Zynga Is Still Being Fueled By ‘Words With Friends’

 Zynga Is Still Being Fueled By ‘Words With Friends’

The effect of Pokemon Go, however, The Know It Guy remains to be seen. FarmVille creator Zynga reported higher-than-expected bookings in the second quarter, driven by higher demand for slot games and social games such as Words with Friends and Zynga Poker. The company said bookings were $175 million in the three months ended June 30. Analysts, on average, had expected $171.3 million, according to research firm FactSet StreetAccount. Bookings, an important metric indicating future revenue, include virtual goods such as currency and lives. During the quarter, the company launched games such as Spin It Rich! Slots, Ice Age: Arctic Blast, and Wizard of Oz: Magic Match. The company’s long-delayed mobile racing game CSR 2 launched at the end of the second quarter.


“We still have got a lot a work to do. We are not declaring victory or getting too ahead of ourselves here,” Chief Executive Frank Gibeau told Reuters. Zynga ZNGA -0.35%, whose FarmVille once dominated games played on Facebook FB -0.51%, named Electronic Arts EA -0.90% veteran Frank Gibeau as chief executive in March to spearhead its transition to a mobile-focused games maker. Gibeau—who replaced founder Mark Pincus—has a track record of managing EA’s mobile franchises, such as “Plants vs. Zombies” and getting games shipped on time. He said the launch of Pokemon Go had no positive or negative impact on the company but added new people to mobile gaming.


Pokemon Go, released in the United States on July 6, has become a global phenomenon, sending players into city streets, offices, parks, and restaurants to search for colorful animated characters. Gibeau said the company also worked on augmented reality, virtual reality, and wearables. However, Zynga’s average daily active users fell 14.3% to 18 million from a year earlier. Gibeau said most of the decline was driven by some of the legacy mobile games. Subscribe to Data Sheet, Fortune’s daily newsletter about the business of technology. The company’s net loss narrowed to $4.45 million from $26.87 million a year earlier. Total costs and expenses fell 17.2%.

Revenue from advertising rose 21.6% and accounted for 25.3% of total revenue. The company forecasted third-quarter bookings from $180 million to $190 million, largely below the average analyst estimate of $188 million expected by FactSet StreetAccount. Zynga is on track to launch ten games this year, with the second half featuring titles such as FarmVille: Tropic Escape and another delayed action-strategy game, Dawn of Titans. The company appointed Matt Bromberg, with whom Gibeau has worked, as a chief operating officer. Up to Thursday’s close of $2.97, shares had risen 11% this year.

Dennis Bailey


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