Gamehaus Holdings Inc. reported first‑quarter fiscal 2026 revenue of $27.7 million, a 7.5% decline from $30.0 million in the same period a year earlier. The drop is largely attributable to a strategic reduction in user‑acquisition spend and a 5.4% decline in advertising revenue, which fell to $2.4 million. In‑app purchase revenue, however, remained robust at $25.3 million, offsetting some of the advertising shortfall.
Net income rose to $1.8 million, up 12% from $1.6 million in Q1 FY2025, while diluted earnings per share climbed to $0.04 from $0.03. The earnings increase reflects tighter operating costs and a modest rise in operating income to $1.0 million, even though operating income fell from $1.5 million in the prior year’s quarter. Management highlighted a net profit margin of 6.7% versus 5% in Q4 FY2025, indicating improved profitability despite revenue pressure.
Operating expenses fell 6.2% to $26.7 million from $28.5 million, and cost of revenue decreased 5.8% to $14.5 million, down from $13.3 million in Q1 FY2025. The margin expansion is driven by cost discipline and a shift toward higher‑margin in‑app purchase revenue, while the decline in advertising revenue and user‑acquisition spend reduced overall cost of revenue.
Average daily active users dropped to 550 from 759, yet average revenue per daily active user (ARPDAU) increased to $0.536 from $0.431, a 24.4% rise. The higher ARPDAU reflects stronger monetization of the remaining user base, supported by a growing direct‑to‑consumer (DTC) channel. On iOS, DTC revenue contribution rose from roughly 10% in August to about 16% at quarter‑end, with management projecting it to exceed 30% in the next fiscal quarter.
Gamehaus guided total revenue for Q2 FY2026 to $24 million–$27 million, maintaining a cautious outlook amid ongoing user‑acquisition adjustments. The company repurchased approximately 200,000 shares under its $5 million share‑repurchase program, spending about $0.29 million, and held $15.3 million in cash and cash equivalents as of September 30, 2025. Management emphasized continued focus on cost discipline, AI integration, and expanding the DTC model as key drivers of future growth.
Management comments underscored confidence in the company’s sustainable model. Chairman Brian Xie Feng noted that the quarter’s net profit margin improvement to 6.7% demonstrates the effectiveness of cost controls and a shift toward higher‑margin segments. Speaker Host Jack Wang highlighted the acceleration of DTC integration, noting that the DTC revenue share on iOS is expected to surpass 30% in the next quarter, signaling a strategic pivot toward direct player relationships and reduced platform fees. Investors responded positively, citing the company’s improved profitability and strategic focus on AI and DTC initiatives.
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