Zynga revenue decline continues
Social gaming company's revenue down 31% in Q2 2013 compared to this time last year
Zynga’s revenues have fallen 31% year-on-year during the second quarter of 2013, the company has announced in its results for the three months ended 30 June 2013.
The latest figures show revenues dropped to $231m in the period compared to $332.5m in Q2 2012, with the company posting a net loss of $16m for the quarter. Zynga’s number of active users also declined, with DAU falling 45% year-on-year and MAUs down 29%.
The April-June period saw Zynga begin a cost-cutting restructuring strategy which included a reduction in staff numbers of around 520 and the closure of some of its offices. These changes resulted in a $25m cost saving during Q2 and will lead to an expected annual pre-tax savings of between $70-80m, the company said.
Don Mattrick, who replaced Mark Pincus as CEO last month, said Zynga needed to return “back to basics” after another disappointing set of quarterly figures.
“The next few years will be a time of phenomenal growth in our space and Zynga has incredible assets to take advantage of the market opportunity,” Mattrick said. “To do that, we need to get back to basics and take a longer term view on our products and business, develop more efficient processes and tighten up execution all across the company.
“We have a lot of hard work in front of us and as we reset, we expect to see more volatility in our business than we would like over the next two to four quarters,” he added.
In response to the latest figures Zynga announced it will no longer pursue a real-money gaming licence in the US but will instead focus on free-to-play social games, following last month’s acquisition of game studio Spooky Cool Labs.
Zynga had predicted disappointing results for the quarter shortly after releasing its Q1 fiscal results which showed year-on-year revenues and bookings fell 18% and 30% respectively.