NQ Mobile Inc (ADR) (NYSE:NQ) shares are up over 20% today following a number of announcements made by the company. It’s interesting to note that the shares of the company hit a 52-week low on Thursday at $6.25. On Friday,NQ Mobile, revealed plans to sell a minority stake in its wholly owned subsidiary FL Mobile. The tech firm also updated its revenue outlook for the first quarter ended March 31, 2014, along with providing anb initial outlook for the second quarter of 2014.
Plans to sell minority stake in FL Mobile
NQ Mobile Inc (NYSE:NQ) announced a definitive agreement to sell up to 5.88%, or $25 million, of FL Mobile. The agreement includes $15 million to Bison Mobile Limited and $10 million to other investors at a “pre-money valuation of $400 million or post-money valuation of $425 million.” According to the company, proceeds from the sale will be utilized to “expand and enhance” the FL Mobile business, brand and content. A redemption right is also included in the agreement, which will trigger if FL Mobile fails to conclude a qualified IPO within 12 months of the investment.
“We have a significant number of exciting and fast-growing businesses and assets that we believe are currently under-valued,” said Dr. Henry Lin, co-founder and co-CEO of NQ Mobile. Lin added that the company will remain focused on further developing the platform strategy on a global basis.
NQ Mobile ups guidance
On Friday, the global provider of mobile Internet services firm raised its revenue guidance for the first quarter, and now expects revenue to come in higher compared to the earlier announced guidance range of $75-$76 million, which is an increase of 125% over the same quarter last year. For the first quarter, analysts polled by Thomson Reuters expect the company to report revenues of $75.27 million.
Co-founder and co-CEO of NQ Mobile Inc (NYSE:NQ) Dr. Henry Lin said in a press release, “We remain diligently focused and confident in our business, our strategy, and our future.”
NQ Mobile Inc (NYSE:NQ) also revealed an initial net revenue outlook for the second quarter of 2014. For the second quarter, the company expects the net revenue in the range of $83-$84 million compared to $41.4 million in 2013. The enhanced outlook is based on strong business trends and financial visibility. For the second quarter, analysts expect the company to post revenues of $78.88 million.