Publisher Glu Mobile (NASDAQ:GLUU) has announced its Q3 2010 financials for the three months ending September 30.

Revenue was $15.5 million, down 21 percent year on year, and 3 percent sequentially.

Net losses for the quarter were $1.6 million, compared to a loss of $4.0 million in Q3 2009, when the company was heavily involved in restructuring.

Bad dollar, good dollar

Due to the weakness of the dollar against other currencies, during the quarter, Glu made a profit of $177,000 in terms of foreign exchange activity compared to a loss of $28,000 a year ago.

According to non-GAAP accounting, which excludes foreign currency exchange gains and losses primarily related to the revaluation of assets and liabilities, the company made a net loss of $363,000, compared to a loss of $889,000 in the same period last year.

Glu was cash flow positive from operations for the sixth consecutive quarter, generating $389,000.

Thanks to its recent $13.5 million private placement, the company ended the quarter with cash and cash equivalents of $15.9 million while reducing its draw down on its line of credit to $1.6 million.

New model

"We are confident that our new product strategy will gain traction in the coming quarters, as we continue to make progress in repositioning the business," stated CEO Niccolo de Masi.

"During the third quarter, we were able to sequentially grow smartphone revenues by 12 percent, micro-transactions and in-game advertising by 98 percent, as well as monthly active users by 15 percent.

"With our goal of launching five to six new social, persistent titles every quarter beginning in the fourth quarter of 2010, I am cautiously optimistic that our smartphone and tablet revenue growth will accelerate in 2011."

Glu also announced that Ben Smith, one of the earliest investors in Tapulous, had joined Glu Mobile's board.

However, the company expects GAAP revenue of between $14.0 million and $14.5 million for its Q4 and between $62.7 million and $63.2 million for the overall year.

It expects a Q4 loss of between $7.0 million and $7.4 million, and an annual loss of $15.5 million and $15.9 million.

For 2009, it posted sales of $79.3 million and losses of $18.2 million.

[source: Glu Mobile]