Zynga’s revenues for the first quarter of 2013 declined 18% year-over-year to $264 million as the company is in the midst of doing a big pivot onto mobile platforms. Last year, during the same quarter, Zynga earned $321 million in revenue.
Analysts had estimated on average that the company would pull in $209.8 million in revenue and lose 4 cents a share. The quarter had net income of $4 million million and shares are down 13 percent in after-hours trading.
In the earnings release, CEO Mark Pincus said:
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. 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.
The tough cuts and studio closures of last year are largely over, and Zynga’s shares have climbed 35 percent since the beginning of the year.
Now the company is looking ahead to a couple potential growth areas: 1) mobile games 2) midcore games 3) third-party publishing and 4) real-money gaming.
On mobile platforms, which is the huge growth area for the industry, Zynga has a couple of reliable franchises like Poker, which is currently ranked #15 on the top-grossing charts in the U.S. It also has the “With Friends” line-up which has top-grosser Scramble With Friends and the newly-launched Running With Friends, which could be compared to Imangi’s Temple Run or Kiloo’s Subway Surfers. They’ve also pumped up the release of the Draw Something sequel too.
But Zynga’s performance has paled in comparison to old rivals like the U.K.’s King or Finland’s Supercell, which is the industry’s darling of the moment. With just 100 employees, that Helsinki-based company made nearly as much as Zynga did in the same quarter with $179 million in revenue.
On the real-money gaming side, Zynga only recently made its debut after the quarter ended with the launch of two titles in the U.K. market. So we won’t see the performance of any of those titles until the next earnings announcement.
Article courtesy of TechCrunch