As the company continues to see users abandon its games at an alarming rate, it has reversed course on its plan to pursue real-money casino games in the U.S., a combination that led to investors punishing the stock Friday.
The social gaming company pre-announced some ugly third-quarter earnings late Thursday and significantly reduced its financial guidance for the year. Now, Wall Street analysts are beginning to wonder aloud if the company will ever be able to turn things around.
Last week was an ugly one for Zynga, but the company is likely to face some even rockier times, argues Chris Morris, with the coming expiration of a new round of employee stock options being the most looming hurdle.
Last week was an ugly one for Zynga. An earnings shortfall and reduced guidance for the coming fiscal year resulted in a 40 percent drop in the company’s stock, which brought out the doomsayers.
Those corporate obituaries are premature, but the company is likely to face some even rockier times before there’s much chance of things getting better.