KongZhong Revenues Above Expectations
KongZhong Corporation (Nasdaq: KONG), a mobile Internet company in China, today announced its unaudited second quarter 2009 financial results. Total revenues for 2Q09increased 37% year-over-year and increased 9% quarter-over-quarter to $32.3 million, exceeding the Company's 2Q09 revenue guidance of $30.5 to $31.5 million.
Net income in 2Q09 was $3.55 million, a 41% increase compared with 1Q09 net income of $2.52 mn.
- WVAS revenues in 2Q09 increased 10% from 2Q08 and increased 1% from 1Q09 to $23.93 mn.
- Revenues from 2.5G services accounted for approximately 21% of total WVAS revenues and revenues from 2G services represented the remaining 79% in 2Q09.
- Total mobile game revenues in 2Q09 were $6.8 mn, a 368% increase from the same period last year and a 38% increase from 1Q09.
- Revenues from downloadable games were $5.04 mn, an increase of 335% from the same period last year and a 19% sequential increase.
- Revenues from downloadable games continued to perform well due to the overall growth of the mobile game market in China, said the company. Revenues from mobile multi-player online games ("MMO") were $1.76 mn, an increase of 497% from the same period last year and a 144% sequential increase. The bulk of these revenues were from "Tian Jie". The year-over-year and sequential strong performance in mobile MMO was driven by the increased marketing activities and optimized game operations which led to an increase in Tian Jie users and a higher percentage of users purchasing in-game virtual items.
The company's new game, Feng Shen online did not contribute any significant revenues during 2Q09. However, due to a large portion of its mobile MMO users being students, the company does not expect similar sequential performance in 3Q09 for its mobile MMO business as it enters the summer holiday season. In 2Q09, revenues from mobile MMO made up 26% of total mobile game revenues compared to 15% in 1Q09.
Based on information available on August 11, 2009, KongZhong expects total revenues for the third quarter of 2009 to be between $34 and $35 million.