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At a Glance
Uppers

Ability to work on very popular games for a well-known company

Great benefits and perks, including free food and bringing your dog to work

Downers

Poor work/life balance with long hours often required

Competitive and high pressure environment

The Bottom Line

Zynga is an innovative company with an entrepreneurial spirit and high stress work environment.

About Zynga Inc.

Zynga puts people in touch with their inner vocabularian, farmer, and gambler. The company is a leading social game developer with titles such as Words with Friends, FarmVille, and Zynga Poker. It offers the games online for free primarily through the app stores of Apple and Google, as well as social networking sites such as Facebook. Zynga claims more than 80 million monthly active users with about 90% of them on mobile devices. Players use a credit card or a service such as PayPal to buy virtual currency to purchase in-game virtual goods that enhance, extend, or accelerate gameplay. The company generates about two-thirds of its revenue from the US. Zynga founder Mark Pincus fashioned the name after his late dog Zinga.

Operations

Zynga makes money from selling virtual goods in online games and by selling advertising. More than 75% of the company’s revenue comes from the purchase of virtual goods that enhance the game-playing experience. Players also can purchase mobile game downloads. Zynga Poker, CSR Racing 2, and Hit It Rich! Slots generate about 45% of online game revenue.

Advertising, which supplies the other 25% of revenue, includes mobile and display ads, engagement ads and offers, and branded virtual goods and sponsorships. The company cites Words with Friends as a generator of substantial advertising revenue.

Geographic Reach

The US is Zynga's largest market, generating about two-thirds of sales. Based in San Francisco, the company also has offices in North America, Asia, and Europe.

It has about a dozen offices in the US and international locations in Canada, China, Germany, India, Ireland, Japan, Luxembourg, and the UK.

Sales and Marketing

Zynga relies on mobile devices for generating most of its revenue. More than half of revenue comes from Apple and its iOS mobile operating system and about a third comes from Google and its Android mobile operating system. Facebook, formerly Zynga’s top revenue generator, now supplies about an eighth of sales.

The company cross-promotes new games to its existing audience and through paid advertising.

Financial Performance

Since achieving sales of more than $1 billion in each of 2011 and 2012, Zynga’s revenue has bounced up and down. In 2017, revenue bounced up to about $861 million, a 17% increase from 2016.

Online game revenue increased 22% in 2017 from 2016 on higher revenue from CSR Racing 2, Zynga Poker, The Wizard of Oz: Magic Match, and Dawn of Titans. Games with lower online game revenue in 2016 were Empires and Allies 2, FarmVille 2, FarmVille 2: Country Escape, and FarmVille: Harvest Swap. Advertising revenue ticked 1% higher year-to-year.

Higher revenue and lower costs earned Zynga a profit of more than $26 million, ending a six-year streak of net losses.

Zynga’s cash fell to about $373 million in 2017 from about $825 million in 2016. The company spent more on investing activities in 2017, including more than $130 million for acquisitions.

Strategy

Zynga relies on its stable of tried-and-true and tried some more games to deliver more sales. It finds ways for games like CSR Racing 2, Zynga Poker, and FarmVille to grab more attention from current players and lure new players through social media interactions with current players. Zynga introduced features to its Poker games such as leagues, tournaments, and jackpots that it says keeps players playing and spending. The company intends to milk those cash cows while it establishes new franchises. It’s betting on Dawn of Titans and The Wizard of Oz: Magic Match to develop into long-term franchises.

Another long-term franchise could develop from a 2018 licensing agreement Zynga reached with Walt Disney Co. Zynga signed a multi-year licensing deal to develop a mobile game based on the Star Wars movies with an option to develop a second game. Zynga will also take over live service operations of the Star Wars: Commander game that came out in 2014. Zynga's NaturalMotion Studios will handle development of Star Wars-related games.

Zynga has added new modes of play to increase player engagement. It introduced a team-based synchronous multiplayer mode for its hardcore players. It enables four players to participate in an intense competition.

Although live game play is key to Zynga’s fortunes, it has introduced a single player mode that allows a player to go against an artificial intelligence-fortified opponent. The idea is to keep players engaged when their live-game opponents are taking their turns.

Game competition is intense as gaming companies manage existing franchises and develop new games. Games such as Candy Crush Saga and Clash of Clans have gained popularity at the expense of Zynga's offerings. Companies known for computer and consoloe games have expanded into mobile games. 

Mergers and Acquisitions

Zynga has made acquisitions to expand globally and help it become less dependent the US market. Acquisitions also help diversify its development teams and, consequently, its catalog of titles.

In 2018 Zynga bought 80% Small Giant Games, developer of the Empires & Puzzles franchise, for $560 million. Zynga highlighted Small Giant's team of experienced game developers and the expansion of its new game pipeline. Zynga was to buy the other 20% of Small Giant over three years.

In another 2018 transaction Zynga bought Gram Games, whose titles include MergeDragons! and 1010!, for $250 million. Those and Gram's seven other mobile games have been downloaded more than 170 million times. Gram claims more than three million daily active users. It has studios in London.

Zynga’s nearly $100 million acquisition of Peak Games in 2017 was made to strengthen its casual card game portfolio. In the deal, Zynga picked up mobile card games such as Spades Plus and Gin Rummy Plus, as well as popular local Turkish games 101 Okey Plus and Okey Plus

Also in 2017 Zynga acquired four mobile apps from Harpan LLC, a two-man studio specializing in Solitaire games, for $42.5 million.

Zynga Inc.

699 8TH ST
San Francisco, CA 94103-4901
Phone: 1 (855) 449-9642

Stats

Employer Type: Publicly Owned
Stock Symbol: ZNGA
Stock Exchange: , NASDAQ
CEO and Director: Frank D. Gibeau
Chairman: Mark J. Pincus
CTO: Nick Tornow
Employees (This Location): 242
Employees (All Locations): 1,777

Major Office Locations

San Francisco, CA

Other Locations

San Francisco, CA
Mckinney, TX
Ashburn, VA