Zynga Stock Slips After Falling Short of Q1 Street Expectations

Zynga Stock Slips After Falling Short of Q1 Street Expectations
  • Zynga Inc ZNGA reported first-quarter sales growth of 2% year-over-year to $691 million, missing the consensus of $745.22 million. Quarterly bookings of $695 million, down 3% Y/Y.
  • Online game or user-pay revenue was $538 million (-3% Y/Y), and user pay bookings were $528 million (-11% Y/Y). Advertising & other revenue was $154 million (+24% Y/Y), and advertising & other bookings were $167 million (+35% Y/Y).
  • DAUs were 40 million (+3% Y/Y), and MAUs were 209 million (+27% Y/Y). Mobile average bookings per mobile DAU (ABPU) of $0.190 were down 6% Y/Y.
  • Income from operations for the quarter was $15 million, compared to a loss of $(5.5) million a year ago.
  • EPS was $(0.02), below the consensus of $0.09.
  • Net cash used in operating activities was $(202.7) million, versus $(163.7) million in 1Q21.
  • Adjusted EBITDA was $144.4 million (+17.3% Y/Y) and the margin expanded by 280 bps to 20.9%.
  • Last week, ZNGA announced that Bernard Kim, Zynga's President of Publishing, is leaving to become CEO of Match Group. To support transition efforts, Mr. Kim will remain with Zynga until May 30, 2022.
  • Outlook: Zynga is not providing forward guidance due to the pending transaction with Take-Two Interactive Software TTWO. Take-Two shares are rising by 17% in the after-hours session to $124.20.
  • Price Action: ZNGA shares are trading lower by 2.08% at $7.53 during the post-market session on Monday.
  • Photo via Wikimedia Commons

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