NEW YORK (AP) ¿ Online gaming and software company GigaMedia Ltd. reported a 60 percent drop in first-quarter profit, citing the impact of a global recession and the weakness of the euro against the U.S. dollar. The Taiwan-based company said it earned $4.8 million, or 8 cents per share in the first three months of the year. That compared to $12 million, or 20 cents per share, in the year-ago period. Revenue fell to $44.4 million, from $51.2 million a year earlier. Analysts polled by Thomson Reuters were expecting earnings of 9 cents per share on revenue of $43.9 million. GigaMedia also said it's in final stage discussions with two parties about a partnership or sale of its poker and casino software business. No additional details were disclosed. Revenue from GigaMedia's gaming software business fell 17 percent year-over-year to $31.7 million in the first quarter. The company noted the segment is traditionally driven by an upturn in online gaming during winter in the fourth quarter.
Poker software revenue meanwhile fell 27 percent to $21.6 million, GigaMedia said. The drop reflects the adverse economic climate in Europe and depreciation of the euro against the U.S. dollar, which has continued to increase playing costs, the company said. Chief Executive Arthur Wang said the good news is the company believes it's hit bottom in the downturn and renewed strength is expected in Europe for the second half of the year. Shares of GigaMedia fell 51 cents, or 8.3 percent, to $5.65 in afternoon trading.