Zynga released its third quarter reports yesterday. The numbers were a bit better than the analysts had been waiting for, giving shares a temporary 13 percent boost. However, Zynga shares soon descended to an almost historic low of $2.13. Far, far away from the IPO price of $10, and the year high of $15.91.
Here are the numbers: revenue was up 3 percent to $316.637 million, but advertising shrank 11 percent to a two year low of $256 million. Daily active users are up 10 percent to 60 million year-on-year, but far from the 72 million peak.
Zynga presented a net loss of $52.72 million, compared to a net income of $12.5 million last year. Revenue for the first nine months this year increased 17 percent to $970 million compared to 2011.
The company is expected to continue its downsizing program with more lay-offs and office closings. Recently, the San Francisco based firm closed down operations in the UK and Japan and cut 5 percent of its workforce.
Zynga also announced its plans to repurchase $200 million worth of its shares. It is clearly a sign to calm down the stock market and attract possible investors.
Zynga CEO Mark Pincus commented: “While the last several months have been challenging for us, Zynga remains well positioned to capitalize on the growth of social gaming. It’s more clear than ever that along with search, shop and share, play is a fundamental pillar of the Internet.”
The company had earlier revealed that it has intentions to introduce real-money online wagers to its social games. The details about the ifs and hows are not yet known.
Pincus emphasized that his company has high hopes on mobile gambling, saying: “Mobile is the next major growth opportunity for Zynga.” The social gaming firm begins testing its “With Friends” mobile game network next week.
In the meantime, Zynga is trying to change current US gaming laws by spending $75,000 a day on lobbying.