"Here's the real question you need to answer: once they cut all the high-expense ratio, the stuff that they do at a cost point that's so high, is there anything left? Is there still a core of things that's profitable, and how big is that company?" “Every horrible thing in the book”
There must have been some artists that like drawing cutesy characters, but majority of the people, : we found this money-printing machine help us oil the wheels and make more money. "The whole company is very short-term minded. "A lot of people internally at Zynga are jaded," said Dave Dopson, a former Zynga principal engineer who is now at another major Silicon Valley company. The new CEO, Don Mattrick, told investors on the company's most recent earnings call to expect "two to four quarters of volatility." In other words, the company has a rocky short-term future ahead of it. And in just a single quarter during 2013, the company lost more than one-quarter of its most loyal daily users.Īs a result, hundreds of Zynga employees have been laid off, Pincus has been replaced as CEO, and three top executives have recently been tossed out. The industry analysis firm AppData estimates that Zynga's Monthly Average Users (MAUs) have now fallen below 127 million, the company's lowest level in four years. As of this writing, the stock price is hovering around $3.00 per share.įinally, Zynga has seen a massive erosion of its user base, one that has accelerated in recent months. After the December 2011 initial public offering (IPO) at $9.50 per share, the stock price rose as high as $14.69 on March 2, 2012. For one thing, profitability was an aberration 2010 was the only year that Zynga made a profit, and since 2008 the company has sustained a net loss of just under $600 million. It was also on an acquisition binge, picking up 11 companies in as many months between 20.īut even as the prospectus was published, Zynga's star was losing its luster. Since its July 2007 founding, Zynga raked in hundreds of millions of dollars in venture capital, launched massive hits like FarmVille, Mafia Wars, and CityVille, and turned a 2010 profit of $90.5 million. Zynga was riding high after several years of success.
Will it? At the time, Pincus had ample reason for confidence. And I'm planning for Zynga to be there when they want to play."
When they enter high school, there's no doubt that they'll search on Google, they'll share with their friends on Facebook, and they'll probably do a lot of shopping on Amazon. "While it's unlikely that we can improve upon this classic, I look forward to playing Zynga games with them very soon. "My kids decided a few months ago that peek-a-boo was their favorite game," he wrote. In Zynga's July 2011 prospectus to future shareholders, company founder and CEO Mark Pincus outlined his firm's ambitious plan to take over the gaming world.
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