Total revenues for the quarter increased 9% year-over-year to USD35.3 million and total gross margin was 48% in the second quarter of 2010, an increase of 44% from the previous quarter in 2010. Net income was USD2.6 million, and KongZhong had USD135 million in cash and cash equivalents at the end of their quarter.

However, looking closely at their results shows wireless value-added service revenues in the second quarter were USD17.4 million, a 33% decrease from the first quarter of 2010 and a 27% decrease from the same period last year.

In addition, IVR revenues were more significantly impacted on a sequential basis as IVR revenues benefited seasonally in the first quarter from various Chinese New Year promotions and in the second quarter the overall operating environment became more restrictive towards IVR and other WVAS traditional media promotions. As a result, 2G revenues represented 85% of total WVAS revenues compared to 91% in the first quarter of 2010, while 2.5G services made up 15% of total WVAS revenues.

Total mobile game revenues in the second quarter were USD13.0 million, a 91% increase from the same period last year and a 37% increase from the first quarter of 2010.