Zynga upgrades exec team as Pincus steps down from operational role
Zynga lost $61 million in the first quarter but the company did exceed Wall Street's expectations
Zynga's leadership team continues to evolve as CEO Don Mattrick today announced a number of significant changes. Founder Mark Pincus is stepping down from his operational role as Chief Product Officer to focus on the role as Chairman of the Board of Directors, and the company also added some new faces to the management team.
Alex Garden, a former general manager of Xbox Live, former CEO of Nexon Publishing and founder of developer Relic Entertainment, has joined Zynga as President of Zynga Studios. Garden will leverage his 25 years of game industry experience to oversee all Zynga studios as the company continues to scale its game operations.
Also joining Zynga is Henry LaBounta, the company's first Chief Visual Officer. LaBounta is an Academy Award nominated visual effects leader with nearly 30 years of experience across games, films, animation and television. LaBounta has worked in visual effects at EA, Microsoft and DreamWorks, and the hiring marks a change in focus for Zynga, as the company does intend to create more emotive, realistic entertainment experiences across its games, it said today. LaBounta will report in to Alex Garden.
The third major hire for Zynga was Jennifer Nuckles as Chief Marketing Officer. Nuckles has over 18 years of consumer marketing experience, having advised some major global brands like Clorox. She'll report into COO Clive Downie.
Other important changes include Steve Chiang stepping down from Zynga after four years with the company and Pauline Moller, previously Vice President of Operations for Casino, taking up the new role of VP of Studio Operations. Moller, who will report in to Garden, has over 14 years of experience at EA where she oversaw around 1,400 employees and shipped over 50 AAA titles.
From an organizational standpoint, COO Clive Downie, CFO David Lee, GC Devang Shah, NaturalMotion CEO Torsten Reil and Alex Garden will all report directly to Mattrick. "This change in our executive leadership team creates a more agile CEO Staff as we continue to scale our business and execute against a year of continued growth," Mattrick said. "These organizational changes are critical to help us execute more nimbly against our strategic frame of grow and sustain, create new hits and drive efficiencies. As we grow our culture of innovation, I am confident that these leaders will strengthen our creative and technical capabilities as well as nurture and mentor our existing teams."
Alongside the management changes today, Zynga announced its first-quarter earnings, revealing a net loss of $61 million (compared to net income of $4 million a year earlier) and revenues of $168 million, which is down 36 percent year-over-year. The business continues to be driven by Zynga's big franchises, as FarmVille 2, Zynga Poker and FarmVille accounted for 30 percent, 24 percent and 10 percent of online game revenue, respectively.
Zynga said its bookings for the first quarter were down 30 percent to $161 million, but that did exceed the high-end of its Q1 2014 outlook and it also represented an increase of 10 percent compared to the fourth quarter of 2013.
"In Q1 our teams delivered a solid start to the year against our strategic frame of growing and sustaining our franchises, creating new hits and driving efficiencies. We have established a strong base for 2014 and believe we are pacing well for a year of growth," said Mattrick. "For the first time in two years, our teams delivered sequential growth across our key performance metrics including bookings, Adjusted EBITDA, mobile bookings mix and audience. We believe these indicators demonstrate our strategy is working and the focus, rigor and discipline of our teams is showing up in our results."
He added, "I am particularly proud of the FarmVille team's commitment to franchise growth, especially as it relates to last week's worldwide launch of FarmVille 2: Country Escape. Since the launch, we have seen more than 4 million installs of the game and received great feedback from our players. We are pleased with the team's execution and encouraged by the early indicators we are seeing."
For the second quarter, Zynga is expecting revenue in the range of $140 million to $160 million with a net loss in the range of $75 million to $65 million.
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