Zynga lays off 520 employees
Posted by: Tim Tibbetts on 06/04/2013 01:55 AM
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Online game maker Zynga Inc. said Monday that it is cutting 520 jobs, about 18 percent of its workforce, in a cost-saving move designed to help it adapt to consumers shifting game play from computers to mobile devices.
Zynga's stock plunged 12 percent to close at $2.99 on the Nasdaq stock market after trading was halted twice on Monday. Its shares have traded below $4 since about July 2012, after debuting at $10 in its December 2011 initial public offering.
This isn’t a big surprise to anyone in the business. We are in uncharted territory once again as people have numerous ways to entertain themselves online. While Farmville was a Facebook game, people now play a lot on their mobile devices and that is a more difficult area to make money. Odds are there are no easy answers for Zynga here.
WBay reports that before the announcement, analysts polled by FactSet were already forecasting that annual revenue for Zynga would shrink to $944 million by the end of the year, down from $1.28 billion in 2012.
Zynga's stock plunged 12 percent to close at $2.99 on the Nasdaq stock market after trading was halted twice on Monday. Its shares have traded below $4 since about July 2012, after debuting at $10 in its December 2011 initial public offering.This isn’t a big surprise to anyone in the business. We are in uncharted territory once again as people have numerous ways to entertain themselves online. While Farmville was a Facebook game, people now play a lot on their mobile devices and that is a more difficult area to make money. Odds are there are no easy answers for Zynga here.
WBay reports that before the announcement, analysts polled by FactSet were already forecasting that annual revenue for Zynga would shrink to $944 million by the end of the year, down from $1.28 billion in 2012.
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