|The press release: finance.yahoo.com|
Zynga Misses in First Quarter, But Touts New Leadership and Mobile Growth
By Eric Johnson
April 23, 2014, 1:09 PM PDT
Still in the middle of its social to mobile transition, Zynga fell short of the street consensus on earnings per share in Q1, with a loss of seven cents vs. an expected one-cent loss, dragged down by higher than expected restructuring costs.
Analysts initially expected the restructuring costs to hit in the second quarter, but the company pulled them forward, totaling $29 million in the first quarter of 2014. However, the company reported better-than-expected bookings of $161 million, beating analyst expectations of $146.5 million. Total revenue fell 36 percent year-over-year to $168 million.
Zynga shares are trading up 4 percent after hours, at 4.61 per share as of the time of this writing.
The gaming company also announced the completion of a leadership shuffle that began with the appointment of former Xbox executive Don Mattrick as CEO last year. Former CEO Mark Pincus, who had been serving as Chief Product Officer under Mattrick, has stepped down from that role but will remain chairman of Zynga’s board.
Alex Garden, currently the general manager of Xbox Music, Video and Reading at Microsoft, will become the first President of Zynga Studios, a new role reporting to Mattrick, on May 5. Garden will oversee all games developed at Zynga except NaturalMotion’s titles, which will remain under that company’s CEO Torsten Reil.
Reporting to Garden will be another new hire, Chief Visual Officer Henry LaBounta, who started two weeks ago. LaBounta previously worked with Mattrick on the Need for Speed franchise at EA, and has experience in CGI, movies and television by way of a six-year stint at DreamWorks.
In its last new hire, Jennifer Nuckles, Zynga is also getting a Chief Marketing Officer for the first time since the resignation of former CMO Jeff Karp in 2012. Nuckles started last week and will oversee attempts to go beyond Zynga’s current marketing initiatives, banner and interstitial app ads.
Following January’s acquisition of Natural Motion for $527 million, the company’s monthly mobile audience grew 45 percent, but even excluding Natural Motion’s hit games like CSR Racing and Clumsy Ninja, mobile users were up 11 percent quarter over quarter. At GDC last month, Mattrick said the company’s mobile turnaround is halfway there, and it’s likely that transition will be the central focus of the company’s call with investors at 2:00 Pacific Time.