“Zynga is making the focused choice not to pursue a license for real money gaming in the United States,” the company said in a statement. “Zynga will continue to evaluate all of its priorities against the growing market opportunity in free, social gaming, including social casino offerings.”
The announcement, which came on a day when Zynga reported quarterly results mostly in line with investor expectations, sent its shares down 13 percent, to $3.06 in after-hours trading.
Over the last year, Zynga’s business model has rapidly crumbled while it continued to lose online gamers to rivals. Executives have pleaded for time to turn around the company, arguing to investors that greater fiscal discipline and execution would stabilize Zynga’s position, while its foray into casino-style gambling could pay off handsomely in the long run.
That thinking has changed in recent months within the company’s upper echelons, with Mark Pincus, a founder, and his replacement as chief executive, Don Mattrick, returning to Zynga’s roots with free social games like FarmVille, which catapulted the company to stardom in 2009.
“We need to get back to basics and take a longer-term view on our products and business, develop more efficient processes and tighten up execution all across the company,” Mr. Mattrick said in a statement.
Zynga reported $231 million in quarterly revenue on Thursday, a 31 percent drop from a year ago, as the struggling publisher continued to lose players.
Zynga said the number of active monthly players dropped to 187 million this quarter from 306 million a year ago, its lowest since mid-2010. The company, which has acknowledged fundamental problems with its business model, went public in December 2011 at $10 a share.
Excluding certain items, Zynga posted a loss of a penny a share, compared with a penny-a-share profit a year ago.
Zynga reported $188 million in bookings, which is a measure of the value of virtual goods bought by players during the three-month period that ended June 30. That is a 38 percent drop from $302 million a year earlier.
The announcement, which came on a day when Zynga reported quarterly results mostly in line with investor expectations, sent its shares down 13 percent, to $3.06 in after-hours trading.
Over the last year, Zynga’s business model has rapidly crumbled while it continued to lose online gamers to rivals. Executives have pleaded for time to turn around the company, arguing to investors that greater fiscal discipline and execution would stabilize Zynga’s position, while its foray into casino-style gambling could pay off handsomely in the long run.
That thinking has changed in recent months within the company’s upper echelons, with Mark Pincus, a founder, and his replacement as chief executive, Don Mattrick, returning to Zynga’s roots with free social games like FarmVille, which catapulted the company to stardom in 2009.
“We need to get back to basics and take a longer-term view on our products and business, develop more efficient processes and tighten up execution all across the company,” Mr. Mattrick said in a statement.
Zynga reported $231 million in quarterly revenue on Thursday, a 31 percent drop from a year ago, as the struggling publisher continued to lose players.
Zynga said the number of active monthly players dropped to 187 million this quarter from 306 million a year ago, its lowest since mid-2010. The company, which has acknowledged fundamental problems with its business model, went public in December 2011 at $10 a share.
Excluding certain items, Zynga posted a loss of a penny a share, compared with a penny-a-share profit a year ago.
Zynga reported $188 million in bookings, which is a measure of the value of virtual goods bought by players during the three-month period that ended June 30. That is a 38 percent drop from $302 million a year earlier.
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