Boston, MA 04/11/2014 (wallstreetpr) – NQ Mobile Inc (ADR) (NYSE:NQ) is a provider of mobile security and privacy services. The company has market value of approximately$680 million.
The company is taking advantage of the growth in smartphone demand to growth its business. The company’s services are available on Google Inc (NASDAQ:GOOG)’s Android mobile platform. Android is the most popular mobile operating system. NQ believes it can grow with the growth of Android in the smartphone world.
The company released its fourth quarter Thursday. During the release of the financial results, the company pointed out that its previous results had some accounting error. It said the error was due to “overstatement” regarding stock-based compensation. On that note, the company revised the GAAP per share loss that it reported in the fiscal 2013 third quarter.
The company said it its full-year GAAP loss per share was 5 cents; that compared with Wall Street consensus estimate of 17 cents profit.
Fictitious business claims
Although the accounting error does not come as a big deal, it has the potential of opening a floodgate of question about the company’s business and accounting practices. Last October, the company’s business was termed “fictitious” by a short-seller. Muddy Waters, managed by Carson Block, published a report claiming that NQ Mobile Inc (ADR) (NYSE:NQ) deceives investors. The report claimed that the company was not forthright about its sales and cash holdings, thus becoming a “fictitious” business.
In retaliation, NQ Mobile Inc (ADR) (NYSE:NQ) hurriedly formed an investigative committee to look into the claims alleged by Muddy Waters. According to the fourth quarter earnings press release, the company stated that it intends to issue its report on the investigations. However, it is not clear when such report will come out.
Fourth quarter financial data
NQ Mobile Inc (ADR) (NYSE:NQ) reported mixed results for the fourth quarter. Earnings in the quarter dipped massively while revenue jumped significantly.
The company reported fourth quarter earnings per share of $0.22. Analysts expected the company to earn $0.32 per share. EPS in the corresponding quarter one year ago was $0.23.
While earnings tumbled massively, revenue popped 126 percent to $67.9 million. Analysts expected revenue to come in at $62.8 million in the quarter.
NQ Mobile Inc (ADR) (NYSE:NQ) expects revenue in the current quarter to come in between $75 and $76 million. Analysts expect the company to generate revenue of $65.5 million in the current quarter.
