GigaMedia halves Q1 losses following business turnaround

With Asian online game developer and operator GigaMedia currently making moves to turn around its declining business, the company has managed to halve its losses for the first quarter of fiscal 2012 year-over-year. In February, GigaMedia outlined several major moves it is implementing with the hopes of turning around its business and increasing shareholder value. Its previous "dysfunctional business model" led to notable losses for the company in the last fiscal year. The new plans appear to be making an impact, as losses were greatly reduced year-over-year. As part of its new plans, GigaMedia has revealed that it is disposing of its IAHGames subsidiary, which supplies Asian regions with big-name releases such as Counter Strike Online, FIFA Online 2 and Dragonica. Company CEO John Stringer said this move will "further strengthen new Giga's performance." IAHGames recorded losses of $1.4 million for the quarter, compared to GigaMedia's overall losses of $2.6 million for the quarter. GigaMedia's casual games portal FunTown continued to see increased revenues, thanks to higher contributions from all games. In particular, Tales Runner, A.V.A. and Mahjong revenues all increased, thanks to successful Chinese New Year promotions, granting the portal profits of $1.1 million. FunTown currently sees monthly active paying account numbers of 75,000, with average monthly revenue per active paying account of $29.88 -- up 17 percent compared to the previous quarter. For the quarter ended March 31, 2012, GigaMedia posted revenues of $8.4 million, down from $10.4 million year-over-year, while losses were $2.6 million, reduced from $5.2 million year-over-year. Going into its second quarter, GigaMedia expects a quarter-over-quarter increase in operating expenses due to the disposal of IAHGames.