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Zynga Opts Out Of U.S. Online Gambling

The CEO of social gaming firm Zynga shocked investors throughout the world by announcing that the California based firm would not attempt to offer real money online gambling services within the United States.

The announcement was made by the company's new CEO Dan Mattick, and caused the stock price to drop 16% in the process. "Zynga is making the focused choice not to pursue a license for real money gaming in the United States. Zynga will continue to evaluate all of its priorities against the growing market opportunity in free, social gaming, including social casino offerings," Mattick said.

Although the company is pulling out of any potential American real money offerings, the firm is apparently still committed to its British and European real money offerings.

Zynga also revealed its second quarter fiscal results. Key financial indicators for the period were:

  • Revenues dropped 31% y-o-y to $231 million

  • Active monthly player declined to 187 million (Q2-2012: 306 million) - Zynga's lowest since mid-2010. Monthly web numbers were 129 million and mobile was at 57 million.

  • A 1 cent per share loss, compared with a 1 cent profit a year ago.

  • $188 million in bookings - a measure of the value of virtual goods bought by players during the three-month period ending June 30, and a 38% drop from Q2-2013's $302 million.

  • Monthly unique payers were 1.9 million, down from 4.1 million a year ago and down 22% from the previous quarter.

  • On the plus side, the company has $1.5 billion in cash and investments, and Zynga’s average daily bookings per average daily user grew from $0.046 in the second quarter 2012 to $0.053 in the second quarter 2013, up 14% from a year ago.

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usbarbadosslim93 Recently online: 45 min ago
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26 July 2013 - 3:23pm
#1

I have to say that as a shareholder of Zynga that this really pisses me off. I fortunately bought this stock when it bottomed out last year, but I thought online gambling was Zynga's potential saving grace.

Ugh.

usUbetcha
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28 July 2013 - 9:31pm
#2

Oh no.. thousands would be broken hearted, like me! Sad But I do think they will reconsider the US in the future as soon as the online gambling will be legally established.

Y'all take care.. =^. .^=

auCL-Ed
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28 July 2013 - 11:50pm
#3

Ouch. If you bought when it bottomed out then you can still sell and make a profit. This company disgusts me to be honest. They rip off other people's ideas to make pseudo "games" that are little more than treadmills aimed solely at extracting money from their customers for worthless virtual items and perks. When you consider that the founders dumped their stock and ran when it was priced around $15 and left shareholders holding the can, and that they paid over $200 million for the company that made Draw Something app (which was about $198 million too much) I'd enjoy seeing it go bankrupt. Sell sell sell!

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usbarbadosslim93 Recently online: 45 min ago
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29 July 2013 - 12:17am
#4

Already processed, Ed. I ended up dropping it out after I read this story and picked up about $0.70 per share.

I still did Okay, but I am not happy with what they did here.

auCL-Ed
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30 July 2013 - 12:19am
#5

Good move. 70c per share in a year is still a pretty good gain.

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