in Mobile Gaming

#Glu Mobile: Reiterates Q3 outlook

Our most recent trading idea, Glu Mobile, re-iterated its outlook statement given in connection with its Q2 2012 report, after yesterday’s closing. Shares of Glu Mobile were up 9 cents, or 2.7%, at $3.38 in late trading after the company said that it expects Q3 revenue in the range of $20.25 million to $21.25 million, on a non-GAAP basis, and an adjusted Ebitda loss of $3.1 million to $4 million, but probably a little closer to the smaller end of that loss estimate. The Street has been modeling $21.3 million and an Ebitda loss of $3 million.

Glu said it had no titles in the quarter that met the success of “prior breakout hits,” thus limiting upside for the quarter. CEO Niccolo de Masi said it was too soon to update the company’s Q4 view given the lack of upside last quarter in the game titles:

“We did not have any breakout title launches in Q3 and are still evaluating our expectations of their lifetime performance. In the next several weeks, we expect to launch Contract Killer 2 and Death Dome, which titles will be important to Q4 revenue performance. Consequently, we have yet to form an updated view on fourth quarter 2012 results. However, we will manage the business to be Adjusted EBITDA break-even or better for Q4.”

However, Glu expects to have further commentary on Q4′s outlook when it formally reports results for Q3.

We stick our belief that the recent correction of the Glu Mobile share price has been hugely exaggerated and see this as a great entry point.

Nordic Investor

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