Zynga lowers 2012 outlook with preliminary earnings report
Zynga today released its preliminary earnings report for its fiscal third quarter which ended on Sept. 30.
The developer says it expects to report third quarter revenue somewhere in the range of $300 million to $305 million, with bookings between $250 million and $255 million. Meanwhile, Zynga says it expects to report a net loss between $90 million to $105 million; the non-GAAP (generally accepted accounting principals) net loss is between $2 million and $5 million and EBITDA (earnings before interest, taxes, depreciation, and amortization) in the range of $10 million to $15 million.
Zynga also says it expects to report diluted earnings per share between ($0.12) and (0.14), with non-GAAP EPS between $0.00 and ($0.01). According to Zynga, the third quarter results come from “weakness of certain games in our web ‘invest and express’ category,” as well as an impairment charge (the new term for writing off worthless goodwill) between $85 to $90 million that’s tied to all the intangible assets acquired in Zynga’s purchase of OMGPOP back in March. Zynga also noted it had reduced expectations for some of its games — including The Ville.
“The third quarter of 2012 continued to be challenging and, while many of our games performed to plan, as a whole we did not execute to our satisfaction,” said Zynga CEO and Founder Mark Pincus in a statement.
All these factors caused Zynga to revise its outlook for the 2012 fiscal year, which was originally expected to bring in $1.15 billion to $1.225 billion in revenue and an EBITDA of $180 million to $250 million. The new projection expects bookings to be somewhere between $1.085 billion to $1.1 billion with EBITDA now in the range of $147 million to $162 million.

In spite of the ongoing success of ChefVille after its launch and bringing on some big-name publishing partners for both mobile and social platforms,the third quarter has seen the company suffer a number of public setbacks. The Ville, which debuted to much fanfare in June, became the source of a high-profile lawsuit from Electronic Arts. Since then, the game’s lost almost three quarters of its traffic. In addition to this, a number of high-profile members of the company have left Zynga within a short period of time, including former COO John Schappert, CCO Mike Verdu and CMO Jeff Karp.
Zynga will be holding a conference call on its third quarter financial results on Wednesday, Oct. 24 at 2:00 pm PST. A webcast and slides will be available at the company’s investor site at that time.



October 5th, 2012 at 4:00 pm
[...] shares plummet following preliminary earnings report — After Zynga’s disappointing preliminary earnings report yesterday where the company downgraded its expected earnings for the year, the company’s [...]
October 7th, 2012 at 10:10 am
[...] Zynga lowers 2012 outlook with preliminary earnings report [...]
October 8th, 2012 at 1:00 pm
[...] announcement comes just as the frenzy surrounding Zynga’s lowered 2012 outlook reaches a fevered pitch. The company’s stock priced opened trading today at $2.42 — down [...]
October 10th, 2012 at 1:18 pm
[...] již zveřejnila zprávu za 3. čtvrtletí a ta nebyla příliš pozitivní. Podle webu Inside Social Games, Zynga snížila odhady na rok 2012 a očekává ztrátu 105 milionů dolarů, místo předchozího [...]
October 16th, 2012 at 8:47 am
[...] spent playing Words With Friends and Scramble With Friends each month. With Zynga’s recent preliminary earnings report leaving many underwhelmed, it’s not surprising the company is seeking to show investors that [...]