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Zynga Shares Hit New Low
Zynga has again slashed its 2012 outlook on poor performance from its online games, setting the stock to new lows after hours. The stock was halted after hours after decreasing 50 cents or 22 percent to 2.19. Zynga also lowered its outlook from the recent purchase of OMGPOP for “Draw Something”, claiming it had over bought the company as much as 85 to 95 million. Signs are not looking good for the once casual giant, at it would seem every week another executive or team member is exiting the company. TheNExtWeb has run some numbers on the write down and it would seem Zynga has lost from the time of acquisition of OMGPOP to today’s date (197 days) as $500,000 lost a day. Ouch.
Zynga is set to report this loss in the next three to four weeks in its quarterly report for the third quarter, the loss is 12 to 14 cents per share. COO John Schappert addressed employees on the companies concerns with sales saying, “Let’s not lose sight of the bigger picture. The world is playing games, and is increasingly choosing social games”. It is not known if Facebook will also be effected from this information as the two seem pretty tied together with revenue from casual games.
Source – Yahoo