Zynga’s fall from grace
Now, Zynga’s stock is not the only taking a nose dive following disappointing Q2 results (Apple disappointed analysts too, failing to impress for the first time since 2003).
However, there’s a notable difference – Apple saw sluggish sales of iPhones (probably in anticipation of iPhone 5) that were not offset by more iPads, iMacs, etc. Zynga, on the other hand, has experienced no growth (apart form its acquisition of OMGPop) and although revenues grew a notch, expenses grew faster:
Faced with a dismal quarter, Zynga lowered its outlook for the year on Wednesday, citing game delays, reduced expectations for “Draw Something” and what it called a “more challenging environment on the Facebook Web platform.”
Comments made by Zynga founders (this time it’s Eric Schiermeyer, not Marc Pincus) are not mitigating the crisis at hand. On the contrary, they are further alienating whoever has any good will left. Eric Schiermeyer publicly acknowledged Zynga games are little more than a Skinner box, you know the one where mice press a lever to get random rewards.
Of course, games are not that great of a Skinner box, compared to say real-money gambling. So guess where Zynga is headed next? That’s right (quote courtesy of VB):
Mark Pincus, chief executive of Zynga, said in a conference call with analysts today that the company will launch its first real-money online gambling poker game in the first half of 2013. The game will likely be launched outside the U.S., since real-money online gambling is still illegal in the vast majority of states.