Zynga’s earnings report for Q1 2013 shows $263.5M in revenue, $4.1M gain

zyngaearningsToday, Zynga reported it made $263.5 million in revenue, with $229.8 million in bookings for Q1 2013. In terms of revenue, that’s flat year-over-year while bookings were roughly by 30 percent year-over-year.

Zynga’s earnings report shows it had a net income gain of $4.1 million; up from Q1 2012’s loss of $85.4 million, and adjusted EBITDA (earnings before interest, taxes, depreciation and amortization) of $29 million. The diluted net income per share was $0.00, up year-over-year from a net income loss of $(0.12).

Daily active users (DAU) decreased from 65 million in the first quarter of 2012 to 52 million in the first quarter of 2013, down 21 percent year-over-year. DAU were down 8 percent from 56 million in the fourth quarter of 2012. Monthly active users (MAU) decreased from 292 million in the first quarter of 2012 to 253 million in the first quarter of 2013, down 13 percent year-over-year. MAU were down 15 percent from 298 million in the fourth quarter of 2012.

Zynga’s revenue for Q1 2013 fall comfortably within its outlook at the end of Q4 2012, and it’s net income of $4.1 million beat it’s prediction of a net loss of between ($32) million and ($12) million. As a result, Zynga says revenue is projected to be in the range of $225 million to $235 million for Q2 2013. Net loss is projected to be in the range of ($36.5) million to ($26.5) million. EPS is projected to be in the range of ($0.05) to ($0.03), based on a share count of approximately 785 million to 795 million shares. Bookings are projected to be in the range of $180 million to $190 million.

CFO and CAO Mark Varnesh said that Zynga’s top earners were Zynga Poker and FarmVille which brough in 22 percent and 16 percent of online revenue. No other Zynga game brought in more than 10 percent.

Zynga has canceled underperforming existing games and shut down studios with games in development in the past year to cut down on operating costs. COO David Ko said Zynga will continue with this strategy, and that it will soon retire The Ville, Empires & Allies, Dream Zoo, and Zynga City on Tencent.

“We are encouraged by the strong execution from our teams and the breakout hit performance of FarmVille 2, which captures the imagination of nearly 40 million players every month,” said Mark Pincus, CEO and Founder, Zynga. “2013 will continue to be a transition year as we face the challenging environment on the web and invest in developing the leading franchises and network across web and mobile platforms and offer our 253 million monthly players a connected experience that can follow them from work to school to home and anywhere in between.”

On the earnings call today, Pincus said that Zynga will “measure [its] success next quarter by its ability to bring existing users and games to mobile.”

As has been the case in past quarters, Zynga still has a lot of cash, cash equivalents and marketable securities on hand. Currently, the company has $1.67 billion in these, up  from the $1.65 billion it had in Q4 2012. After it paid its long-term debt in April 2013, Zynga also doesn’t have any short term or long term debt. Cash flow from operations in Q1 2013 was $26.4 million compared to$78.8 million for the first quarter of 2012. Free cash flow was $23.2 million for the first quarter of 2013 compared to $43.8 million for the first quarter of 2012.


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