GigaMedia Announces Fourth-Quarter and Full Year 2021 Financial Results

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[{"type":"text","content":" TAIPEI, March 31, 2022 /PRNewswire/ -- GigaMedia Limited (NASDAQ: GIGM) today announced its unaudited financial results for the fourth quarter and full year of 2021. \nHighlights for Year Ended December 31, 2021\nFor 2021, GigaMedia reported revenues of $5.5 million, with a gross profit of $2.9 million, an operating loss of $4.0 million and the net loss of $3.4 million.\nCompared to the prior year, the losses widened in spite of a fair gross margin rate, mainly because revenues from certain licensed games decreased as our Japanese and Korean licensors were considerably impacted by the COVID-19 pandemic, and delays of supports, upgrades and new contents affected the sustaining of interest in the games. Along with recent easing of restrictions, there are signs of improvement, but still not returning to the pre-pandemic level. \nAnd secondly, in exploring and evaluating prospects of strategic investment opportunities, more professional services of legal, valuation and other specialists were engaged. Meanwhile, our interest income was markedly reduced as the interest rate had been held down at near zero in the past year. \nAs for our $10 million investment in Aeolus convertible note, Aeolus has made progress in business development, and successfully attracted new investors and carried out in late 2021 its Series B Financing of totally more than $37 million at a subscription price slightly higher than $3 or other applicable prices. Considering that after the financing, Aeolus would become cash abundant with a stronger financial position to pursue expansion more resourcefully, we elected to take the 10% discount of the conversion price to convert up to 20%, or $2 million, of the principal amount of the note at $2.718 into 735,835 shares of the Series B preferred shares. After the conversion, the outstanding principal amount under the note is $8 million, and our right to elect to convert the remaining amount upon maturity, upon prepayment, or when certain events occur, into ordinary shares of Aeolus at a price of $3.00 per share, is not affected.\nFourth Quarter and Full Year Overview \nConsolidated 4Q revenues decreased by 19.6% quarter-on-quarter mainly due to seasonality, and by 11.4% year-over-year as certain of our licensed games have entered the decline stage. Full year revenues decreased by 20.1% to $5.5 million from $6.9 milli...

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