Ahead of earnings report, Zynga shares open at all-time low

Zynga’s stock today opened at $2.30 a share, an all-time low for the company since its IPO last December. Since the market opened, shares dropped even lower to $2.19 and are trading at $2.22 at the time of writing.

Over the past two quarters, Zynga’s stock has recovered a bit ahead of the company’s earnings calls as shareholders have anticipated record revenues. Each time this has happened, Zynga’s revenues have disappointed investors and the stock has fallen to new low points.

This quarter, though, Zynga released a preliminary earnings report that said Zynga expects to report a net loss between $90 and $105 million, causing the company’s shares to slump in the weeks leading up to today’s call. The company says it’s expecting revenue to be somewhere between $300 and $305 million, with bookings between $250 and $255 million.

Two major factors with this quarter’s financial results was an impairment charge (the new term for writing off worthless goodwill) of $85 to $90 million that was tied to the intangible assets acquired when Zynga purchased OMGPOP back in March and some of its games (like The Ville) not performing as well as initially expected.

The company’s stock price also probably wasn’t helped by yesterday’s news that the company had laid off approximately 5 percent of its workforce, shut down its Boston studio, was considering more closures and is planning to sunset 13 unspecified games. Facebook CEO Mark Zuckerberg’s revelations about Zynga’s performance this quarter probably didn’t instill much investor confidence, either.

There is a bit of good news for investors, however: Bloomberg reveals Zynga has no long or short-term debt, which means the company’s main concern is ensuring it has enough operating cash. During last quarter’s earnings call, it turned out Zynga had roughly $1.6 billion in the bank.

We’ll update this story after Zynga’s earnings report at 2 p.m. PST.

Marketing with Facebook Insights

Mediabistro Course

Marketing with Facebook Insights

Starting October 2, use Facebook’s analytics tool track and optimize your marketing efforts! Taught by the group marketing manager of social media at Microsoft/BingAds, Geoffrey Colon will show you how to measure key performance indicators and make your data actionable. Register now!

 

Leave a Reply

Get the latest news in your inbox
interested in advertising with inside social games?

Social Media Jobs
of the Day

Senior Web Developer

Kaufmann Mercantile
Brooklyn, NY

Director of Web and Online Services

University of California at Irvine
Irvine, CA

Web Producer / Designer

Purch
New York, NY

Marketing Graphic / Web Designer

Collectrium
New York, NY

Web Production Designer (Contrator)

Marvel Entertainment
New York, NY

Featured Company

Join leading companies like this one and recruit from the nation's top media job seekers on the Mediabistro Job Board. Every job post comes with our satisfaction guarantee. Learn More
 

Our Sponsors

Mediabistro A division of Prometheus Global Media home | site map | advertising/sponsorships | careers | contact us | help courses | browse jobs | freelancers | content | member benefits | reprints & permissions terms of use | privacy policy Copyright © 2014 Mediabistro Inc. call (212) 389-2000 or email us