Zynga Shares Tumble on Gloomy 2Q View
Zynga’s (NASDAQ: ZNGA) revenue fell 18% in the first quarter but the social-media games company turned a profit after posting a big loss a year ago.
Revenue was $263.6 million for the first quarter of 2013, down from $321 million in the first quarter of 2012, and a decrease of 15% compared to the fourth quarter of 2012, the company said in a statement.
Zynga reported a profit of $4.1 million, or less than a penny a share, compared with a year-earlier loss of $85.4 million, or 12 cents a share.
Shares were down about 10% in after-hours trading apparently based on Zynga’s pessimistic forecast for the second quarter. The shares rose 17 cents, or 5.3%, to $3.35 in regular trading.
The San Francisco-based company makes games that are featured on popular social media sites such as Facebook (NASDAQ: FB). Analysts have grown skeptical of the company’s growth prospects now that Facebook users also appear to be leveling off.
The company’s most popular game FarmVille has seen participation by Facebook users decline.
Mark Pincus, Zynga's CEO and founder, said in the statement: "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."
Zynga’s total expenses fell 34% to $268.5 million, while daily active users fell to 52 million, from 65 million a year earlier and down from 56 million in the prior quarter.