Gambling Financials

Asian ISP Gigamedia bets on Gambling

One of Asia’s first internet companies to be listed on the Nasdaq market is staging a comeback as an online gambling operator.
Taiwan-based Gigamedia (NASDAQ: GIGM) started as an ISP over cable TV lines in the late 1990s.

Despite a promising start, growth faltered after Taiwan’s former telephone monopoly took advantage of its existing infrastructure and connections to belatedly enter the broadband market.

The company’s record profits come from gambling and gaming websites, including poker and slot machine games, and multiplayer online games without cash gambling.

Gigamedia’s revenues surged 88 per cent year on year to reach $40m in the second quarter. The company’s profits more than doubled to reach $10m during the quarter.

“Growth was driven by increases in real money players on Everest Poker,” said Gigamedia president Thomas Hui.

“Approximately 154,000 active depositing real money customers played Everest Poker during the second quarter, up 254 per cent year on year and 12 per cent sequentially.

“Approximately 54,000 new depositing real money players were added during the quarter.”

The results are in contrast to many of the company’s competitors in online poker which have seen “very weak quarterly performance”, according to Traci Mangini of ThinkEquity Partners.

European gambling sites account for approximately three quarters of Gigamedia’s revenues. Gigamedia also operates online games in Asia, and is expanding its gambling operation in the region.

Although Gigamedia is listed on Nasdaq, US authorities have become increasingly fierce in their opposition to internet gambling firms, going so far as to detain executives of listed European companies while in transit through the US. So far authorities have only targeted online bookmakers and 3rd party payment processors.