BY TOM SOMACH

Prophets of doom?

Or just profits?

We may finally be finding out.

That’s because it looks like the recent efforts by the U.S. government to cripple Internet gambling worldwide may not be as crippling as first feared.

In fact, one company is reporting profits are up, despite the U.S. crackdown on Internet poker and other forms of Internet gambling.

888 Holdings LLC, the parent company of Internet poker room Pacific Poker (www.pacificpoker.com), has announced that total revenues from all its Internet gambling operations were up 7% in 2006, compared to 2005.

The revenues rose $19 million, from $271 million in 2005 to $290 million in 2006, the company said in a press release.

The news came as a surprise to many in the Internet gambling industry, as Pacific Poker suffered a huge drop in business last year when it pulled out of the U.S. market following the passage of anti-online gambling legislation by the U.S. Congress.

After the passage of that legislation–the Unlawful Internet Gambling Enforcement Act or UIGEA–888 focused efforts on markets outside the U.S. and saw revenues from non-U.S. sources rise sharply in the fourth quarter of 2006, the company said.

In addition to Pacific Poker, 888 also operates an online casino which offers blackjack, baccarat, craps, roulette, video poker and other casino games.

The company plans to also soon add online backgammon.

“Following our exit from the U.S. market in the fourth quarter of 2006, the company has worked hard to continue expanding its non-U.S. business and we are especially pleased with the results,” said 888 chief executive Gigi Levy.

888 is a British company which operates from Gibraltar, a British territory located on the southern tip of Spain.