Zynga Reports Higher Revenues, Loss in First Quarter
Zynga reported a net loss of $85 million, or 12 cents a share on revenues of $329 million, in the first quarter ended March 31.
When excluding some charges, including stock-based compensation, the company’s non-GAAP earnings totaled 6 cents a share, beating analyst expectations of 5 cents a share. Revenues also exceeded the expectations of analysts, who were anticipating first-quarter revenue of $318 million.
In the period a year earlier, the company reported a profit of $16.8 million on revenues of $242.9 million.
In after-hours trading, the social game developer’s stock bounced around, at one point increasing by 13 cents and then falling later by 2 cents.
The company’s results were solid, considering that it was Zynga’s second quarter as a public entity.
Still, it is also the second time in a row that the company reported a loss, despite seven previous quarters of profitability. It said most of that loss was attributable to $133.9 million in stock-based expense during the quarter, which was up from the $14.5 million reported in the same period a year earlier.
The company, which released such games as Hidden Chronicles and Scramble with Friends during the quarter, also updated its 2012 outlook, projecting non-GAAP earnings of 23 cents to 29 cents a share on bookings in the range of $1.4 billion to $1.5 billion. The company said it expects slower sequential growth in the first half of the year with most of its growth weighted toward the second half.
Bookings are what Zynga actually sells in the quarter versus revenue, which is amortized over multiple quarters. It reports these two figures because virtual goods are perceived as having a long shelf life. Bookings are often considered a better measure for how the company did during the immediate period.
In the first quarter, bookings totaled $329.2 million, an increase of 15 percent compared to the first quarter 2011, and an increase of 7 percent compared to the fourth quarter 2011.