Shares in mobile games publisher Glu Mobile were trading down more than 15 percent at one point this morning, at about $1, after the company yesterday reported a fourth-quarter revenue decline and projected a drop in first-quarter revenue.
Glu reported revenues of $19.1 million in the fourth quarter of 2009 compared with $21.6 million in the fourth quarter of 2008. GAAP revenue is expected to be between $15 million and $15.5 million in the first quarter.
In its latest quarter, GAAP loss from operations and net loss were $6.7 million and $6.9 million, respectively, compared with GAAP loss from operations and net loss of $36.3 million and $37.2 million, respectively, in the fourth quarter of 2008.
The company achieved positive cash flows from operations for the third consecutive quarter, generating $195,000 in cash from operations during the fourth quarter of 2009.
In a statement, CEO Niccolo de Masi said the company already has begun allocating resources with a target of doubling its smartphone studio capacity this year. The company also will be scaling back "unprofitable activities," he said.
In a conference call, he said the company's transition toward new products and platforms will take some time, and the company is committed to remaining cash flow neutral from operations as well as aggressively growing revenues from smartphones. The new CEO anticipates continuing his initial review of the business for another 60 days, according to the call transcript from Seeking Alpha.
For the first quarter that ends March 31, Glu expects its GAAP net loss to be between $5.4 million and $5.8 million.
Results were more uplifting this week for EA Mobile, which posted a 14 percent third-fiscal quarter net revenue increase year-over-year. EA Mobile had seven of the top 11 games on the iPhone/iPod touch in December and seven of the top 10 games on Verizon Wireless for the quarter.