Zynga to Kick Off Its IPO Roadshow Next Week
Zynga will start its investor roadshow next week ahead of a much-anticipated initial public offering. Fortune’s Dan Primack first reported the story, but we’ve confirmed it with a source that’s knowledgeable about the company’s plans. Zynga declined to comment.
The roadshow will start Monday and involve executives like chief executive Mark Pincus, along with chief operating officer John Schappert and chief financial officer David Wehner. We don’t know where the roadshow will happen or to whom the company will be pitching, but a video of Zynga’s presentation will probably become available at some point next week.
We’re also expecting to see an amendment to the company’s earlier IPO filings, likely on Monday that will include pricing.
Just to revisit: Zynga originally filed to raise as much as $1 billion back in July. There are six underwriters on the offering including Morgan Stanley, Goldman Sachs Group Inc., Bank of America-Merrill Lynch, Barclays Capital, JP Morgan Chase & Co. and Allen & Company.
In its most recent quarter, Zynga earned $12.5 million in net income on $306.8 million in revenue, with revenues up 80 percent from the same quarter a year before. However, the company’s number of daily active users have declined two quarters in a row to 54 million users, a negative signal for future earnings growth if Zynga can’t continue to boost its average bookings per user. The company did boost average bookings per user to an all-time record of 5.8 cents per user per day in the third quarter of this year.
The company’s timing is interesting. December is generally the month when many mutual funds rebalance their portfolios, which might potentially open up more capital for the company’s offering. The company’s also coming to market at a time when concerns about the stability of the euro are fueling day-to-day volatility in global equity markets.