Chinese mobile and online gaming company KongZhong (NASDAQ: KONG) has announced its unaudited results for the 12 months ending 31 December 2012.

Total revenues were $186 million, up 16.5 percent year-on-year.

Mobile games accounted for $21.2 million, down 48 percent compared to 2011, as the company transitioned from feature phone games to smartphone content.

The company blamed operators' for de-emphasing feature phone mobile games marketing, and their monthly subscription policies which lead to a higher churn of players.

Full year net income for the company was $25.7 million, compared to a loss of $7.7 million in 2011.

This included a non-cash impairment loss on goodwill and intangible assets charge of $20 million, so stripping this out, 2012's net income was up 104 percent.

Three-way play

KongZhong operates in three areas; mobile games, online games and WVAS (wireless value added services), all of which are currently profitable on a gross basis.

During 2012, mobile games and WVAS declined, while online gaming boomed - sales up 125 percent.

KongZhong will launch Guild Wars 2 in China and runs Wargaming.net's World of Tanks in the country.

Looking forward

"We have successfully migrated our internal internet and feature phone mobile game teams onto the Noumena smartphone game engine and believe we have strong advantages in the mid-core to hardcore smartphone game segment for both the China and global mobile game markets," commented CEO Leilei Wang.

"Expect us to release a significant amount of new smartphone game content in the first half of 2013."

During Q4, 49 percent of KongZhong's mobile sales came from smartphone games, up 15 percent compared to Q3.

Its smartphone games have been downloaded over 30 million times, and these games average 1.3 million players per month.

KongZhong ended 2012 with $174 million in cash and cash equivalents.

[source: KongZhong]