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Zynga Cutting 18 Percent of Staff
Thursday May 7,2015 : ZYNGA PLANNING STAFF CUTS
18 percent cut envisaged to get back to profitability.
Despite a relatively positive first quarter in which revenues rose 9 percent to $183.3 million and net losses were reduced to $46.5 million, the troubled San Francisco-based social gaming giant Zynga has announced plans to cut staff numbers.
The company says the cuts will save around $45 million a year and affect around 18 percent of its staff as a return to profitability is sought.
Two years ago the company laid off 520 people.
News of the latest job cuts plan saw the company's share price rise more than 9 percent.
Zynga's quarterly showed that the company's belated recognition of mobile as an essential channel has resulted in 63 percent of its $167.4 million virtual product sales in the quarter emanating from mobile...a massive increase compared to the previous year. Monthly and daily mobile user numbers were both significantly up.
On the gaming front, casino sales were up 55 percent y-o-y, with slots titles particularly successful
The company will be concerned at a drop in its player conversion rate, which is now at 1.5 percent, with average daily user numbers down 3 million to 25 million, although average daily sales per user were up 18 percent in the quarter to 6.5 US cents.
Looking ahead to the end of Q2, the company says it expects its net loss to rise to as much as $54 million.
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