GigaMedia Announces Fourth-Quarter and Full Year 2020 Financial Results

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[{"type":"text","content":"TAIPEI, March 31, 2021 /PRNewswire/ -- GigaMedia Limited (NASDAQ: GIGM) today announced its unaudited financial results for the fourth quarter and full year of 2020. \nHighlights for Year Ended December 31, 2020\nFor 2020, GigaMedia reported revenues of $6.9 million, with a gross profit of $3.9 million, an operating loss of $2.2 million and the net loss of $1.3 million.\n\"In spite of a slower fourth quarter, GigaMedia closed 2020 with encouraging results as a whole,\" said GigaMedia CEO James Huang. \"Wider customer base, sustainable revenues, and higher profitability. With our internally-driven growth, improved cost structure and effective marketing, we have been steadily delivering our strategy and making good progress.\"\nCompared to the prior year, the 2020 performance exhibited overall improvements. Our gross margin rate has risen by 3.1% to 57.0% from 53.9% in 2019, and consequently the gross profit increased by 9.4% while the revenues slightly increased by 3.5%. The loss from operations was also cut by 28.6% from $3.0 million in 2019, and the net loss narrowed by 22.0%.\nMeanwhile, in 2020 GigaMedia has entered and executed a purchase agreement to acquire ownership of $10 million principal amount of convertible promissory note issued by Aeolus Robotics Corporation (\"Aeolus\"), an R&D company engaged in developing AI-enabled service robots. We have made an announcement for this strategic investment on August 31, 2020, immediately after the closing of the agreement. The issuance of this convertible note provided Aeolus its much-needed working capital, and through this funding, GigaMedia is exploring possibilities of further strategic cooperation with Aeolus.\nFourth Quarter and Full Year Overview \nConsolidated 4Q revenues decreased by 30.1% quarter-on-quarter mainly due to seasonality, and by 5.7% year-over-year as certain of our licensed games have entered the decline stage. Full year revenues increased 3.5% to $6.9 million from $6.6 million in 2019. Loss from operations for 4Q was $0.6 million, representing a loss increase from $0.4 million in 3Q, mainly due to a decrease in gross profit and an increase in selling and marketing expenses. Full year operating loss was $2.2 million, representing a loss reduction of $0.9 million from approximately $3.0 million for 2019. The net asset value was approximately $4.89 per share...

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