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    Zynga posts 4Q net loss, higher revenue

    By BARBARA ORTUTAY | Associated Press – Tue, Feb 14, 2012

    NEW YORK (AP) — Online game maker Zynga Inc. reported a net loss in the last three months of 2011, weighed by hefty stock-compensation expenses and other costs in its first quarter as a public company.

    Its adjusted earnings and revenue skidded past Wall Street's expectations, but that wasn't enough to lift the stock of the company behind the most popular games played on Facebook.

    San Francisco-based Zynga said Tuesday that it lost $435 million, or $1.22 per share, in the fourth quarter. That's down from earnings of $16.1 million, or 5 cents per share, a year earlier when it was still privately held.

    Adjusted earnings were 5 cents per share in the latest quarter, surpassing Wall Street's expectations by 2 cents. This figure excludes one-time items, including $510 million in stock compensation expenses triggered by Zynga's initial public offering of stock in mid-December.

    Revenue rose 59 percent to $311 million as Zynga grew its user base, ad revenue and the money it makes from games such as "CityVille," ''FarmVille and "Zynga Poker." Analysts surveyed by FactSet were expecting $302 million.

    Zynga said it had 54 million daily active users in the fourth quarter, up 13 percent from 48 million in the fourth quarter of 2010.

    The company launched 12 games in 2011, including eight mobile games. Though it relies on Facebook games for nearly all of its revenue, Zynga is working on expanding to other areas, notably mobile devices. "Words With Friends," a Scrabble-like game played mainly on smartphones, is one of its best-known titles.

    "Zynga set new records in the year in terms of audience size, revenues and bookings," CEO Mark Pincus said in a statement. "We saw great momentum in mobile and advertising and ended the year with a strong pipeline of new games."

    For all of 2011, Zynga lost $404 million, or $1.40 per share, down from earnings of $27.9 million, or 11 cents per share, in 2010. Revenue nearly doubled to $1.14 billion from $597 million.

    The company expects adjusted earnings of 24 cents to 28 cents in 2012. Analysts are forecasting earnings of 23 cents per share.

    Zynga's stock fell 56 cents, or 3.9 percent, to $13.79 in after-hours trading. The stock had closed up 93 cents, or nearly 7 percent, at $14.35. Zynga's stock has traded in the range of $7.97 and $14.44 since its IPO.

     

    3 comments

    • RICHARD S
      RICHARD S  •  Morgantown, West Virginia  •  3 mths ago
      Amazing how " going public " instantly makes a company loose buckets of money. Funny that they were profitable before going public, lets just see how long it takes before they go bankrupt.
    • spankmeister
      spankmeister  •  Lenexa, Kansas  •  3 mths ago
      Richard. Let"s try and be a little more positive. My wife bought shares of Zynga. And while we've made 40 percent on the purchase, let's not stop the fun now!
    • A Yahoo! User  •  Irvine, California  •  3 mths ago
      ha ha ha. they were never profitable
     Post a comment
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