BackZynga to cut 18% of staff, close offices as games underperform
Firm says reductions will save an estimated $70-80 million in pre-tax expenses annually
Premium(Bloomberg)
San Francisco: Zynga Inc., the biggest maker of online social games, said it will cut 520 jobs, or 18% of its staff, and close some offices amid disappointing results from its titles outside the Farmville series.
The reductions will save an estimated $70-80 million in pre-tax expenses annually, the San Francisco-based company said on Monday in a statement. The cuts will be completed by August, and will result in restructuring charges of $24-26 million in the second quarter and $2-5 million in the third quarter.
Zynga will also record about a $15 million reversal of stock-based expenses because of the job reduction, and said the net loss in the current period will be between $28.5 million and $39 million, including the costs of the restructuring.
“While our Farmville franchise continues to perform well, other games are underperforming," the company said in the statement. Zynga’s most popular current game is Farmville 2, followed by Texas HoldEm Poker, according to App Data. Bloomberg
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