Glu Mobile Inc. Skyrockets After Earnings Report

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Shares of Glu Mobile surged by as much as 14.58% to $4.40 per share in after-hours trading

Glu Mobile released its fourth quarter earnings report after closing bell tonight, posting non-GAAP earnings of 11 cents per share on non-GAAP revenue of $76.2 million, a 78% year over year increase that was also significantly ahead of guidance. Analysts had been expecting the game maker to post earnings of 2 cents per share on $63.78 million in revenue. In the same quarter a year ago, non-GAAP earnings were 7 cents per share.

Key metrics from Glu Mobile’s earnings report

GAAP revenues were $72.9 million for the quarter, while GAAP earnings were 1 cent per share or $1.4 million. That’s compared to last year’s net loss of 5 cents per share or $3.5 million. Adjusted EBITDA was 14.1 million, while the adjusted EBITDA margin was a record 18.5%, again beating Glu Mobile’s guidance.

Glu Mobile’s GAAP gross margin was 56% in the fourth quarter, a decline from 69% in the same quarter a year ago. Non-GAAP gross margin fell from 73% the previous year to 61% in the fourth quarter of 2014.

For the full year, Glu Mobile reported a compounded annual growth rate of 37.9% since 2010 in non-GAAP revenue. GAAP revenues for the full year were $223.1 million while non-GAAP revenues were $241.8 million. GAAP net income was $8.1 million or 8 cents per share for the full year. Non-GAAP net income was $33.3 million or 34 cents per share.

Glu mobile raises guidance

Glu Moble significantly increased its non-GAAP revenue guidance for this year as well. Management expects non-GAAP revenues of between $50 million and $52 million for the current quarter. They expect adjusted EBITDA of about $0.9 million and non-GAAP net losses of between $1 million and $3 million or losses of between 1 cent and 3 cents per share.

For the full year, Glu Mobile expects non-GAAP revenues of between $245 million and $275 million and adjusted EBITDA to be between #30 million and $35 million. The company expects between $26 million and $31 million in non-GAAP net income or between 23 cents and 28 cents per share in earnings.

The game maker also announced a five-year exclusive partnership with pop singer Katy Perry. Glu Mobile plans to create a free-to-play mobile game using her voice and likeness. They expect the game to be released in the second half of this year.


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