All Eyes Still on Mobile as Zynga Earnings Approach

The adage is tired at this point — the tech industry is shifting to mobile, and everyone knows it.

Thing is, that still doesn’t change the harsh truth for companies braving the huge, often uncomfortable transition to the mobile world after years of building a business on the Web.

That’s the perfect way to describe Zynga — which reports earnings today after the bell — the social gaming company smack in the middle of a long, slow trudge toward creating a “mobile first” business. (Sound familiar? Just ask our friends over at Facebook, and the many PC makers whose market is drying up in front of their eyes as tablets and smartphones eat their lunch.)

For Zynga, the reality is that even if the company can pull it off in the long run, it’s not going to be so pretty in the short term. As of Wednesday morning, the Street’s consensus expects Zynga to post a loss of four cents per share on revenue of $209.8 million.

Still, some analysts remain optimistic — if not today, then for the future. “While Zynga faces a challenging transition as it looks to diversify from Facebook to Zynga.com and mobile, we think trends in core Web franchises such as FarmVille and Zynga Poker are stabilizing and the advertising segment improves from the shift toward mobile games,” said J.P. Morgan analyst Doug Anmuth in a research note.

The company hinted at some strides made last quarter in the mobile space, breaking out for the first time its number of monthly active users on mobile devices. As of the last earnings report, nearly one-quarter of Zynga’s roughly 300 million monthly active users play Zynga’s games on mobile devices. That’s about 72 million people, and not bad for a company in transition.

One other bullish area for analysts is something Zynga has pushed hard into recently: Real-money gaming. The company launched two of its titles in the United Kingdom on the first of this month, and plans to push out more in the coming year. Zynga is pretty much stuck overseas with real-money gaming for now, as current U.S. law keeps the company from letting stateside users gamble online.

Again, while that may prove another promising revenue stream eventually, it’s still off in the future.

“For Zynga, any hope for real, sustainable top-line growth likely rests primarily on opportunities in on-line gambling — opportunities that are at least a year away,” Sterne Agee analyst Arvind Bhatia wrote in a research note.

We’ll be on the call this afternoon to see how Zynga’s mobile efforts are going — perhaps the company is doing better in the short term than analysts expect. Or perhaps not.