Taipei, October 30th / PRNewswire / -- GigaMedia Limited (Nasdaq ticker: GIGM) announced its unaudited financial results for the third quarter of 2026 today.
Management Commentary
GigaMedia indicates that in the third quarter of 2026, the company's revenue was 3.16 million US dollars, gross profit was 2 million US dollars, operating income was 680,000 US dollars, and net profit was 1.93 million US dollars.
The company stated that its operational performance in the second and third quarters of 2026 was attributed to a successful IP collaboration with an authorized game it operates in Hong Kong, which drove a significant increase in revenue. Total revenue for this quarter reached $3.16 million, a 48.8% increase from $2.13 million in the previous quarter and a 245.4% increase from $920,000 during the same period last year.
The company stated that with the end of this event, revenue is expected to decline in the next quarter. However, the company is actively leveraging this expanded player base to lay a stronger foundation for long-term growth.
In addition, during the previous quarter, the company converted and settled its corporate notes issued under Aeolus Robotics Corporation (“Aeolus”) into preferred stock on more favorable terms, obtaining 33.35% of the voting rights equity, which was subsequently accounted for using the equity method. This preferential pricing was based on an existing note conversion clause that provided a discount compared to other Aeolus investors, and this information was fully disclosed to all relevant parties. Accordingly, in accordance with applicable accounting standards, the company recognized approximately $1.7 million in gain on disposal in this quarter. Investors should note that this recognition of gain also correspondingly increased the carrying amount of the company's equity investment in Aeolus under the equity method; however, this investment still requires regular impairment assessments.
Despite the company providing investors with explanations for these one-time and non-recurring items that affected the current period's performance, its overall financial condition remains robust. As of September 30, 2026, the company held a total of $30.23 million in cash, cash equivalents, and restricted cash, which amounts to $2.74 per share, indicating ample liquidity.
Third Quarter Overview
- Revenue increased by 48.8% quarter-on-quarter to approximately $3.16 million, compared to $2.13 million in the previous quarter.
- In the third quarter of 2026, consolidated operating revenue was $680,000, compared to a loss of $100,000 in the previous quarter.
- In the previous quarter, as the conversion and settlement were completed, the company reclassified its investment in Aeolus from available-for-sale financial assets to equity method investments, and the adjustments previously recorded as other comprehensive losses were reversed. This quarter, approximately $1.7 million was recognized as gain on deemed disposal, along with a loss of $710,000 from equity method investments. As a result, as of the end of this quarter, the carrying amount of this investment increased to $13.65 million, which is higher than the $12.67 million at the end of June 2026.
- The net asset value is approximately $3.86 per share.
Unaudited Consolidated Financial Results
GigaMedia Limited is a diversified digital entertainment service provider. Its digital entertainment business, FunTown, develops and operates a range of digital entertainment products in Taiwan and Hong Kong, with a focus on mobile games and casual games.
GigaMedia The unaudited consolidated performance summary is as follows.
Third Quarter
- In the third quarter of 2026, consolidated revenue amounted to $3.16 million, representing a 48.8% increase from $2.13 million in the previous quarter and a 245.4% increase from $920,000 during the same period last year.
- Gross profit increased by 61.4% compared to the previous quarter, reaching $2 million, compared to $1.24 million in the previous quarter; it also increased by 336.7% compared to $460,000 in the same period last year.
- In the third quarter of 2026, consolidated operating revenue was $680,000, compared to a loss of $100,000 in the previous quarter.
- The consolidated net profit for the third quarter of 2026 was $1.93 million, compared to $550,000 in the previous quarter.
- As of the end of the third quarter of 2026, cash, cash equivalents, and restricted cash amounted to $30.23 million.
Financial Condition
As of September 30, 2026, GigaMedia maintained a robust financial position, with cash, cash equivalents, and restricted cash totaling $30.23 million, equivalent to $2.74 per share.
Business Outlook
The following forward-looking statements reflect the expectations of GigaMedia as of October 30, 2026. Given potential changes in economic conditions and consumer spending, the evolution of the online gaming industry, and various other risk factors, including those discussed in the company's 2025 Form 20-F annual report submitted to the U.S. Securities and Exchange Commission and mentioned below, actual results may differ significantly from these expectations.
GigaMedia CEO Huang Zhengyu stated: "For the next quarter, GigaMedia will continue to pursue an internally driven growth strategy by improving the efficiency of existing games, implementing effective marketing, and steadily expanding its customer base."
Regarding the company's strategic investment in Aeolus Robotics Corporation, the project is still in the research and development phase, and its current contribution to revenue is limited. However, given the promising industry prospects and the company's unique market positioning, we expect this collaboration to bring valuable strategic synergies and enhance the company's future growth potential.
Use of indicators other than GAAP
To complement the consolidated financial statements prepared in accordance with US GAAP, the company has used the following non-GAAP indicators defined by SEC: EBITDA. Management believes that EBITDA (Earnings Before Interest, Taxes, Depreciation, and Amortization) is a useful supplementary performance measure, as it excludes certain non-cash items such as depreciation and amortization, and it is also a performance indicator used by some investors, stock analysts, and others in making investment decisions. EBITDA is not an earnings indicator recognized by GAAP and does not have a standardized meaning. Non-GAAP indicators such as EBITDA should be considered in conjunction with the results prepared in accordance with GAAP, but should not be regarded as substitutes for or superior to other financial indicators prepared in accordance with GAAP. The limitation of using EBITDA is that it does not include all items that affect the company's current net profit. A reconciliation table of non-GAAP financial indicators with the corresponding indicators under GAAP is provided in the attached unaudited financial statements.
Regarding the figures in this press release
Quarterly Performance
All quarterly financial results mentioned in the body of this press release, tables, and attachments have not been audited. Unless otherwise indicated as “GAAP”, the financial statements on which the financial results reported in this press release are based are prepared in accordance with U.S. GAAP standards and are presented in US dollars.
Q&A
Regarding the Q&A session on the third-quarter performance for 2026 released this time, investors can send their questions via email to [ email protected ], and the company will respond to each one individually.
About GigaMedia
GigaMedia Limited is headquartered in Taipei, Taiwan, and registered in Singapore (registration number: 199905474H). It is a company that provides diversified digital entertainment services in Taiwan and Hong Kong. GigaMedia's digital entertainment services business is a leader in innovation in Asia, with continuously enhanced capabilities in digital entertainment development, distribution, and operation, as well as platform services focusing on mobile games and casual games. For more information, please visit www.gigamedia.com.tw.
The statements contained in the above text and other parts of this press release that are not historical facts are considered "forward-looking statements" as defined by the "Safe Harbor" provisions of the Private Securities Litigation Reform Act of 1995. These forward-looking statements include projections regarding future financial performance (as described in the "Business Outlook" section of this press release and in management's quotes), as well as the strategies and operational plans of GigaMedia. These statements are based on management's current expectations and are subject to risks, uncertainties, and changes in circumstances. Important factors that could cause actual results to differ significantly from these forward-looking statements include, but are not limited to: the company's ability to develop, launch, or acquire more popular online games; the company's ability to retain existing online game players and attract new players; and the company's ability to launch online games on schedule. For additional risks and other factors that could lead to different results, please refer to GigaMedia's annual report 20-F filed in April 2026 and other documents submitted to the U.S. Securities and Exchange Commission.
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