A model in decline? Zynga’s cruddy earnings bring down Facebook, too
- $22.8 million loss for Zynga in the most recent quarter
- -$1.89 the amount Zynga’s stock went down in after-hours trading on Wednesday after the company announced downright dismal results
- -$2.23 the amount Facebook’s stock went down in after-hours trading in reaction — the company derives a chunk of its profit from Zynga source
» Why is Zynga sucking? Its model is in decline. “The largest reason for us decreasing our guidance has to do with the performance of our existing games,” said the company’s Chief Financial Officer, David Wehner. While they increased their user base in the most recent quarter, this was largely due to the acquisition of OMGPop, the makers of “Draw Something.” What’s not clear is whether the problem is with casual games in general, or simply casual games on Facebook. It’s possible the decline may be due to the rise of smartphone gaming. As it is, the Zynga stock, if it stays at its current level, will hit an all-time low tomorrow.