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Finance

Zynga hands out stock options to employees to stop exodus

Zynga hands out stock options to employees to stop exodus

Fri 10 Aug 2012 12:58am GMT / 8:58pm EDT / 5:58pm PDT
MobileOnlineFinanceSocial

After earnings fall below expectations, Zynga entices staff with stock

Zynga has reportedly handed out stock options to employees after the company's financial shortfall, according to Bloomberg. While the company has given stock options and cash bonuses in the past, this marks the first time all employees received equity awards. The move is intended to prevent employees leaving for for greener pastures.

"It's a proactive move to prevent mass exodus," said Sterne Agee analyst Arvind Bhatia told Bloomberg. "It's positive for morale and I think it's the fair thing to do."

Zynga is going through a tough time financially as the market moves away from social gaming towards mobile. Chief operating officer John Schappert resigned from the company yesterday, following the removal his previous responsibilities due to a management shuffle.

Zynga founder Mark Pincus began the management changes to keep the company afloat and relevant. Zynga's stock had an initial public offering of $10 per share back in December of 2011, rising to a high of $14.69 before plummeting down to earth, where it sits at $3.01 currently.

5 Comments

Bad move - Golden Handcuffs, never a good reason to stay!

Posted:A year ago

#1

Paul Leather
Studying Mulitimedia Computing

4 0 0.0
When will devs learn that casual gamers won't fork out as much money as hardcore gamers? Yes alot of apps and facebook games are great for a few quid in the short term but that's it, even Nintendo are attempting to bring back the hardcore gamers!

Posted:A year ago

#2

Andrew Goodchild
Studying development

1,227 388 0.3
It's by no means limited to gamers. Anyone deeply into anything as a hobby is more reliable than a mass audience getting into a trend.
I used to work in a rock club, which started to do a "School Disco" on a Saturday, because it was all the rage, and made a lot of money. 18 months later the rock nights were still respectably ticking along, but the school disco fad was over, Saturday nights were dead, and the club was in trouble as a result.
That was the Wii's problem, possibly it was guitar hero's problem, and it most probably is Zynga's problem. Something that quickly and seemingly easily gains a large audience, will lose the audience quickly and easily too.

Posted:A year ago

#3

Peter Dwyer
Games Designer/Developer

481 290 0.6
I had odd images of Mark Pincus herding staff into a corner before fitting them with golden handcuffs.

Seriously, it's not an incentive to people to stay in the hopes the company will last long enough and be profitable enough that the stocks will make them rich. I made that mistake a long time ago and would never make it again. Even if the stock option was Apple.

Posted:A year ago

#4

Joshua Rose
Executive Producer / Lead Designer

191 80 0.4
Guess that IPO is coming back to bite them in the butt.

Posted:A year ago

#5

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