CDC Corp. (CHINA), the parent company of CDC Software Corporation (CDCS), CDC Global Services, CDC Games and China.com, reported Monday a profit for the third quarter, compared to a loss last year.
The Hong Kong-based company's net income attributable to controlling interest for the third quarter was US$5.58 million or US$0.05 per share, compared to a loss of US$9.98 million or US$0.09 per share in the previous year.
On average, five analysts polled by Thomson Reuters expected the company to report earnings of US$0.02 per share for the quarter. Analysts' estimates typically exclude special items.
Total revenue for the quarter declined to US$76.65 million from US$104.07 million last year. Analysts expected a revenue of US$79.73 million for the third quarter.
The company's subsidiary, CDC Software reported revenues of US$48.61 million, down from US$60.51 million a year ago. However, the subsidiary's net income for the third quarter rose to US$6.24 million or US$0.22 per share from US$4.24 million or US$0.15 per share last year mainly due to lower operating expenses. On a non-GAAP basis, the subsidiary's net income for the quarter was US$9.62 million or US$0.33 per share.
Analysts expected CDC Software to report earnings of US$0.31 per share on revenues of US$48.70 million for the third quarter.
Separately, CDC Software revised its fiscal 2009 guidance based on the preliminary financial results and estimates. Net income attributable to controlling interest is expected to be in the range of US$17.2 million - US$19.3 million. Previously, CDC Software projected net income for 2009 in the range of US$15 million - US$18 million. Revenue is expected to be in the range of US$197 million - US$200 million for the full year of 2009. Analysts estimate earnings of US$1.19 per share on revenues of US$200.09 million for the full year.
CDC Global Services revenue for the quarter were US$19.22 million, down from US$28.79 million last year due to lower profit margins impacted by the completion of high yielding margin engagements and the expenses associated with ramping up its BPO operations in India.
Revenue from CDC Games declined to US$6.16 million from US$12.12 million a year earlier. The quarterly decrease was mainly attributable to resources focused on upcoming game launches of The Lord of the Rings Online and Richman Universe. China.com revenues were US$2.65 million, flat with the previous year.
For the group, gross profit for the quarter declined to US$33.21 million or 43% of revenues from US$47.26 million or 45% of revenues a year ago.
Total operating expenses declined to US$35.20 million from US$47.24 million last year. Sales and marketing expenses lowered to US$11.70 million from US$17.56 million a year ago. Research and development expenses were US$4.00 million, down from US$6.35 million in the previous year.
General and administrative expenses decreased to US$17.15 million from US$19.49 million last year. Amortization expenses were US$1.95 million, compared to US$2.86 million in the previous year.
Other income for the quarter was US$10.51 million, compared to a loss of US$4.86 million a year ago.
For the nine-month period, net income attributable to controlling interest was US$16.54 million or US$0.14 per share, compared to a loss of US$33.09 million or US$0.31 per share in the same period of the previous year. Total revenue for the period declined to US$237.14 million from US$312.03 million last year.
Looking forward, the company noted that it remains cautiously optimistic with its long-term prospects including acquisitions, new growth strategies and the launching new games.
CHINA is currently trading at US$2.63, up 0.21 or 8.68%, on a volume of 900K shares on the Nasdaq.
CDCS is currently trading at US$9.80, down 0.20 or 2.00%, on the Nasdaq.
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June 12, 2026 17:14 ET Major central bank action was the focus this week in economic news. The European Central Bank became the first major central bank to move in response to the rising inflationary pressures in the backdrop of the conflict in the Middle East. In North America, the U.S. inflation and trade data as well as Canada’s central bank decision gained attention. The Chinese trade data was the main news in Asia.