Key Takeaways From Zynga’s Q1 Earnings

May 8th, 2017 by Trefis Team
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Zynga (NASDAQ:ZNGA) posted mixed results for the first quarter, with bookings beating market expectations, but the bottom line missing market expectations.  The online gaming company’s revenues increased 4% year-over-year (y-o-y) to $194.3 million and bookings rose over 14% y-o-y to about $207.4 million at the end of Q1 2017. The company was able to significantly cut down on its losses for the quarter and reported net loss of $9.5 million, against the $26.6 million it reported in losses in the prior year quarter.

These results were driven by continued strong performance of online games, partially offset by weak performance of the advertising segment. The growth in the company’s top line was also attributed to its ability to attract a larger audience for its offerings since the company was able to increase its average daily user base (up 11% y-o-y) and average monthly user base (up 6% y-o-y). The company’s cost reduction plan, initiated in May 2015, continued to aid the growth in the company’s bottom line, and it reported a net loss of $9.5 million.

Going forward, Zynga expects to generate revenues of $200 million and bookings of $205 million in the current quarter. This should imply growth of 10% and 17% y-o-y in revenues and bookings, respectively.

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