Zynga Inc. (NASDAQ: ZNGA) topped Wall Street estimates for profit and revenue in its fiscal second quarter. Shares of the videogame publisher, however, were down about 20% on Friday morning as investors focused more on the weaker than expected guidance.
Financial performance
Zynga reported $27.8 million of net income in Q2 (2 cents per share) versus the year-ago figure of $150.3 million in loss (16 cents per share). It generated $720 million of revenue – a significant increase from last year’s $451.7 million, as bookings jumped more than 35% to $711.9 million.
According to FactSet, experts had forecast $679.9 million of revenue, 2 cents of per-share loss, and $718.1 million of bookings.
Other notable figures and M&A spree
Other notable figures include an annualised growth of 87% in average mobile DAUs, a 51% in online gaming revenue, and an unprecedented 109% in built-in game ad revenue, which was attributed to Rolic that it acquired last year.
Zynga is currently on an M&A spree, with Chartboost and StarLark being two of its most recent acquisitions. Additionally, Zynga is minimising its physical presence in San Francisco as it intends to adopt a hybrid workplace model.
Future guidance
For the fiscal third quarter, Zynga now forecasts $665 million of revenue and $660 million of bookings versus the FactSet consensus of $679.9 million in revenue and $718.1 million of bookings. Its full-year guidance for revenue matches analysts’ call, but bookings expectations are weaker by roughly $140 million.
CEO Gibeau’s remarks on CNBC’s “TechCheck”
Commenting on the weak guidance, CEO Frank Gibeau said on CNBC’s “TechCheck”:
“Starting in June and July as the great reopening began,
