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Glu's revenues rise 3% in 2011 to $66.2 million, but firm still posts $21.2 million loss

Company beats Q4 estimates

Glu's revenues rise 3% in 2011 to $66.2 million, but firm still posts $21.2 million loss
Publisher Glu Mobile (NASDAQ:GLUU) has announced its figures for the firm's fourth quarter and full year ended 31 December 2011.

Full year GAAP revenue came in at $66.2 million, up 2.9 percent from 2010.

Continued compensation and restructuring costs following the publisher's acquisition of Blammo Games saw the company make an GAAP operating loss of $21.2 million, however, up from 2010's loss of $11.4 million.

As a result of said costs – which it's claims won't be balanced out until 2013 – Glu prefers to use non-GAAP results as a measure, which pegs full year revenue at $72.9 million and operating loss at $3.4 million.

Smart move

2011 marked a change in Glu's focus, with the outfit for the first time making smartphones its priority.

As a result, revenue from freemium releases have been marked as a key driver in 2011, particularly in Q4, when the firm posted GAAP revenues of $15.2 million.

That's down 2.6 percent year on year, with the company posting a quarterly operating loss of $9.8 million.

Nonetheless, CEO Niccolo de Masi still believes the firm's first steps in the smartphone market meant it ended the year on a positive note.

"The fourth quarter was a strong finish to 2011 for Glu," stated de Masi.

"Our non-GAAP freemium revenues grew 66 percent on a sequential basis, driven by strong growth in microtransactions and in-game advertising.



"We are continuing to successfully execute our freemium social strategy with growth coming from both our popular existing titles and the successful launches of a number of new games.

"With integration of our two 2011 acquisitions proceeding to plan, we look forward to 2012 smartphone revenue growth with confidence."

Above estimates

Non-GAAP revenue for Q4 came in at $20.1 million, up 29.7 percent year on year and well above the firm's estimate of $16-17 million.

Non-GAAP operating loss came in at $1.2 million, slightly better than the $1.3 million loss recorded in Q4 2010 and, again, much smaller than the firm's estimate of a $5.7-6.6 million loss.

"We are very pleased with our strong fourth quarter performance, which exceeded our expectations across all of our key metrics," added EVP and CFO Eric R. Ludwig.

"With a healthy balance sheet and continued solid execution from our seven global studios, we believe we are well positioned to scale the business, leverage our growing user base and drive significant smartphone revenue growth in 2012."

In terms of Q1 2012 predictions, Glu expects non-GAAP revenue to be between $17.5 million and $18.5 million, with smartphones games generating between $14.0 million and $15.0 million in their own right.

The firm expects to post a non-GAAP operating loss of between $3.9 million and $4.7 million.

Glu ended the year with cash and cash equivalents of $32.2 million.

[source: Glu Mobile]

With a fine eye for detail, Keith Andrew is fuelled by strong coffee, Kylie Minogue and the shapely curve of a san serif font.