Mobile game developer and publisher Glu Mobile today reported total non-GAAP (generally accepted accounting principles) smartphone revenues of $17.1 million for Q1 2013, falling by 7.6 percent from Q4 2012′s $18.5 million, and by 1.7 percent from Q1 2012′s $17.4 million. iOS and Android accounted for 91 percent of Glu’s smartphone revenue, marginally down from 92 percent in Q4 2012.
Glu also cut staff yesterday in an effort to reduce the number of its development studio teams and eliminate certain research and development positions. The reduction in staff was equivalent to circa 12 percent of this year’s starting headcount of 564 employees. Glu also made this decision to enable it to hire additional monetization, live operations, server technology, user experience and product management personnel to support Glu’s transition to becoming a games-as-a-service (GaaS) company. Glu plans to bring headcount up to 580 by year’s end. Restructuring will complete no later than June 30, 2013. Glu did just hire Chris Arkhavan as president of publishing, who is focusing on growing advertising revenues, increasing direct marketing efficiencies and overseeing third-party publishing.
The company’s total revenue for the first quarter of 2013 was $19.0 million, down 12 percent from $21.6 million in Q1 2012, and fell 8.7 percent quarter-over-quarter from total revenue of $20.8 million in Q4 2012. Non-GAAP operating loss was $2.2 million in Q1 2013 compared to Q1 2012′s $23,000 and Q4 2012′s $2.5 million. Glu’s non-GAAP net loss was $2.3 million in Q1 2013, resulting in a non-GAAP earnings per share (EPS) loss of $0.03.
“I’m pleased with the moentization progress we made in Q1 and the steps we are taking to maintain this momentum,” de Masi says.
The San Francisco-headquartered game studio released seven freemium games in Q1 — Dragon Storm, Stardom: Hollywood, Gun Bros 2, Small City, Samurai vs. Zombies Defense 2, Heroes of Destiny, and Frontline Commando: D-Day. Titles released in Q1 2013 accounted for 16 percent ($2.66 million) of non-GAAP smartphone revenue this past quarter. Glu now plans to launch 12 first-party titles in 2013, with five already out. In March, Glu, in partnership with mobile gambling service Probability PLC, launched its first real-money game title Samurai vs. Zombies Defense Slots for the web in the U.K. Glu also announced today’s launch of another slots game in partnership with Probability with Contract Killer Slots in the U.K. Lastly, Glu began development on a Glu-IP-branded mobile casino suites game, which is expected to launch in the U.K. by Q3 2013.
Daily active users (DAU) rose from 3.5 million in Q4 2012 to 3.9 million in Q1 2013. Monthly active users (MAU) also increased, moving from 34.8 million in Q4 2012 to 40.1 million in Q1 2013.
In Q1 2013, Glu’s average revenue per daily active user (ARPDAU) was 6.4 cents, down from 6.7 cents in Q4 2012. The average for the percentage of MAU converting to paid users stood still at 0.7 percent. Stardom: The A List once again had the highest ARPDAU at 8.3 cents, although that figure fell from 9.1 cents in Q4 2012. The female-focused game also had the greatest conversation rate, converting 1.2 percent of MAU to paid users. Contract Killer 2 led all Glu titles again as the game with the most DAU, with 292,000 DAU. Heroes of Destiny and Dragon Storm, two Q1 2013 releases, broke Glu’s own ARPDAU records. As for Glu’s third-party publishing efforts, the game house plans to launch six titles globally by December 2013.
Glu’s most lucrative title for Q1 2013 was Eternity Warriors 2, which generated $2.1 million in non-GAAP revenue. Another notable title was Contract Killer 2, which raked in $1.8 million.
For Q2 2013, Glu estimates non-GAAP smartphone revenue between $15.2 million and $16.2 million. Glu now predicts between $80 million and $84 million in smartphone revenue for the 2013 fiscal year, down from the company’s prediction of $84 million to $88 million it provided in the Q4 2012 earnings release. As of March 31, 2013, Glu finished the quarter with a cash balance of $21.2 million and no debt.
Glu’s stock price dipped 7 cents after the release of its earnings report to $3.01 per share, with a market cap of $200.5 million. In after hours trading, the stock dropped even more to $2.90.