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Zynga shedding players, plans to shut down  The Ville
Zynga shedding players, plans to shut down The Ville
April 24, 2013 | By Kris Graft

April 24, 2013 | By Kris Graft
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    4 comments
More: Social/Online, Business/Marketing



Social games giant Zynga has reported quarterly profits thanks to strong performance of FarmVille 2, but the company is shedding players, paying and otherwise.

Monthly unique paying users decreased to 2.5 million during the third fiscal quarter ended March 31. That's down from 3.5 million paying users for the same quarter a year ago, a 30 percent decline.

Daily active users and monthly active users also declined year-on-year for the quarter. DAUs were down 21 percent to 52 million, while MAUs were down 13 percent to 253 million.

Zynga reported a quarterly profit of $4.1 million, a small gain but much better than the $85.4 million loss the company incurred for the same quarter a year prior.

Quarterly revenues were down 18 percent to $263.6 million.

CEO Mark Pincus in a statement called FarmVille 2 a "breakout hit" that has nearly 40 million players every month.

He called 2013 a "transition year," during which the company will take on the challenging mobile space, where Zynga is working to gain more traction. Pincus intends to "invest in developing the leading franchises and network across web and mobile platforms" for the company's 253 million monthly players.

Even though Pincus is optimistic -- and even though Zynga beat analyst expectations -- investors drove shares down 11 percent in after hours trading.

UPDATE: Pincus said in a conference call that the company would be shutting down social games The Ville, Empires & Allies, Dream Zoo, and Zynga City on China's Tencent network. Draw Something 2 is launching tonight.

Pincus also addressed the company's focus on "mid-core" games. The company aims to take game mechanics that are familiar to more traditional, avid players and make them more palatable for a wider social and mobile game market.

"I would say that of the teams that are focused on new [intellectual property] today, we probably have more resources investing in mid-core ... than any other genre. It's obviously the biggest and fastest growing part of our market, and you can imagine that's where we're investing the most as well.

"We're not trying to compete in the most hardcore places, even within mid-core. ... Even if [a game] is traditionally a more hardcore game style or genre, what we're trying to make it much more accessible."


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Comments


Michel Desjardins
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A tinny profit of 4.1 M$ that gives shareholders a Diluted earnings per share of 0.00$. No level up there.

The Q2-2013 Outlook, as per the Zinga filling, will be a Net Loss between -37 and -27 M$. So, Zynga will swings back to loss. I would prefer investing in Bitcoins.

Cost them 5.4 million in restructuring... I could have done it for five times less. They probably hired consultants...

They should be releasing their Annual Report 2012 soon.

Ramin Shokrizade
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While the move to "midcore" seems logical, I think it highly unlikely that they know what midcore is. Thus they will be chasing a phantom demographic. Presumably they will be making higher engagement antisocial pay to win games like Kabam and Kixeye. While those kinds of games do convert at two to three times the rate of Zynga's core fare, none of the three aforementioned companies currently understands the space or their consumers well enough to capitalize on their market position.

Charles Battersby
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*POP*

Jorge Ramos
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Zynga is the reason I wish facebook would let me blacklist/block app requests by publisher.

My inner grumpy cat approves of the Ville shutting down. :)


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