Glu Mobile Inc. (NASDAQ:GLUU), a leading global developer and publisher of freemium games for smartphone and tablet devices, today announced financial results for its second quarter ended June 30, 2012.
“We are very pleased with our strong execution during the second quarter,” stated Niccolo de Masi, Chief Executive Officer of Glu. “Our ability to grow our quarterly smartphone revenues by 111% year over year was driven by our strength in freemium, male-oriented games such as Deer Hunter Reloaded and Frontline Commando across iOS, Android, and Amazon. We remain excited about our strong slate of sequel and new franchise titles that will launch primarily between September and December. We believe that Glu is well positioned for strength in Q4 and beyond.
De Masi continued, “In addition, we are excited to have completed the acquisition of GameSpy, formerly a subsidiary of IGN Entertainment, Inc., which brings Glu industry-recognized leadership in online, cross-platform technology infrastructure. GameSpy’s battle-tested team will enable Glu’s product roadmap to include robust and highly scalable multiplayer and social functionality. We expect that GameSpy will be earnings neutral in the near term; however, the acquisition of GameSpy is expected to help us drive higher monetization and lifetime value in Glu’s titles from 2013 on.”
Second Quarter 2012 Financial Highlights:
- Revenue: Total GAAP revenue was $23.6 million in the second quarter of 2012 compared to $17.7 million in the second quarter of 2011. Total non-GAAP revenue was $24.2 million in the second quarter of 2012 compared to $17.9 million in the second quarter of 2011. Non-GAAP revenue excludes changes in deferred revenue.
- Gross Margin: GAAP gross margin was 87% in the second quarter of 2012 compared to 78% in the second quarter of 2011. Non-GAAP gross margin was 91% in the second quarter of 2012 compared to 83% in the second quarter of 2011. Non-GAAP gross margin excludes changes in deferred revenue and royalties and amortization of intangible assets.
- GAAP Operating Loss: GAAP operating loss was $(5.2) million in the second quarter of 2012 compared to a $(1.6) million loss in the second quarter of 2011.
- Non-GAAP Operating Income: Non-GAAP operating income was $602,000 in the second quarter of 2012 compared to $29,000 during the second quarter of 2011. Non-GAAP operating income excludes changes in deferred revenue and deferred royalty expense, stock-based compensation expense, amortization of intangible assets, restructuring charges, change in fair value of the Blammo earnout and transitional costs.
- Adjusted EBITDA: Adjusted EBITDA was $1.2 million for the second quarter of 2012 compared to $435,000 during the second quarter of 2011. Adjusted EBITDA is defined as non-GAAP operating income less depreciation.
- GAAP Net Loss and EPS: GAAP net loss was $(3.0) million for the second quarter of 2012 compared to a GAAP net loss of $(1.8) million for the second quarter of 2011. GAAP EPS was a loss of $(0.05) for the second quarter of 2012, based on 63.8 million weighted-average basic shares outstanding, compared to a loss of $(0.03) for the second quarter of 2011, based on 54.6 million weighted-average basic shares outstanding.
- Non-GAAP Net Income/(Loss) and EPS: Non-GAAP net income was $199,000 for the second quarter of 2012 compared to a loss of $(506,000) for the second quarter of 2011. Non-GAAP EPS was break even for the second quarter of 2012 based on 63.8 million weighted-average basic shares outstanding, compared to a loss of $(0.01) for the second quarter of 2011 based on 54.6 million weighted-average basic shares outstanding.
- Cash Flows Generated/ (Used) in Operations: Cash flows generated from operations were $1.6 million for the second quarter of 2012 compared to cash flows used in operations of $(457,000) for the second quarter of 2011.
- We launched two new freemium titles – Lil’ Kingdom and Deer Hunter Reloaded.
- Our total GAAP smartphone revenues of $19.9 million grew 111% from Q2 2011 and comprised 84% of total GAAP revenues.
- Our non-GAAP smartphone revenues of $20.4 million grew 111% from Q2 2011 and were 85% of total non-GAAP revenues.
- Our non-GAAP freemium revenue (micro-transactions, in-game advertising and offers) grew 151% to $19.2 million compared to $7.7 million in Q2 2011.
- We completed the acquisition of GameSpy.
- We launched two new freemium games, Gears & Guts and Mutant Roadkill, on the Apple App Store and Google Play.
- We released two of our top freemium games, Gun Bros and Contract Killer, for Xbox LIVE® for Windows Phone.
- We announced that we were the first third-party developer to leverage in-app purchasing on the Windows Phone platform.
- We announced the availability of Frontline Commando on the Mac App Store.
- We announced the availability of Deer Hunter Reloaded, Frontline Commando, Samurai vs. Zombies Defense, and Lil’ Kingdom on the new Nexus 7, powered by Google Android 4.1 Jelly Bean.
- We announced the availability of Contract Killer, Gun Bros, Big Time Gangsta, Bug Village, and Stardom: The A-List on the new Facebook App Center.
- We launched Glu Credits, the first universal currency on the GooglePlay store which allows users interoperability with virtual currency purchases across a growing list of Glu titles.
- We launched Glu VIP Club, our new Android subscription service allowing users to receive significant bonus Glu Credit value as part of a monthly membership fee.
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