Oasys Mobile, a provider of games and other content for use on mobile devices, increased its revenues sharply in the fourth quarter of 2006, leading the firm’s new CEO to label it as a “turning point.”

But what will happen next for Oasys is not clear.

The company said it has retained an investment banking firm to explore financial and business options. Oasys listed sale of the firm as a possibility.

Despite the increases in revenue, losses for the quarter and year also increased for Oasys (OTCBB: OYSM) due in part to costs related to severance of laid-off employees and the departure of Gary Ban, its former chief executive officer. Other expenses such as for stock options and development of a new Web site also increased the red ink.

Oasys shares traded at 39 cents on Wednesday afternoon.

In the fourth quarter, Oasys reported revenues of $2.64 million, up 35.4 percent from the same time period in 2005 and a jump of 24.8 percent from the third quarter of 2006. For the year, revenues improved 11.5 percent to $8.69 million.

Losses increased to $2.95 million for the quarter from $2.49 million in 2005 and to $14.76 million for the year compared to $6.11 million in 2005.

“Our fourth quarter was our strongest yet and marked a turning point in the Company’s operations,” said Doug Dyer, who replaced Ban as CEO in December. “We are now focused on three distinct lines of business that we believe have long-term sustainable growth.”

Dyer noted that Oasys has reduced its employee headcount by a third. The company employed 70 people before launching a series of cutbacks in November.

As part of its 2007 strategy, the company also has retained RBC Daniels & Associates as an investment banker. Oasys said it planned to refinance debt that is due in June and also to seek additional working capital for growth and expansion.

Among other options, Oasys also said RBC Daniels & Associates would help the company evaluate “certain strategic alternatives” such as investments from strategic partners or business combinations. The company listed “sale of the business” as an option.

Oasys, which recently secured a number of distribution deals such as for a “Barbie” product in Japan in partnership with Mattel, reported $3.81 million in cash and accounts receivable.