Zynga online game developer intends to dismiss 520 employees by August 2013 (about 18% of the company’s staff) and close several offices according to its cost reduction programme to save $70-80M, the company says.
None of us ever expected to face a day like today. But I think we all know this is necessary to move forward, - Zynga CEO Mark Pincus says.
In addition to the report on staff reductions, the company also released a new forecast on Q2 2013 financial results indicating expected net loss of $28,5M - $39M, while the previous forecast stated $26,5M - $36,5M.
Zynga Company was in a special partnership with the world's largest social network Facebook since 2010, which featured exclusive conditions of mutual promotion of services. For a long time, most of Zynga’s revenue (about 80%) was accounted for Facebook. At the same time, the company is trying to reduce its dependence on the world's largest social network.
During the IPO, which took place in December 2011, Zynga Company raised $1B being at the upper end of the price range with $10 per security. The peak value of the shares fell on the beginning of March 2012, when the company's securities traded at $14.69. However, Zynga shares have fallen by 80% since that time.