Cardiff Blues losses fell by more than £1m in the year ending June 2018, according to the company's annual accounts.
Increased income, including £1.9m from the Welsh Rugby Union, saw losses fall from £1,971,732 to £526,540.
The region also benefitted from benefactors Peter Thomas and Martin Ryan writing off debts of more than £4m.
Thomas wrote off £3.33m and Ryan £933,708.
Chairman Alun Jones, who was appointed in December 2018, said Thomas had agreed to convert "part of his loan into a non-voting class of shares" as part of a restructuring of the region's board of directors.
Thomas remains as a director and life president.
The region is still negotiating with Cardiff Athletic Club, who own Cardiff Arms Park, over a new lease for the ground.
"All our discussions point towards a shared ambition to deliver a new, long-term lease at Cardiff Arms Park beyond 2022," said Jones in the chairman's statement.
The £1.9m extra income from the WRU was part of the governing body's Project Reset, with the region's turnover increasing by nearly 36% to £13m from £9.6m.
An extra £1.5m was spent on "increased squad costs and investment in coaching, academy and infrastructure," according to chief executive Richard Holland.