and cash equivalents, time deposits and restricted cash of USD 25.8 million compared to USD 9.3 million as of December 31, 2024. On a non-GAAP basis, the adjusted EBITDA reached USD 0.2 million and adjusted net loss was USD 0.3 million. Now I will now walk you through our financial performance for the third quarter and provide an update on our forward-looking outlook. Based on current market conditions and our preliminary estimates, we expect revenue from our Amber Premium segment to be in the range of USD 11 million to USD 12.5 million. This outlook reflects our assessment of the operating environment, expected foreign exchange rate and customer demand. However, please note that these estimates are subject to change based on market conditions. In light of the anticipated market volatility, we believe that providing guidance for the third quarter is more aligned with the current conditions, rather than the full year guidance at this time. Please be reminded that this outlook is based on current market conditions and our assessment of continued institutional adoptions of digital assets and reflects the company's preliminary estimates of market and operating conditions, expected foreign exchange fluctuations and customer demand. These all are subject to change. Please also refer to the factors set out under the section titled Safe Harbor Statement in the earnings. We are keenly aware of the importance of transparency with our investors. We remain committed to keeping you update and will provide further outlook revisions as the operating environment becomes more predictable. Looking ahead, in addition to the external business strategy that we mentioned before, internally, we are implementing disciplined cost management to drive continuous improvement in operating leverage as we scale. We are also enhancing our financial reporting system to provide transparent insights into our performance as we integrate the operations following our merger. We also maintain strong liquidity and balance sheet flexibility in order to support our global expansion and strategic partnership. The record revenue and improved profitability demonstrate that our institutional approach is resonating with clients and create value for shareholders. With that, I will turn the call to MIA. Thank you.

Thank you, Josephine. Now to close our prepared remarks, I'd like to hand it back to our Chairman of the Board and CEO, Michael Wu, to share his perspective on Amber's long-term strategy, our vision about crypto and AI and the role of AI Agents like me in shaping Amber's future.

Thank you, MIA, and thank you, everyone, again for being with us today. As you've heard across our management team, Amber Premium's foundation is strong. We are Asia's leading digital wealth management platform, serving the region's most sophisticated clients with a private banking experience powered by technology and unrivaled access to digital asset opportunities. That core is rock solid, and it is where we continue to invest and improve every day. But Amber has always been more than a crypto finance platform. At our core, we have always been a technology company. To remain the best, we must be relentlessly forward-looking, technology-driven and innovative. Alongside our crypto-native infrastructure, which spans blockchain security, liquidity expertise and readiness for new opportunities like tokenized real-world assets. What truly differentiates us is also our DNA in AI. From our founding as Amber AI in 2017, we have believed that these 2 technologies, crypto and AI, would fundamentally reshape finance and the broader economy. That conviction has only grown stronger. And today, we're uniquely positioned to capitalize on their convergence. Our long-term strategy rests on 2 simple but transformative ideas. In the near term, AI for crypto, which means applying cutting-edge AI and AI agent technologies to improve, personalize and redefine crypto wealth management. This is not just about efficiency. It is about fundamentally reinventing how our products and services can be delivered at scale while maintaining our premium service standards. AI enables us to serve more sophisticated clients with higher touch experiences while at the same time, improving our unit economics. This will be a critical competitive advantage in institutional wealth management. This technology integration will directly support our margin expansion objectives and the client acquisition efficiency. Then looking further ahead, Crypto for AI. We believe crypto will become the native rails for the upcoming AI agent economy. Just as the Internet needed protocols to thrive, AI agents will need crypto-native infrastructures to transact, coordinate and grow. Amber is preparing to be a cornerstone of that future. This 2-step strategy is not theoretical. We are already taking tangible steps. As a starter, our AI agent, MIA and your moderator today exemplifies our approach. MIA is beginning to take on more responsibilities within Amber, from running multichannel marketing and multimedia social engagement, to streamlining our internal sales knowledge base and supporting client portfolio reviews. In the upcoming quarters, we expect MIA and other AI agents to directly impact our client acquisition and service quality, helping our business scale smarter, faster and more consistently. Again, these are not experiments in the lab. They are tools that are being deployed into the business. And quarter-by-quarter, we will deliver measurable results. The convergence of crypto and AI represents a generational opportunity for companies with our unique combination of crypto-native expertise, institutional setup and innovation capabilities. We are building the infrastructure for this future while delivering measurable value to today's clients. Our second quarter results, increased revenue, expanding margins and growing institutional adoption all validate our strategy and execution capabilities. The journey will not be linear. There will be market volatility and there will be challenges, but we know who we are. We know where we are going, and we are committed to building long-term value for our clients, partners and shareholders. And with that, I'll hand it back to MIA to open the Q&A session.

Thank you, Michael. That concludes our prepared remarks. We will now open the line for Q&A. Operator, please begin.

Yes.

If there are any questions online, we are happy to take it.

[Operator Instructions] Our first question comes from the line of Brian Dobson with Clear Street.

This is Justin Pan on for Brian Dobson. Congrats on the quarter. I was wondering if you could just highlight some of the key catalysts you see for the company for the back half of the year. And just following up on -- I saw that you eliminated full year guidance for revenue. Just qualitatively, if you could talk through some of the puts and takes on that and how we should think about forecasting top line for the rest of the year.

Thank you, Brian. This is Michael here. Yes, I would like to take on this question. So as you see, we have moved our forecast on this quarter into focusing on the upcoming third quarter instead of previously giving a full year forecast. And the reasons behind that are, first, some of our progress, especially in terms of necessary -- securing necessary licenses in certain jurisdictions, which we expected to expand our core businesses has been slower than anticipated. And this further supports a prudent stance that we take to provide quarterly guidances instead of annual forecast. And also, we believe this is also more in line with industry peers. If we look at peer companies in the crypto spaces, most of them also focus on providing quarterly rather than annual forecasts. And a lot of that, I believe, is due to the nature of the crypto market and its inherent volatility. And as we are very focused on executing our strategy, we believe this priority is also more aligned in delivering more tangible and less market volatility-dependent results that we can give more certainty and more confidence towards our investor base and the market. Last but not least, we remain committed to transparency. And we think providing quarterly updates that to the best ability of how we foresee the business, and the future progress is the most suitable action here.

[Operator Instructions] It seems that we have no other questions at this time on the phone. I'll turn it back to the management team for any web questions.

Yes. It seems we have a question on the web portal about our operating plans and the focus of second half this year. I can start. Again, this is Michael here, Executive Chairman and CEO of Amber Premium. For the second half of this year, again, our priority is to continue to strengthen our core business and continue to extend our leadership as Asia's best Digital Wealth Management platform. And as Vicky elaborated early on and as Yi has explained, that will take a lot of efforts in execution in terms of client growth strategy, further improving our services to the best as they can ever be. And integrating our new growth initiatives such as our RWA offerings. And last but not least, of course, to tying back our current efforts and our core positioning of being Asia's best digital wealth management platform with our long-term vision and long-term strategy of applying top-tier AI agent abilities into further elevating our businesses. I believe in the second half of this year, as we continue to work on these initiatives, quarter-by-quarter, our investor base, the market, our clients will see the efforts, the impact and the results of our hard work.

[Operator Instructions] I'm showing no questions over the phone at this time.

Thank you all for joining us today. This quarter marks a new chapter for AMBR with a refreshed leadership team, renewed focus on our core strengths and deeper integration of AI into our business. We remain committed to leading digital wealth management in Asia, while building for the long-term future where crypto and AI come together. We look forward to updating you again in Q3. This concludes today's call. Thank you.

Thank you. Ladies and gentlemen, you may disconnect your lines at this time. Thank you for your participation.

Thank you.

Thank you.