CryptoLogic warns of major third quarter revenue fall

CRYPTOLOGIC, the casino software developer, expects to report a 31% year-on-year fall in third quarter revenue to US$9.6m, from US$14m at the same point last year.

In a release this morning, the company blamed a combination of sluggish wagering due to the uncertain economic backdrop, and a failure of the seasonal increase in demand normally seen in September towards the end of the traditionally slower third quarter to materialise.

Revenue streams from new games launched by customers late in the period that will not come online until the final quarter, it added.

However CryptoLogic’s expected third-quarter trading loss of US$3.4m represents an improvement on the US$5.9m loss posted for the same period last year, reflecting the continued cost savings associated with CryptoLogic’s divesting of its poker network and accompanied restructuring, which enabled it to cut quarterly operating expenses by 25% on a year-on-year basis.

The company said that with a strong pipeline of new business, CryptoLogic remained confident in its strategy announced in October last year to return the business to profitability founded on its core casino licensing business, “albeit at a slower rate than anticipated by management and the market.”

The full third quarter results will be revealed on 5 November.

In other company news this week, CryptoLogic signed a deal with Rank to provide Rank with a suite of new games.

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