Zynga is worth 740 million dollars, moving games is big trouble

Zynga was a leader in social games, and now it's a dismal day, Beijing time, June 5, when Zynga announced that it had laid off 520 people, 18% of its total staff and $80 million trillion in cost savings per person.

Zynga's shares plunged 12% per cent to below $3 trillion after layoffs were announced, with only 2.34 billion dollars left in the company's market capitalisation. Since the IPO, Zynga has had a double whammy, with no good news coming. In fact, Zynga's shares fell 70% per cent since the late 2011 IPO.

There are some places to focus on the company's current situation:

1, only worth 740 million dollars

Zynga has 1.6 billion of dollars in cash and negotiable securities, and the company's market capitalisation is about $2.34 billion trillion, and after deducting, investors think the company is worth only 740 million dollars. Once, Zynga's market capitalisation was close to $7 billion trillion.

2, mobile game is a big trouble

Zynga is eager to expand in mobile gaming, largely because web games are cooling faster than expected. But mobile games are harder to make than web games. The rapid growth of new equipment and the slow pace of Zynga casual gaming in new equipment has become Zynga's biggest problem. Managers are announcing layoffs to cut costs.

3. How to go Next

How will Zynga go next? It may consider privatization or be acquired by other companies. Some sources close to the company argue that Zynga's big shareholders (including VC-Peng Hua) are unlikely to favour a big sale. How Zynga manages to reverse the downturn will determine its eventual fate.