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NQ Mobile Inc. Announces Fourth Quarter and Fiscal Year 2012 Results.

BEIJING
  or  , city (1994 est. urban pop. 6,093,300; 1994 est. total pop. 7,240,700), capital of the People’s Republic of China. It is in central Hebei prov.
 and
DALLAS
 city (1990 pop. 1,006,877), seat of Dallas co., N Tex., on the Trinity River near the junction of its three forks; inc. 1871. The second largest Texas city, after Houston, and the eighth largest U.S.
, March 6, 2013 /PRNewswire/ —

Fourth Quarter of 2012:

* Record Net Revenues of $30.0 million, Up 134.1% Year-over-Year

* Net Income
Attributable

 to NQ Mobile was $4.9 million

*
GAAP

See generally accepted accounting principles (GAAP).
 Fully
Diluted
  
tr.v. di·lut·ed, di·lut·ing, di·lutes
1. To make thinner or less concentrated by adding a liquid such as water.

2. To lessen the force, strength, purity, or brilliance of, especially by admixture.
 Earnings per ADS [1] of $0.09

* Non-GAAP Net Income Attributable to NQ Mobile [2] was $12.3
million, Up 88.4% Year-over-Year

* Non-GAAP Fully Diluted Earnings per ADS [3] of $0.23

Fiscal Year 2012:

* Record Net Revenues of $91.8 million, Up 125.6% Year-over-Year

* Net Income Attributable to NQ Mobile was $9.4 million

* GAAP Fully Diluted Earnings per ADS of $0.18

* Non-GAAP Net Income Attributable to NQ Mobile was $34.0 million,
Up 62.4% Year-over-Year

* Non-GAAP Fully Diluted Earnings per ADS of $0.66

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
 see month.
 31, 2012.

(Logo: http://photos.prnewswire.com/prnh/20121224/CN34262LOGO)

Fourth Quarter 2012 Highlights

* Net revenues increased 134.1% year-over-year to $30.0 million.

* Net income attributable to NQ Mobile increased 52.7%
year-over-year to $4.9 million.

* Non-GAAP net income attributable to NQ Mobile, defined as net
income attributable to NQ Mobile excluding share-based compensation
expenses, increased 88.4% year-over-year to $12.3 million.

* GAAP fully diluted Earnings per ADS was $0.09 and non-GAAP fully
diluted Earnings per ADS was $0.23 for the fourth quarter of 2012.
Diluted weighted average number of ADSs outstanding increased to 53.5
million in the fourth quarter of 2012 from 51.2 million in the previous
quarter.

* On
November
 see month.
 30, 2012, the Company completed the acquisition of the
remaining 73.6% equity interest in Beijing Feiliu Jutian Technology Co.
(“Feiliu”). Feiliu’s financials were
consolidated
  
v. con·sol·i·dat·ed, con·sol·i·dat·ing, con·sol·i·dates

v.tr.
1. To unite into one system or whole; combine:
 in the
Company’s financial statements starting on December 1, 2012.

Fiscal Year 2012 Highlights

* Net revenues for fiscal year 2012 increased 125.6% year-over-year
to $91.8 million.

* Net income attributable to NQ Mobile for fiscal year 2012,
decreased 8.0% year-over-year to $9.4 million, mainly due to the $24.5
million in share-based compensation expenses recorded in the fiscal year
of 2012, compared with $10.7 million in 2011.

* Non-GAAP net income attributable to NQ Mobile for fiscal year
2012, increased 62.4% year-over-year to $34.0 million.

* GAAP fully diluted Earnings per ADS was $0.18 and non-GAAP fully
diluted Earnings per ADS was $0.66 for the fiscal year 2012. Diluted
weighted average number of ADSs outstanding increased to 51.1 million in
the fiscal year 2012 from 38.7 million in 2011.

The Company’s non-GAAP financial measures and related
reconciliations to GAAP financial measures are described in the

accompanying
  
v. ac·com·pa·nied, ac·com·pa·ny·ing, ac·com·pa·nies

v.tr.
1. To be or go with as a companion.

2.
 sections of “Non-GAAP Disclosure” and
“Reconciliations to Unaudited
Condensed
  
v. con·densed, con·dens·ing, con·dens·es

v.tr.
1. To reduce the volume or compass of.

2. To make more concise; abridge or shorten.

3. Physics
a.
 Consolidated Statements of
Operations.”

Fourth Quarter and Fiscal Year 2012 Operating
Metrics
 Managed care A popular term for standards by which the quality of a product, service, or outcome of a particular form of Pt management is evaluated. See TQM.
 

* Cumulative registered user accounts were 283.4 million as of
December 31, 2012, compared with 146.7 million as of December 31, 2011
and 241.6 million as of
September
 see month.
 30, 2012. Including Feiliu’s 67.4
million registered user accounts, NQ Mobile had total registered user
accounts of 350.8 million as of December 31, 2012.

* Average monthly active user accounts for the quarter ended
December 31, 2012 were 97.7 million, compared with 52.4 million for the
corresponding period of 2011 and 84.5 million for the quarter ended
September 30, 2012. Including Feiliu’s 12.5 million average monthly
active user accounts, NQ Mobile had total average monthly active user
accounts of 110.2 million for the quarter ended December 31, 2012.

* Average monthly paying user accounts for the quarter ended
December 31, 2012 were 8.9 million, compared with 5.6 million for the
corresponding period of 2011 and 8.2 million for the quarter ended
September 30, 2012.

* Beijing NationSky Network Technology, Inc. (“NationSky”)
had over 1,200 enterprise customers as of December 31, 2012.

“We are very pleased to report a strong fourth quarter and an
excellent 2012 fiscal year performance with record revenues,”
commented Dr. Henry
Lin
   , Maya Ying Born 1959.

American sculptor and architect whose public works include the Vietnam Veterans Memorial in Washington, D.C. (1982).

Noun 1.
, Chairman and Co-Chief Executive Officer of NQ
Mobile. “In our first full year as a public company, we grew our
revenue by 126% from $41 million to over $92 million. Even without
taking into account the revenue contribution from the NationSky and
Feiliu acquisitions, we achieved revenue of $79 million for 2012 and an
outstanding organic growth rate of 93%. This significant growth is
driven by our consistent execution, as well as the continued rapid
growth of the global
smartphone

 industry and adoption of mobile security
and privacy solutions by consumers worldwide.”

“This past year also marked an important strategic year in the
evolution of NQ Mobile as we broadened from a pure mobile security
company to a mobile Internet platform company. Through the acquisitions
of NationSky and Feiliu, we greatly expanded our product and service
offerings, extended our customer base, and
diversified

 our revenue
streams. We are well positioned to
capitalize on
   

v. t. 1. To turn (an opportunity) to one’s advantage; to take advantage of (a situation); to profit from; as, to  an opponent’s mistakes s>.
 the significant size
and growth of the mobile Internet services market for both consumers and
enterprises. Through continuous technology innovation and expansion of
products and services, we have set in motion our plan to become an
integrated part of our users’ daily mobile experiences,”
continued Dr. Lin.

“Another key theme for NQ Mobile in 2012 was the continued
global expansion of our business while maintaining our leadership
position in China,” added Omar
Khan

, Co-Chief Executive Officer of
NQ Mobile. “We have made tremendous achievements in building a top
tier global team, establishing our international corporate headquarters
in Dallas,
broadening
  
tr. & intr.v. broad·ened, broad·en·ing, broad·ens
To make or become broad or broader.


broad
 our service offerings and gaining significant

traction
 Definition

Traction is the use of a pulling force to treat muscle and skeleton disorders.
Purpose

Traction is usually applied to the arms and legs, the neck, the backbone, or the pelvis.
 with global consumers and business partners alike. There is no
better evidence of that than our latest announcement with
America
 [for Amerigo Vespucci], the lands of the Western Hemisphere—North America, Central (or Middle) America, and South America. The world map published in 1507 by Martin Waldseemüller is the first known cartographic use of the name.
 Movil
to offer the entire suite of our
flagship

 consumer security and privacy
offerings: NQ Mobile Security (TM), NQ Mobile
Vault
 ceiling over a room, formed in any one of a variety of curved shapes.
Nature of Vaults

A vault is generally composed of separate units of material, such as bricks, tiles, or blocks of stone, so shaped or cut that when assembled they form a
 (TM) and NQ Family

Guardian

 (TM) to its 262 million subscribers across 18 countries. We are
confident that the strong momentum in our international business will
continue in 2013. We remain committed to our global expansion effort to
drive the long term growth for our company.”

Fourth Quarter 2012 Results

Revenues[4]

Net revenues in the fourth quarter of 2012 were $30.0 million, up
134.1% year-over-year and up 16.4%
sequentially
  
adj.
1. Forming or characterized by a sequence, as of units or musical notes.

2. Sequent.


se·quen
.

Consumer Mobile Security revenues increased 69.4% year-over-year and
7.0% sequentially to $19.6 million in the fourth quarter of 2012. The
increases were primarily due to the growth in the number of paying user
accounts, which reflected growth in the number of registered and active
user accounts, as well as increased use of NQ Mobile’s premium
services, particularly among its overseas paying user accounts, which
generally pay a higher subscription fee. Revenue contribution from
overseas users accounted for 53.7% of Consumer Mobile Security revenues
in the fourth quarter of 2012, compared with 49.8% in the same quarter a
year ago and 54.1% in the previous quarter.

Enterprise Mobility revenues increased 49.1% sequentially to $6.7
million in the fourth quarter of 2012 due to the strong growth in the
enterprise business and new customer gains.

Mobile Games and Advertising revenues were $0.7 million for the
month of December in the fourth quarter of 2012. The Feiliu acquisition
was closed on November 30, 2012 when the Company fully controlled
Feiliu, thus only the December month of its financials were
consolidated.

Other revenues in the fourth quarter of 2012 were $3.1 million, up
147.5% year-over-year and 3.0% sequentially, primarily due to the growth
in revenues from secured
download

 and delivery services for mobile
applications produced by third parties.

Cost of Revenues

Cost of revenues in the fourth quarter of 2012 was $9.7 million, up
277.9% year-over-year and 21.6% sequentially. The year-over-year
increase was primarily due to the impact from NationSky and Feiliu
acquisitions, increased customer acquisition costs to drive user growth,
higher staff costs from increased headcounts and salaries, and higher

revenue sharing

 with mobile payment service providers consistent with
the increase of revenue from mobile payment service providers. The

sequential

 increase was primarily due to the impact from NationSky and
Feiliu acquisitions, partially offset by lower customer acquisition
costs to meet the annual expenditure budget.

Gross Profit and Gross Margin

Gross profit in the fourth quarter of 2012 was $20.4 million, up
98.2% year-over-year and 14.1% sequentially. Gross margin, or gross
profit as a percentage of net revenues, was 67.8% in the fourth quarter
of 2012, compared with 80.1% in the same quarter a year ago and 69.2% in
the previous quarter. Excluding the impact from NationSky, gross margin
was 79.5% in the fourth quarter of 2012, compared with 78.5% in the
previous quarter. NationSky’s gross margin in the fourth quarter of
2012 was
approximately
  
adj.
1. Almost exact or correct:

2.
 26.8%, compared with 24.6% in the previous
quarter, and the cost of revenues for NationSky primarily consists of
the hardware device
procurement

 cost.

Operating Expenses

 

Total operating expenses in the fourth quarter of 2012 were $20.0
million, up 126.6% year-over-year and 6.1% sequentially. Non-GAAP
operating expenses were $12.6 million in the fourth quarter of 2012, up
128.0% year-over-year and 13.2% sequentially.

Selling and marketing expenses were $4.8 million in the fourth
quarter of 2012, up 32.5% year-over-year and down 15.7% sequentially.
Non-GAAP selling and marketing expenses were $4.2 million, up 73.9%
year-over-year and down 11.8% sequentially. The year-over-year increases
were primarily due to higher marketing and advertising spending and
higher staff costs from
headcount
 or head·count
n.
1. The act of counting people in a particular group.

2. The number of people counted in this way.

Noun 1.
 and salary increase, partially offset
by lower share-based compensation costs. The sequential decrease was
primarily due to lower marketing and advertising spending and lower
share-based compensation costs.

General and administrative expenses were $11.8 million in the fourth
quarter of 2012, up 235.7% year-over-year and 14.0% sequentially. The
year-over-year increase was mainly due to higher share-based
compensation expenses as a result of additional option and restricted
shares issuance to executives and non-employee consultants, higher staff
costs from salary and headcount increases, and higher legal and
professional fees resulted from acquisition and investment activities.
The sequential increase was primarily due to higher legal and
professional fees and higher staff costs. Non-GAAP general and
administrative expenses were $5.5 million, up 240.1% year-over-year and
37.2% sequentially. The year-over-year and sequential increases were
primarily due to higher staff cost, higher legal and professional fees
expenses and costs associated with the Feiliu acquisition.

Research and development expenses were $3.4 million in the fourth
quarter of 2012, up 101.5% year-over-year and 21.0% sequentially. The
year-over-year increase was primarily due to higher staff cost from
salary and headcount increases and higher share-based compensation
expenses while the sequential increase was primarily due to higher staff
cost from salary increase and higher office-related expenses. Non-GAAP
research and development expenses were $2.8 million, up 92.3%
year-over-year and 22.7% sequentially. The year-over-year and sequential
increases were primarily due to higher staff costs from salary and
headcount increases.

Operating Income

 / (Loss) and
Operating Margin

 

Operating income in the fourth quarter of 2012 was $0.4 million,
compared with the operating income of $1.5 million in the same quarter a
year ago and an
operating loss

The excess of operating expenses over revenue. As with operating income, operating losses exclude revenues and expenses from operations that are not considered a regular part of the business. Also called deficit. Compare operating income.
 of $1.0 million in the previous quarter.
Operating margin was 1.3% in the fourth quarter of 2012, compared with
11.4% in the same quarter a year ago. The decline in operating income
and operating margin was mainly due to the significant increase in
share-based compensation expenses.

Non-GAAP operating income was $7.9 million in the fourth quarter of
2012, up 63.1% year-over-year and 15.2% sequentially. Non-GAAP operating
margin was 26.2% in the fourth quarter of 2012, compared with 37.5% in
the same quarter a year ago and 26.4% in the previous quarter. Excluding
the impact from NationSky, non-GAAP operating margin was 30.7% in the
fourth quarter of 2012, compared with 29.8% in the previous quarter.
Operating margin for NationSky was about 10.3% in the fourth quarter of
2012, compared with 10.3% in the previous quarter.

Foreign Exchange Gain / (Loss), Interest Income and Other Income
Foreign exchange gain was $0.7 million in the fourth quarter of 2012,
compared with a gain of $0.9 million in the same quarter a year ago and
a loss of $0.2 million in the previous quarter. Foreign exchange gain
was primarily attributable to the appreciation of
RMB

RMB Rolf Maier Bode
RMB Ren Min Bi  
 against US$.
Interest income was $0.9 million in the fourth quarter of 2012, compared
with $0.6 million in the same quarter a year ago and $0.8 million in the
previous quarter. Interest income was primarily due to the term deposit
position. The Company also recorded a gain of $2.9 million in other
income in the fourth quarter of 2012 from step acquisition of
Feiliu’s remaining equity interest on November 30, 2012.
Subsequently, Feiliu became the
wholly owned subsidiary

 of NQ Mobile. As
a result, the Company re-measured the fair value of the previously owned
26.4% equity interest at the acquisition date and recognized a gain of
$2.9 million accordingly.

Income Tax

Income tax benefit was $0.07 million in the fourth quarter of 2012,
compared with an income tax expense of $0.05 million in the same quarter
a year ago and $0.3 million in previous quarter. The low effective tax
rate was primarily due to the
preferential
  
adj.
1. Of, relating to, or giving advantage or preference:

2.
 tax treatment enjoyed by
certain subsidiaries of the Company.

Net Income

Net income attributable to NQ Mobile was $4.9 million in the fourth
quarter of 2012, compared with $3.2 million in the same quarter a year
ago and $0.3 million in the previous quarter. Non-GAAP net income
attributable to NQ Mobile was $12.3 million in the fourth quarter of
2012, up 88.4% year-over-year and 51.5% sequentially. Excluding the net
income contribution of $0.4 million from Nationsky, the non-GAAP net
income for NQ Mobile increased 82.1% year-over-year and 49.9%
sequentially to $11.9 million.

Cash Flows and Deferred Revenue

Net cash flow generated from operations for the fourth quarter of
2012 was $3.9 million, compared with $4.2 million in the same quarter a
year ago and $6.9 million in the previous quarter. As of December 31,
2012, the Company had total cash position of $120.4 million ($18.9
million in cash and cash equivalents and $101.5 million in term
deposits) and deferred revenue of $12.2 million.

Fiscal Year 2012 Results

Revenues

Net revenues for fiscal year 2012 were $91.8 million, up 125.6% from
$40.7 million in 2011. Excluding revenue contribution in fiscal year
2012 of $12.6 million from NationSky acquired in the second quarter of
2012 and $0.7 million from Feiliu acquired in the fourth quarter of
2012, net revenues were $78.5 million, up 93.1%. The significant
increase was mainly due to the strong growth in Consumer Mobile Security
revenue.

Consumer Mobile Security revenues were $67.9 million in fiscal year
2012, up 87.7% from $36.2 million in 2011. Revenue contribution from
overseas users accounted for 52.6% of Consumer Mobile Security revenues
in fiscal year 2012, compared with 48.9% in 2011.

Other revenues in fiscal year 2012 were $10.6 million, up 137.5%
from $4.5 million in 2011. Other revenues as a percentage of total net
revenues excluding NationSky and Feiliu was 13.5% in fiscal year 2012,
compared with 11.0% in 2011.

Cost of Revenues

Cost of revenues in fiscal year 2012 was $25.7 million, up 219.5%
from $8.1 million in 2011. The increase was primarily due to the impact
from NationSky and Feiliu acquisitions, increased customer acquisition
cost, higher staff costs from salary and headcount increases, and higher
revenue sharing with mobile payment service providers.

Gross Profit and Gross Margin

Gross profit in fiscal year 2012 was $66.0 million, up 102.5% from
$32.6 million in 2011. Gross margin was 72.0% in fiscal year 2012,
compared with 80.2% in 2011. Excluding the impact from Nationsky, gross
profit for NQ Mobile in 2012 was $62.9 million, up 92.8%, and the gross
margin was 79.4%.

Operating Expenses

Total operating expenses in fiscal year 2012 were $63.8million, up
135.5% from $27.1 million in 2011. Non-GAAP operating expenses were
$39.4 million in fiscal year 2012, up 138.5% from $16.5 million in
2011.

Selling and marketing expenses were $17.4 million in fiscal year
2012, up 118.7% from $8.0 million in 2011. Non-GAAP selling and
marketing expenses were $15.1 million in fiscal year 2012, up 149.6%
from $6.0 million in 2011. The increase was primarily due to increased
marketing and advertising spending, higher staff costs from salary and
headcount increases and higher travelling and entertainment
expenses.

General and administrative expenses were $36.8 million in fiscal
year 2012, up 162.2% from $14.0 million in 2011. The increase was
primarily due to higher share-based compensation expenses, higher staff
cost from salary and headcount increases, higher legal and professional
fees and higher consulting fees. Non-GAAP general and administrative
expenses were $16.2million in fiscal year 2012, up 165.0% from $6.1
million in 2011. The increase was primarily due to higher staff cost
from salary and headcount increases, higher legal and professional fees,
higher consulting fees and higher travelling and entertainment
expenses.

Research and development expenses were $9.6 million in fiscal year
2012, up 88.1% from $5.1 million in 2011. The increase was primarily due
to higher staff costs from salary and headcount increases, higher
share-based compensation expenses and higher traveling and entertainment
expenses. Non-GAAP research and development expenses were $8.1 million
in fiscal year 2012, up 86.0% from $4.4 million in 2011. The increase
was primarily due to higher staff costs from salary and headcount
increases and higher traveling and entertainment expenses.

Operating Income / (Loss) and Operating Margin

Income from operations, or operating income, for fiscal year 2012,
decreased 59.0% year-over-year to $2.3 million from $5.5 million in
2011, mainly due to the significant increase in share-based compensation
expenses in the fiscal year of 2012. Non-GAAP operating income for
fiscal year 2012, increased 65.4% year-over-year to $26.8 million from
$16.2 million in 2011. Excluding operating income contribution of $1.3
million from NationSky, non-GAAP operating income increased 57.4%
year-over-year to $25.5 million.

Foreign Exchange Gain, Interest Income, Gain on Change of Interest
in an Associate and Other Income

Foreign exchange gain was $0.07 million in fiscal year 2012,
compared with a gain of $3.0 million in 2011. Foreign exchange gain was
primarily attributable to the appreciation of RMB against US$. Interest
income was $3.2 million in fiscal year 2012, compared with $1.3 million
in 2011. The increase was primarily due to the higher deposit position
resulting from the May 2011
IPO

 proceeds. The company recorded a gain on
change of interest in an associate of $0.9 million in the third quarter
of 2012, because the Company and all other then shareholders of Feiliu
transferred 20% of the equity interest in Feiliu to a new shareholder,
which was accounted for by equity method in the third quarter of 2012,
in exchange for the transfer of certain intangible assets. The fair
value of the intangible assets being valued were higher than the
carrying amount of the equity interest which the Company transferred,
which resulted a gain of $0.9 million recorded by the Company in the
third quarter of 2012. The Company also recorded a gain of $2.9 million
in other income in the fourth quarter of 2012 from step acquisition of
Feiliu’s remaining equity interest on November 30, 2012.
Subsequently, Feiliu became the wholly owned subsidiary of NQ Mobile. As
a result, the Company re-measured the fair value of the previously owned
26.4% equity interest at the acquisition date and recognized a gain of
$2.9 million accordingly.

Income Tax

Income tax expense was $0.4 million and the effective tax rate was
4.3% in fiscal year 2012, compared with an income tax expense of $0.1
million in 2011. The low effective tax rate was primarily due to the
preferential tax treatment enjoyed by certain subsidiaries of the
Company.

Net Income/(Loss)

Net income attributable to NQ Mobile for fiscal year 2012, decreased
8.0% year-over-year to $9.4 million from $10.3 million in 2011, mainly
due to the significant increase in share-based compensation expense
recorded in the fiscal year of 2012. Non-GAAP net income attributable to
NQ Mobile for fiscal year 2012, increased 62.4% year-over-year to $34.0
million from $20.9 million in 2011. Excluding net income contribution in
fiscal year 2012 of $0.7 million from NationSky, non-GAAP net income
increased 59.3% year-over-year to $33.3 million.

Other Business Updates and Significant Events

NQ Mobile
Share Repurchase Plan

A corporation’s plan for buying back a predetermined number of its own shares in the open market. Institution of a share repurchase plan derives from management’s view that the company has limited outside investment opportunities and
 

On November 26, 2012, NQ Mobile announced that its board of
directors has authorized a share repurchase plan under which the Company
may
repurchase
  
tr.v. re·pur·chased, re·pur·chas·ing, re·pur·chas·es
To buy (something) again.

n.
The act of buying something that one previously sold or owned.

Noun 1.
 up to US$20 million of its American
Depository

 Shares
(“ADSs”) over the next 12 months. As of
February
 see month.
 28, 2013, the
Company has purchased a total of 523,269 ADSs amounting to approximately
$3.2 million. The Company may continue to buy ADSs subject to applicable
legal restrictions and other factors and in a manner consistent with
applicable securities laws.

America Movil and NQ Mobile (TM) Collaborate to offer Mobile
Subscribers Security, Privacy and Family Protection across
Mexico
 or  Span. Ciudad de México (Méjico), city (1990 pop. 8,236,960; 1991 met. area est. 20,899,000), central Mexico, capital and largest city of Mexico.
, and

Latin America
 the Spanish-speaking, Portuguese-speaking, and French-speaking countries (except Canada) of North America, South America, Central America, and the West Indies.
 

On March 4, 2012, NQ Mobile announced that America Movil (NYSE:

AMX

AMX Air Mobility Express
AMX Amberjacks
AMX Alabama Motor eXpress
),
Latin
  
n.
1.
a. The Indo-European language of the ancient Latins and Romans and the most important cultural language of western Europe until the end of the 17th century.

b.
 America’s leading telecom group in terms of equity
subscribers, will offer NQ Mobile’s flagship products: NQ Mobile
Security (TM), NQ Mobile Vault (TM) and NQ Family Guardian (TM) to its
262 million subscribers located in 18 countries, including Mexico and
Latin America.

NQ Mobile Offers Unique Enterprise Mobile Device Management and
Security Solution, NQSky(TM), through Its Subsidiary, NationSky

On February 21, 2013, NQ Mobile announced that it has started
offering the new NQSky Enterprise Mobile Device Management (
MDM

)
solution through its subsidiary NationSky. Offering a suite of
customized services under the NQSky brand, NationSky provides its
customers end-to-end solutions from mobile data strategy consulting,
architecture design and
deployment

, to mobile device, content and
application management. NationSky also provides industry-specific
solutions as well as complete platform integration services.

NQ Mobile Announces that U.S. Cellular Will Begin Offering NQ Family
Guardian (TM) Product Under the Name U.S. Cellular Family
Protector
 /pro·tec·tor/ () a substance in a catalyst that prolongs the rate of activity in the latter.
 to
its 5.9 million Customers

On February 19, 2013, NQ Mobile announced that U.S. Cellular will
offer NQ Mobile’s Family Guardian product under the name U.S.
Cellular Family Protector (TM) powered by NQ Mobile (TM) to its 5.9
million customers.

4G Wireless to Offer NQ Mobile Security (TM), NQ Mobile Vault (TM)
for
Android

 and NQ Family Guardian (TM) in More Than 120 Verizon Premium
Wireless Retail Locations in the
Southwest

 US

On February 7, 2013, NQ Mobile announced that 4G Wireless will offer
NQ Mobile Security, NQ Mobile Vault for Android and NQ Family Guardian
at 120 retail locations across
California
 , most populous state in the United States, located in the Far West; bordered by Oregon (N), Nevada and, across the Colorado River, Arizona (E), Mexico (S), and the Pacific Ocean (W).
 and
Nevada
 , far western state of the United States. It is bordered by Utah (E), Arizona (SE), California (SW, W), and Oregon and Idaho (N).
.

Diamond Mobile to Offer NQ Mobile (TM) Privacy, Security and Family
Protection Solutions at more than 210 Verizon Premium Wireless Retail
Locations Across Western and Southern US

On February 1, 2013, NQ Mobile announced that Diamond Wireless, an
authorized Verizon retailer, will offer NQ Mobile Security, NQ Mobile
Vault for Android and NQ Family Guardian at more than 210 retail
locations across the U.S. beginning March 2013.

I-Mobile and NQ Mobile Collaborate to Offer Southeast Asian Mobile
Subscribers Privacy, Security and Peace of Mind

On
January
 see month.
 7, 2013, NQ Mobile and I-Mobile Corporation, a leading
mobile
handset

 provider in
Thailand
 , Thai Prathet Thai [land of the free], officially Kingdom of Thailand, constitutional monarchy (2005 est. pop. 65,444,000), 198,455 sq mi (514,000 sq km), Southeast Asia.
 and Southeast Asia, announced an
agreement to bring consumers easy access to one of the most powerful
mobile security and safety apps on the market to help ensure safe mobile
experiences for its users. I-Mobile will pre-install NQ Mobile Security
on its Android mobile devices beginning in January 2013.

NQ Mobile Announces Completion of Senior Management Share Purchase
Plan

On December 6, 2012, NQ Mobile announced that members of its senior
management, including Co-CEOs Dr. Henry Lin and Mr. Omar Khan, and
COO

 Mr. Vincent
Shi

SHI Samsung Heavy Industries
SHI Social Health Insurance
SHI Statutory Health Insurance
SHI Samsung Heavy Industries Co, Ltd
, among others, have completed their previously announced
share purchase plan to use their personal funds to purchase up to an
aggregate of $2 million worth of the Company’s ADSs in open market
transactions within six months from June 6, 2012.

Vox Mobile Collaborates with NQ Mobile to Provide Enterprise Mobile
Security

On November 13, 2012, NQ Mobile and Vox Mobile, a leading provider
of managed mobility solutions for enterprises, announced their

collaboration

 to integrate and offer enterprise endpoint mobile security
solutions to Vox Mobile’s customers globally. NQ Mobile’s
security features provide enterprise customers and their employees with
the privacy and security features they need to protect their businesses
by securing sensitive device data from mobile threats and
unsecure

a. 1. Insecure.
 mobile environments.

Business Outlook

The Company expects net revenues to be in the range of $32.8 million
and $33.3 million for the first quarter of 2013 and raises the full year
2013 net revenue guidance from the previously issued range of $150
million to $155 million to a range of $178 million to 183 million.

The above forecast reflects the Company’s current and
preliminary view, which is subject to possible material changes.

Conference Call Information

NQ Mobile’s management team will hold an earnings conference
call to discuss its results and outlook at 8:00PM U.S. Eastern Time on

Wednesday
 see week.
, March 6, 2013, (9:00AM Beijing/Hong
Kong

 Time on
Thursday
 see week.
,
March 7, 2013).

The dial-in details for the conference call are:

U.S. Toll Free: 1 866 519 4004 International: +1 718 354 1231
Hong
Kong

 , Mandarin Xianggang, special administrative region of China, formerly a British crown colony (2005 est. pop. 6,899,000), land area 422 sq mi (1,092 sq km), adjacent to Guangdong prov.
: +852 2475 0994 United Kingdom: +44 2030598139 China
Mainland

1 Island (1991 pop. 14,150), 178 sq mi (461 sq km), N Scotland. The largest of the Orkney Islands, it is also called Pomona. Kirkwall, the seat of the Orkney Islands council area, is on the island.
: 400
620 8038 or 800 819 0121 Conference ID: 13418261

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 11:00 p.m. U.S. Eastern Time on March 6 through April
6, 2013. The dial-in details for the replay are:

U.S. Toll Free: 1 855 452 5696 International: +1 646 254 3697
Conference ID: 13418261

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

About NQ Mobile

NQ Mobile Inc. (NYSE: NQ) is a leading global provider of mobile
Internet services. NQ Mobile is a mobile security pioneer with proven
competency to acquire, engage, and
monetize

 customers globally. NQ
Mobile’s portfolio includes mobile security and mobile games &
advertising for the consumer market and consulting, mobile platforms and
mobility services for the enterprise market. As of December 31, 2012, NQ
Mobile maintains a large, global user base of 283 million registered
user accounts and 98 million monthly active user accounts through its
consumer mobile security business, 65 million registered user accounts
and 13 million monthly active user accounts through its mobile games
& advertising business and over 1,200 enterprise customers. NQ
Mobile maintains dual headquarters in
Dallas, Texas
 or
, USA and Beijing,
China. For more information on NQ Mobile, please visit
http://www.nq.com.

Non-GAAP Financial Measures

To supplement the Company’s financial results prepared in

accordance

 with
United States
 officially United States of America, republic (2005 est. pop. 295,734,000), 3,539,227 sq mi (9,166,598 sq km), North America. The United States is the world’s third largest country in population and the fourth largest country in area.
 
Generally Accepted Accounting Principles

 (“GAAP”), NQ Mobile’s management uses non-GAAP measures
of cost of revenues, operating expenses, operating income and net income
attributable to NQ Mobile, which are adjusted from results based on GAAP
to exclude the share-based compensation expenses. The Company also uses
non-GAAP fully diluted earnings per ADS, which is the non-GAAP net
income attributable to common shareholders divided by weighted average
number of diluted ADS.

The Company’s non-GAAP financial information is provided as
additional information to help the Company’s investors compare
business trends among different reporting periods on a consistent basis
and to enhance investors’ overall understanding of the historical
and current financial performance of the Company’s
continuing
operations

Parts of a business that are expected to be maintained as an ongoing segment of an overall business operation. Income and losses from continuing operations are reported separately if any segments have been discontinued during the
 and its prospects for the future. The Company’s non-GAAP
financial information should be considered in addition to results
prepared in accordance with GAAP, but should not be considered a
substitute for, or superior to, GAAP results. In addition, the
Company’s calculation of this non-GAAP financial information may be
different from the calculation used by other companies, and therefore
comparability may be limited.

The non-GAAP financial measures are provided to enhance
investors’ overall understanding of NQ Mobile’s current
financial performance and prospects for the future. A limitation of
using non-GAAP cost of revenues, operating expenses, operating income
and net income attributable to NQ Mobile, excluding share-based
compensation expenses, is that the share-based compensation charge has
been and will continue to be a significant
recurring
  
intr.v. re·curred, re·cur·ring, re·curs
1. To happen, come up, or show up again or repeatedly.

2. To return to one’s attention or memory.

3. To return in thought or discourse.
 expense in the
Company’s business for the
foreseeable
  
tr.v. fore·saw , fore·seen , fore·see·ing, fore·sees
To see or know beforehand:
 future. In order to
mitigate

v.
To moderate in force or intensity.


miti·gation n.
 these limitations the Company has provided specific information
regarding the GAAP amounts excluded from each non-GAAP measure. The
accompanying tables include details on the reconciliation between GAAP
financial measures that are most directly comparable to the non-GAAP
financial measures the Company has presented.

Notes to Financial Information

Financial information in this press release other than the
information indicated as being non-GAAP is
derived
  
v. de·rived, de·riv·ing, de·rives

v.tr.
1. To obtain or receive from a source.

2.
 from NQ Mobile’s
unaudited financial information prepared in accordance with GAAP.

Forward Looking Statements

This news release contains “forward-looking statements”
within the meaning of Section 27A of the Securities Act of 1933, as

amended
  
v. a·mend·ed, a·mend·ing, a·mends

v.tr.
1. To change for the better; improve:

2.
, and Section 21E of the Securities Exchange Act of 1934, as
amended, and as defined in the U.S.
Private Securities Litigation Reform
Act

 of 1995. These forward-looking statements can be identified by

terminology

 such as “will,” “expects,”
“anticipates,” “future,” “intends,”
“plans,” “believes,” “estimates” and
similar statements. All statements other than statements of historical
fact in this press release are forward-looking statements and involve
certain risks and uncertainties that could cause actual results to
differ materially from those in the forward-looking statements. These
forward-looking statements are based on management’s current
expectations, assumptions, estimates and projections about the Company
and the industry in which the Company operates, but involve a number of
unknown risks and uncertainties, Further information regarding these and
other risks is included in the Company’s filings with the U.S.
Securities and Exchange Commission. The Company undertakes no obligation
to update forward-looking statements to reflect subsequent occurring
events or
circumstances

, or changes in its expectations, except as may
be required by law. Although the Company believes that the expectations
expressed in these forward-looking statements are reasonable, it cannot
assure you that such expectations will turn out to be correct, and
actual results may differ materially from the anticipated results. You
are urged to consider these factors carefully in evaluating the
forward-looking statements contained herein and are cautioned not to
place undue reliance on such forward-looking statements, which are
qualified in their entirety by these cautionary statements.

For investor and media inquiries please contact:

Investor Relations NQ Mobile Inc. Email: investors@nq.com Phone:
+852 3975 2853

SOURCE NQ Mobile Inc.