Zynga's Profits Continue To Drop

[vansau]

Zynga's Profits Continue To Drop

For the first nine months of 2011, only 4.4 percent of Zynga's users were paying for its games. As a result, it's made huge amounts of cash, but much smaller profits than last year.

It sounds like the <a href=http://www.escapistmagazine.com/news/view/110241-10-Billion-Zynga-Valuation-Means-Were-In-a-Bubble-Boys>casual gaming bubble is officially starting to shrink. Zynga, the company <a href=http://www.escapistmagazine.com/news/view/107211-Zynga-Claims-Ownership-Over-All-Things-Ville>behind everything "Ville", has revealed that it's continuing to make money, but it's still a lot less than last year.

In a new SEC filing, Zynga revealed that the last financial quarter's $306 million in earnings were record-breaking, but net profits were down from last year by almost 54 percent to $12.5 million. Granted, that's still better than the <a href=http://www.escapistmagazine.com/news/view/113301-Zynga-Profits-Take-a-Beating>95 percent profit drop that the company revealed earlier this year, but when you're trying to launch an IPO, it never looks good to reveal that your profits are down.

Meanwhile, Zynga is reporting that of its 152 million unique monthly users, only 6.7 million of them provided its revenue during the first nine months of 2011. That means that only 4.4 percent of Zynga's users are actually paying for the company's games; if I worked there, I'd find that statistic a little terrifying.

The company is also claiming that its third financial quarter will show drastic improvements, thanks to the launches of Adventure World and the new Facebook version of Words With Friends.

Source: <a href=http://www.gamasutra.com/view/news/38394/Zynga_Shows_Record_Revenue_Reduced_Profit_In_Quarterly_Filing.php>Gamasutra

Permalink

 

[Daystar Clarion]

This pleases me.

Did they honestly think the 'fans' of their games would hang around forever and then move on to play another Ville title?

 

[theonecookie]

Well you can only make shitty games for so long casual or otherwise but then again its not like there going to have to down grade there toilet rolls or anything

 

[Ruwrak]

People are catching on that everything is the same but then with just a different skin and the rake is swapped for a paintbrush?

Or that the users have spend enough money and realise they are not getting anywhere? I tend to get tired of these games around the 15th level. I sit down and wonder what the hell I am doing, then boot up another game like Arkham City or whatev and forget about Zynga.

I won't miss it anyway.

 

[The_root_of_all_evil]

Ah, so there is good news for once.

 

[esperandote]

When they released their games there were a lot of potential players, once they filled the market there was only one way to go.

 

[Scars Unseen]

Hopefully this is an early sign that the more predatory F2P schemes won't make it in the long term. Of course, it could just be that Zynga makes horrible games...

 

[HobbesMkii]

Like the other comments posted, I too find this to be good riddance to bad rubbish. Zynga is guilty of pretty much blatant idea theft, and they should be punished for their lack of creativity in their bank account. Also, I'm happy to hear it, so that we can all stop worrying about the games of the future being published by Zynga, and instead start worrying about them only being available on the iPad.

 

[Archemetis]

Couldn't be happening to a more deserving company, I mean obviously I don't like the idea of anyone losing their jobs (unless they're arseholes) but I'm sure the truly talented ones will land themselves in more reputable companies.

Also I wonder what kind of 'ville they'll throw at the mass of idiots who follow them when the third quarter rolls in?

 

[Hero in a half shell]

Excuse me, To properly express my feelings on this issue I must find a cat and a swively chair...

... Ok, I'm back, *Ahem* MUHAHAHA HAHAHAHA HAHAHAHA

I know it seems cold-hearted to be laughing at a story that could mean people losing jobs, but Zynga probably bankrupted more indie developers than ever employed people, which they did under pretty horrible circumstances, and their CEO makes Tim "Sue-guru" Langdell look like Ghandi.

If that company dies it will be to the benefit of humanity.

 

[penguindude42]

Ah, so there is good news for once.

It's even actual news!

*is shot*

 

[Pipotchi]

So many crops..... dieing.... It's sad really. Really sad.

-'4.4 percent of Zynga's users are actually paying for the company's games'-

Ouch. Layoff's in the future... I wonder if the Zynga haters are glad.

This is pretty much how I feel, whilst i hate Zynga and all their games I would hate to be working there right now. Perhaps as a new guy been there about 18 months, joined a fast growing mega company and now its all going to hell.

Pity

 

[KeyMaster45]

This calls for a celebration, everybodeh dance!!

Early celebrations and over confident declarations of victory aside. The only reason I'd be sad to see Zynga go under is because I know it would cause the lower people in the company to lose their jobs. Still, should it collapse it would just go to show that a business model based on your product being the latest and greatest fad (along with some unscrupulous business practices) cannot work in the long term. What you need is something people will want for a long time AND unscrupulous business practices.

 

[Robert Ewing]

With the idea of people loosing a lot of jobs, a lot of investors shitting quite expensive pants, and a board director that's probably going to jump off a building... I can't help but feel really, really smug about all this. Hehe.

 

[Lunar Templar]

This pleases me.

and this was my thought exactly

good riddance i say, may it continue till nothing is left, as they won't be missed