Is 35 percent a "plummet" or a "plunge"?
Whichever -- Zynga shares, that's what they're doing right now. Zynga is the San Francisco-based online game maker known for CityVille, FarmVille and other popular titles.
Here's the lead from the Wall Street Journal:
"Zynga’s earnings just stunk up the joint and the company is partly blaming Facebook for the disappointing results."
(Boy, things have changed under Rupert Murdoch.)
Facebook shares are buying the FarmVille too, right now, down about 8 percent.
AP's report on Zynga:
Zynga says it had a loss in the second quarter, with adjusted earnings and revenue below Wall Street's expectations.
Zynga said Wednesday that it lost $22.8 million, or 3 cents per share, in the April-June quarter. That's down from earnings of $1.4 million a year ago when it was still privately held. Its per-share results last year were at breakeven. Adjusted earnings were a penny per share, below expectations of 5 cents per share. Zynga says revenue grew 19 percent to $332 million. Analysts surveyed by expected $342.8 million.
Zynga had a lot riding on this quarter. Investors had been punishing its stock because of worries about declining user numbers.
We asked Sam Hamadeh, CEO of IPO research firm Privco for his take on the news.
"Zynga's results are weak by every measure," he said in an email. "Bookings in the quarter missed by over 15%, barely above $300M, rather than the $350M expected by analysts, a figure itself already lowered by analysts in recent weeks. [This is] Zynga's most important measure, as it measures dollar transactions of games and virtual goods sold in the quarter.
"The quarter shows clear signs that other gaming companies are now taking market share from Zynga, which unlike in 2010 and early 2011 is no longer 'the only game in town' on the Facebook platform."
Tomorrow, Facebook will release its first quarterly results since going public. Hamadeh said it may not be pretty: "[Zynga] results augur poorly for the Payments revenue line item (15% of Facebook's business) in Facebook's results."
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