Market Overview

Zynga Earnings Preview

Zynga (NASDAQ: ZNGA) will report its earnings after the bell on Tuesday.

Analysts are expecting a fourth quarter loss of $0.03 on the EPS front. This will be a setback as compared to the same period in 2011, when the San Francisco firm netted $0.05 per share.

Revenues are expected to come in far below last year, as well. After earning $306.5 million during the last quarter of 2011, Zynga is expected to round out 2012 with revenues of $212 million.

The stock dropped by 17 percent during the quarter, finishing 2012 at $2.36.

Lower Full-Year Guidance

In October, Zynga lowered its full-year guidance.

Original expectations were for revenues to finish in the $1.150 billion to $1.225 billion range. However, the company revised its estimate to $1.085 billion to $1.100 billion. According to Zynga, this was due to its lower expectations for the second half of 2012, lower expectations for some of its games and delays in the launches of other games.

It's All a Big Game

Zynga released several new games during the quarter.

In September, the social gaming firm launched FarmVille 2. It became the company's first fully 3D game.

Zynga also released Montopia and Ayakashi: Ghost Guild worldwide on iPhone (NASDAQ: AAPL), iPod touch and Google Play (NASDAQ: GOOG). These became the first role-playing games the company designed for mobile gamers. The games were originally released in 2012, but were only available in Japan.

In October, Zynga announced a partnership with Gibraltar-based gaming firm bwin.party (LSE: BPTY.L). The companies will bring hundreds of online gambling games to the UK market during the first half of 2013.

Other games the company released include Clay Jam and CoasterVille.

Chief Game Designer to Play a Role Elsewhere, Joins Mass Exodus

Chief game designer Brian Reynolds has left Zynga, according to a report by Venture Beat last week. Reynolds headed the Zynga East studio in Baltimore and is the latest of several top employees to leave the firm in recent times.

According to Venture Beat, other notable departures over the past year include COO John Schappert, chief creative officer Mike Verdu, chief security officer Nils Puhlmann, chief technical officer of infrastructure Alan Leinwand, CFO David Wehner and OMGPOP chief revenue officer Wilson Griegel.

Bank of America Upgrade

Bank of America (NYSE: BAC) has upgraded Zynga to Buy. And, the market appears to have latched on to this rating.

After closing at $2.84 on January 28, the stock dropped back down to close at $2.56 on Monday. However, it is on the rise once again, currently sitting near the $2.75 mark.

Zynga is up over 6 percent on Tuesday.

Posted-In: Ayakashi: Ghost Guild bwin.party Clay Jam Coasterville Farmville 2Earnings News Guidance Best of Benzinga

 

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