Zynga to shed 15 percent of its staff amid losses and decrease in players
Today, Zynga announced its full year 2013 results alongside news that it plans to dramatically decrease its workforce as part of newly installed CEO Don Mattrick's recovery plan for the company as it sees financial losses and a dwindling player base.
As part of a cost reduction plan designed to save the company between $33 and $35 million, Zynga plans to lay off approximately 314 employees -- 15 percent of its current workforce -- this year.
At the same time, Zynga announced it acquired mobile game and tech company NaturalMotion
for $527 million. That company has 260 workers worldwide.
Zynga also announced that it made a $25 million loss for the fourth quarter of 2013, as it shed millions of players.
According to the company, its monthly unique players declined in the fourth quarter from 2.9 million to 1.3 million year-over-year, and despite having three of the top 10 games on Facebook -- FarmVille 2, Words With Friends
and Zynga Poker
-- it lost 16 percent of its players, or 300,000, from the prior quarter. The company still has an army of players, however, boasting daily active user counts of 14 million and 13 million on web and mobile, respectively, for the fourth quarter of 2013.
The company's net loss for 2013 overall was $37 million. The good news is that this is down from a loss of $209 million the year prior
The company is projecting a much bigger loss for the first quarter of 2014: $56 million to $49 million. Still, CEO Don Mattrick said in the earnings statement, "We... expect 2014 to be a growth year. We believe that Q1 will be a solid foundation for that growth and we expect substantial improvements for the remainder of the year..."
: The market appears to like this news. In after-hours trading, Zynga's stock shot up around 20 percent. As of this writing, it sells for $4.25 a share.