BEIJING, March 21, 2016 /PRNewswire/ - NQ Mobile Inc. ("NQ Mobile" or the "Company" (NYSE: NQ), a leading global provider of mobile internet services, today announced its unaudited financial results for the fourth quarter and fiscal year ended December 31, 2015.

Highlights For Fourth Quarter 2015

• Record Quarterly Net Revenues of $127.5 million, a 42.1% increase year-over-year from $89.7 million in the same period in 2014.
• Record Quarterly Mobile Value Added Services (MVAS) Net Revenues of $51.4 million, a 110.5% increase year-over-year from $24.4 million in the same period in 2014.
• Net Income attributable to NQ Mobile for the fourth quarter of 2015 was $19.9 million, or $0.21 per ADS, basic.
• Non-GAAP net income attributable to NQ Mobile for the fourth quarter of 2015 was $43.0 million or $0.46 per ADS, basic.
• Cash Flow generated from operations of $8.6 million.

Highlights For The Fiscal Year 2015

• Record Annual Net Revenues of $406.7 million, a 22.4% increase year-over-year from $332.3 million in 2014.
• Record Annual Mobile Value Added Services (MVAS) Net Revenues of $139.6 million, a 31.6% increase year-over-year from $106.1 million in the same period in 2014.
• Net loss attributable to NQ Mobile for the fiscal year 2015 was $1.3 million.
• Non-GAAP net income attributable to NQ Mobile for the fiscal year 2015 was $51.3 million or $0.55 per ADS, basic.

Operating Metrics as of December 31, 2015

As a reminder, beginning in the third quarter of 2014, the Company began presenting the operating metrics of average monthly active user accounts ("MAUs" as redefined to include many emerging businesses previously not included in the Company's user account metrics. As such, the MAUs presented herein should only be compared to the third quarter of 2014 and forward and not be compared to operating metrics previously reported in historical periods because there is not a way to accurately compare such results. The MAUs for the period presented herein and going forward are expected to be better aligned with the key underlying trends of a mobile internet platform company focused on driving mobile consumer traffic and engagement that can be monetized. The MAU statistics do not include the users addressed by the installation of the Company's advertising SDK into third-party applications. These indirect users generate impressions and search traffic that the Company can monetize outside of the user accounts generated directly by the Company's own portfolio of products and applications.

Average Monthly Active User Accounts as of December 31, 2015: 198.2 million

"We are pleased with the performance of our businesses during 2015," said Mr. Zemin Xu, Chief Executive Officer of NQ Mobile. "We made progress in our goals to divest and monetize certain assets while at the same time focusing on a core set of consumer businesses going forward."

"The performance of the MVAS segment in the fourth quarter provides compelling evidence of the future of our consumer and entertainment businesses," said Mr. Roland Wu, Chief Financial Officer of NQ Mobile. "Our strategy is to divest and monetize certain assets, while increasing our balance sheet and positioning our company to both increase value to shareholders while also investing in the future of our business. We are well on our way."

Fourth Quarter 2015 Results

Revenues

Net revenues in the fourth quarter of 2015 increased 42.1% year-over-year to $127.5 million from $89.7 million in the same period in 2014.

Mobile value added service revenues increased 110.5% year-over-year to $51.4 million from $24.4 million in the same period in 2014. The increase in mobile value added service revenue was primarily attributable to the growth in mobile gaming revenues and live mobile social video platform revenues. The increase in mobile gaming revenues was primarily the result of the continuing expansion of FL Mobile's business in both domestic and overseas markets, which grew over 129.7% compared with the same period in 2014. The significant increase in live mobile social video platform revenues was driven by the rapid growth of Showself's business in our live video platforms, which was up 557.2% compared to the same period in 2014. The strong growth in NQ Mobile's live mobile social video platform and mobile gaming revenues was offset by a year-over-year decrease in consumer mobile security revenues which was mainly due to the fact that the Company has been moving its focus away from premium mobile security services and focusing more on mobile applications and services.

Advertising revenues increased 7.6% year-over-year to $22.0 million from $20.4 million in the same period in 2014. The increase was mainly due to the continued expansion of our advertising networks and the monetization through advertising and successful third party application referrals.

Enterprise mobility revenues increased 18.5% year-over-year to $52.1 million from $44.0 million in the same period in 2014. This increase is mainly due to continuing strong growth of hardware sales as well as an increase in software sales.

Other revenues increased 131.2% year-over-year to $2.0 million from $0.9 million in the same period in 2014. Other revenues are generated primarily by providing technical contract services to third parties and fluctuate as such business is driven by individual projects.

Cost of Revenues

Cost of revenues in the fourth quarter of 2015 increased 66.2% year-over-year to $104.9 million from $63.1 million in the same period in 2014. The year-over-year increase was primarily due to higher cost of products sold within the enterprise mobility segment, as well as higher customer acquisition costs and revenue sharing costs, incurred mainly for the Company's mobile game business and live mobile social video platform business, which was in line with the increase in corresponding revenue from these businesses.

Gross Profit and Gross Margin

Gross profit in the fourth quarter of 2015 decreased 15.1% to $22.6 million from $26.5 million in the same period in 2014. Gross margin, or gross profit as a percentage of net revenues, was 17.7% in the fourth quarter of 2015, compared with 29.6% in the same period in 2014.

Operating Expenses

Total operating expenses in the fourth quarter of 2015 decreased 11.3% year-over-year to $41.2 million from $46.5 million in the same period in 2014. Non-GAAP operating expenses, which exclude share-based compensation, the expenses incurred for the handling of short seller allegations and the amortization of intangible assets arising from acquisitions increased 52.6% year-over-year to $36.0 million from $23.6 million in the same period in 2014.

Selling and marketing expenses in the fourth quarter of 2015 decreased 6.5% year-over-year to $6.2 million from $6.6 million in the same period in 2014. Non-GAAP selling and marketing expenses, which exclude share-based compensation decreased 2.2% year-over-year to $6.3 million from $6.4 million in the same period in 2014. The year-over-year decrease resulted from the decrease in promotional activities, as well as reduced expenditures in our consumer security business.

General and administrative expenses in the fourth quarter of 2015 decreased 13.3% year-over-year to $27.2 million from $31.4 million in the same period in 2014. Non-GAAP general and administrative expenses, which exclude share-based compensation, the expenses incurred for the handling of short seller allegations and amortization of intangible assets arising from acquisitions, increased 150.9% year-over-year to $22.1 million, up from $8.8 million in the same period in 2014. The year-over-year increase was mainly due to an increase in the provision for doubtful accounts based on management's assessment at the end of the period.

Research and development expenses in the fourth quarter of 2015 decreased 7.1% year-over-year to $7.8 million from $8.4 million in the same period in 2014. Non-GAAP research and development expenses, which exclude share-based compensation and amortization of intangible assets arising from acquisitions, decreased 9.1% to $7.6 million from $8.3 million in the same period in 2014. The year-over-year decrease was primarily due to reduced product development expenses mainly from our consumer security business.

Share-based compensation expenses

Share-based compensation expenses, which were allocated to related operating cost and expenses line items, amounted to $4.4 million in the fourth quarter of 2015, compared to $19.3 million in the corresponding period in 2014.

Loss /Income from Operations and Operating Margin

Loss from operations in the fourth quarter of 2015 was $18.7 million, compared with an operating loss of $19.9 million in the same period in 2014.

Non-GAAP income from operations, which excludes share-based compensation, expenses incurred for the handling of short seller allegations, amortization of intangible assets arising from acquisitions, and impairment losses decreased to a loss of $10.8 million from Non-GAAP income of operations of $5.1 million in the same period in 2014. Non-GAAP operating margin, or non-GAAP income from operations as a percentage of net revenues, was -8.5% in the fourth quarter of 2015, compared with 5.6% in the same quarter in 2014.

Foreign Exchange Gain, Interest Expenses and Other Income

Foreign exchange loss was $0.6 million in the fourth quarter of 2015, compared with a gain of $0.5 million in the same quarter of the previous year, which was affected by fluctuations in the foreign exchange rates. Interest expenses were $1.5 million in the fourth quarter of 2015, compared with $1.1 million in the same quarter a year ago. Interest expenses were primarily derived from interest expense related to convertible debts, offset by the interest income from certain term deposits.

Gain from Disposal of Subsidiary

In the fourth quarter of 2015, we recorded a gain from the disposal of a subsidiary of approximately $56.2 million related to the completion of the NationSky divestment.

Investment Impairment

In the fourth quarter of 2015, we recorded an impairment charge of $12.9 million related to certain investments we made in the past which were fully impaired during this quarter.

Income Tax

Income tax expense was $6.1 million in the fourth quarter of 2015, compared with $3.4 million in the same period in 2014.

Net Income/Loss

Net Income attributable to NQ Mobile was $19.9 million in the fourth quarter of 2015, compared with a net loss of $21.2 million in the same period in 2014. Non-GAAP net income attributable to NQ Mobile, which excludes share-based compensation, expenses incurred for the handling of short sellers, interest expenses related to convertible debts, amortization of intangible assets arising from acquisitions, and impairment losses was $43.0 million in the fourth quarter of 2015, compared with $6.1 million in the same period in 2014.

Cash and C ash E quivalents, T erm D eposits and R estricted C ash

Cash and cash equivalents, term deposits and restricted cash together amounted to $254.3 million as of December 31, 2015.

Cash Flow

Net cash flow generated from operations for the fourth quarter of 2015 was $8.6 million.

Fiscal Year 2015 Results

Revenues

Net revenues for the fiscal year 2015 increased 22.4% year-over-year to $406.7 million from $332.3 million in 2014.

Mobile value added service revenues for the fiscal year 2015 increased 31.6% year-over-year to $139.6 million from $106.1 million in 2014. The increase in mobile value added service revenues was primarily attributable to the growth in mobile gaming revenues and live mobile social video platform revenues. The increase in mobile gaming revenues primarily resulted from the continuing expansion of FL Mobile's business in both domestic and overseas markets, which grew 66.2% compared to the previous year. The significant increase in live mobile social video platform revenues was driven by the rapid growth of the business of Showself, which was up 951.6% compared to the previous year. The strong growth in NQ Mobile's live mobile social video platform revenues and mobile gaming was offset by a decrease in consumer mobile security revenues which was mainly due to the Company moving its focus away from premium mobile security services and focusing on mobile applications and services.

Advertising revenues for the fiscal year 2015 decreased 1.6% year-over-year to $71.7 million from $72.9 million in 2014. This was mainly due to slower smartphone sales and shipments which impacted our advertising network revenues for the fiscal year.

Enterprise mobility revenues for the fiscal year 2015 increased 27.8% year-over-year to $190.0 million from $148.7 million in 2014. The increase was due to stronger hardware and software sales.

Other revenues for the fiscal year 2015 increased 15.3% year-over-year to $5.4 million from $4.6 million in 2014. Other revenues are generated primarily by providing technical contract services to third parties and fluctuate as such business is driven by individual projects.

Cost of Revenues

Cost of revenues for the fiscal year 2015 increased 40.9% year-over-year to $319.4 million from $226.7 million in 2014. The year-over-year increase was primarily due to higher cost of products sold within the enterprise mobility segment, as well as higher customer acquisition costs and revenue sharing costs, incurred mainly for the Company's mobile game business and live mobile social video platform business.

Gross Profit and Gross Margin

Gross profit for the fiscal year 2015 decreased 17.3% to $87.3 million from $105.7 million in 2014. Gross margin, or gross profit as a percentage of net revenues, was 21.5% for the fiscal year 2015, compared with 31.8% in 2014. The primary reason for the decline in gross profit and gross margin is the free charge of mobile security services in domestic markets and higher customer acquisition costs and revenue sharing costs, incurred mainly for the Company's mobile game business and live mobile social video platform business.

Operating Expenses

Total operating expenses for the fiscal year 2015 decreased 35.0% year-over-year to $121.2 million from $186.6 million in 2014. Non-GAAP operating expenses, which exclude share-based compensation expenses, expenses incurred for the handling of short seller allegations, and the amortization of intangible assets arising from acquisitions, increased 12.7% year-over year to $101.3 million from $89.9 million in 2014.

Selling and marketing expenses for the fiscal year 2015 decreased 10.7% year-over-year to $26.8 million from $30.0 million in 2014. Non-GAAP selling and marketing expenses for the fiscal year 2015, which exclude share-based compensation, decreased 8.6% year-over-year to $26.1 million from $28.5 million in 2014. This was primarily due to the decrease in promotional activities, as well as reduced expenditures particularly within our consumer security business.

General and administrative expenses for the fiscal year 2015 decreased 50.0% year-over-year to $65.5 million from $131.0 million in 2014. Non-GAAP general and administrative expenses for the fiscal year 2015, which exclude share-based compensation, the expenses incurred for the handling of short seller allegations and the amortization of intangible assets arising from acquisitions, increased 26.8% year-over-year to $46.3 million from $36.5 million in 2014. The increase was primarily due to an increase in the provision for doubtful accounts based on management assessment at the end of the period.

Research and development expenses for the fiscal year 2015 increased 13.1% year-over-year to $29.0 million from $25.7 million in 2014. Non-GAAP research and development expenses for the fiscal year 2015, which exclude share-based compensation and the amortization of intangible assets arising from acquisitions, increased 16.6% to $29.0 million from $24.9 million in 2014. The year-over-year increase was primarily due to higher staff costs associated with headcount growth mainly in our enterprise mobility business.

Share-based compensation expenses

Share-based compensation expenses, which were allocated to related operating cost and expenses line items, decreased 80.3% year-over-year to $16.6 million from $83.8 million in 2014. The decrease in share-based compensation expenses was mainly due to less performance-based share options granted in relation to the Company's acquisitions in 2015 compared with that in 2014.

Loss /Income from Operations and Operating Margin

Loss from operations for the fiscal year 2015 was $33.9 million, compared with an operating loss of $81.0 million in fiscal year 2014.

Non-GAAP income from operations for the fiscal year 2015, which excludes share-based compensation, expenses incurred for the handling of short seller allegations and intangible assets arising from acquisitions, decreased year-over-year to a loss of $6.0 million from Non-GAAP income from operations of $23.2 million in 2014. Non-GAAP operating margin, or non-GAAP income from operations a percentage of net revenues, was -1.5% for the fiscal year 2015, compared with 7.0% in 2014. The decrease in non-GAAP operating income was mainly due to the decline in gross margin, which was affected by the increase in cost of revenues as highlighted above in the respective section on cost of revenues.

Foreign Exchange Loss, Interest Expenses/Income

Foreign exchange loss was $1.7 million for the fiscal year 2015, compared with a loss of $0.4 million in 2014. The loss in foreign exchange was primarily attributable to the fluctuation in foreign exchange rates. Interest expenses were $4.7 million for the fiscal year 2015, compared with $5.4 million in 2014. Interest expenses were primarily derived from interest expense related to convertible debts, offset by the interest income from certain term deposits.

Gain from Disposal of Subsidiary

In the fiscal year of 2015, we recorded a gain from the disposal of subsidiary of approximately $56.2 million related to the completion of the NationSky divestment.

Investment Impairment

In the fiscal year of 2015, we recorded an impairment charge of $15.5 million related to certain investments we made in the past which were fully impaired.

Income Tax

Income tax expense was $9.2 million for the fiscal year 2015, compared with $5.5 million in 2014.

Net Loss /Income

Net Loss attributable to NQ Mobile was $1.3 million for the fiscal year 2015, compared with a net loss of $76.7 million in 2014. Non-GAAP net income attributable to NQ Mobile, which excludes share-based compensation, expenses incurred for the handling of short seller allegations, interest expenses related to convertible debts, amortization of intangible assets arising from acquisition and impairment losses was $51.3 million for the fiscal year 2015, compared with $36.9 million in 2014.

Cash Flow

Net cash used in operating activities for the fiscal year 2015 was $12.0 million.

Other Significant Events

Updates on the FL Mobile Divestment

In a press release on February 22 2016, the Company announced that it, Beijing Jinxin Rongda Investment Management Co., Ltd., a subsidiary of Tsinghua Holdings Co. Ltd., ("Beijing Jinxin" and the controlling shareholder of Gansu Huangtai Wine-Marketing Industry Co., Ltd. ("Gansu Huangtai" were contemplating a transaction to sell the entire stake of FL Mobile Jiutian Technology Co., Ltd., the Company's consolidated affiliate in China, to Gansu Huangtai. Subsequently, on March 14, 2016, however, the Company was informed that Gansu Huangtai was not able to proceed further with such proposed transaction. Beijing Jinxin remains committed to the binding framework agreement announced on August 26, 2015 and is working with the Company on the completion of that transaction.

NQ Mobile Appoints Mr. Justin Chen as President and General Counsel; Announces Changes to its Board of Directors

In a press release issued on February 2, 2016, the Company announced that it had appointed Mr. Justin Chen as its President and General Counsel effective as of February 2, 2016. The appointment of Mr. Chen, former independent director, to President and General Counsel necessitated a number of other changes to the Company's board of directors (the "Board". While Mr. Justin Chen remains as a director of the Board, he has resigned from his positions as a member of each of the audit committee, compensation committee and corporate governance and nominating committee of the Board. To fill in the vacancies, the Company has appointed Dr. Ethan Hu as an independent director, the Chair of the audit committee and a member of each of the compensation committee and the corporate governance and nominating committee of the Board, effective as of February 2, 2016. In addition to the appointment of Dr. Hu, several other changes to the Board of Directors include the resignation of Mr. Xu Zhou, Mr. Roland Wu and Mr. Max Yao from their positions as directors of the Board, effective as of February 2, 2016. Mr. Yao has also resigned as the Chair of the audit committee. Each of Mr. Xu Zhou, Mr. Roland Wu and Mr. Max Yao confirmed that his resignation did not result from any disagreement with the Company on any matter relating to the Company. Mr. Roland Wu remains as the chief financial officer of the Company. After the effectiveness of the changes to the Board, the Company's Board consists of seven directors, four of whom are independent directors.

NationSky Divestment

In a press release issued on December 31, 2015, the Company announced that it had completed the divestment of all of NQ Mobile's interest in the NationSky business for an aggregate consideration of US$80 million.

Termination of Proposed Divestment of Beijing Tianya

In a press release issued on December 16, 2015, the Company announced that it had terminated the agreement to sell 100% of the equity interest in Beijing Tianya Co., Ltd. ("Beijing Tianya" to Tack Fiori International Group ("Tack Fiori". The Proposed Divestment was terminated upon mutual agreement between NQ Mobile and Tack Fiori. In the course of reviewing the draft announcement of the Proposed Divestment, The Stock Exchange of Honk Kong Limited took the view that the Proposed Divestment would constitute a reverse takeover and would be treated as if it were a new listing application. In view of the tremendous cost and time expected to be incurred for complying with such expanded listing requirements, both NQ Mobile and Tack Fiori considered that it is beneficial to terminate the Proposed Divestment and relevant agreements.

BEIJING and DALLAS, Aug. 26, 2015 /PRNewswire/ - NQ Mobile Inc. ("NQ Mobile" or the "Company" (NYSE: NQ), a leading global provider of mobile internet services, today announced its unaudited financial results for the quarter ended June 30^th, 2015.

Highlights for Second Quarter 2015

• Quarterly Net Revenues were $102.1 million in the second quarter of 2015, a 25.0% increase year-over-year from $81.6 million in the same period in 2014, a new record level for the Company.
• Gross Margin was 24.8% in the second quarter of 2015, compared with 21.0% in the first quarter of 2015. Non-GAAP Operating Margin was 5.1% in the second quarter of 2015, up from negative 1.8% in the first quarter of 2015.
• Net Loss attributable to NQ Mobile was $1.6 million, or a loss of $0.02 per ADS, in the second quarter of 2015, a 90.2% improvement compared with a net loss of $16.8 million, or a loss of $0.22 per ADS, in the same period in 2014.
• Non-GAAP Net Income attributable to NQ Mobile was $7.0 million, or $0.08 per ADS in the second quarter of 2015, compared with Non-GAAP net income of $14.8 million, or $0.20 per ADS, in the same period in 2014.
• Total Share Based Compensation Expenses fell to $1.1 million, a 95.6% decline year-over-year from $25.4 million in the same period in 2014.

Operating Metrics as of June 30, 2015

As a reminder, beginning in the third quarter of 2014, the Company began presenting the operating metrics of average monthly active user accounts ("MAUs" as redefined to include many emerging businesses previously not included in the Company's user account metrics. The MAUs presented herein include the user accounts in all the related business segments. As such, the MAUs presented herein should only be compared to operating metrics in the third quarter of 2014 and thereafter and not be compared to operating metrics in earlier historical periods, because there is not a way to accurately compare such results. The MAUs for the period presented herein and going forward are expected to be better aligned with the key underlying trends of a mobile internet platform company focused on driving mobile consumer traffic and engagement that can be monetized. The MAU statistics do not include the users addressed by the installation of the Company's advertising SDK into third-party applications. These indirect users generate impressions and search traffic that the Company can monetize outside of the user accounts generated directly by the Company's own portfolio of products and applications.

Average Monthly Active User Accounts as of June 30, 2015: 188.2 million.

"We are encouraged to see solid improvement in the second quarter of 2015," said Mr. Zemin Xu, CEO of NQ Mobile, "The management team remains committed to executing our business strategies, with great efforts in the monetization of our traffic-based mobile entertainment businesses, in order to achieve sustainable growth."

"Our topline growth remains strong and we, by executing our business strategies, started to see improvement in our profitability this past quarter. We are confident about our future growth and will maintain our focus on executing and delivering results." commented Mr. Roland Wu, CFO of NQ Mobile.

Second Quarter 2015 Results

Revenues

Net revenues in the second quarter of 2015 increased 25.0% year-over-year to $102.1 million from $81.6 million in the same period in 2014.

Mobile value added service revenues increased 8.2% year-over-year to $31.7 million from $29.2 million in the same period in 2014. The increase in mobile value added service revenues was primarily attributable to the growth in live mobile social video platform revenues and mobile gaming revenues. The significant increase in social video platform revenues was driven by the rapid growth of the business of Showself. And the increase in mobile gaming revenues was primarily the result of the continuing expansion of FL Mobile's business in both domestic and overseas markets, which grew 10.0% year-over-year from the same period in 2014. Meanwhile, consumer mobile security revenues decreased mainly because the Company has been moving its focus away from premium security services and focusing more on mobile applications and services.

Advertising revenues increased 6.1% year-over-year to $16.2 million from $15.3 million in the same period in 2014. The growth was primarily due to increased monetization through advertising and successful third party application referrals resulting mainly from WAPS and Fanyue, the Company's online and offline advertising networks.

Enterprise mobility revenues increased 48.1% year-over-year to $52.8 million from $35.6 million in the same period in 2014. The growth was primarily driven by the significant demand for Apple products, along with an increase in the sales of enterprise mobility software with more distribution channels which were being developed in the second quarter of 2015.

Other revenues decreased 2.5% year-over-year to $1.4 million from $1.5 million in the same period in 2014. Other revenues are generated primarily by providing technical contract services to third parties and fluctuate as such business is driven by individual projects.

Cost of Revenues

Cost of revenues in the second quarter of 2015 increased 41.0% year-over-year to $76.8 million from $54.5 million in the same period in 2014. The year-over-year increase was primarily due to higher cost of products sold for the enterprise mobility business, which totaled $46.1 million in the second quarter of 2015 compared to $32.7 million in the same period last year. In addition, the cost of revenue sharing, which is incurred mainly for the Company's mobile game business and live mobile social video platform, increased to $10.8 million in the second quarter of 2015 compared to $4.6 million in the same period last year.

Gross Profit and Gross Margin

Gross profit in the second quarter of 2015 decreased 6.9% to $25.3 million from $27.2 million in the same period in 2014. Gross margin, or gross profit as a percentage of net revenues, was 24.8% in the second quarter of 2015, compared with 33.3% in the same period in 2014. Excluding the impact from hardware sales of the enterprise mobility business and associated costs, gross margin was 44.6% in the second quarter of 2015, down from 55.2% in the same period in 2014.

Operating Expenses

Total operating expenses in the second quarter of 2015 decreased 52.2% year-over-year to $23.9 million from $49.9 million in the same period in 2014. Non-GAAP operating expenses, which exclude share-based compensation, the expenses incurred for the handling of short seller allegations and the amortization of intangible assets arising from acquisitions, decreased by 2.9 % year-over-year to $21.9 million from $22.5 million in the same period in 2014.

Selling and marketing expenses in the second quarter of 2015 decreased 17.1% year-over-year to $6.7 million from $8.1 million in the same period in 2014. Non-GAAP selling and marketing expenses, which exclude share-based compensation, decreased 18.8% year-over-year to $6.3 million from $7.8 million in the same period in 2014. The year-over-year decrease in selling and marketing expenses mainly resulted from the decrease in spending on the promotional channels for mobile games due to later launch of games in this quarter, as well as less expenditure on the consumer mobile security business.

General and administrative expenses in the second quarter of 2015 decreased 70.6% year-over-year to $10.6 million from $35.9 million in the same period in 2014. Non-GAAP general and administrative expenses, which exclude share-based compensation, the expenses incurred for the handling of short seller allegations and amortization of intangible assets arising from acquisitions, decreased 6.9% year-over-year to $8.5 million from $9.1 million in the same period in 2014. The year-over-year decrease in general and administrative expenses under GAAP was mainly from a significant $23.6 million decrease in compensation expenses, as well as a large decrease in the provision of bad debt expenses.

Research and development expenses in the second quarter of 2015 increased 11.6% year-over-year to $6.6 million from $5.9 million in the same period in 2014. Non-GAAP research and development expenses, which exclude share-based compensation and amortization of intangible assets arising from acquisitions, increased 25.5% to $7.1 million from $5.6 million in the same period in 2014. The year-over-year increase in research and development expenses was primarily due to the increase in the expenditures on software development, mainly including staff costs, as a result of business expansion.

Share-based compensation expenses

Share-based compensation expenses, which were allocated to related operating cost and expenses line items, declined to $1.1 million in the second quarter of 2015, a decrease of 95.6% from $25.4 million in the corresponding period in 2014. The significant decrease in share-based compensation expenses was primarily due to the one-off reversal of the unvested share options related to the departure of a former executive and less equity incentives issued to the Company's acquirees.

Income/Loss from Operations and Operating Margin

Income from operations in the second quarter of 2015 was $1.4 million, compared with an operating loss of $22.8 million in the same period in 2014.

Non-GAAP income from operations, which excludes share-based compensation, the expenses incurred for the handling of short seller allegations and amortization of intangible assets arising from acquisitions, was $5.2 million in the second quarter of 2015, compared with an income of $6.5 million in the same period in 2014. Non-GAAP operating margin, or non-GAAP income from operations as a percentage of net revenues, was 5.1% in the second quarter of 2015, compared with 8.0% in the same quarter in 2014. The decrease in non-GAAP operating margin was mainly due to the decline in gross margin, which was the result of the rapid market growth of the enterprise mobility business with lower gross margin.

Foreign Exchange Gain/Loss, Interest Expenses and Other Income

Foreign exchange gain was $0.7 million in the second quarter of 2015, compared with a loss of $0.04 million in the same quarter of the previous year, which was affected by a fluctuation in foreign exchange rates. Interest expenses were $1.1 million in the second quarter of 2015, compared with $1.4 million in the same quarter of the previous year. Interest expenses were primarily derived from interest expense related to convertible debt, offset by the interest income from certain term deposits.

Income Tax

Income tax expense was $0.4 million in the second quarter of 2015, compared with an income tax expense of $1.7 million in the same period in 2014.

Net Loss/Income

Net Loss attributable to NQ Mobile was $1.6 million in the second quarter of 2015, compared with net loss of $16.8 million in the same period in 2014. Non-GAAP net income attributable to NQ Mobile, which excludes share-based compensation, the expenses incurred for the handling of short seller allegations, interest expenses related to convertible debt, amortization of intangible assets arising from acquisition and impairment loss arising from acquisitions, was $7.0 million in the second quarter of 2015, compared with net income of $14.8 million in the same period in 2014.

Cash and C ash E quivalents, T erm D eposits and R estricted C ash

Cash and cash equivalents, term deposits and restricted cash together amounted to $239.4 million as of June 30, 2015.

Cash Flow

Net Cash used in operations in the second quarter of 2015 was $14.7 million.

Other Significant Events

Below please find a summary of certain significant events that took place during the period from May 19, 2015, the date of the Company's last earnings release, through August 26, 2015.

Appointment of Mr. Roland Wu as Chief Financial Officer

As previously announced, on June 1, 2015, the Company appointed Mr. Roland Wu as its Chief Financial Officer, effective as of that date. With Mr. Wu's appointment, Dr. Vincent Shi stepped down as the acting Chief Financial Officer of NQ Mobile and is now focusing on his responsibilities as Chairman of the board of directors and Chief Operating Officer of the Company.

NQ Mobile enters into a binding agreement to sell FL Mobile

In a press release on August 26, 2015, the Company announced that it entered into a legally binding framework agreement (the "FL Framework Agreement" with Beijing Jinxing Ronda Investment Management Co. Ltd. ("Beijing Jinxing", a subsidiary of Tsinghua Holdings Co., Ltd and an independent third party, to sell the Company's entire stake in FL Mobile Inc., NQ Mobile's majority owned Cayman Islands subsidiary (the "FL Divestment". The Company and other existing shareholders of FL Mobile Inc. have agreed to sell to Beijing Jinxing the entire stake in FL Mobile Inc. that they currently hold for no less than RMB 4 billion (or approximately no less than US $626 million).

NQ Mobile Inc. enters into a binding agreement to sell NationSky

In a press release on August 26, 2015, the Company announced that it entered into legally binding share purchase agreements, which provide for the sale of all of NQ Mobile's interests in the NationSky business (the "NationSky Divestment", including the entire interest in Beijing NationSky Network Technology Co., Ltd. ("Beijing NationSky" to Mr. Hou Shuli, a founder and senior management member of Beijing NationSky, for an aggregate consideration of US $80 million cash.

NQ Mobile Share Repurchase

As previously announced, on December 23, 2014, the Board authorized the Company to repurchase up to $80 million of its shares on the open market, in privately negotiated transactions, in block trades and/or through other legally permissible means, depending on market conditions and in accordance with applicable rules and regulation, over the next 12 months. To date, NQ Mobile has repurchased $12.6 million worth of shares on the open market, or a total ofapproximately 2.9 million ADSs. As of August 26, 2015, $67.4 million remains available for further repurchases under the $80 million authorized share repurchase program.

Business Outlook

The Company expects net revenues to be in the range of $455.0 million to $460.0 million for the full year 2015, representing a 36.9% to 38.4% year-over-year increase. Net revenues for the third quarter of 2015 are expected to be in the range of $110.0 million to $112.0 million, representing a 35.5% to 37.9% year-over-year increase. This outlook includes net revenue expectations for FL Mobile and NationSky and is subject to change based upon the timing of the closing of the announced FL Divestment and NationSky Divestment.

Conference Call Information

NQ Mobile's management team will hold an earnings conference call to discuss its results and outlook at 8:30 PM U.S. Eastern Time on Wednesday, August 26, 2015, (8:30 AM Beijing/Hong Kong Time on Thursday, August 27, 2015).

The dial-in details for the conference call are:

U.S. Toll Free: +1-866-519-4004
International: +1-845-675-0437
Hong Kong: +852-3018-6771
United Kingdom:  +44 203-059-8139
China Mainland: 4006208038 or 8008190121
Conference ID: 12130777

Please dial in 10 minutes before the call is scheduled to begin and provide the conference ID to join the call.

A replay of the call will be available after the conclusion of the conference call at 11:30 p.m. U.S. Eastern Time on August 26 through September 2, 2015. The dial-in details for the replay are:

U.S. Toll Free: 1-855-452-5696
International: +1- 646-254-3697
Conference ID: 12130777

Additionally, a live and archived webcast of this call will be available on the Investor Relations section of NQ Mobile's website at http://ir.nq.com.

Follow us on Twitter @NQMobileIR.

BEIJING and DALLAS, June 1, 2015 /PRNewswire/ -- NQ Mobile Inc. ("NQ Mobile" or the "Company" (NYSE: NQ), a leading global provider of mobile Internet services, today announced the appointment of Mr. Roland Wu as its chief financial officer in addition to his role as director, effective as of June 1, 2015.  With Mr. Wu's appointment, Dr. Vincent Wenyong Shi will step down from his role as the acting chief financial officer and focus on his responsibilities as the Company's chairman of the board of directors and chief operating officer.

In the meantime, Mr. Roland Wu will remain as a director, but resigned from his position as a member of the compensation committee of the Company's board of directors, and as a replacement, the board of directors elected Mr. William Li, an independent director of the Company, as a new member to the compensation committee, both effective as of June 1, 2015.

"We are happy to announce Mr. Roland Wu's appointment," said Dr. Vincent Wenyong Shi, the Chairman of NQ Mobile. "Roland brings experience and knowledge to help our Company enhance our financial reporting and internal controls, execute growth plans and deliver value for shareholders over time.  We are excited about the future and look forward to his excellent service as our chief financial officer."

"I am pleased with the organization and the execution of our entire management team right now," said Mr. Zemin Xu, the CEO of NQ Mobile. "We welcome Roland to the management team and we know he will add to our overall performance as we strive to deliver results and achieve our plans for the future."

Mr. Roland Wu, a Chartered Financial Analyst charterholder, has extensive experience and in-depth capital markets knowledge, having served in the financial industry over the last fifteen years.  He has served as Executive Director of Winshine Entertainment & Media Holding Company Limited since 2014. Additionally, Mr. Wu served as a portfolio manager at Haitong International Asset Management Company from 2009 to 2013 and as an investment analyst at Baoying Fund Management Co., Ltd. from 2006 to 2009. Mr. Wu obtained his masters degree in business administration from Nankai University and a bachelor degree in Computer Science from Beijing Jiaotong University.

"I am honored to join the NQ Mobile team," said Mr. Roland Wu, the chief financial officer of NQ Mobile. "I am confident in the Company's future and I look forward to working with the entire organization to help accomplish the Company's growth targets."

NQ Mobile up 3.5% on Q4 revenue beat, healthy sales guidance

• In addition to beating Q1 revenue estimates (while posting in-line EPS), NQMobile is guiding for Q2 revenue of $102M-$103M (+25%-26.2% Y/Y), above a sole analyst estimate of $99.5M, and full-year revenue of $455M-$460M (+36.9%-38.4%), above a sole estimate of $443M.
• Business performance: Q1 mobile value-added service revenue -8.2% Y/Y to $25.1M - lower consumer mobile security revenue offset mobile gaming (FL Mobile) and live mobile video growth. Ad revenue +4.3% to $17.5M . Enterprise mobility revenue (NQSky) +33.6% to $46M thanks to an Apple distribution deal and iPhone 6 sales. Other revenue -54.8% to $0.6M.
• Financials: Gross margin fell to 21% from 29.6% in Q4 and 36.9% a year ago (hurt EPS); a mix shift towards enterprise mobility sales was responsible. Operating expenses (non-GAAP) rose 1.1% to $22.3M - sales/marketing spend totaled $7.1M, G&A $8M, and R&D $7.2M.
• NQ ended Q1 with $270.5M in cash, and $172.5M in convertible debt (compares with a current market cap of $310M). $11.6M of its $80M buyback authorizationhad been used as of today.
• NQ has risen to $3.84 AH.
• Q1 results, PR

DALLAS and BEIJING, April 21, 2015 /PRNewswire/ -- NQ Mobile Inc. (NYSE: NQ) ("NQ Mobile" or the "Company", a leading global provider of mobile Internet services, today announced that Mr. Omar Khan, current Co-Chief Executive Officer of NQ Mobile, has decided to transition to an advisory role and step down in his capacity as Co-CEO and Director of the Company, effective as of May 1, 2015. At the same time, Mr. Khan will also resign from his position as the Chief Executive Officer of NQ Mobile US, Inc., a direct wholly owned subsidiary of the Company, and from his other roles within the Company.  To help with a smooth transition, Mr. Khan will remain with the Company as an advisor through December 31, 2015.

As part of this transition, in order to streamline the management process of the Company, the Company will also eliminate the Co-CEO management structure.  The Board of Directors has decided to appoint Mr. Zemin Xu, the current Co-CEO of the Company, to take over as the Company's Chief Executive Officer, effective as of May 1, 2015.

"Omar joined us at a very important time in our business evolution and development," said Dr. Vincent Shi, Chairman of the Board of NQ Mobile. "He helped guide our company's important transition from being a mobile security provider to being a true global mobile Internet services provider.  We would like to thank Omar for his stewardship and great service during his tenure and we are grateful he has helped us prepare for an even brighter future."

"When I joined the Company in January 2012, I shared with Company management a vision and passion for building a global mobile Internet services company with expanding application and services for consumers, enterprises and partners alike," said Omar Khan.  "I am proud of the progress we have made over the past 3 years. I believe the timing is right for me to leave as Co-CEO and for Zemin to lead this Company into its next chapter.  As a Company today, NQ Mobile has a more diversified business model, enjoys a deeper bench of strong leaders, and is generally more process driven, better governed and far better positioned for a great future then when I first started here.  I am excited about the Company's future and I wish the best for Vincent, Zemin and the rest of the management team as well as the Company's employees and shareholders."

NQ Mobile will host a conference call to discuss this announcement today at 9:00 am EDT (9:00 p.m. Beijing/Hong Kong time).

BEIJING and DALLAS, March 19, 2015 /PRNewswire/ -- NQ Mobile Inc. ("NQ Mobile" or the "Company" (NYSE: NQ), a leading global provider of mobile Internet services, today announced the appointment of Mr. Chun Ding as an independent director to the Company's board of directors, effective as of March 18, 2015.

Mr. Chun Ding, a US citizen, is the Managing Member of CRCM LLC, the general partner of CRCM L.P., an asset management firm he founded in 2006. He graduated, as valedictorian, from Middlebury College in 1993 with a B.A. in Economics. He received his Masters of Business Administration from Harvard Business School in 1997, as a Baker Scholar. Before founding CRCM, Mr. Ding had extensive work experience in investment banking and institutional asset management through his previous jobs with large U.S. financial institutions in New York and San Francisco.

About NQ Mobile

NQ Mobile Inc. (NYSE: NQ) is a leading global provider of consumer and enterprise mobile Internet services. NQ Mobile's portfolio of offerings includes mobile security and productivity, mobile search, mobile games & advertising applications for the consumer market and consulting, mobile platforms, and mobility management services for the enterprise market. NQ Mobile maintains dual headquarters in Dallas, Texas, USA and Beijing, China. For more information on NQ Mobile, please visit http://www.nq.com.

BEIJING and DALLAS, March 18, 2015 /PRNewswire/ - NQ Mobile Inc. ("NQ Mobile" or the "Company" (NYSE: NQ), a leading global provider of mobile internet services, today announced its unaudited financial results for the fourth quarter and fiscal year ended December 31, 2014.

Highlights For Fourth Quarter 2014

• Record Quarterly Net Revenues of $89.7 million, a 32.2% increase year-over-year from $67.9 million in the same period in 2013.
• Gross profit for the fourth quarter of 2014 was $26.5 million, a 19.9% decrease from $33.1 million in the same period in 2013.
• Gross margin or gross profit as a percentage of net revenues was 29.6%, up sequentially from 27.8% in the previous quarter and indicative of the stabilization of the profitability outlook.
• Non-GAAP income from operation for the fourth quarter of 2014 was $2.1 million, a 83.2% decrease from $12.6 million in the same period in 2013.
• Non-GAAP operating margin, or non-GAAP income from operations as a percentage of net revenues, was 2.4% in the fourth quarter of 2014, up sequentially from a slightly negative operating margin in the previous quarter and also indicative of the stability of the profitability outlook.
• Non-GAAP net income attributable to NQ Mobile for the fourth quarter of 2014, which excludes share-based compensations, expenses incurred for the handling of short seller allegations and interest expenses related to convertible debts, was $3.2 million or $0.03 per ADS, basic.

Highlights For The Fiscal Year 2014

• Record Annual Net Revenues of $332.3 million, a 68.9% increase year-over-year from $196.7 million in 2013.
• Gross profit for fiscal year 2014 was $105.7 million, a 8.7% decrease from $115.8 million in 2013.
• Non-GAAP income from operation for the fiscal year 2014 was $12.4 million, a 76.7% decrease from $53.3 million in 2013.
• Non-GAAP net income attributable to NQ Mobile for the fiscal year2014, which excludes share-based compensations, expenses incurred for the handling of short seller allegations and interest expenses related to convertible debts, was $26.2 million or $0.32 per ADS, basic.

Operating Metrics as of December 31, 2014

As a reminder, beginning in the third quarter of 2014, the Company began presenting the operating metrics of average monthly active user accounts ("MAUs" as redefined to include many emerging businesses previously not included in the Company's user account metrics. The MAUs presented herein include the user accounts in NQ Live, Music Radar and more recent investments such as Yipai and Showself, among others. As such, the MAUs presented herein should only be compared to the third quarter of 2014 and not be compared to operating metrics previously reported in historical periods because there is not a way to accurately compare such results. The MAUs for the period presented herein and going forward are expected to be better aligned with the key underlying trends of a mobile internet platform company focused on driving mobile consumer traffic and engagement that can be monetized. The MAU statistics do not include the users addressed by the installation of the Company's advertising SDK into third-party applications. These indirect users generate impressions and search traffic that the Company can monetize outside of the user accounts generated directly by the Company's own portfolio of products and applications.

Average Monthly Active User Accounts as of December 31, 2014: 160.8 million

"We are pleased to report record revenues both for the fourth quarter and the full fiscal year of 2014, as we continued our transition toward the traffic-based mobile entertainment business," said Dr. Vincent Wenyong Shi, Chairman, Chief Operating Officer and Acting Chief Financial Officer of NQ Mobile. "With the challenging year of 2014 now behind us, our transition is in full swing as we firmly further execute our various strategic initiatives. In addition to our top-line growth, we were also encouraged to see sequential improvement for our margins that indicates stabilization of profitability. We believe we are well-positioned to capture the growth opportunities in the mobile internet landscape."

Fourth Quarter 2014 Results

Revenues

Net revenues in the fourth quarter of 2014 increased 32.2% year-over-year to $89.7 million from $67.9 million in the same period in 2013.

Mobile value added service revenues decreased 9.9% year-over-year to $24.4 million from $27.1 million in the same period in 2013. The decrease in mobile value added service revenues was due to the decrease in consumer mobile security revenues, which in turn was primarily due to the Company's moving its focus away from premium security services and focusing more on mobile applications and services. This decrease was offset partially by the growth in mobile gaming revenues and the inclusion of live mobile social video platform revenues. The increase in mobile gaming revenues was primarily the result of the rapid growth of FL Mobile's game platform and the launch of new games in the fourth quarter of 2014. The inclusion of live mobile social video platform revenues is the result of the consolidation of Showself.

Advertising revenues increased 22.2% year-over-year to $20.4 million from $16.7 million in the same period in 2013.The growth was due to increased monetization through advertising and successful third party application referrals resulting mainly from WAPS and Fanyue, the Company's online and offline advertising networks.

Enterprise mobility revenues increased 87.2% year-over-year to $44.0 million from $23.5 million in the same period in 2013.This increase is mainly due to the fast growth of the enterprise mobility business as a result of obtaining a premium distributor agreement with Apple Inc. as well as the acquisition of Trustek, which is also a premium distributor for Apple Inc. In addition, the growth of the services and software component of Enterprise Mobility also reached a record level in the fourth quarter and showed sequential improvement throughout 2014.

Other revenues increased 60.4% year-over-year to $0.9 million from $0.5 million in the same period in 2013. Other revenues are generated primarily by providing technical contract services to third parties and fluctuate as such business is driven by individual projects.

Cost of Revenues

Cost of revenues in the fourth quarter of 2014 increased 81.8% year-over-year to $63.1 million from $34.7 million in the same period in 2013. The year-over-year increase was primarily due to higher cost of products for the enterprise mobility business, which totaled $34.4 million in the fourth quarter of 2014 compared to $17.8 million in the same period last year. Customer acquisition costs, including advertising inventory costs, or the cost that the Company pays developers and other partners for advertising space (inventory), increased to $12.3 million in the fourth quarter of 2014 compared to $6.8 million in the same period in 2013. The cost of additional revenue sharing, which is incurred mainly for the Company's mobile game business increased to $4.6 million in the fourth quarter of 2014 compared to $2.1 million in the same period last year.

Gross Profit and Gross Margin

Gross profit in the fourth quarter of 2014 decreased 19.9% to $26.5 million from $33.1 million in the same period in 2013. Gross margin, or gross profit as a percentage of net revenues, was 29.6% in the fourth quarter of 2014, compared with 48.8% in the same period in 2013. Excluding the impact from the enterprise mobility business, gross margin was 42.2% in the fourth quarter of 2014, down from 63.6% in the same period in 2013.The primary reason for the decline in gross profit and gross margin is the expansion of the enterprise mobility business which has a lower margin compared with other business of the Company as well as the increase of cost of revenues detailed above.

Operating Expenses

Total operating expenses in the fourth quarter of 2014 increased 22.9% year-over-year to $46.5 million from $37.8 million in the same period in 2013.Non-GAAP operating expenses, which exclude share-based compensation and expenses incurred for the handling of short seller allegations, increased 19.1% year-over-year to $24.5 million from $20.5 million in the same period in 2013.

Selling and marketing expenses in the fourth quarter of 2014 decreased 14.8% year-over-year to $6.6 million from $7.8 million in the same period in 2013. Non-GAAP selling and marketing expenses, which exclude share-based compensation, decreased 14.3% year-over-year to $6.4 million from $7.5 million in the same period in 2013. The year-over-year decrease was mainly due to the decrease in overseas promotional channels associated with the consumer mobile security business.

General and administrative expenses in the fourth quarter of 2014 increased 31.1% year-over-year to $31.4 million from $24.0 million in the same period in 2013. Non-GAAP general and administrative expenses, which excludes share-based compensation and the expenses incurred for the handling of short seller allegations, increased 33.7% year-over-year to $9.8 million, up from $7.3 million in the same period in 2013. The year-over-year increase was mainly due to higher staff costs associated with headcount growth, partially offset by decreased bad debt expenses.

Research and development expenses in the fourth quarter of 2014 increased 39.0% year-over-year to $8.4 million from $6.0 million in the same period in 2013. Non-GAAP research and development expenses, which exclude share-based compensation, increased 44.1% to $8.3 million from $5.7 million in the same period in 2013. The year-over-year increase was primarily due to higher product development expenses associated with higher staff costs associated with headcount growth.

Share-based compensation expenses

Share-based compensation expenses, which were allocated to related operating cost and expenses line items, amounted to $19.3 million in the fourth quarter of 2014, compared to $14.9million in the corresponding period in 2013. The increase in share-based compensation expenses was mainly due to performance-based share options granted in relation to the Company's acquisitions.

Loss /Income from Operations and Operating Margin

Loss from operations in the fourth quarter of 2014 was $19.9 million, compared with an operating loss of $4.7 million in the same period in 2013.

Non-GAAP income from operations, which excludes share-based compensation and expenses incurred for the handling of short seller allegations, decreased 83.2% year-over-year to $2.1millionfrom $12.6 million in the same period in 2013. Non-GAAP operating margin, or non-GAAP income from operations as a percentage of net revenues, was 2.4% in the fourth quarter of 2014, compared with18.6% in the same quarter in 2013. Excluding the impact from the enterprise mobility business, non-GAAP operating margin was 3.9% in the fourth quarter of 2014, compared to 22.0% in the same period in 2013.

Foreign Exchange Gain, Interest Expenses and Other Income

Foreign exchange gain was $0.5 million in the fourth quarter of 2014, compared with a gain of $0.6 million in the same quarter a year ago. The gain in foreign exchange was primarily attributable to the revaluation of the net monetary assets denominated in functional currency other than US$ and the fluctuation is in line with the fluctuation of the trend of the foreign exchange rates. Interest expenses were $1.1 million in the fourth quarter of 2014, compared with $2.2 million in the same quarter a year ago. Interest expenses were primarily derived from interest expense related to convertible debts, offset by the interest income from certain term deposits.

Income Tax

Income tax expense was $3.4 million in the fourth quarter of 2014, compared with an income tax benefit of $0.2 million in the same period in 2013.

Net Loss

Net loss attributable to NQ Mobile was $21.2 million in the fourth quarter of 2014, compared with net loss of $4.3 million in the same period in 2013. Non-GAAP net income attributable to NQ Mobile, which excludes share-based compensation, expenses incurred for the handling of short sellers and interest expenses related to convertible debts, was $3.2 million in the fourth quarter of 2014, compared with $14.9 million in the same period in 2013.

Cash and C ash E quivalents, T erm D eposits and R estricted C ash

Cash and cash equivalents, term deposits and restricted cash together amounted to $273.0 million as of December 31, 2014.

Cash Flow

Net cash flow used in operations for the fourth quarter of 2014 was $8.5 million.

Fiscal Year 2014 Results

Revenues

Net revenues for the fiscal year 2014 increased 68.9% year-over-year to $332.3 million from $196.7 million in 2013.

Mobile value added service revenues for the fiscal year 2014 increased 2.5% year-over-year to $106.1 million from $103.5 million in 2013. The increase in mobile value added service revenues was primarily due to the increase in mobile game revenues and the inclusion of live mobile social video platform revenues, partially offset by the decrease in consumer mobile security revenues. The increase in mobile game revenues was primarily due to the rapid growth of FL Mobile's game platform and the launch of new games in the fiscal year of 2014. The inclusion of live mobile social video platform revenues is the result of the consolidation of Showself. The decrease in consumer mobile security revenues was primarily due to the Company's moving its focus away from premium security subscription-based revenues and focusing more on mobile applications and services that can be monetized.

Advertising revenues for the fiscal year 2014increased 99.1% year-over-year to $72.9 million from $36.6 million in 2013.Such robust growth was due to increased monetization through advertising and successful third party application referrals resulting mainly from the acquisitions of WAPS and Fanyue, the Company's online and offline advertising networks.

Enterprise mobility revenues for the fiscal year 2014 increased 180.5% year-over-year to $148.7 million from $53.0 million in 2013.This increase is mainly due to the fast growth of the enterprise mobility business as a result of obtaining a premium distributor agreement with Apple Inc. as well as the acquisition of Trustek, which is also a premium distributor for Apple Inc. In addition, the growth of the services and software component of Enterprise Mobility also reached a record level during the fiscal year.

Other revenues for the fiscal year 2014 increased 30.4% year-over-year to $4.6 million from $3.6 million in 2013. Other revenues are generated primarily by providing technical contract services to third parties and fluctuate as such business is driven by individual projects.

Cost of Revenues

Cost of revenues for the fiscal year 2014 increased 180.1% year-over-year to $226.7 million from $80.9 million in 2013. The year-over-year increase was primarily due to higher cost of products for the enterprise mobility business, which totaled $128.5 million for the fiscal year 2014 compared to $37.4 million in 2013.Customer acquisition costs, including advertising inventory costs, or the cost that the Company pays developers and other partners for advertising space (inventory) increased to an aggregate of $40.8 million for the fiscal year 2014 compared to $13.0 million in 2013. The cost of revenue sharing, which is incurred mainly in relation to the Company's mobile game business increased to $18.1million for the fiscal year 2014 compared to $3.4 million in 2013.

Gross Profit and Gross Margin

Gross profit for the fiscal year 2014 decreased 8.7% to $105.7 million from $115.8 million in 2013. Gross margin, or gross profit as a percentage of net revenues, was 31.8% for the fiscal year 2014, compared with 58.9% in 2013. Excluding the impact from the enterprise mobility business, gross margin was 49.9% for the fiscal year 2014, down from 71.2% in 2013. The primary reasons for the decline in gross profit and gross margin are the expansion of enterprise mobility business which has a lower margin compared with other business of the Company as well as the increase of cost of revenues.

Operating Expenses

Total operating expenses for the fiscal year 2014 increased 55.2% year-over-year to $186.6 million from$120.3 million in 2013. Non-GAAP operating expenses, which exclude share-based compensation expenses and expenses incurred for the handling of short seller allegations, increased 48.8% year-over year to $93.5 million from $62.9 million in 2013.

Selling and marketing expenses for the fiscal year 2014 increased 16.1% year-over-year to $30.0 million from $25.8 million in 2013. Non-GAAP selling and marketing expenses for the fiscal year 2014, which exclude share-based compensation, increased 21.4% year-over-year to $28.5 million from $23.5 million in 2013. The year-over-year increase was mainly due to higher staff costs associated with headcount growth, partially offset by the decrease in overseas promotional channels associated with the consumer mobile security business.

General and administrative expenses for the fiscal year 2014 increased 70.1% year-over-year to $131.0 million from $77.0 million in 2013. Non-GAAP general and administrative expenses for the fiscal year 2014, which exclude share-based compensation and the expenses incurred for the handling of short seller allegations, increased 68.5% year-over-year to $40.3 million from $23.9 million in 2013. The year-over-year increase was mainly due to higher staff costs associated with headcount growth and increased intangible assets amortization expenses in relation to business acquisitions.

Research and development expenses for the fiscal year 2014 increased 47.2% year-over-year to $25.7 million from $17.4 million in 2013. Non-GAAP research and development expenses for the fiscal year 2014, which exclude share-based compensation, increased 59.8% to $24.6 million from $15.4 million in 2013.The year-over-year increase was primarily due to higher product development expenses and higher staff costs associated with headcount growth.

Share-based compensation expenses

Share-based compensation expenses, which were allocated to related operating cost and expenses line items, amounted to $83.8 million for the fiscal year 2014, compared to $55.4 million in 2013. The increase in share-based compensation expenses was mainly due to performance-based share options granted in relation to the Company's acquisitions.

Loss /Income from Operations and Operating Margin

Loss from operations for the fiscal year 2014was $81.0 million, compared with an operating loss of $4.5 million in fiscal year 2013

Non-GAAP income from operation for the fiscal year 2014, which excludes share-based compensation and expenses incurred for the handling of short seller allegations, decreased 76.7% year-over-year to $12.4 million from $53.3 million in 2013. Non-GAAP operating margin, or non-GAAP income from operations a percentage of net revenues, was 3.7% for the fiscal year 2014, compared with 27.1% in 2013.Excluding the impact from the enterprise mobility business, non-GAAP operating margin was 8.2% for the fiscal year 2014, compared with 32.5% in 2013.

Foreign Exchange Loss, Interest Expenses/Income

Foreign exchange loss was $0.4 million for the fiscal year 2014, compared with a gain of $1.8 million in 2013. The loss in foreign exchange was primarily attributable to the revaluation of the net monetary assets denominated in functional currency other than US$ and the fluctuation is in line with the fluctuation of the trend of the foreign exchange rates. Interest expenses were $5.4 million for the fiscal year 2014, compared with interest income of $0.4 million in 2013.Interest expenses were primarily derived from interest expense related to convertible debts, offset by the interest income from certain term deposits.

Income Tax

Income tax expense was $5.5 million for the fiscal year 2014, compared with $1.1 million in 2013.

Net Loss Income

Net loss attributable to NQ Mobile was $76.7 million for the fiscal year 2014, compared with net loss of $1.9 million in 2013. Non-GAAP net income attributable to NQ Mobile, which excludes share-based compensation, expenses incurred for the handling of short seller allegations and interest expenses related to convertible debts, was $26.2 million for the fiscal year 2014, compared with $57.8 million in 2013.

Cash Flow

Net cash provided by operating activities for the fiscal year 2014 was $6.2 million.

Other Significant Events

Other than previously announced events, below please find certain significant events that took place during the fourth quarter of 2014.

NQ Mobile Share Repurchase

On December 23, 2014, the Board authorized the Company to repurchase up to $80 million of its shares on the open market, in privately negotiated transactions, in block trades and/or through other legally permissible means, depending on market conditions and in accordance with applicable rules and regulation, over the next 12 months. To date, NQ Mobile has repurchased $11.3million worth of shares on the open market, or a total ofapproximately 2.6million ADSs. As of March 18, 2015, $68.7 million remains available for further repurchases under the $80 million authorized share repurchase program.

Business Outlook

The Company expects net revenues to be in the range of $450.0 million to $455.0 million for the full year 2015, representing a 36% to 37% year-over-year increase. Net revenues for the first quarter of 2015 are expected to be in the range of $85.0 million to 86.0 million, representing a 7% to 8% year-over-year increase.

Happy January!

We hope everyone had a safe and wonderful New Year. As we discussed in our recent earnings call, we are truly excited for 2015, as we believe this is going to be a great year for NQ Mobile and a new era for our team and our shareholders.

As this year begins, we'd like to address several topics on which we are receiving frequent questions, as well as provide additional details on the press release issued this morning:

Company Buyback - On December 23, 2014, the Board of Directors authorized the Company to purchase up to $80 million worth of stock over the next 12 months. The Company was in the market buying stock during the recent open trading window and established a 10b5-1 plan prior to the closing of the fourth quarter trading blackout that began on December 31, 2014. The specific details of these purchases and any other future purchases made by the Company will be provided each quarter with the quarterly financial results.

Management Purchases - As disclosed in today's press release, Dr. Vincent Wenyong Shi, the Company's Co-Founder, Chairman and Acting Chief Financial Officer, along with other members of the senior management team, established a 10b5-1 plan to purchase up to $4 million worth of stock on open market transactions. According to this plan, on Monday January 5th, a total of 239,500 shares were purchased at an average price of $4.14 per ADS for a total amount of approximately $991,000. Due to NQ Mobile's status as a foreign private issuer, purchases of shares by its executive officers cannot be filed using Form 4 with the Securities and Exchange Commission ("SEC". As such, the Company has provided details of the purchases made on Monday January 5, 2015 in the content of the press release. In the future, all future stock purchasing activity made by the management team will be provided each quarter with the quarterly financial results.

FL Mobile Transaction with Tack Fiori - The Company announced a memorandum of understanding (MOU) on December 18, 2014, under which NQ Mobile has proposed to sell FL Mobile to Tack Fiori, which would become the controlling shareholder. You can find the specific details of the proposal in the press release HERE. Ongoing negotiations and discussions are taking place related to the specific terms and other factors that may be part of the overall transaction closing. The Company looks forward to providing more specific details, as well as a more comprehensive explanation around this transaction, as these negotiations and discussions materialize into a formal definitive agreement. The Company will not comment further on this process until definitive terms and all conditions are set forth and final negotiations have been completed.

However, we continue to believe that this transaction will 1) Unlock shareholder value, and 2) help accelerate the commercial growth of FL Mobile.

We noted in our earnings call that moving forward NQ Mobile is going to be focused on action and committed to executing and delivering for our shareholders and customers. These announcements are a part of that, and you'll be hearing more from us in the weeks and months ahead.

Please let us know if you have any questions.

By Shuli Ren

Deutsche Bank attended The China Game Industry Annual Conference last week and came back with a few takeaways.

China’s video gaming industry grows at a brisk pace this year. The industry is expected to grow by 37.7% to reach 115 billion yuan in revenue. While client-based games, with 53% market share, continues to have the lion’s share of the market, mobile games are expanding rapidly this year at an estimated pace of 144.6%. Mobile games are now the second largest segment in the gaming industry.

During the conference, Tencent Holding‘s (0700.HK/TCEHY) management said the company had already moved onto the big screen and started testing the waters in TV games this year. “These initiatives should help advance its multi-screen ecosystem,” noted analysts Vivian Haoand Alan Hellawell III.

There could be two reasons. The mobile gaming industry has already reached a bottleneck in term of user growth, commented Qihoo 360‘s (QIHU) representatives. This is in line with Qihoo’s own surveys. Total number of mobile gamers already reached 358 million. In addition, competition among developers has heated up:

China Mobile Games & Entertainment’s (CMGE) management said that it costs at least RMB5m to develop a mid-core mobile game at present, and that surging costs in game development and promotion have started knocking smaller players out of the business.

BEIJING and DALLAS, Dec. 24, 2014 /PRNewswire/ -- NQ Mobile Inc. ("NQ Mobile" or the "Company" (NYSE: NQ), a leading global provider of mobile Internet services, today announced the results of its annual general meeting of shareholders held in Hong Kong on December 19, 2014.

At the meeting, the shareholders of NQ Mobile Inc. approved the following resolutions:

1. RESOLVED, as an ordinary resolution:
   
   1. that the Company's authorized share capital be increased from US$80,000 divided into (a) 560,000,000 Class A Common Shares of a par value of US$0.0001 each and (b) 240,000,000 Class B Common Shares of a par value of US$0.0001 each, to US$180,000 divided into (a) 1,560,000,000 Class A Common Shares of a par value of US$0.0001 each and (b) 240,000,000 Class B Common Shares of a par value of US$0.0001 each, by the creation of 1,000,000,000 Class A Common Shares of a par value of US$0.0001 each.
   2. that each director or officer of the Company be and is hereby authorized to take any and every action that might be necessary, appropriate or desirable to effect the foregoing resolution as such director or officer, in his absolute discretion, thinks fit.
2. RESOLVED, as a special resolution:
   
   1. that the Company's Memorandum of Association be amended by substituting the existing Section 8 in its entirety with the following new Section 8:
      "The share capital of the Company is US$180,000 divided into (a) 1,560,000,000 Class A Common Shares of a par value of US$0.0001 each and (b) 240,000,000 Class B Common Shares of a par value of US$0.0001 each."
   2. RESOLVED, that each director or officer of the Company be and is hereby authorized to take any and every action that might be necessary, appropriate or desirable to effect the foregoing resolution as such director or officer, in his absolute discretion, thinks fit.