Zynga Increases Profitability on Higher Revenues in Q3

Social game leader Zynga said it recorded a profit of $12.5 million on revenues of $306.8 million in the quarter ended Sept. 30, according to an updated filing with the Securities & Exchange Commission.

The results are significantly better than its second quarter, which garnered criticism for its weakness.

In the prior period, the San Francisco company, which is seeking $1 billion in a public offering, narrowly reported a profit of $1.4 million on revenues of $279.9 million.

The company attributed the jump in revenues to the launch of its new game, Adventure World, and the release of Words with Friends on Facebook.

In general, the company attributes growth to the launch of new games. In the prior quarter, it had just ended a five-month hiatus. To be sure, there’s a lot more coming. At an Oct. 11 press conference, it unveiled 10 games it plans to launch over the next several months on Facebook and mobile.

The company said during the nine months ended Sept. 30 it had approximately 6.7 million unique players who paid for items in games. That’s a small percentage of its overall user base, which spans 54 million users on a daily basis and 227 million users on a monthly basis.

In the third quarter, DAUs declined mainly due to fewer players of its more mature games and because it launched a limited number of new games in the first nine months of 2011.

The company continues to have the largest audience on Facebook, however, though by a smaller margin than before. Previously, it claimed to be bigger than the next 15 game companies combined based on monthly active users. That number has dropped to eight.

As of Sept. 30, Zynga had 2,789 employees.

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