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Technology Stocks : Zynga, Inc.
ZNGA 2.290.0%Oct 17 8:10 PM EDTNews

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From: Glenn Petersen2/15/2012 6:42:12 AM
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Zynga Finds Online Gambling 'Very Interesting' [Earnings Call]

Tomio Geron, Forbes Staff
2/14/2012 @ 6:32PM

Online gambling is “very interesting” to Zynga, Zynga COO John Schappert said in a conference call with analysts after posting its first quarterly earnings as a public company.

A recent Justice Department opinion according to some observers could open the way for Internet gambling in certain states. Speculation has been running high that Zynga would move into online gambling particularly with its Zynga Poker game and its recently announced Casino series of games. Zynga recently told AllThingsD that it is seeking partners for online gambling. Also Facebook gaming company Double Down Interactive was recently acquired by video poker company International Game Technology, fueling more speculation.

In the call today with analysts, in response to a question about online gambling, Schappert said, ”I think it’s actually a very interesting opportunity, because we’re in an unique position. We have the world’s largest online poker game and the most social online poker game we’ve been running for four years. We had record results last quarter. And it’s one of the top six games on Facebook. So I think we’re in a very good position and it’s a category that’s interesting to us.”

Presumably, the legal issues with online gambling in the U.S. would still potentially need to be worked out.

Other notes from Zynga CEO Mark Pincus‘ conference call with analysts today:

  • Zynga has grown its mobile user base to 15 million daily active users, which is up five-fold from a year ago.
  • On the international front, Zynga doubled its international revenue year-over-year, through increased localization. Its games are now available in 17 languages compared to five languages a year ago.
  • In terms of individual game performance, Zynga’s new game Mafia Wars 2 came in below expectations but its new Ville franchise game CastleVille performed better than expected. Mafia Wars 2 “didn’t resonate as well with consumers,” Pincus said.
  • The company’s Z Cloud, its own cloud infrastructure, was by the end of the year managing nearly 80% of the company’s daily active users, up from 20% in the beginning of the year.
  • Pincus was asked about critical news articles about his management style. He said the quiet period was difficult because he couldn’t respond to competitors and others. He said, “We pride ourselves on being an open and transparent company with employees…”
  • Project Z, Zynga’s destination website is now in closed beta and preparing for an eventual live launch, Schappert said. “Project Z is a destination site for social gaming, we’re trying to create a place for people to enjoy social games, to play together. And always have an endless supply of friends,” he said. “It’s now in an internal closed beta. We don’t have a release date.”
  • On hard core social games, which others such as Kabam have been focusing on, Shappert said don’t count Zynga out of that category. “Our goal is to deliver leading games in every category of play.”

forbes.com
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