GigaMedia Announces Subscription for Aeolus Preferred Shares by Conversion and Settlement of Aeolus Convertible Notes

Rhea-AI Summary

GigaMedia (NASDAQ:GIGM) converted Aeolus Robotics convertible notes into 719.09 million Series C preferred shares on June 16, 2026, at about US$0.0176 per share, for notes totaling US$12.37 million.

GigaMedia now holds 719.83 million Aeolus preferred shares, about 33.35% of voting rights, and will apply the equity method to this investment. Aeolus, an AI-enabled service robot developer, reported an unaudited 2025 net loss of US$8.98 million and total assets of US$4.38 million.

Positive

• 719.09M Aeolus Series C preferred shares subscribed via note conversion
• Total Aeolus notes of US$12.37M converted at about US$0.0176 per share
• Post-transaction holding of 719.83M Aeolus preferred shares
• Aeolus voting-rights ownership increased to approximately 33.35%
• Aeolus investment reclassified to equity method from available-for-sale

Negative

• Aeolus reported unaudited 2025 net loss of US$8.98M
• Aeolus reported total assets of US$4.38M as of December 31, 2025

News Market Reaction – GIGM

+1.45%

+1.45% Session close to close

In the Jun 16 session, GIGM gained 1.45%, reflecting a mild positive market reaction.

Data tracked by StockTitan Argus on the day of publication.

Market Context

This announcement details GigaMedia’s conversion of US$12.37 million in Aeolus notes into 719.09 mil...

Analysis

This announcement details GigaMedia’s conversion of US$12.37 million in Aeolus notes into 719.09 million Series C preferred shares, raising its voting interest to about 33.35% and shifting the stake to equity-method accounting. Aeolus remains early-stage, with a 2025 unaudited net loss of US$8.98 million and assets of US$4.38 million. Investors may watch how Aeolus’s AI-enabled service robots progress commercially and how its results affect GigaMedia’s reported earnings.

Key Figures

Aeolus notes principal: US$12.37 million Shares subscribed: 719.09 million shares Subscription price: US$0.0176 per share +5 more

8 metrics

Aeolus notes principal US$12.37 million Convertible promissory notes converted on June 16, 2026

Shares subscribed 719.09 million shares Aeolus Series C Preferred Shares received via conversion

Subscription price US$0.0176 per share Average consideration per Aeolus preferred share

Total Aeolus holding 719.83 million shares Aeolus preferred shares held after the transaction

Aeolus voting rights 33.35% GigaMedia ownership of Aeolus voting rights post-transaction

Aeolus net loss US$8.98 million Unaudited net loss for year ended December 31, 2025

Aeolus total assets US$4.38 million Total assets as of December 31, 2025

Ownership threshold 33.35% Triggers equity method accounting for Aeolus investment

Historical Context

5 past events · Latest: May 28 (Neutral)

Pattern 5 events

Date	Event	Sentiment	24h Move	Catalyst
May 28	AGM notice	Neutral	+1.1%	Announcement of 27th AGM and standard voting proposals.
May 04	Q1 2026 earnings	Negative	-4.8%	Revenue decline and widening net loss for Q1 2026.
Mar 26	FY2025 earnings	Positive	+1.7%	Full-year revenue growth and narrowing net loss in 2025.
Mar 02	Note extension	Neutral	+0.0%	Extension of Aeolus convertible note maturity to May 31, 2026.
Jan 30	Board change	Positive	+0.7%	Appointment of Ying-Chih Liao as non-executive director.

24h Move is the share-price change in the day after each event; other market factors may also have contributed.

Pattern Detected

Recent news and earnings have generally seen price moves that align directionally with the underlying tone of each release.

Recent Company History

Over the last six months, GigaMedia has focused on stabilizing its core digital entertainment business while selectively deploying capital. Earnings on Mar 26, 2026 and May 4, 2026 highlighted modest revenue growth but continued losses. Several governance and AGM-related updates, plus amendments to Aeolus convertible notes on Mar 2, 2026, framed Aeolus as a strategic focus. Today’s conversion into Aeolus preferred shares continues that investment trajectory and shifts accounting to the equity method.

Key Terms

convertible promissory notes, preferred shares, equity method, available-for-sale, +2 more

6 terms

convertible promissory notes financial

"conversion and settlement of the convertible promissory notes issued by Aeolus"

A convertible promissory note is a loan a company takes that can later be turned into shares instead of being paid back in cash; think of lending money now in exchange for a voucher that can become ownership later. Investors care because it mixes credit risk and potential ownership upside—it can protect lenders if a company struggles while also diluting existing shareholders when converted, affecting future share value and investor returns.

preferred shares financial

"subscription of 719.09 million Aeolus Series C Preferred Shares by conversion"

Preferred shares are a type of investment that gives investors priority over common shareholders when it comes to receiving dividends and getting their money back if a company is sold or liquidated. Think of them as a safer, more predictable way to earn income from a company's profits, similar to a fixed-return investment, but without voting rights. This makes preferred shares appealing to those seeking stable income with a higher claim on assets than regular stockholders.

equity method financial

"The investment in Aeolus securities is thereby accounted for under the equity method"

An equity method investment is an accounting approach used when a company owns enough of another business to influence its decisions but not control it (commonly around 20–50% ownership). Instead of counting only dividends, the investor records its share of the other company’s profits and losses on its own income statement and adjusts the investment’s value on the balance sheet—like tracking a friend’s joint project by noting your share of their gains or setbacks. For investors, this matters because it can significantly affect reported earnings, asset values, and the apparent strength of a company’s financial results.

available-for-sale financial

"whereas they were previously classified as available-for-sale, reported at fair value"

A classification for bonds, stocks or other investments that a company plans to keep but might sell before they reach full term. Think of it like items a shop keeps on a shelf for potential sale: their market value can go up or down while the company holds them, and those unrealized gains or losses are shown separately from operating profit until they are sold. Investors watch this because large swings can change a company’s reported net worth and signal how much flexibility it has to raise cash quickly.

AI-enabled service robots technical

"engaged in developing AI-enabled service robots, specifically in elderly-care"

AI-enabled service robots are physical machines that perform routine or specialized tasks for people or businesses by using onboard sensors and artificial intelligence to perceive their surroundings and make decisions. Investors care because they can lower ongoing labor costs, increase consistency and speed—like a reliable automated helper replacing repetitive human work—while also requiring upfront capital, software updates and integration, creating both growth opportunities and execution risks for companies that deploy them.

UVC disinfection medical

"service robots, specifically in elderly-care, night shift patrol, and UVC disinfection"

UVC disinfection uses short-wave ultraviolet light to inactivate bacteria, viruses and other microbes by damaging their genetic material, similar to how strong sunlight can bleach and kill germs but in a focused, controlled way. Investors care because the technology drives demand for products and services across healthcare, buildings, transport and consumer goods, and its commercial value depends on demonstrated effectiveness, safety standards, regulatory approvals and cost compared with alternative cleaning or filtration methods.

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TAIPEI, June 16, 2026 /PRNewswire/ -- GigaMedia Limited (NASDAQ: GIGM) today announced that effective June 16, 2026, the Company has entered into and executed with Aeolus Robotics Corporation ("Aeolus") agreements of subscription of 719.09 million Aeolus Series C Preferred Shares by conversion and settlement of the convertible promissory notes issued by Aeolus and purchased by GigaMedia from September 2023 to February 2026, total principals amounting to US$12.37 million. The subscription consideration for the shares is equivalent to an average approximately US$0.0176 per share.

After the transaction, GigaMedia holds 719.83 million Aeolus preferred shares and the Company's ownership of Aeolus voting rights increased to approximately 33.35%. The investment in Aeolus securities is thereby accounted for under the equity method, whereas they were previously classified as available-for-sale, reported at fair value in GigaMedia's financial statements.

Information on Aeolus and Investment Rationale

Aeolus Robotics Corporation, a private company incorporated in Cayman Islands with subsidiaries and offices in East Asia, Europe and the U.S., is an R&D company engaged in developing AI-enabled service robots, specifically in elderly-care, night shift patrol, and UVC disinfection.

AI and robot are believed to be two game changers for future businesses. The global industrial and service robot market is projected to grow rapidly in a few years, and Aeolus, leveraging its technical finesse and strategic investor relationships, is ready for entering service robot markets in Japan, America and other countries that are experiencing severe labor shortages or high costs.

Aeolus is led by Richard Lee, also known as Lee, Tsung-Jung, has extensive experience in Taiwan's information technology industry, with senior executive roles spanning Acer, ASUS, Synology, QNAP, and Aeolus Robotics. He previously served as Vice President of ASUS Computer, General Manager of Synology, and President of QNAP, where he contributed to the development and commercialization of Taiwan technology products in global PC, storage, NAS, and IoT-related markets.

As of and for the year ended December 31, 2025, Aeolus reported the unaudited net loss of US$8.98 million with total assets of US$4.38 million.

The agreements were entered into for the purpose of strategically supporting the investee in its efforts of exploring AI-enabled service robots. GigaMedia continually reviews its investment alternatives and may enter into additional transactions of Aeolus's securities from time to time in accordance with applicable laws.

About GigaMedia

Headquartered in Taipei, Taiwan, GigaMedia Limited (Singapore registration number: 199905474H) is a diversified provider of digital entertainment services in Taiwan and Hong Kong. GigaMedia's digital entertainment service business is an innovative leader in Asia with growing capabilities of development, distribution and operation of digital entertainments, as well as platform services for games with a focus on mobile games and casual games. More information on GigaMedia can be obtained from www.gigamedia.com.

The statements included above and elsewhere in this press release that are not historical in nature are "forward-looking statements" within the meaning of the "safe harbor" provisions of the Private Securities Litigation Reform Act of 1995. GigaMedia cautions readers that forward-looking statements are based on the Company's current expectations and involve a number of risks and uncertainties. Actual results may differ materially from those contained in such forward-looking statements. Information as to certain factors that could cause actual results to vary can be found in GigaMedia's Annual Report on Form 20-F filed with the United States Securities and Exchange Commission in April 2026.

View original content:https://www.prnewswire.com/news-releases/gigamedia-announces-subscription-for-aeolus-preferred-shares-by-conversion-and-settlement-of-aeolus-convertible-notes-302801533.html

SOURCE GigaMedia

FAQ

What did GigaMedia (NASDAQ:GIGM) announce about its Aeolus Robotics investment on June 16, 2026?

GigaMedia converted Aeolus Robotics convertible notes into 719.09 million Series C preferred shares on June 16, 2026. According to GigaMedia, the notes’ principal totaled US$12.37 million, giving it about 33.35% voting rights in Aeolus.

How many Aeolus preferred shares does GigaMedia hold after the June 2026 transaction?

After the transaction, GigaMedia holds 719.83 million Aeolus preferred shares. According to GigaMedia, these holdings represent approximately 33.35% of Aeolus voting rights, and the investment will now be accounted for using the equity method instead of fair-value classification.

At what valuation did GigaMedia convert its Aeolus Robotics convertible notes into shares?

GigaMedia converted its Aeolus convertible notes at an average of about US$0.0176 per share. According to GigaMedia, the total principal of the converted notes was US$12.37 million, resulting in a subscription of 719.09 million Series C preferred shares.

Why is GigaMedia changing Aeolus Robotics to the equity method in its financial statements?

GigaMedia will use the equity method because its Aeolus voting rights rose to around 33.35%. According to GigaMedia, the Aeolus securities were previously classified as available-for-sale and reported at fair value in its financial statements.

What business does Aeolus Robotics focus on following GigaMedia’s increased stake (GIGM)?

Aeolus Robotics focuses on AI-enabled service robots for elderly care, night shift patrol, and UVC disinfection. According to GigaMedia, Aeolus operates across East Asia, Europe, and the U.S., targeting markets facing labor shortages and higher labor costs.

What are Aeolus Robotics’ latest reported financials relevant to GigaMedia’s GIGM investment?

Aeolus reported an unaudited net loss of US$8.98 million for 2025 and total assets of US$4.38 million. According to GigaMedia, these figures relate to Aeolus as of and for the year ended December 31, 2025.

What is GigaMedia’s strategic rationale for increasing its ownership in Aeolus Robotics (GIGM)?

GigaMedia’s agreements aim to strategically support Aeolus in AI-enabled service robots. According to GigaMedia, it views AI and robotics as major future business drivers and may consider additional Aeolus securities transactions over time, subject to applicable laws.