The toughest year for Zynga's revenue

The real money game was the last straw for Zynga, and Zynga announced it was abandoning the introduction of online "gambling" games.

According to foreign media reports, Zynga, the famous social gaming firm, released its second-quarter financial statements last week, with Zynga's active daily users falling from 52 million in the last quarter to 39 million in the second quarter, and Zynga lost 25% of its users in just 3 months.

Meanwhile, Zynga's revenues were miserable, with a net loss of $15.8 million in the second quarter ($ 4.1 million in the last quarter). Zynga's shares are naturally affected, falling 15% on the day.

People familiar with the Internet are aware that Zynga's logo is a sand-skinned dog. "This is Zynga's toughest year," said Mark Pincus, Zynga's president. And last year was the toughest year for the dog. In the summer of 2012, Zynga lost a large number of management members, and in December 2012 Zynga announced that it had bought Omgpop (Draw something developers) with high bids, causing huge losses to the company and shutting down Omgpop company in June 2013.

In the earnings, Zynga mentioned another important thing. Zynga has planned to introduce real money online games to the United States (ie, a gambling game), which is now completely bankrupt, which means that Zynga's last plan to retain users and return losses has failed completely.

"Zynga thinks the company's biggest opportunity is to focus on free social games. Although Zynga has started testing the real-money game products in the UK, the company is not planning to obtain relevant authorization in the United States. Zynga will continue to put its best resources into free social games that boost potential. ”

Despite all the bad news, at least Zynga has one thing to say that it has hope, and that is the construction of its mobile platform.

"Zynga's bad performance is not surprising," says Brian Blau, a Gartner analyst. "It is clear that Zynga is in the process of transition, which will continue until 2014, when the entire Zynga business model will change." Zynga has the talent, the resources and the opportunity, but at the moment they have to focus on their core competencies, shift to move, and build their own mobile platforms before the company collapses. Game companies have the ability to repair themselves, they can pull back the old users, but the platform and the new game is the first task. ”

Five minutes?

China's very popular "Happy Farm" game was developed by a five-minute company, and at first the company did show potential, but as social networking sites weakened and users became tired, fewer people were stealing food. Last December, the five-minute announcement was closed, and in June 2012 its daily revenue was only three digits.

Zynga is at least not as down as five minutes, with at least a lot of games and a certain base of mobile platforms, and Zynga's social gaming is really making money from last quarter's revenue. But over-reliance on social networking sites and faulty acquisitions is a key factor in Zynga's failure. Five minutes before the bankruptcy, the CEO knows meditation every day, do not ask about corporate affairs, the company lacks management; Zynga also had a similar situation last year, where a large number of management losses were fatal to a company, and Zynga was able to demonstrate that the remaining management had the capacity to manage the company well.

While the media and investors are not bullish on Zynga's future, Zynga's transition is essential. Mobility is a trend and Zynga is on the move. As Gartner analysts say, Zynga's transition will take time, and a year is enough. Zynga is never going to collapse like five minutes.